Capitola City Council
November 9, 2023

REVISED 11/9/2023 11:30 AM
City of Capitola
City Council Meeting Agenda
Thursday, November 09, 2023 – 6:00 PM
City Council Chambers
420 Capitola Avenue, Capitola, CA 95010
Mayor: Margaux Keiser
Vice Mayor: Kristen Brown
Council Members: Yvette Brooks, Joe Clarke, Alexander Pedersen Regular Meeting of the Capitola City Council – 6 PM
All correspondence received prior to 5:00 p.m. on the Wednesday preceding a Council Meeting will be distributed to Councilmembers to review prior to the meeting. Information submitted after 5 p.m. on that Wednesday may not have time to reach Councilmembers, nor be read by them prior to consideration of an item.

1. Roll Call and Pledge of Allegiance
Council Members Yvette Brooks, Joe Clarke, Alexander Pedersen, Kristen Brown, and Mayor Margaux Keiser.

2. Additions and Deletions to the Agenda

3. Additional Materials
Additional information submitted to the City after distribution of the agenda packet.

A. Correspondence Received - Item 7D

4. Oral Communications by Members of the Public
Oral Communications allows time for in-person members of the public to address the City Council on any “Consent Item” on tonight’s agenda, or on any topic within the jurisdiction of the City that is not on the “General Government/Public Hearings” section of the Agenda. Members of the public may speak for up to three minutes, unless otherwise specified by the Mayor. Individuals may not speak more than once during Oral Communications. All speakers must address the entire legislative body and will not be permitted to engage in dialogue. A maximum of 30 minutes is set aside for Oral Communications.

5. Staff / City Council Comments
Comments are limited to three minutes.

6. Consent Items
All items listed as “Consent Items” will be enacted by one motion in the form listed below. There will be no separate discussion on these items prior to the time the Council votes on the action unless members of the City Council request specific items to be discussed for separate review. Items pulled for separate discussion will be considered following General Government. Note that all Ordinances which appear on the public agenda shall be determined to have been read by title and further reading waived.

A. City Council Meeting Minutes
Recommended Action: Approve minutes from the regular meeting on October 26, 2023. 1 City Council Meeting Agenda – November 09, 2023
City of Capitola Page 2
B. City Check Registers
Recommended Action: Approve check registers dated September 29, 2023 and October 13, 2023.

C. Cliff Drive Resiliency Project Contract Amendment 1
Recommended Action: Authorize the City Manager to execute Amendment 1 to the Professional Services Agreement with CSW/Stuber-Stroeh Engineering Group, Inc. for professional planning, permitting, and design services for the Cliff Drive Resiliency Project.

D. 2023 Holiday Parking
Recommended Action: Authorize the suspension of parking meter and pay station operation to allow free three-hour parking in the Village Parking Meter Zone A (1) from November 23, 2023, through December 25, 2023.

E. 1098 38th Avenue Project
Recommended Action: Adopt a resolution authorizing the City Manager to finalize the loan agreement with MidPen Housing to assist with predevelopment activities for a 100% affordable multifamily rental housing development located at 1098 38th Avenue.

7. General Government / Public Hearings
All items listed in “General Government / Public Hearings” are intended to provide an opportunity for public discussion of each item listed. The following procedure pertains to each General Government item: 1) Staff explanation; 2) Council questions; 3) Public comment; 4) Council deliberation; 5) Decision.

A. Resolution Against Banning Materials
Recommended Action: Adopt a resolution against banning books and materials in the Santa Cruz Public Library system. (Continued from October 26, 2023) B. 2023 Special Event Report
Recommended Action: Receive report on 2023 special events; provide direction regarding changes to specific special event permit conditions; and approve recurring minor and general special events for 2024.

C. Capitola Lifeguard Season Overview
Recommended Action: Receive a report on Capitola Lifeguard service season statistics and approve the proposed operation schedule for future summer and fall seasons.

D. Citywide Housing Element Adoption
Recommended Action: Adopt a resolution to adopt the Addendum to the General Plan Update Environmental Impact Report and the 6th Cycle Housing Element, and direct staff to submit the Housing Element to the State of California for certification.

E. FY 2023-24 City Fee Schedule
Recommended Action: Adopt a resolution amending the fee schedule for Fiscal Year 2023-24. (Continued from October 26, 2023)
F. Amendments to Title 2: Administration and Personnel
Recommended Action: Introduce, by title only, waiving further reading of the text, an ordinance of the City of Capitola amending Chapters 2.04 and 2.08 of the Capitola Municipal Code. (Continued from October 26, 2023)

8. Adjournment - Adjourn to the next regularly scheduled City Council meeting on November 21, 2023, at 6:00 PM.
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How to View the Meeting
Meetings are open to the public for in-person attendance at the Capitola City Council Chambers located at 420 Capitola Avenue, Capitola, California, 95010.

Other ways to Watch:

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City of Capitola, California YouTube Channel
To Join Zoom Application or Call in to Zoom:

Meeting
link: https://us02web.zoom.us/j/83328173113?pwd=aVRwcWN3RU03Zzc2dkNpQzRWVXAydz09 Or dial one of these phone numbers: 1 (669) 900 6833, 1 (408) 638 0968, 1 (346) 248 7799 Meeting ID: 833 2817 3113
Meeting Passcode: 678550
How to Provide Comments to the City Council
Members of the public may provide public comments to the City Council in-person during the meeting.

If you are unable to attend in-person, please email your comments to [email protected] and they will be included as a part of the record for the meeting. Please be aware that the City Council will not accept comments via Zoom.

Notice regarding City Council: The City Council meets on the 2nd and 4th Thursday of each month at 6:00 p.m. in the City Hall Council Chambers located at 420 Capitola Avenue, Capitola.

Agenda and Agenda Packet Materials: The City Council Agenda and the complete Agenda Packet are available for review on the City’s website: www.cityofcapitola.org and at Capitola City Hall prior to the meeting. Agendas are also available at the Capitola Post Office located at 826 Bay Avenue Capitola.

Need more information? Contact the City Clerk’s office at 831-475-7300.

Agenda Materials Distributed after Distribution of the Agenda Packet: Pursuant to Government Code §54957.5, materials related to an agenda item submitted after distribution of the agenda packet are available for public inspection at the Reception Office at City Hall, 420 Capitola Avenue, Capitola, California, during normal business hours.

Americans with Disabilities Act: Disability-related aids or services are available to enable persons with a disability to participate in this meeting consistent with the Federal Americans with Disabilities Act of 1990. Assisted listening devices are available for individuals with hearing impairments at the meeting in the City Council Chambers. Should you require special accommodations to participate in the meeting due to a disability, please contact the City Clerk’s office at least 24 hours in advance of the meeting at 831-475-7300. In an effort to accommodate individuals with environmental sensitivities, attendees are requested to refrain from wearing perfumes and other scented products.

Si desea asistir a esta reunión pública y necesita ayuda - como un intérprete de lenguaje de señas americano, español u otro equipo especial - favor de llamar al Departamento de la Secretaría de la Ciudad al 831-475-7300 al menos tres días antes para que podamos coordinar dicha asistencia especial o envié un correo electrónico a [email protected].

Televised Meetings: City Council meetings are cablecast “Live” on Charter Communications Cable TV Channel 8 and are recorded to be rebroadcasted at 8:00 a.m. on the Wednesday following the meetings and at 1:00 p.m. on Saturday following the first rebroadcast on Community Television of Santa Cruz County (Charter Channel 71 and Comcast Channel 25). Meetings are streamed “Live” on the City’s website at www.cityofcapitola.org by clicking on the Home Page link “Meeting Agendas/Videos.” Archived meetings can be viewed from the website at any time. 3 1
Gautho, Julia
From: John <[email protected]>
Sent: Friday, November 3, 2023 3:43 PM
To: City Council
Subject: Fwd: Housing Element Second Attempt
Follow Up Flag: Follow up
Flag Status: Flagged
Hey folks
Remove parking minimums on AFFH. Rezone AFFH sans Mullins so it’s viable. Capitola does not have a city attorney, we are top of the list in AMBAG for folks to try builders remedy on.

And can we please have some hospitality. I guarantee you Jamie and others on staff support me on this. It’s the only option available to us in the hole we have dug.

When this second HE try also fails I look forward to y’all ignoring my advice based mostly on how other jurisdictions similar to us have passed. Why you ignore it is more an issue of lived experience and the California public education system.

Y’all should listen to Alexander more. He strikes me as the sort of human a neutral outsider who knows better than the rest of y’all would place on our council. Only explanation for why he’s there I can think up at least. Maybe he’ll tell us all the story someday.

I’m going to miss this.

Begin forwarded message:

From: John <[email protected]>
Date: November 1, 2023 at 10:08:44 AM PDT
To: [email protected], Julia Gautho <[email protected]>, Katie Herlihy <[email protected]>
Subject: Housing Element Second Attempt
Remove parking minimums on AFFH. Rezone AFFH sans Mullins so it’s viable. Capitola does not have a city attorney, we are top of the list in AMBAG for folks to try builders remedy on.

And can we please have some hospitality. I understand Kristen sunk our hotel in the Swenson lot early in her reign for whatever reasons but I can not stress enough how much Hospitality would solve our continually worsening over the last 7 years economic woes. I guarantee you Jamie and others on staff support me on this. It’s the only option available to us in the hole we have dug. 4 Item 3 A.
1 Gautho, Julia
From: Gautho, Julia
Sent: Thursday, November 9, 2023 11:25 AM
Cc: Samantha Zutler; Burke, Tamar M.; Herlihy, Katie ([email protected]) Subject: FW: Merlone Geier's Comments on November 3, 2023 Draft Housing Element Attachments: Ltr to Capitola City Council.pdf
Good Morning, Mayor and City Council,
I have attached correspondence relating to Item 7D on tonight’s agenda. This correspondence will be included with the agenda packet and updated for public review shortly.

Julia Gautho
City Clerk - City of Capitola
831.475.7300 x228
From: "Gray, Matthew S. (Perkins Coie)" <[email protected]> Date: November 8, 2023 at 4:53:47 PM PST
To: [email protected]
Cc: [email protected], "Phillips, Eric S." <[email protected]> Subject: Merlone Geier's Comments on November 3, 2023 Draft Housing Element

[EXTERNAL]
Good afternoon, Jamie:

Please see attached for correspondence from Merlone Geier concerning the November 3, 2023 draft of the City of Capitola’s Housing Element. We ask that you please distribute the letter to the Councilmembers in advance of tomorrow night’s hearing. Please do not hesitate to contact me or Scott McPherson should you wish to discuss.

Thank you,

--Matt

Matthew S. Gray | Perkins Coie LLP

PARTNER
505 Howard Street
Suite 1000
San Francisco, CA 94105
PHONE: 415-344-7082
FAX: 415-344-7282
E-MAIL: [email protected]

NOTICE: This communication may contain privileged or other confidential information. If you have received it in error, please advise the sender by reply email and immediately delete the message and any attachments without copying or disclosing the contents. Thank you. 5 Item 3 A.
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Matthew S. Gray
[email protected]
D. +1.415.344.7082
November 8, 2023

BY ELECTRONIC MAIL
Mayor Margaux Keiser ([email protected])
Vice Mayor Kristen Brown ([email protected])
Councilmember Yvette Brooks ([email protected]) Councilmember Joe Clarke ([email protected])
Councilmember Alexander Pedersen ([email protected]) Re: Merlone Geier Partners’ Additional Comments on 2023 - 2031 Draft Capitola Housing Element Update
Dear Mayor Keiser, Vice Mayor Brown, and Councilmembers Brooks Clarke and Pederson:

Our firm represents Merlone Geier Partners (“MGP”), the owner of the majority of the Capitola Mall site (the “Mall”) and more specifically Assessor’s Parcel Numbers 034-261-15; -37;- 38; - 39; and -40 (the “Property”), which are collectively targeted for 679 residential units under the City’s November 3rd draft Housing Element for the 2023-2031 planning cycle (“Draft Housing Element”). These 679 units represent more than fifty percent of the City’s entire Regional Housing Needs Assessment (“RHNA”) allocation. Accordingly, we believe it is necessary for the City of Capitola (“City”) to give due consideration to MGP’s concerns regarding the viability of the City’s strategy for delivering these units. Staff still has not addressed the comments detailed in our letter of August 1, 2023, which is attached here as Exhibit A. As further explained below, the Draft Housing Element assumes without any evidence that the Property can support conversion from commercial to residential use at a density of nearly 29-units per acre. Unless the Draft Housing Element is further revised to require specific zoning modifications, the Property will continue to be used solely for commercial use throughout the 2023-2031 planning cycle.

There is No Evidence in the Draft Housing Element to Support the Assumption that the Property Can be Developed at a Density of 29 Units Per Acre Under Current Development Controls
Both our August 1, 2023 comment letter and comments from the Department of Housing and Community Development’s (“HCD”) dated October 1, 2023 advised the City that the Draft Housing Element must evaluate realistic development capacity for nonvacant sites included in the housing sites inventory. Refer to our August 1, 2023, letter for a summary of the Government Code requirements and to HCD’s technical advisory publication describing the acceptable methodologies for performing this analysis.

The Draft Housing Element relies on MGP’s 2019 site redevelopment application and “conversations” with MGP to substantiate its assumption that the Property can support a density of approximately 29 units per acre. This assumption yields a total of 679 units on the 23.42 6 Item 3 A.

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acres of land included within the Property. Instead of evaluating whether site development controls, including maximum building heights (whether those heights are 40’ or 50’ with the possible discretionary height increase under City Code Section 17.88) or maximum floor area ratio (FAR) (whether at an FAR of 1.5:1 or the possible discretionary FAR of 2:1), the Draft Housing Element merely states that because MGP’s 2019 application requested discretionary approvals for a project at a density of 20 units per acre and MGP has previously expressed an interest in developing the Property at 30 units per acre, that the Property thus supports the density projected in the housing sites inventory analysis (i.e., nearly 29 units per acre).

There is a glaring oversight in the City’s density assumption. As shown in Exhibit B attached hereto, MGP’s 2019 application assumed that building heights would be increased to 75’ to achieve a density of even 20 units per acre. This application was ultimately withdrawn, meaning that the City did not increase the height limit beyond 40’ or 50’ (assuming approval of the discretionary 10’ height incentive under City Code Section 17.88). Thus, the Draft Housing Element assumes a height increase that has not been adopted as a zoning amendment or directed as a future zoning amendment as a policy in the Draft Housing Element. The 2019 MGP application is therefore not representative of the Property’s realistic development capacity per the requirements of Government Code Section 65533.2. Likewise, “conversations” between MGP and the City about possible redevelopment at 30 units per acre, without any accompanying actions by the City to modify the Property’s zoning to achieve that number, are not adequate to satisfy the requirements of Government Code Section 65533.2.

Delaying Identification – Let Alone Implementation – of Necessary Zoning Changes until 2027 Will Not Deliver Housing Within the 2023-2031 Planning Cycle The Draft Housing Element does not include any policy changes designed to actually deliver housing on the Property within the 2023-2031 planning cycle. While the City could, as MGP suggested, include policies directing an increase in maximum building height and FAR or establish a minimum density consistent with projections in the Draft Housing Element, the draft instead defers any analysis to a future study that will “identify[] strategies to initiate mall redevelopment” to be overseen by a “technical committee.” (p. 5-10.) And then, “if by 2027, [it] becomes apparent that redevelopment of the Mall site is not achievable, the City will develop alternative strategies to the 6th Cycle RHNA requirement.” (Ibid.) There is no reason to defer identification of strategies to initiate redevelopment of the Property consistent with the Draft Housing Element’s proposed densities. The very application that the City relies on to support its density assumptions (MGP’s 2019 application) demonstrates that a height increase to 75’ – coupled with other modifications to current development controls -- are necessary to achieve even a lower density than the 29-units per acre projected in the Draft Housing Element. The City can – as other jurisdictions have done across the State – adopt a minimum development density that corresponds with the assumptions in the Draft Housing Element. The City’s proposed deferral of these decisions to a committee provides no assurance that the City will take the zoning actions necessary to enable over 50% of the City’s RHNA allocation.
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Moreover, waiting until 2027 to see if the committee’s unspecified strategies work and, if not, to then “develop alternative strategies” is not a strategy. To implement zoning changes in 2027, the City would need to evaluate those changes under the California Environmental Quality Act (Pub. Resources Code, § 21000 et seq., “CEQA”), presumably by preparing and then certifying an environmental impact report. Zoning modifications would need to be approved by ordinance and would be subject to referendum. Even assuming the City were to successfully navigate the legal process to adopt the zoning changes, there would be very little time left within the 2023- 2031 planning cycle to build any of the units, let alone the several buildings that would contain all 679 units presumed in the Draft Housing Element.

MGP continues to insist that the Draft Housing Element should include the following if the City is to rely on redevelopment of the Property for at least 679 units during the 2023 – 2031 planning cycle:

Increase maximum building heights to 75’ (excluding mechanical features) independent of any kind of discretionary incentive concept as in City Code Section 17.88.

Increase maximum FAR from 1.5:1 to 2:1 and exclude any structured parking from the calculation. Here too, the increase in FAR should not be dependent on the award of any discretionary incentives as in City Code Section 17.88.

Establish a minimum density of 29 units per acre.

The Property Will Only be Redeveloped During the Planning Cycle if MGP Is Willing to Participate in that Process
As HCD noted, the Property is nonvacant and already occupied by ongoing commercial users.

MGP can continue operating the site as a commercial project, including by extending current leases or signing new leases over time. Conversion of some or all of the Property to residential use requires a substantial investment of capital that would need to be justified by the project’s economics. MGP is a leading developer, owner, and operator of mixed-use projects all over the West Coast. MGP – and not a technical committee or any group of consultants that the City might enlist – best understands what is required for an owner to pursue the redevelopment contemplated by the Draft Housing Element.

The zoning changes identified above are essential to any potential redevelopment during the 2023-2031 planning cycle, as those changes would eliminate significant entitlement, development and schedule risk that MGP will not otherwise be willing to assume. That said, if the City were to adopt these minimum changes and certify a corresponding environmental analysis, MGP would evaluate scenarios pursuant to which it would deliver more than 679 units to make even greater progress toward the City’s RHNA allocation. Again, MGP’s willingness to take on this work will depend on the City’s implementation of these specific, objective changes to zoning constraints in the near term, rather than deferring possible changes to future studies or analyses by a committee.
8 Item 3 A.

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MGP remains willing to collaborate with the City in its efforts to achieve certification of its 2023- 2031 Housing Element. However, we do not believe the Draft Housing Element can or should be certified in its current form for the reasons detailed above. We encourage the City Council to delay action on the Draft Housing Element to incorporate the modifications requested above and to bring the draft back for adoption and subsequent certification by HCD at a later date.

Regards,
Matthew S. Gray
MSG:gjc
cc: Jamie Goldstein, City Manager
Eric Phillips, Burke, Williams & Sorensen LLP
Paul McDougall, HCD
9 Item 3 A.
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Exhibit A
August 1, 2023, Letter

10 Item 3 A.
163159545.3
Matthew S. Gray
[email protected]
D. +1.415.344.7082
August 1, 2023
Jamie Goldstein
City Manager
City of Capitola
Capitola City Hall
420 Capitola Ave
Capitola, CA 95010
Re: Capitola Housing Element 2023-2031 (May 2023 Draft) Dear Mr. Goldstein,
Our firm represents Merlone Geier Partners (“MGP”) the owner of Assessor Parcel Numbers 034-261-07; -15; -37;- 38; -39; and -40 (collectively, the “Property”) which comprise approximately 31 acres of the Capitola Mall, and which the City of Capitola (“City”) is relying on to accommodate nearly 64 percent of its Sixth Cycle Regional Housing Needs Allocation (“RHNA”) obligation of 1,336 units. The purpose of this letter is to express MGP’s concerns regarding the May 2023 draft 2023 – 2031 Housing Element (“Draft Housing Element”). In summary, the Draft Housing Element fails to comply with State law, and it must be revised to include policies to address development constraints would undoubtedly prevent development of 853 during the planning cycle as contemplated in the draft.

We note at the outset that MGP has extensive experience as an owner and operator of similarly situated properties all along the West Coast. MGP has successfully redeveloped more than a dozen mall properties for alternative uses, including multi-family residential, and is currently pursuing the redevelopment of several other such projects in Northern California (including in Alameda County, Santa Clara County, and Marin County). Based on this experience, MGP offers the following comments with the goal of informing the Draft Housing Element both so that it conforms with State law and so it can be used to achieve the stated purpose of facilitating actual housing development in Capitola.

The Draft Housing Element Fails to Account for Development Constraints as Required by the Government Code
The Government Code establishes requirements for the evaluation of nonvacant sites included within a housing element, including for purposes of determining realistic development potential.

Additional guidance is provided by the California Department of Housing and Community Development (“HCD”), which is summarized in HCD’s Housing Element Site Inventory Guidebook – Government Code Section 65533.2 dated May 2020 (“HCD Guidebook”). As stated by HCD, “a local government [must] calculate the projected residential development capacity of the sites in the housing element that can be realistically achieved” and this must be done using one of two approved methodologies. (HCD Guidebook, p. 19.) First, the agency 11 Item 3 A.
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may use minimum densities, but only if it has adopted a “local law or regulations that require the development of a site at a minimum density.” (Govt. Code, § 65583.2(c)(1).) Second, where the agency has not established a minimum density, the agency can use “factors” to derive realistic development capacity. Under this scenario, the agency “must describe the methodology used to determine the number of units calculated” based on, among other things, the land use controls that govern the property. (Govt. Code, § 65583.2(c)(2).) The HCD Guidebook states as follows:

The analysis must consider the imposition of any development standards that impact the residential development capacity of the sites identified in the inventory. When establishing realistic unit capacity calculations, the jurisdiction must consider the cumulative impact of standards such as maximum lot coverage, height, open space, [and] parking . . . The analysis should consider any development standards or the cumulative effect of development standards that would limit the achievable density on a site. For example, if a mixed-use zone requires commercial on the ground floor and has a height limit of three stories along with lot coverage and other development standards, the density that actually can be achieved on the site might be less than the maximum allowable density.
(HCD Guidebook, p. 20; emphasis added.)
The Draft Housing Element lists the Property as part of the Sites Inventory in Appendix D. Each of the parcels is identified as “nonvacant” and the City projects a minimum of 853 units on the site in the aggregate during the 2023-2031 planning period. (Draft Housing Element, p. 4-28.) These units are anticipated to be built under the Property’s current regional commercial (C-R) zoning without any zoning amendments. (Ibid.) The calculation of 853 units is derived solely from purported “conversations” between MGP and City staff in which “an overall minimum residential density of 29 dwelling units/acre” was discussed. The City then multiplies this conjectural 29-units per acre number by the 29.4 acres that the City believes comprise the Property, to establish a minimum development capacity of 853 units.

The City’s calculation of the Property’s development capacity fails to satisfy the requirements of Government Code Section 65583.2(c). As the City notes in the Draft Housing Element, the Property is not subject to any regulation that establishes a minimum residential density.

Therefore, realistic development capacity must be evaluated under Government Code Section 65583(c)(2), which requires an evaluation of applicable land use controls. Further, per Section 65583(c)(1), the City must “demonstrate how the number of units for the site . . . will be accommodated.” The Draft Housing Element does not include an evaluation of how General Plan, C-R zoning, or other Municipal Code provisions limit development on the Property. There is no evaluation of applicable height, floor area ratio, setback, ground-floor commercial use requirements or other limitations that affect the delivery of housing. The City’s assumption that the Property can accommodate 29 units per acre or a minimum of 853 units under applicable 12 Item 3 A.
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development controls is not based on substantial evidence that satisfies Government Code requirements.

The Property’s Zoning Must be Modified to Accommodate a Minimum of 853 Units on the Developable Portions of the Site.

MGP evaluated the site to determine whether a minimum of 853 residential units can be developed as part of a mixed-use project during the 2023-2031 Housing Element cycle.

Consistent with State law for nonvacant commercial sites, MGP quantified the portion of the Property that can be redeveloped during the planning cycle. This analysis reflects the following:

Property subject to long-term leases: Certain MGP-owned property, including existing buildings and portions of the MGP-owned surface parking area, are subject to leases in favor of commercial tenants that extend through the 2023-2031 planning cycle. Of the 1,369,690 square feet of the Property that MGP owns, 442,771 square feet including the Kohl’s building, portions of the existing central mall, and parking fields servicing Target and Macy’s are subject to leases and therefore must be excluded, bringing the developable area down to 926,919 square feet. The areas encumbered by leases and which are ineligible for redevelopment are shown on Exhibit 1 attached hereto, including the cross-hatched areas shown as areas “A” through “D” on the Exhibit.

Retained retail: As MGP understands from its experience on similar projects, successful mixed-use retail and residential projects require a critical mass of retail to achieve a sense of a place. Preservation of a certain amount of the existing retail structures is also necessary from an economic perspective due to land economics and to sustain a portion of existing sales tax revenues flowing to the City. Further, the General Plan and the 41st Avenue / Capitola Mall Re-Visioning Plan call for preservation of retail as part of any redevelopment. As such, we assume that fifty percent of the existing MGP-owned retail building area (excluding Kohl’s which is already excluded due to the lease constraint) will be retained for retail. This amounts to 149,660 square feet. Parking spaces must also be preserved to service the retained retail space. We assume an industry-standard four spaces per 1,000 square feet of retail will be required to attract tenants. Accordingly, we assume 300,000 square feet of surface area would be set aside to build 600 parking spaces of 500 square feet each.

In light of the above site constraints 477,259 square feet of MGP-owned portions of the Property is subject to redevelopment during the 2023-2031 Housing Element cycle. This requires a minimum density of approximately 80 units per acre to achieve a minimum of 853 residential units during the planning period.

Modifications to the Property’s zoning are required if the City intends to make a good faith effort to comply with State law requirements. Specifically, the following changes to the C-R zoning controls are necessary to achieve a minimum density of 80 units per acre on the 477,529 square feet of land eligible for redevelopment and facilitate at least 853 residential units during the Housing Element cycle:
13 Item 3 A.
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Maximum building height should be increased from 40 feet to 75 feet, not counting building mechanical features
Maximum FAR should be increased from 1.5:1 to 2:1 and should exclude any structured parking from the calculation.
the prohibition on ground-floor residential use should be eliminated. The prohibition of ground-floor residential provides a further site constraint and obstacle to achieving the desired minimum number of residential units.

Development “Incentives” under Municipal Code Section 17.88 Do Not Constitute Development Controls for Purposes of Calculating Realistic Minimum Development Capacity
Section 17.88 of the Municipal Code authorizes the City Council to grant “incentives” that could partially alleviate the zoning constraints outlined above, namely by marginally increasing maximum height and FAR. These potential incentives should not be misconstrued as if they represent prevailing site controls that permit the minimum development capacity of the Property.

First, an applicant is not entitled to the incentives even if the applicant agrees to provide one of the “benefits” listed in Section 17.88.040(A)(1) – (11). The operative language states: “the public benefit provided shall be of sufficient value as determined by the planning commission to justify deviation from the standards of the zoning district that currently applies to the property.” As such, the Planning Commission must make a subjective determination that the “value” of the benefit is sufficient, which determination is then provided to the City Council in the form of a recommendation. There is no methodology prescribed in the Code for how the Planning Commission determines that the value of an offered public benefit is sufficient to justify an incentive as applied to a given project. Similarly, the City Council must find that the proposal provides a “substantial benefit” to the community. This is a subjective determination, particularly given that the Code contains a list of eligible project benefits under Section 17.88(A).

Second, to obtain an incentive, the applicant must agree to provide public benefits in excess of the types of development exactions that the City could otherwise require by law as a condition of development approval. Section 17.88.020 states that the City may grant incentives only when the “community benefits offered are not otherwise required by the zoning code or any other provision of local, state, or federal law.” Similarly, the Council must find that the offered public benefit “exceeds the minimum requirements of the zoning code or any other provision of state or federal law.” The City cannot lawfully require an applicant to provide the public benefits under Section 17.88.040 to obtain the incentives under Section 17.88.050 as a condition of a development approval in another form, e.g., a variance or condition of use permit, since requiring a public benefit with no relationship to the proposed incentive (as opposed to, e.g., requiring setbacks to offset aesthetic or shadow impacts associated with a building height increase) would constitute an unconstitutional condition. (See Nollan v. California Coastal Commission, 483 U.S. 825 (1987) (there must be a nexus between a permit condition imposed on the specific regulatory interest advanced by the condition); Dolan v. City of Tigard, 512 U.S. 14 Item 3 A.
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374 (1994) (requiring proportionality between the condition imposed and the impact to be addressed by the condition); California Building Association v. City of San Jose 61 Cal.4th 435, 492 (government may not impose a condition on the receipt of a benefit that requires the individual to give up a constitutional right, including the right to demand compensation for a taking of his or her property).) It cannot be assumed that MGP will agree to provide such benefits as a condition of obtaining only partial relief from the zoning standards that will otherwise prevent the development of the minimum 853 units.

Assuming that MGP Chooses to Negotiate a Development Agreement, the Development Agreement Cannot Substitute for Addressing Development Constraints in the Draft Housing Element
The Draft Housing Element incorrectly assumes that any development constraints applicable to the Property will be addressed through a development agreement rather than through zoning amendments. Specifically, the draft states:

The City intends to establish a Development Agreement (DA) that would serve as an added layer to the existing Regional Commercial (C-R) zone that would set forth specific development regulations for the mall site project area to guide future development of residential uses while providing for the redevelopment of retail and commercial uses.
(Draft Housing Element, p. 4-28.)
This is flawed for two reasons. First, the City cannot unilaterally “establish” a development agreement governing the Property. MGP, in its discretion, would choose to apply for a development agreement and the parties would then negotiate the terms at arm’s length each in their sole discretion. (See Govt. Code, §§ 65864 et seq.; see also Municipal Code Chapter

18.04.030(E) (“A development agreement is a contract that is negotiated and voluntarily entered into by city and applicant and may contain any additional or modified conditions, terms or provisions agreed upon by the parties”.) The development agreement would then need to be approved at the City Council’s discretion at the conclusion of the project approval process. (Municipal Code, § 18.04.040(F).) Second, a development agreement is not a mechanism for amending the site development controls that pertain to a particular property. Rather, the development agreement vests the applicant’s rights to complete the project in accordance with “the rules, regulations, and official policies in force at the time of execution of the agreement.” (Govt. Code, § 65866(a).) Therefore, without a prior or concurrent modification of the site controls, any development agreement would only vest MGP’s right to develop the Property in accordance with the C-R zoning constraints described above.

The Draft Housing Element should be amended to incorporate procedures for modifying C-R zoning provisions rather than assuming that a future development agreement will serve that purpose. As outlined above, MGP cannot be compelled to enter into a development agreement.

The City should not assume that delaying State-mandated zoning changes in the Housing Element will bring MGP to the table for future development agreement negotiations. This 15 Item 3 A.
163159545.3
approach does not satisfy Government Code Section 65583(c)(1)’s mandate for the City to demonstrate how it will accommodate its RHNA obligation, particularly given that the development agreement would not on its own address the current site development constraints.

Proposed Affordable Housing Projections for the Property Are Not Realistic Appendix D of the Draft Housing Element indicates that of the 853 units allocated to the Property, 65 percent of those units would be reserved for low or moderate-income households.

While we understand that the City is challenged to find suitable locations to accommodate affordable units within its jurisdiction, it is not realistic to assume that the Property (or any property for that matter) can be redeveloped with only 299 out of 853 units (35 percent) not being subject to income-based restrictions. The Property is currently developed with viable commercial uses, and even for the former Sears building, the site can be repositioned as needed to attract other commercial users. It would be economically infeasible to terminate the current regional commercial land uses and instead devote the Property to a predominantly affordable housing project.

In addition, saddling MGP-owned properties with such a disproportionately high amount of the City’s share of below-market-rate development obligations violates the City’s legal obligations to treat similarly situated properties equally. Moreover, the infeasibility of providing such a disproportionately high amount of affordable housing within any market rate development proposal, coupled with the City’s obligations under the No Net Loss Law to not approve projects providing less than the proscribed amount of affordable housing (unless the affordable units are replanned for another site), would result in an unconstitutional taking of MGP’s property without just compensation. The Draft Housing Element should therefore be revised to reflect more reasonable assumptions for affordable housing at the Property.

We look forward to reviewing the next draft of the housing element and remain willing to engage with the City throughout the update process.

Matthew S. Gray
MSG:gjc
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163159545.3
Exhibit 1
(attached)
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A
B
C
D
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164396701.4
Exhibit B
MGP’s 2019 Application Site Plan
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A
B
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TOP OF PODIUM +20’ - 0”
TOP OF PARAPET +24’ - 0”
TOP OF PARAPET +81’ - 1”
TOP OF PARAPET +78’ - 1”
+00’ - 0”
Parking Garage
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TOP OF PODIUM +20’ - 0”
TOP OF PARAPET +24’ - 0”
TOP OF PARAPET +56’ - 1”
TOP OF PARAPET +85’
+00’ - 0”
Parking Garage
Residential
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TOP OF PODIUM +20’ - 0”
TOP OF PARAPET +24’ - 0”
TOP OF PARAPET +78’ - 1”
+00’ - 0”
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1 Gautho, Julia
From: Molly Ording <[email protected]>
Sent: Thursday, November 9, 2023 12:47 PM
To: City Council
Subject: Approval Housing Element!
Dear Members of Capitola City Council:

I was hoping to be able to aƩend your meeƟng and urge your approval of the 6th RHNA cycle for the City of Capitola! I am unfortunately unable to aƩend tonite but want to urge your support for this as presented and long studied and commented upon. I am proud to live in a community that has so thoroughly veƩed much needed future housing opportuniƟes and is reporƟng on these to the state in a Ɵmely manner!! Thank you to ALL for all your hard work in, hopefully, finalizing this porƟon of the process! We look forward to seeing the fruits of your prodigious labors becoming much needed housing opportuniƟes and realiƟes in the near future! Many thanks to ALL!
Most sincerely,
Molly & Mickey Ording
218 Monterey Avenue
Capitola, Ca. 95020
Sent from my iPhone
25 Item 3 A.

Capitola City Council
Agenda Report
Meeting: November 9, 2023
From: City Manager Department
Subject: City Council Meeting Minutes
Recommended Action: Approve minutes from the regular meeting on October 26, 2023.

Background: Attached for Council review and approval are the draft minutes from the regular City Council meeting on October 26, 2023.

Attachments:

1. 10/26/2023 Minutes
Report Prepared By: Julia Gautho, City Clerk
Approved By: Jamie Goldstein, City Manager
26 Item 6 A.

City of Capitola
City Council Meeting Minutes
Thursday, October 26, 2023 – 6:00 PM
City Council Chambers
420 Capitola Avenue, Capitola, CA 95010
Mayor: Margaux Keiser
Vice Mayor: Kristen Brown
Council Members: Yvette Brooks, Joe Clarke, Alexander Pedersen Closed Session – 5 PM
i. CONFERENCE WITH REAL PROPERTY NEGOTIATORS (Gov’t Code § 54956.8) Property: Monterey Park, APN: 036-15-102
City Negotiator: Jamie Goldstein, City Manager
Negotiating Parties: Soquel Union Elementary School District Under Negotiation: Transfer of Real Property
Regular Meeting of the Capitola City Council – 6 PM

1. Roll Call and Pledge of Allegiance – The meeting was called to order at 6:00 PM. In attendance: Council Members Brooks, Clarke, Pedersen, Vice Mayor Brown, and Mayor Keiser.

2. Additions and Deletions to the Agenda – None

3. Presentations – None

4. Report on Closed Session – The City Council met and discussed one item on the Closed Session agenda. No reportable action was taken.

5. Additional Materials
A. Four emails were received relating to Item 9A.

6. Oral Communications by Members of the Public
 Carin Hanna, resident, thanked Public Works staff for their work.  Justin Fia, resident, voiced opposition to Consent Item 8B.  TJ Welch, resident, requested that Consent Item 8B be pulled for discussion.  James Whitman, resident, voiced opposition to Consent Item 8B and provided pamphlet materials on local government to the City Council.
 Gorin Klepich, resident, discussed graffiti at Jade Street Park.  Ben Vernazza, resident, spoke about the Coastal Rail Trail Segment 9.  John Mulry, resident, voiced opposition to Consent Item 8B.  Speaker provided comments.
 Speaker provided comments.

7. Staff / City Council Comments
 Council Member Brooks reminded the community of the Adaptive Family Fall Festival on October 28th.
 Council Member Pedersen reminded the community of the Capitola Village Halloween Parade on October 29th.
27 Item 6 A.

City Council Meeting Minutes – October 26, 2023
City of Capitola Page 2
 Mayor Keiser thanked Assemblymember Dawn Addis for the contribution of $1M for the Community Center Renovations, recognized the Police Department for their work with neighboring jurisdictions on recent arrests, and thanked Public Works staff for their work.

8. Consent Items
A. City Council Meeting Minutes
Recommended Action: Approved minutes from the regular meeting on October 12, 2023.

B. Resolution Against Banning Materials
Recommended Action: Adopt a resolution against banning books and materials in the Santa Cruz Public Library system. (Pulled for discussion by Council Member Clarke, continued to November 9, 2023.)
C. CalRecycle Grant Programs
Recommended Action: Adopted Resolution No. 4342 authorizing the application for grant funds from the California Department of Resources, Recycling, and Recovery (CalRecycle).

Council Member Clarke pulled Item 8B for discussion.

Motion to approve Items 8A and 8C: Council Member Brooks Seconded: Vice Mayor Brown
Voting Yea: Council Members Brooks, Clarke, Pedersen, Vice Mayor Brown, Mayor Keiser

9. General Government / Public Hearings
A. Coastal Rail Trail Segments 10 and 11
Recommended Action: Provided direction to staff on a comment letter on the Environmental Impact Report and Consolidated Coastal Permit Request for the Coastal Rail Trail Segments 10 and 11.

Community Development Director Herlihy presented the staff report.

Public Comments:
 Leslie Nielsen, resident, spoke in support of Design Option A.  Carin Hanna, resident, spoke in opposition to the Consolidated Coastal Development Process.
 Barry Scott, resident, spoke in support of replacing the trestle.  Matt Ferrel, Friends of Rail Trail, spoke in support of the Rail Trail.  A representative from Trail Now spoke in support of preserving the trestle.  Tina Andriana, resident, spoke in support of the Ultimate Trail design.  Dennis Norton, resident, spoke in support of increased bicycle transportation through the Village.
 Molly Ording, resident, spoke in support of the Ultimate Trail design.  Rosemary Sarka, Roaring Camp Railroads, voiced doubt about the feasibility of the Interim Trail Design.
 John Mulry, Strong Towns Santa Cruz, spoke in support of making Monterey Avenue a one-way street.
 Paula Bradley, resident, spoke against the Interim Trail.  Johanna Lighthill, County resident, voiced safety concerns about the Ultimate Trail design.
 Jean Brocklebank, resident, voiced concern about residents residing in mobile home parks if the Ultimate Trail is approved.
 Speaker provided comments.
28 Item 6 A.

City Council Meeting Minutes – October 26, 2023
City of Capitola Page 3
 Speaker provided comments.

Council Member comments included a discussion of what the Planning Commission’s role will be during the approval process for this project, impacts to the wildlife through Segment 11, an overview of the timeline for the Consolidated Coastal Development Permit, and clarification on communication to mobile home residents.

Motion to direct staff to prepare a comment letter on the EIR and authorization for the Community Development Director to consolidate the CDP with the County: Council Member Brooks
Seconded: Vice Mayor Brown
Voting Yea: Council Members Brooks, Pedersen, Vice Mayor Brown, Mayor Keiser Voting Nay: Council Member Clarke
B. Chief’s Advisory Committee
Recommended Action: Received a report about the formation of the Police Chief’s Advisory Committee, reviewed the application and selection process, and provided direction to staff.

Police Chief Dally presented the staff report.

Public Comments:
 Linda Smith, resident, spoke in support of the Capitola Police Department and the re-recruitment efforts proposed by staff.
 John Mulry, resident, spoke in support of the Police Chief’s Advisory Committee.  Speaker provided comments.

The City Council thanked initial applicants for their interest, encouraged staff to support and inform Spanish speaking applicants during the re-recruitment process, requested that staff remove the “technical skill” requirements for new applicants, encouraged staff to engage young adults or a representative from the youth community, and directed staff to accept applications from Aptos and Soquel and Live Oak, with priority for applicants with strong ties to Capitola.

C. FY 2023-24 City Fee Schedule
Recommended Action: Adopt a resolution amending the fee schedule for Fiscal Year (FY) 2023-

24. (Continued to November 9, 2023.)
D. Amendments to Title 2: Administration and Personnel
Recommended Action: Introduce, by title only, waiving further reading of the text, an ordinance of the City of Capitola amending Chapters 2.04 and 2.08 of the Capitola Municipal Code. (Continued to November 9, 2023.)

10. Adjournment – Adjourned at 8:58 PM to the next regularly scheduled City Council meeting on November 9, 2023, at 6:00 PM.
____________________________
ATTEST: Margaux Keiser, Mayor
____________________________
Julia Gautho, City Clerk
29 Item 6 A.

Capitola City Council
Agenda Report
Meeting: November 9, 2023
From: Finance Department
Subject: City Check Registers
Recommended Action: Approve check registers dated September 29, 2023 and October 13, 2023.

Account: City Main
Date Starting Check # Ending Check # Payment
Count Amount
9/29/2023 104342 104428 96 $ 619,093.57
10/13/2023 104429 104522 100 $ 1,248,804.27
The main account check register dated September 15, 2023, ended with check #104341.

Account: Payroll
Date Starting
Check/EFT #
Ending
Check/EFT #
Payment
Count Amount
9/29/2023 5848 5852 114 $ 211,364.00
10/13/2023 23345 23446 117 $ 200,979.26
The payroll account check register dated September 15, 2023, ended with check #5847.

Following is a list of payments issued for more than $10,000 and descriptions of the expenditures:

Check/
EFT Issued to Dept Description Amount
104352 Bear Electrical Solutions
Inc. PW Stockton Ave & Escalona solar pedestrian crossing $ 22,293.35 104354 Burke Williams and
Sorensen LLP CM August Legal Services $ 27,668.71
104393 Pacific Gas & Electric PW September Utilities $ 14,407.17 104396 Plumber’s Paradise PW Elkay water bottle filling stations (4) $ 21,188.00
104407 Santa Cruz County Sheriff PD FY23/24 SART Program Contribution $ 11,870.00
104409 Santa Cruz Regional 911 PD
FY23/24 Second quarter
operating contribution & First
half capital/debt service
$ 183,318.25
104413 Soquel Creek Water
District PW August Water & Irrigation $ 21,494.02
1600 CalPERS Health Insurance CM October health insurance $ 67,820.29 30 Item 6 B.
1601 CalPERS Member
Services Division CM PERS contributions PPE 9/16/23 $ 63,528.21 1602 Employment Development
Department CM State Taxes PPE 9/16/23 $ 12,343.05
1603 Internal Revenue Service CM Federal taxes & Medicare PPE 9/16/23 $ 39,432.61
1607 Wells Fargo Bank Fin August Credit Card Charges $ 17,857.93 104442 Boone Low Ratliff
Architects Inc PW Community Center renovation design services $ 31,025.15 104445 Capitola-Soquel Chamber
of Commerce Fin October-June TOT $ 27,067.05
104449 Cushman Contracting Corp
Escrow
PW September Wharf Project
retainer $ 39,259.42
104450 Cushman Contracting
Corporation PW September Wharf Resiliency and Public Access $ 745,928.98 104466 Hope Rehabilitation
Services PW Litter abatement services $ 10,800.00
104476 Long Beach BMW
Motorcycles PD 2023 BMW R1250RT-P Motorcycle $ 33,751.49 104479 MBASIA CM Liability claims – Deductible
recovery invoices $ 23,294.61
104487 Moffatt and Nichol PW
Stockton Ave Bridge Repairs &
Capitola Wharf & Beach
Project Services
$ 57,976.05
104495 Pavement Engineering Inc PW
Capitola Rd. improvement
project & management
services
$ 22,215.00
104501 Santa Cruz County
Auditor-Controller Fin September citation processing $ 10,153.00 1609 CalPERS Member
Services Division CM PERS contributions PPE 9/30/23 $ 64,449.56 1610 Employment Development
Department CM State Taxes PPE 9/30/23 $ 11,424.11
1611 Internal Revenue Service CM Federal taxes & Medicare PPE 9/30/23 $ 37,068.03
Attachments:

1. 9-29-23 Check Register

2. 10-13-23 Check Register
Report Prepared By: Luis Ruiz, Accountant I
Reviewed By: Julia Gautho, City Clerk; Jim Malberg, Finance Director Approved By: Jamie Goldstein, City Manager
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Capitola City Council
Agenda Report
Meeting: October 12, 2023
From: Public Works Department
Subject: Cliff Drive Resiliency Project Contract Amendment 1 Recommended Action: Authorize the City Manager to execute Amendment 1 to the Professional Services Agreement with CSW/Stuber-Stroeh Engineering Group, Inc. for professional planning, permitting, and design services for the Cliff Drive Resiliency Project.

Background: On October 12, 2023, the City Council authorized the City Manager to execute a Professional Services Agreement with CSW/Stuber-Stroeh Engineering Group, Inc. for professional planning, permitting, and design services for the Cliff Drive Resiliency Project in the amount of $1,193,700.

Discussion: After a final review of the contract, Caltrans Local Assistance (Caltrans LA) provided feedback that required the inclusion of additional federal provisions, as mandated by the Federal Highway Administration (FHWA), for professional services. In response, City staff has made the necessary modifications to the agreement as an amendment, obtained approval from Caltrans LA, and engaged in discussions with the consultant. The amendment is now ready for Council approval. The timeline, scope, and budget of the Cliff Drive Resiliency Project will not be affected by this amendment.

Fiscal Impact: Approving this amendment will not have an additional fiscal impact, as it pertains to the same amount and funding source as the original agreement approved by the City Council on October 12, 2023.

Attachments:

1. October 12, 2023 Cliff Drive Resiliency Project Staff Report

2. Draft Amendment
Report Prepared By: Jessica Kahn, Public Works Director Reviewed By: Julia Gautho, City Clerk; Samantha Zutler, City Attorney Approved By: Jamie Goldstein, City Manager
61 Item 6 C.
1ST AMENDMENT TO THE

PROFESSIONAL SERVICES AGREEMENT WITH CSW / STUBER-STROEH ENGINEERING

GROUP FOR THE CLIFF DRIVE RESILIENCY PROJECT
between

CITY OF CAPITOLA AND CSW / STUBER-STROEH ENGINEERING GROUP The City of Capitola and CSW / Stuber-Stroeh Engineering Group, hereby agree to the following Amendment(s) to the Contract dated October 12, 2023:
1) SECTION 6. Time of Beginning and Schedule for Completion Contract, is revised in part to read as follows: “This Agreement will become effective when signed by both parties and will terminate on December 31, 2025."
2) Consultant shall comply with federal funding (FHWA) and Caltrans requirements as outlined in Caltrans Exhibit 10-R, as set forth in Appendix Three attached hereto and incorporated herein. Should there be a conflict between Caltrans Exhibit 10-R and part of this Agreement, Caltrans Exhibit 10-R shall govern.

All other terms and conditions of the Professional Services Agreement remain in full force and effect.

CONTRACTOR: CSW / STUBER-STROEH ENGINEERING
__________________________________ Date: ___________________ By:

CITY OF CAPITOLA
___________________________________ Date: ___________________ By: Benjamin Goldstein, City Manager
62 Item 6 C.

APPENDIX THREE
Caltrans Exhibit 10-R
63 Item 6 C.

Local Assistance Procedures Manual Exhibit 10-R
Cliff Drive Resiliency Project

May 2023
Exhibit 10-R: A&E BOILERPLATE AGREEMENT LANGUAGE
(For Local Assistance Federal-Aid Projects)

NOTE TO LOCAL AGENCY - BE SURE THAT YOUR LEGAL STAFF REVIEWS AND APPROVES ALL CONSULTANT CONTRACTS BEFORE EXECUTION. THIS AGREEMENT LANGUAGE IS RECOMMENDED LANGUAGE,

EXCEPT ARTICLE XXXII TITLE VI ASSURANCES (APPENDICES A AND E MUST BE PHYSICALLY INCLUDED,

UNMODIFIED, IN ANY FEDERAL-AID CONTRACT AND APPENDICES B-D MUST BE PHYSCIALLY INCLUDED, UNMODIFIED, IN ANY FEDERAL-AID CONTRACT INVOLVING RIGHT OF WAY ACQUISITION). MODIFY AS RECOMMENDED BY YOUR OWN LEGAL STAFF AND TO FIT YOUR PARTICULAR REQUIREMENTS AND PROJECT.

THE FISCAL AND FEDERAL PROVISIONS ARE REQUIRED IN ALL FEDERALLY FUNDED CONTRACTS. THE ORIGINAL INTENT OF THE ARTICLE SHALL REMAIN, IF MODIFIED BY YOUR LEGAL STAFF.

THIS EXHIBIT CONTAINS FISCAL REQUIREMENTS FROM 2 CFR 200 AND IS TO BE USED FOR STATE-ONLY FUNDED CONTRACTS AS WELL.

TABLE OF CONTENTS
Page
ARTICLE I INTRODUCTION ................................................................................................................. 3 ARTICLE II CONSULTANT’S REPORTS OR MEETINGS.................................................................... 4 ARTICLE III STATEMENT OF WORK .................................................................................................. 4 ARTICLE IV PERFORMANCE PERIOD................................................................................................ 6 ARTICLE V ALLOWABLE COSTS AND PAYMENTS.......................................................................... 6 ARTICLE VI TERMINATION ............................................................................................................... 10 ARTICLE VII COST PRINCIPLES AND ADMINISTRATIVE REQUIREMENTS.................................. 11 ARTICLE VIII RETENTION OF RECORD/AUDITS ............................................................................. 11 ARTICLE IX AUDIT REVIEW PROCEDURES .................................................................................... 12 ARTICLE X SUBCONTRACTING ....................................................................................................... 13 ARTICLE XI EQUIPMENT PURCHASE AND OTHER CAPITAL EXPENDITURES ........................... 15 ARTICLE XII STATE PREVAILING WAGE RATES............................................................................ 16 ARTICLE XIII CONFLICT OF INTEREST............................................................................................ 19 ARTICLE XIV REBATES, KICKBACKS OR OTHER UNLAWFUL CONSIDERATION ...................... 19

ARTICLE XV PROHIBITION OF EXPENDING LOCAL AGENCY, STATE, OR FEDERAL FUNDS FOR LOBBYING ................................................................................................................................. 20 ARTICLE XVI NON-DISCRIMINATION CLAUSE AND STATEMENT OF COMPLIANCE.................. 20 ARTICLE XVII DEBARMENT AND SUSPENSION CERTIFICATION ................................................. 21 ARTICLE XVIII DISADVANTAGED BUSINESS ENTERPRISES (DBE) PARTICIPATION................. 22 ARTICLE XIX INSURANCE ................................................................................................................ 28 ARTICLE XX FUNDING REQUIREMENTS ......................................................................................... 29 ARTICLE XXI CHANGE IN TERMS .................................................................................................... 29 64 Item 6 C.

Local Assistance Procedures Manual Exhibit 10-R
Cliff Drive Resiliency Project

May 2023
ARTICLE XXII CONTINGENT FEE ..................................................................................................... 29 ARTICLE XXIII DISPUTES.................................................................................................................. 30 ARTICLE XXIV INSPECTION OF WORK ........................................................................................... 30 ARTICLE XXV SAFETY ...................................................................................................................... 30 ARTICLE XXVI OWNERSHIP OF DATA............................................................................................. 31 ARTICLE XXVII CLAIMS FILED BY LOCAL AGENCY’s CONSTRUCTION CONTRACTOR ............ 31 ARTICLE XXVIII CONFIDENTIALITY OF DATA................................................................................. 32 ARTICLE XXIX NATIONAL LABOR RELATIONS BOARD CERTIFICATION.................................... 32 ARTICLE XXX EVALUATION OF CONSULTANT .............................................................................. 33 ARTICLE XXXI PROMPT PAYMENT.................................................................................................. 33 ARTICLE XXXII TITLE VI ASSURANCES .......................................................................................... 33 ARTICLE XXXIII NOTIFICATION ........................................................................................................ 38 ARTICLE XXXIV CONTRACT ............................................................................................................. 38 ARTICLE XXXV SIGNATURES .......................................................................................................... 39 65 Item 6 C.

Local Assistance Procedures Manual Exhibit 10-R
Cliff Drive Resiliency Project

May 2023
(NAME OF STATE)
SULTANT” will be (NAME)

ARTICLE I INTRODUCTION
A. This AGREEMENT is between the following named, hereinafter referred to as, CONSULTANT and the following named, hereinafter referred to as, LOCAL AGENCY:

The name of the “CONSULTANT” is as follows:
(NAME OF CONSULTANT)
Incorporated in the State of
The Project Manager for the “CON
The name of the “LOCAL AGENCY” is as follows:
(NAME)
The Contract Administrator for LOCAL AGENCY will be (NAME) B. The work to be performed under this AGREEMENT is described in Article III Statement of Work and the approved CONSULTANT’s Cost Proposal dated (DATE). The approved CONSULTANT’s Cost Proposal is attached hereto (Attachment #) and incorporated by reference. If there is any conflict between the approved Cost Proposal and this AGREEMENT, this AGREEMENT shall take precedence.

C. CONSULTANT agrees to the fullest extent permitted by law, to indemnify, protect, defend, and hold harmless LOCAL AGENCY, its officers, officials, agents, employees and volunteers from and against any and all claims, damages, demands, liability, costs, losses and expenses, including without limitation, court costs and reasonable attorneys’ and expert witness fees, arising out of any failure to comply with applicable law, any injury to or death of any person(s), damage to property, loss of use of property, economic loss or otherwise arising out of the performance of the work described herein, to the extent caused by a negligent act or negligent failure to act, errors, omissions, recklessness or willful misconduct incident to the performance of this AGREEMENT on the part of CONSULTANT, except such loss or damage which was caused by the sole negligence, or willful misconduct of LOCAL AGENCY, as determined by a Court of competent jurisdiction. The provisions of this section shall survive termination or suspension of this AGREEMENT.

D. CONSULTANT in the performance of this AGREEMENT, shall act in an independent capacity. It is understood and agreed that CONSULTANT (including CONSULTANT's employees) is an independent contractor and that no relationship of employer-employee exists between the Parties hereto. CONSULTANT's assigned personnel shall not be entitled to any benefits payable to employees of City.

E. LOCAL AGENCY is not required to make any deductions or withholdings from the compensation payable to CONSULTANT under the provisions of the AGREEMENT, and is not required to issue W-2 Forms for income and employment tax purposes for any of CONSULTANT's assigned personnel. CONSULTANT, in the performance of its obligation hereunder, is only subject to the control or direction of the LOCAL AGENCY as to the designation of tasks to be performed and the results to be accomplished.

F. Any third party person(s) employed by CONSULTANT shall be entirely and exclusively under the direction, supervision, and control of CONSULTANT. CONSULTANT hereby indemnifies and holds LOCAL AGENCY harmless from any and all claims that may be made against City based upon any contention by any third party that an employer-employee relationship exists by reason of this AGREEMENT.
66 Item 6 C.

Local Assistance Procedures Manual Exhibit 10-R
Cliff Drive Resiliency Project

May 2023
G. Except as expressly authorized herein, CONSULTANT's obligations under this AGREEMENT are not assignable or transferable, and CONSULTANT shall not subcontract any work, without the prior written approval of the LOCAL AGENCY. However, claims for money due or which become due to CONSULTANT from City under this AGREEMENT may be assigned to a financial institution or to a trustee in bankruptcy, without such approval. Notice of any assignment or transfer whether voluntary or involuntary shall be furnished promptly to the LOCAL AGENCY.

H. CONSULTANT shall be as fully responsible to the LOCAL AGENCY for the negligent acts and omissions of its contractors and subcontractors or subconsultants, and of persons either directly or indirectly employed by them, in the same manner as persons directly employed by CONSULTANT.

I. No alteration or variation of the terms of this AGREEMENT shall be valid, unless made in writing and signed by the parties authorized to bind the parties; and no oral understanding or agreement not incorporated herein, shall be binding on any of the parties hereto.

J. The consideration to be paid to CONSULTANT as provided herein, shall be in compensation for all of CONSULTANT’s expenses incurred in the performance hereof, including travel and per diem, unless otherwise expressly so provided.

ARTICLE II CONSULTANT’S REPORTS OR MEETINGS
[Choose either Option 1 or Option 2]
[Option 1 - Use paragraphs A & B below for standard AGREEMENTs] A. CONSULTANT shall submit progress reports at least once a month. The report should be sufficiently detailed for the LOCAL AGENCY’s Contract Administrator to determine, if CONSULTANT is performing to expectations, or is on schedule; to provide communication of interim findings, and to sufficiently address any difficulties or special problems encountered, so remedies can be developed.

B. CONSULTANT’s Project Manager shall meet with LOCAL AGENCY’s Contract Administrator, as needed, to discuss progress on the AGREEMENT.
[Option 2 - Use paragraphs A & B below for on-call AGREEMENTs] A. CONSULTANT shall submit progress reports on each specific project in accordance with the Task Order. These reports shall be submitted at least once a month. The report should be sufficiently detailed for LOCAL AGENCY’s Contract Administrator or Project Coordinator to determine, if CONSULTANT is performing to expectations, or is on schedule; to provide communication of interim findings, and to sufficiently address any difficulties or special problems encountered, so remedies can be developed.

B. CONSULTANT’s Project Manager shall meet with LOCAL AGENCY’s Contract Administrator or Project Coordinator, as needed, to discuss progress on the project(s).

ARTICLE III STATEMENT OF WORK
[Insert Appropriate Statement of work including a Description of the Deliverables in the following sections. If a section does not apply to the AGREEMENT, state “Not Applicable to this AGREEMENT.”] A. CONSULTANT Services
[Detail based on the services to be furnished should be provided by CONSULTANT. Nature and extent should be verified in the negotiations to make precise statements to eliminate subsequent 67 Item 6 C.

Local Assistance Procedures Manual Exhibit 10-R
Cliff Drive Resiliency Project

May 2023
uncertainties and misunderstandings. Reference to the appropriate standards for design or other standards for work performance stipulated in CONSULTANT AGREEMENT should be included.

Describe acceptance criteria, and if the responsible CONSULTANT/engineer shall sign all Plans, Specifications and Estimate (PS&E) and engineering data furnished under the AGREEMENT including registration number.

Environmental documents are not considered complete until a Caltrans District Senior Environmental Planner signs the Categorical Exclusion, a Caltrans Deputy District Director signs the Finding of No Significant Impact, or the Caltrans District Director signs the Record of Decision (see LAPM Chapter 6: Environmental Procedures, and the Standard Environmental Reference).] B. Right of Way
[State whether Right of Way requirements are to be determined and shown by CONSULTANT, whether land surveys and computations with metes and bounds descriptions are to be made, and whether Right of Way parcel maps are to be furnished.]
C. Surveys
[State whether or not the CONSULTANT has the responsibility for performing preliminary or construction surveys.]
D. Subsurface Investigations
[State specifically whether or not CONSULTANT has responsibility for making subsurface investigations. If borings or other specialized services are to be made by others under the supervision of CONSULTANT, appropriate provisions are to be incorporated. Archaeological testing and data recovery guidance can be found in the Standard Environmental Reference.] E. Local Agency Obligations
All data applicable to the project and in possession of LOCAL AGENCY, another agency, or government agency that are to be made available to CONSULTANT are referred to in the AGREEMENT. Any other assistance or services to be furnished to CONSULTANT are to be stated clearly.

F. Conferences, Site Visits, Inspection of Work
This AGREEMENT provides for conferences as needed, visits to the site, and inspection of the work by representatives of the LOCAL AGENCY, State, and/or FHWA. Costs incurred by CONSULTANT for meetings, subsequent to the initial meeting shall be included in the fee.

G. Checking Shop Drawings
[For AGREEMENTs requiring the preparation of construction drawings, make provision for checking shop drawings. Payment for checking shop drawings by CONSULTANT may be included in the AGREEMENT fee, or provision may be made for separate payment.] H. CONSULTANT Services During Construction
The extent, if any of CONSULTANT’s services during the course of construction as material testing, construction surveys. etc., are specified in the AGREEMENT together with the method of payment for such services.

I. Documentation and Schedules
AGREEMENTs where appropriate, shall provide that CONSULTANT document the results of the work to the satisfaction of LOCAL AGENCY, and if applicable, the State and FHWA. This may include preparation of progress and final reports, plans, specifications and estimates, or similar evidence of attainment of the AGREEMENT objectives.
68 Item 6 C.

Local Assistance Procedures Manual Exhibit 10-R
Cliff Drive Resiliency Project

May 2023
J. Deliverables and Number of Copies
The number of copies or documents to be furnished, such as reports, brochures, sets of plans, specifications, or Right of Way parcel maps shall be specified. Provision may be made for payment for additional copies.

ARTICLE IV PERFORMANCE PERIOD
[A time must be set for beginning and ending the work under the AGREEMENT. The time allowed for performing the work is specified; it should be reasonable for the kind and amount of services contemplated; and it is written into the AGREEMENT. If it is desirable that Critical Path Method (CPM) networks, or other types of schedules be prepared by CONSULTANT, they should be identified and incorporated into the AGREEMENT.]
A. This AGREEMENT shall go into effect on (DATE), contingent upon approval by LOCAL AGENCY, and CONSULTANT shall commence work after notification to proceed by LOCAL AGENCY’S Contract Administrator. The AGREEMENT shall end on (DATE), unless extended by AGREEMENT amendment.

B. CONSULTANT is advised that any recommendation for AGREEMENT award is not binding on LOCAL AGENCY until the AGREEMENT is fully executed and approved by LOCAL AGENCY. [Use paragraph C below in addition to paragraphs A & B above for on-call AGREEMENTs. On-call AGREEMENTs shall be 5 years maximum.]
C. The period of performance for each specific project shall be in accordance with the Task Order for that project. If work on a Task Order is in progress on the expiration date of this AGREEMENT, the terms of the AGREEMENT shall be extended by AGREEMENT amendment prior to the expiration of the contract to cover the time needed to complete the task order in progress only. The maximum term shall not exceed five (5) years.

ARTICLE V ALLOWABLE COSTS AND PAYMENTS
[Choose either Option 1, 2, 3, or 4]
[Option 1 - Use paragraphs A through K below for Cost-Plus-Fixed Fee AGREEMENTs] A. The method of payment for this AGREEMENT will be based on actual cost plus a fixed fee. LOCAL AGENCY will reimburse CONSULTANT for actual costs (including labor costs, employee benefits, travel, equipment rental costs, overhead and other direct costs) incurred by CONSULTANT in performance of the work. CONSULTANT will not be reimbursed for actual costs that exceed the estimated wage rates, employee benefits, travel, equipment rental, overhead, and other estimated costs set forth in the approved CONSULTANT’S Cost Proposal, unless additional reimbursement is provided for by AGREEMENT amendment. In no event, will CONSULTANT be reimbursed for overhead costs at a rate that exceeds LOCAL AGENCY’s approved overhead rate set forth in the Cost Proposal. In the event, that LOCAL AGENCY determines that a change to the work from that specified in the Cost Proposal and AGREEMENT is required, the AGREEMENT time or actual costs reimbursable by LOCAL AGENCY shall be adjusted by AGREEMENT amendment to accommodate the changed work. The maximum total cost as specified in Paragraph “I” of this Article shall not be exceeded, unless authorized by AGREEMENT amendment.

B. The indirect cost rate established for this AGREEMENT is extended through the duration of this specific AGREEMENT. CONSULTANT’s agreement to the extension of the 1-year applicable period shall not be a condition or qualification to be considered for the work or AGREEMENT award. 69 Item 6 C.

Local Assistance Procedures Manual Exhibit 10-R
Cliff Drive Resiliency Project

May 2023
C. In addition to the allowable incurred costs, LOCAL AGENCY will pay CONSULTANT a fixed fee of $(AMOUNT). The fixed fee is nonadjustable for the term of the AGREEMENT, except in the event of a significant change in the scope of work and such adjustment is made by AGREEMENT amendment.

D. Reimbursement for transportation and subsistence costs shall not exceed the rates specified in the approved Cost Proposal.

E. When milestone cost estimates are included in the approved Cost Proposal, CONSULTANT shall obtain prior written approval for a revised milestone cost estimate from the Contract Administrator before exceeding such cost estimate.

F. Progress payments will be made monthly in arrears based on services provided and allowable incurred costs. A pro rata portion of CONSULTANT’s fixed fee will be included in the monthly progress payments. If CONSULTANT fails to submit the required deliverable items according to the schedule set forth in Article III Statement of Work, LOCAL AGENCY shall have the right to delay payment or terminate this AGREEMENT.

G. No payment will be made prior to approval of any work, nor for any work performed prior to approval of this AGREEMENT.

H. CONSULTANT will be reimbursed promptly according to California Regulations upon receipt by LOCAL AGENCY’s Contract Administrator of itemized invoices in duplicate. Invoices shall be submitted no later than thirty (30) calendar days after the performance of work for which CONSULTANT is billing. Invoices shall detail the work performed on each milestone and each project as applicable. Invoices shall follow the format stipulated for the approved Cost Proposal and shall reference this AGREEMENT number and project title. Final invoice must contain the final cost and all credits due LOCAL AGENCY including any equipment purchased under the provisions of Article XI Equipment Purchase. The final invoice should be submitted within sixty (60) calendar days after completion of CONSULTANT’s work. Invoices shall be mailed to LOCAL AGENCY’s Contract Administrator at the following address:
(LOCAL AGENCY/NAME OF CONTRACT ADMINISTRATOR)
(ADDRESS)
I. The total amount payable by LOCAL AGENCY including the fixed fee shall not exceed $(Amount).

J. For personnel subject to prevailing wage rates as described in the California Labor Code, all salary increases, which are the direct result of changes in the prevailing wage rates are reimbursable. [Option 2 - For Cost per Unit of Work AGREEMENTs, replace paragraphs A & B of Option 1 with the following paragraphs A, B, and C and re-letter the remaining paragraphs. Adjust as necessary for work specific to your project].

A. The method of payment for the following items shall be at the rate specified for each item, as described in this Article. The specified rate shall include full compensation to CONSULTANT for the item as described, including but not limited to, any repairs, maintenance, or insurance, and no further compensation will be allowed therefore.

B. The specified rate to be paid for vehicle expense for CONSULTANT’s field personnel shall be $(Amount) per approved Cost Proposal. This rate shall be for fully equipped vehicle(s) specified in 70 Item 6 C.

Local Assistance Procedures Manual Exhibit 10-R
Cliff Drive Resiliency Project

May 2023
Article III Statement of Work, as applicable. The specified rate to be paid for equipment shall be, as listed in the approved Cost Proposal.

C. The method of payment for this AGREEMENT, except those items to be paid for on a specified rate basis, will be based on cost per unit of work. LOCAL AGENCY will reimburse CONSULTANT for actual costs (including labor costs, employee benefits, travel, equipment-rental costs, overhead and other direct costs) incurred by CONSULTANT in performance of the work. CONSULTANT will not be reimbursed for actual costs that exceed the estimated wage rates, employee benefits, travel, equipment rental, overhead and other estimated costs set forth in the approved Cost Proposal, unless additional reimbursement is provided for, by AGREEMENT amendment. In no event, will CONSULTANT be reimbursed for overhead costs at a rate that exceeds LOCAL AGENCY approved overhead rate set forth in the approved Cost Proposal. In the event, LOCAL AGENCY determines that changed work from that specified in the approved Cost Proposal and AGREEMENT is required; the actual costs reimbursable by LOCAL AGENCY may be adjusted by AGREEMENT amendment to accommodate the changed work. The maximum total cost as specified in Paragraph “I,” of this article shall not be exceeded unless authorized by AGREEMENT amendment. [Option 3 - Use paragraphs A through P for Specific Rates of Compensation Agreements (such as oncall Agreements). This payment method shall only be used when it is not possible at the time of procurement to estimate the extent or duration of the work or to estimate costs with any reasonable degree of accuracy. The specific rates of compensation payment method should be limited to AGREEMENTs or components of AGREEMENTs for specialized or support type services where the CONSULTANT is not in direct control of the number of hours worked, such as construction engineering and inspection.]
A. CONSULTANT will be reimbursed for hours worked at the hourly rates specified in the CONSULTANT’s approved Cost Proposal. The specified hourly rates shall include direct salary costs, employee benefits, prevailing wages, employer payments, overhead, and fee. These rates are not adjustable for the performance period set forth in this AGREEMENT. CONSULTANT will be reimbursed within thirty (30) days upon receipt by LOCAL AGENCY’S Contract Administrator of itemized invoices in duplicate.

B. In addition, CONSULTANT will be reimbursed for incurred (actual) direct costs other than salary costs that are in the approved Cost Proposal and identified in the approved Cost Proposal and in the executed Task Order.

C. Specific projects will be assigned to CONSULTANT through issuance of Task Orders.

D. After a project to be performed under this AGREEMENT is identified by LOCAL AGENCY, LOCAL AGENCY will prepare a draft Task Order; less the cost estimate. A draft Task Order will identify the scope of services, expected results, project deliverables, period of performance, project schedule and will designate a LOCAL AGENCY Project Coordinator. The draft Task Order will be delivered to CONSULTANT for review. CONSULTANT shall return the draft Task Order within ten (10) calendar days along with a Cost Estimate, including a written estimate of the number of hours and hourly rates per staff person, any anticipated reimbursable expenses, overhead, fee if any, and total dollar amount. After agreement has been reached on the negotiable items and total cost; the finalized Task Order shall be signed by both LOCAL AGENCY and CONSULTANT.

E. Task Orders may be negotiated for a lump sum (Firm Fixed Price) or for specific rates of compensation, both of which must be based on the labor and other rates set forth in CONSULTANT’s approved Cost Proposal.
71 Item 6 C.

Local Assistance Procedures Manual Exhibit 10-R
Cliff Drive Resiliency Project

May 2023
CONSULTANT shall be responsible for any future adjustments to prevailing wage rates including, but not limited to, base hourly rates and employer payments as determined by the Department of Industrial Relations. CONSULTANT is responsible for paying the appropriate rate, including escalations that take place during the term of the AGREEMENT.

F. [Local Agency to include either (a) or (b) below; delete the other one] (a) Reimbursement for transportation and subsistence costs shall not exceed State rates. (b) Reimbursement for transportation and subsistence costs shall not exceed the rates as specified in the approved Cost Proposal. CONSULTANT will be responsible for transportation and subsistence costs in excess of State rates.

G. When milestone cost estimates are included in the approved Cost Proposal, CONSULTANT shall obtain prior written approval in the form of an AGREEMENT amendment for a revised milestone cost estimate from the Contract Administrator before exceeding such estimate.

H. Progress payments for each Task Order will be made monthly in arrears based on services provided and actual costs incurred.

I. CONSULTANT shall not commence performance of work or services until this AGREEMENT has been approved by LOCAL AGENCY and notification to proceed has been issued by LOCAL AGENCY’S Contract Administrator. No payment will be made prior to approval or for any work performed prior to approval of this AGREEMENT.

J. A Task Order is of no force or effect until returned to LOCAL AGENCY and signed by an authorized representative of LOCAL AGENCY. No expenditures are authorized on a project and work shall not commence until a Task Order for that project has been executed by LOCAL AGENCY.

K. CONSULTANT will be reimbursed within thirty (30) days upon receipt by LOCAL AGENCY’S Contract Administrator of itemized invoices in duplicate. Separate invoices itemizing all costs are required for all work performed under each Task Order. Invoices shall be submitted no later than thirty (30) calendar days after the performance of work for which CONSULTANT is billing, or upon completion of the Task Order. Invoices shall detail the work performed on each milestone, on each project as applicable. Invoices shall follow the format stipulated for the approved Cost Proposal and shall reference this AGREEMENT number, project title and Task Order number. Credits due LOCAL AGENCY that include any equipment purchased under the provisions of Article XI Equipment Purchase, must be reimbursed by CONSULTANT prior to the expiration or termination of this AGREEMENT. Invoices shall be mailed to LOCAL AGENCY’s Contract Administrator at the following address:
(NAME OF LOCAL AGENCY/ NAME OF CONTRACT ADMINISTRATOR)
(ADDRESS)
L. The period of performance for Task Orders shall be in accordance with dates specified in the Task Order. No Task Order will be written which extends beyond the expiration date of this AGREEMENT.

M. The total amount payable by LOCAL AGENCY for an individual Task Order shall not exceed the amount agreed to in the Task Order, unless authorized by amendment.

N. If CONSULTANT fails to satisfactorily complete a deliverable according to the schedule set forth in a Task Order, no payment will be made until the deliverable has been satisfactorily completed. 72 Item 6 C.

Local Assistance Procedures Manual Exhibit 10-R
Cliff Drive Resiliency Project

May 2023
O. Task Orders may not be used to amend the language (or the terms) of this AGREEMENT nor to exceed the scope of work under this AGREEMENT.

P. The total amount payable by LOCAL AGENCY for all Task Orders resulting from this AGREEMENT shall not exceed $ (Amount). It is understood and agreed that there is no guarantee, either expressed or implied that this dollar amount will be authorized under this AGREEMENT through Task Orders.
[Option 4 - Use paragraphs A through E below for lump sum agreements.

A. The method of payment for this AGREEMENT will be based on lump sum. The total lump sum price paid to CONSULTANT will include compensation for all work and deliverables, including travel and equipment described in Article III Statement of Work. No additional compensation will be paid to CONSULTANT, unless there is a change in the scope of the work or the scope of the project. In the instance of a change in the scope of work or scope of the project, adjustment to the total lump sum compensation will be negotiated between CONSULTANT and LOCAL AGENCY. Adjustment in the total lump sum compensation will not be effective until authorized by AGREEMENT amendment and approved by LOCAL AGENCY.

B. Progress payments may be made monthly in arrears based on the percentage of work completed by CONSULTANT. If CONSULTANT fails to submit the required deliverable items according to the schedule set forth in Article III Statement of Work, LOCAL AGENCY shall have the right to delay payment or terminate this AGREEMENT in accordance with the provisions of Article VI Termination.

C. CONSULTANT shall not commence performance of work or services until this AGREEMENT has been approved by LOCAL AGENCY and notification to proceed has been issued by LOCAL AGENCY’S Contract Administrator. No payment will be made prior to approval of any work, or for any work performed prior to approval of this AGREEMENT.

D. CONSULTANT will be reimbursed within thirty (30) days upon receipt by LOCAL AGENCY’S Contract Administrator of itemized invoices in duplicate. Invoices shall be submitted no later than thirty (30) calendar days after the performance of work for which CONSULTANT is billing. Invoices shall detail the work performed on each milestone, on each project as applicable. Invoices shall follow the format stipulated for the approved Cost Proposal and shall reference this AGREEMENT number and project title. Final invoice must contain the final cost and all credits due LOCAL AGENCY that include any equipment purchased under the provisions of Article XI Equipment Purchase. The final invoice must be submitted within sixty (60) calendar days after completion of CONSULTANT’s work unless a later date is approved by the LOCAL AGENCY. Invoices shall be mailed to LOCAL AGENCY’s Contract Administrator at the following address:
(LOCAL AGENCY/NAME OF CONTRACT ADMINISTRATOR)
(ADDRESS)
E. The total amount payable by LOCAL AGENCY shall not exceed $(Amount).

ARTICLE VI TERMINATION
A. This AGREEMENT may be terminated by LOCAL AGENCY, provided that LOCAL AGENCY gives not less than thirty (30) calendar days’ written notice (delivered by certified mail, return receipt requested) of intent to terminate. Upon termination, LOCAL AGENCY shall be entitled to all work, including but not limited to, reports, investigations, appraisals, inventories, studies, analyses, drawings and data estimates performed to that date, whether completed or not. 73 Item 6 C.

Local Assistance Procedures Manual Exhibit 10-R
Cliff Drive Resiliency Project

May 2023
B. LOCAL AGENCY may temporarily suspend this AGREEMENT, at no additional cost to LOCAL AGENCY, provided that CONSULTANT is given written notice (delivered by certified mail, return receipt requested) of temporary suspension. If LOCAL AGENCY gives such notice of temporary suspension, CONSULTANT shall immediately suspend its activities under this AGREEMENT. A temporary suspension may be issued concurrent with the notice of termination.

C. Notwithstanding any provisions of this AGREEMENT, CONSULTANT shall not be relieved of liability to LOCAL AGENCY for damages sustained by City by virtue of any breach of this AGREEMENT by CONSULTANT, and City may withhold any payments due to CONSULTANT until such time as the exact amount of damages, if any, due City from CONSULTANT is determined.

D. In the event of termination, CONSULTANT shall be compensated as provided for in this AGREEMENT. Upon termination, LOCAL AGENCY shall be entitled to all work, including but not limited to, reports, investigations, appraisals, inventories, studies, analyses, drawings and data estimates performed to that date, whether completed or not.

ARTICLE VII COST PRINCIPLES AND ADMINISTRATIVE REQUIREMENTS A. The CONSULTANT agrees that 48 CFR 31, Contract Cost Principles and Procedures, shall be used to determine the allowability of individual terms of cost.

B. The CONSULTANT also agrees to comply with Federal procedures in accordance with 2 CFR 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards.

C. Any costs for which payment has been made to the CONSULTANT that are determined by subsequent audit to be unallowable under 48 CFR 31 or 2 CFR 200 are subject to repayment by the CONSULTANT to LOCAL AGENCY.

D. When a CONSULTANT or Subconsultant is a Non-Profit Organization or an Institution of Higher Education, the Cost Principles for Title 2 CFR 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards shall apply.

ARTICLE VIII RETENTION OF RECORD/AUDITS
For the purpose of determining compliance with Gov. Code § 8546.7, the CONSULTANT, Subconsultants, and LOCAL AGENCY shall maintain all books, documents, papers, accounting records, Independent CPA Audited Indirect Cost Rate workpapers, and other evidence pertaining to the performance of the AGREEMENT including, but not limited to, the costs of administering the AGREEMENT. All parties, including the CONSULTANT’s Independent CPA, shall make such workpapers and materials available at their respective offices at all reasonable times during the AGREEMENT period and for three (3) years from the date of final payment under the AGREEMENT and records for real property and equipment acquired with federal funds must be retained for three (3) years after final disposition. LOCAL AGENCY, Caltrans Auditor, FHWA, or any duly authorized representative of the Federal government having jurisdiction under Federal laws or regulations (including the basis of Federal funding in whole or in part) shall have access to any books, records, and documents of the CONSULTANT, Subconsultants, and the CONSULTANT’s Independent CPA, that are pertinent to the AGREEMENT for audits, examinations, workpaper review, excerpts, and transactions, and copies thereof shall be furnished if requested without limitation. 74 Item 6 C.

Local Assistance Procedures Manual Exhibit 10-R
Cliff Drive Resiliency Project

May 2023

ARTICLE IX AUDIT REVIEW PROCEDURES
A. Any dispute concerning a question of fact arising under an interim or post audit of this AGREEMENT that is not disposed of by AGREEMENT, shall be reviewed by LOCAL AGENCY’S Chief Financial Officer.

B. Not later than thirty (30) calendar days after issuance of the final audit report, CONSULTANT may request a review by LOCAL AGENCY’S Chief Financial Officer of unresolved audit issues. The request for review will be submitted in writing.

C. Neither the pendency of a dispute nor its consideration by LOCAL AGENCY will excuse CONSULTANT from full and timely performance, in accordance with the terms of this AGREEMENT.

D. CONSULTANT and subconsultant AGREEMENTs, including cost proposals and Indirect Cost Rates (ICR), may be subject to audits or reviews such as, but not limited to, an AGREEMENT audit, an incurred cost audit, an ICR Audit, or a CPA ICR audit work paper review. If selected for audit or review, the AGREEMENT, cost proposal and ICR and related work papers, if applicable, will be reviewed to verify compliance with 48 CFR 31 and other related laws and regulations. In the instances of a CPA ICR audit work paper review it is CONSULTANT’s responsibility to ensure federal, LOCAL AGENCY, or local government officials are allowed full access to the CPA’s work papers including making copies as necessary. The AGREEMENT, cost proposal, and ICR shall be adjusted by CONSULTANT and approved by LOCAL AGENCY Contract Administrator to conform to the audit or review recommendations. CONSULTANT agrees that individual terms of costs identified in the audit report shall be incorporated into the AGREEMENT by this reference if directed by LOCAL AGENCY at its sole discretion. Refusal by CONSULTANT to incorporate audit or review recommendations, or to ensure that the federal, LOCAL AGENCY or local governments have access to CPA work papers, will be considered a breach of AGREEMENT terms and cause for termination of the AGREEMENT and disallowance of prior reimbursed costs.

E. CONSULTANT’s Cost Proposal may be subject to a CPA ICR Audit Work Paper Review and/or audit by the Independent Office of Audits and Investigations (IOAI). IOAI, at its sole discretion, may review and/or audit and approve the CPA ICR documentation. The Cost Proposal shall be adjusted by the CONSULTANT and approved by the LOCAL AGENCY Contract Administrator to conform to the Work Paper Review recommendations included in the management letter or audit recommendations included in the audit report. Refusal by the CONSULTANT to incorporate the Work Paper Review recommendations included in the management letter or audit recommendations included in the audit report will be considered a breach of the AGREEMENT terms and cause for termination of the AGREEMENT and disallowance of prior reimbursed costs.

1. During IOAI’s review of the ICR audit work papers created by the CONSULTANT’s independent CPA, IOAI will work with the CPA and/or CONSULTANT toward a resolution of issues that arise during the review. Each party agrees to use its best efforts to resolve any audit disputes in a timely manner. If IOAI identifies significant issues during the review and is unable to issue a cognizant approval letter, LOCAL AGENCY will reimburse the CONSULTANT at an accepted ICR until a FAR (Federal Acquisition Regulation) compliant ICR (e.g. 48 CFR Part 31; GAGAS (Generally Accepted Auditing Standards); CAS (Cost Accounting Standards), if applicable; in accordance with procedures and guidelines of the American Association of State Highways and Transportation Officials (AASHTO) Audit Guide; and other applicable procedures and guidelines) is received and approved by IOAI.
75 Item 6 C.

Local Assistance Procedures Manual Exhibit 10-R
Cliff Drive Resiliency Project

May 2023
Accepted rates will be as follows:
a. If the proposed rate is less than one hundred fifty percent (150%) - the accepted rate reimbursed will be ninety percent (90%) of the proposed rate. b. If the proposed rate is between one hundred fifty percent (150%) and two hundred percent (200%) - the accepted rate will be eighty-five percent (85%) of the proposed rate.
c. If the proposed rate is greater than two hundred percent (200%) - the accepted rate will be seventy-five percent (75%) of the proposed rate.

2. If IOAI is unable to issue a cognizant letter per paragraph E.1. above, IOAI may require CONSULTANT to submit a revised independent CPA-audited ICR and audit report within three (3) months of the effective date of the management letter. IOAI will then have up to six (6) months to review the CONSULTANT’s and/or the independent CPA’s revisions.

3. If the CONSULTANT fails to comply with the provisions of this paragraph E, or if IOAI is still unable to issue a cognizant approval letter after the revised independent CPA audited ICR is submitted, overhead cost reimbursement will be limited to the accepted ICR that was established upon initial rejection of the ICR and set forth in paragraph E.1. above for all rendered services. In this event, this accepted ICR will become the actual and final ICR for reimbursement purposes under this AGREEMENT.

4. CONSULTANT may submit to LOCAL AGENCY final invoice only when all of the following items have occurred: (1) IOAI accepts or adjusts the original or revised independent CPA audited ICR; (2) all work under this AGREEMENT has been completed to the satisfaction of LOCAL AGENCY; and, (3) IOAI has issued its final ICR review letter. The CONSULTANT MUST SUBMIT ITS FINAL INVOICE TO LOCAL AGENCY no later than sixty (60) calendar days after occurrence of the last of these items. The accepted ICR will apply to this AGREEMENT and all other agreements executed between LOCAL AGENCY and the CONSULTANT, either as a prime or subconsultant, with the same fiscal period ICR.

ARTICLE X SUBCONTRACTING
A. Nothing contained in this AGREEMENT or otherwise, shall create any contractual relation between the LOCAL AGENCY and any Subconsultants, and no subagreement shall relieve the CONSULTANT of its responsibilities and obligations hereunder. The CONSULTANT agrees to be as fully responsible to the LOCAL AGENCY for the acts and omissions of its Subconsultants and of persons either directly or indirectly employed by any of them as it is for the acts and omissions of persons directly employed by the CONSULTANT. The CONSULTANT's obligation to pay its Subconsultants is an independent obligation from the LOCAL AGENCY's obligation to make payments to the CONSULTANT.

B. The CONSULTANT shall perform the work contemplated with resources available within its own organization and no portion of the work shall be subcontracted without written authorization by the LOCAL AGENCY Contract Administrator, except that which is expressly identified in the CONSULTANT’s approved Cost Proposal.

C. Any subagreement entered into as a result of this AGREEMENT, shall contain all the provisions stipulated in this entire AGREEMENT to be applicable to Subconsultants unless otherwise noted.

D. CONSULTANT shall pay its Subconsultants within Fifteen (15) calendar days from receipt of each payment made to the CONSULTANT by the LOCAL AGENCY.
76 Item 6 C.

Local Assistance Procedures Manual Exhibit 10-R
Cliff Drive Resiliency Project

May 2023
E. Any substitution of Subconsultants must be approved in writing by the LOCAL AGENCY Contract Administrator in advance of assigning work to a substitute Subconsultant.

F. Prompt Progress Payment
CONSULTANT or subconsultant shall pay to any subconsultant, not later than fifteen (15) days after receipt of each progress payment, unless otherwise agreed to in writing, the respective amounts allowed CONSULTANT on account of the work performed by the subconsultants, to the extent of each subconsultant’s interest therein. In the event that there is a good faith dispute over all or any portion of the amount due on a progress payment from CONSULTANT or subconsultant to a subconsultant, CONSULTANT or subconsultant may withhold no more than 150 percent of the disputed amount. Any violation of this requirement shall constitute a cause for disciplinary action and shall subject the licensee to a penalty, payable to the subconsultant, of 2 percent of the amount due per month for every month that payment is not made.

In any action for the collection of funds wrongfully withheld, the prevailing party shall be entitled to his or her attorney’s fees and costs. The sanctions authorized under this requirement shall be separate from, and in addition to, all other remedies, either civil, administrative, or criminal. This clause applies to both DBE and non-DBE subconsultants.

G. Prompt Payment of Withheld Funds to Subconsultants
The LOCAL AGENCY may hold retainage from CONSULTANT and shall make prompt and regular incremental acceptances of portions, as determined by the LOCAL AGENCY, of the contract work, and pay retainage to CONSULTANT based on these acceptances. The LOCAL AGENCY shall designate one of the methods below in the contract to ensure prompt and full payment of any retainage kept by CONSULTANT or subconsultant to a subconsultant. [Choose either Method 1, Method 2, or Method 3 below and delete the other two.] Method 1: No retainage will be held by the LOCAL AGENCY from progress payments due to CONSULTANT. CONSULTANTS and subconsultants are prohibited from holding retainage from subconsultants. Any delay or postponement of payment may take place only for good cause and with the LOCAL AGENCY’s prior written approval. Any violation of these provisions shall subject the violating CONSULTANT or subconsultant to the penalties, sanctions, and other remedies specified in Section 3321 of the California Civil Code. This requirement shall not be construed to limit or impair any contractual, administrative or judicial remedies, otherwise available to CONSULTANT or subconsultant in the event of a dispute involving late payment or nonpayment by CONSULTANT, deficient subconsultant performance and/or noncompliance by a subconsultant. This clause applies to both DBE and non-DBE subconsultants.

Method 2: No retainage will be held by the LOCAL AGENCY from progress payments due to CONSULTANT. Any retainage kept by CONSULTANT or by a subconsultant must be paid in full to the earning subconsultant within 15 days after the subconsultant’s work is satisfactorily completed.

Any delay or postponement of payment may take place only for good cause and with the LOCAL AGENCY’s prior written approval. Any violation of these provisions shall subject the violating CONSULTANT or subconsultant to the penalties, sanctions, and remedies specified in Section 3321 of the California Civil Code. This requirement shall not be construed to limit or impair any contractual, administrative or judicial remedies, otherwise available to CONSULTANT or subconsultant in the event of a dispute involving late payment or nonpayment by CONSULTANT, deficient subconsultant performance and/or noncompliance by a subconsultant. This clause applies to both DBE and non-DBE subconsultants.
77 Item 6 C.

Local Assistance Procedures Manual Exhibit 10-R
Cliff Drive Resiliency Project

May 2023
Method 3: The LOCAL AGENCY shall hold retainage from CONSULTANT and shall make prompt and regular incremental acceptances of portions, as determined by the LOCAL AGENCY of the contract work and pay retainage to CONSULTANT based on these acceptances. CONSULTANT or subconsultant shall return all monies withheld in retention from all subconsultants within 15 days after receiving payment for work satisfactorily completed and accepted including incremental acceptances of portions of the contract work by the LOCAL AGENCY. Any delay or postponement of payment may take place only for good cause and with the LOCAL AGENCY’s prior written approval. Any violation of these provisions shall subject the violating CONSULTANT or subconsultant to the penalties, sanctions, and other remedies specified in Section 3321 of the California Civil Code. This requirement shall not be construed to limit or impair any contractual, administrative or judicial remedies otherwise available to CONSULTANT or subconsultant in the event of a dispute involving late payment or nonpayment by CONSULTANT; deficient subconsultant performance and/or noncompliance by a subconsultant. This clause applies to both DBE and nonDBE subconsultants.

Any violation of these provisions shall subject the violating CONSULTANT or subconsultant to the penalties, sanctions and other remedies specified therein. These requirements shall not be construed to limit or impair any contractual, administrative, or judicial remedies otherwise available to CONSULTANT or subconsultant in the event of a dispute involving late payment or nonpayment by CONSULTANT, deficient subcontract performance, or noncompliance by a subconsultant.

ARTICLE XI EQUIPMENT PURCHASE AND OTHER CAPITAL EXPENDITURES A. Prior authorization in writing by LOCAL AGENCY’s Contract Administrator shall be required before CONSULTANT enters into any unbudgeted purchase order, or subcontract exceeding five thousand dollars ($5,000) for supplies, equipment, or CONSULTANT services. CONSULTANT shall provide an evaluation of the necessity or desirability of incurring such costs.

B. For purchase of any item, service, or consulting work not covered in CONSULTANT’s approved Cost Proposal and exceeding five thousand dollars ($5,000), with prior authorization by LOCAL AGENCY’s Contract Administrator, three competitive quotations must be submitted with the request, or the absence of proposal must be adequately justified.

C. Any equipment purchased with funds provided under the terms of this AGREEMENT is subject to the following:

1. CONSULTANT shall maintain an inventory of all nonexpendable property. Nonexpendable property is defined as having a useful life of at least two years and an acquisition cost of five thousand dollars ($5,000) or more. If the purchased equipment needs replacement and is sold or traded in, LOCAL AGENCY shall receive a proper refund or credit at the conclusion of the AGREEMENT, or if the AGREEMENT is terminated, CONSULTANT may either keep the equipment and credit LOCAL AGENCY in an amount equal to its fair market value, or sell such equipment at the best price obtainable at a public or private sale, in accordance with established LOCAL AGENCY procedures; and credit LOCAL AGENCY in an amount equal to the sales price. If CONSULTANT elects to keep the equipment, fair market value shall be determined at CONSULTANT’s expense, on the basis of a competent independent appraisal of such equipment. Appraisals shall be obtained from an appraiser mutually agreeable to by LOCAL AGENCY and CONSULTANT, if it is determined to sell the equipment, the terms and conditions of such sale must be approved in advance by LOCAL AGENCY.

2. Regulation 2 CFR 200 requires a credit to Federal funds when participating equipment with a fair market value greater than five thousand dollars ($5,000) is credited to the project. 78 Item 6 C.

Local Assistance Procedures Manual Exhibit 10-R
Cliff Drive Resiliency Project

May 2023

ARTICLE XII STATE PREVAILING WAGE RATES
A. No CONSULTANT or Subconsultant may be awarded an AGREEMENT containing public work elements unless registered with the Department of Industrial Relations (DIR) pursuant to Labor Code §1725.5. Registration with DIR must be maintained throughout the entire term of this AGREEMENT, including any subsequent amendments.

B. The CONSULTANT shall comply with all of the applicable provisions of the California Labor Code requiring the payment of prevailing wages. The General Prevailing Wage Rate Determinations applicable to work under this AGREEMENT are available and on file with the Department of Transportation's Regional/District Labor Compliance Officer (https://dot.ca.gov/programs/construction/labor-compliance). These wage rates are made a specific part of this AGREEMENT by reference pursuant to Labor Code §1773.2 and will be applicable to work performed at a construction project site. Prevailing wages will be applicable to all inspection work performed at LOCAL AGENCY construction sites, at LOCAL AGENCY facilities and at off-site locations that are set up by the construction contractor or one of its subcontractors solely and specifically to serve LOCAL AGENCY projects. Prevailing wage requirements do not apply to inspection work performed at the facilities of vendors and commercial materials suppliers that provide goods and services to the general public.

C. General Prevailing Wage Rate Determinations applicable to this project may also be obtained from the Department of Industrial Relations website at http://www.dir.ca.gov.

D. Payroll Records

1. Each CONSULTANT and Subconsultant shall keep accurate certified payroll records and supporting documents as mandated by Labor Code §1776 and as defined in 8 CCR §16000 showing the name, address, social security number, work classification, straight time and overtime hours worked each day and week, and the actual per diem wages paid to each journeyman, apprentice, worker, or other employee employed by the CONSULTANT or Subconsultant in connection with the public work. Each payroll record shall contain or be verified by a written declaration that it is made under penalty of perjury, stating both of the following:
a. The information contained in the payroll record is true and correct. b. The employer has complied with the requirements of Labor Code §1771, §1811, and §1815 for any work performed by his or her employees on the public works project.

2. The payroll records enumerated under paragraph (1) above shall be certified as correct by the CONSULTANT under penalty of perjury. The payroll records and all supporting documents shall be made available for inspection and copying by LOCAL AGENCY representatives at all reasonable hours at the principal office of the CONSULTANT. The CONSULTANT shall provide copies of certified payrolls or permit inspection of its records as follows:
a. A certified copy of an employee's payroll record shall be made available for inspection or furnished to the employee or the employee's authorized representative on request. b. A certified copy of all payroll records enumerated in paragraph (1) above, shall be made available for inspection or furnished upon request to a representative of LOCAL AGENCY, the Division of Labor Standards Enforcement and the Division of Apprenticeship Standards of the Department of Industrial Relations. Certified payrolls submitted to LOCAL AGENCY, the Division of Labor Standards Enforcement and the Division of Apprenticeship Standards shall not be altered or obliterated by the CONSULTANT.
79 Item 6 C.

Local Assistance Procedures Manual Exhibit 10-R
Cliff Drive Resiliency Project

May 2023
c. The public shall not be given access to certified payroll records by the CONSULTANT.

The CONSULTANT is required to forward any requests for certified payrolls to the LOCAL AGENCY Contract Administrator by both email and regular mail on the business day following receipt of the request.

3. Each CONSULTANT shall submit a certified copy of the records enumerated in paragraph (1) above, to the entity that requested the records within ten (10) calendar days after receipt of a written request.

4. Any copy of records made available for inspection as copies and furnished upon request to the public or any public agency by LOCAL AGENCY shall be marked or obliterated in such a manner as to prevent disclosure of each individual's name, address, and social security number. The name and address of the CONSULTANT or Subconsultant performing the work shall not be marked or obliterated.

5. The CONSULTANT shall inform LOCAL AGENCY of the location of the records enumerated under paragraph (1) above, including the street address, city and county, and shall, within five (5) working days, provide a notice of a change of location and address.

6. The CONSULTANT or Subconsultant shall have ten (10) calendar days in which to comply subsequent to receipt of written notice requesting the records enumerated in paragraph (1) above. In the event the CONSULTANT or Subconsultant fails to comply within the ten (10) day period, he or she shall, as a penalty to LOCAL AGENCY, forfeit one hundred dollars ($100) for each calendar day, or portion thereof, for each worker, until strict compliance is effectuated.

Such penalties shall be withheld by LOCAL AGENCY from payments then due. CONSULTANT is not subject to a penalty assessment pursuant to this section due to the failure of a Subconsultant to comply with this section.

E. When prevailing wage rates apply, the CONSULTANT is responsible for verifying compliance with certified payroll requirements. Invoice payment will not be made until the invoice is approved by the LOCAL AGENCY Contract Administrator.

F. Penalty

1. The CONSULTANT and any of its Subconsultants shall comply with Labor Code §1774 and §1775. Pursuant to Labor Code §1775, the CONSULTANT and any Subconsultant shall forfeit to the LOCAL AGENCY a penalty of not more than two hundred dollars ($200) for each calendar day, or portion thereof, for each worker paid less than the prevailing rates as determined by the Director of DIR for the work or craft in which the worker is employed for any public work done under the AGREEMENT by the CONSULTANT or by its Subconsultant in violation of the requirements of the Labor Code and in particular, Labor Code §§1770 to 1780, inclusive.

2. The amount of this forfeiture shall be determined by the Labor Commissioner and shall be based on consideration of mistake, inadvertence, or neglect of the CONSULTANT or Subconsultant in failing to pay the correct rate of prevailing wages, or the previous record of the CONSULTANT or Subconsultant in meeting their respective prevailing wage obligations, or the willful failure by the CONSULTANT or Subconsultant to pay the correct rates of prevailing wages. A mistake, inadvertence, or neglect in failing to pay the correct rates of prevailing wages is not excusable if the CONSULTANT or Subconsultant had knowledge of the obligations under the Labor Code.

The CONSULTANT is responsible for paying the appropriate rate, including any escalations that take place during the term of the AGREEMENT. 80 Item 6 C.

Local Assistance Procedures Manual Exhibit 10-R
Cliff Drive Resiliency Project

May 2023

3. In addition to the penalty and pursuant to Labor Code §1775, the difference between the prevailing wage rates and the amount paid to each worker for each calendar day or portion thereof for which each worker was paid less than the prevailing wage rate shall be paid to each worker by the CONSULTANT or Subconsultant.

4. If a worker employed by a Subconsultant on a public works project is not paid the general prevailing per diem wages by the Subconsultant, the CONSULTANT of the project is not liable for the penalties described above unless the CONSULTANT had knowledge of that failure of the Subconsultant to pay the specified prevailing rate of wages to those workers or unless the CONSULTANT fails to comply with all of the following requirements:
a. The AGREEMENT executed between the CONSULTANT and the Subconsultant for the performance of work on public works projects shall include a copy of the requirements in Labor Code §§ 1771, 1775, 1776, 1777.5, 1813, and 1815. b. The CONSULTANT shall monitor the payment of the specified general prevailing rate of per diem wages by the Subconsultant to the employees by periodic review of the certified payroll records of the Subconsultant.
c. Upon becoming aware of the Subconsultant’s failure to pay the specified prevailing rate of wages to the Subconsultant’s workers, the CONSULTANT shall diligently take corrective action to halt or rectify the failure, including but not limited to, retaining sufficient funds due the Subconsultant for work performed on the public works project. d. Prior to making final payment to the Subconsultant for work performed on the public works project, the CONSULTANT shall obtain an affidavit signed under penalty of perjury from the Subconsultant that the Subconsultant had paid the specified general prevailing rate of per diem wages to the Subconsultant’s employees on the public works project and any amounts due pursuant to Labor Code §1813.

5. Pursuant to Labor Code §1775, LOCAL AGENCY shall notify the CONSULTANT on a public works project within fifteen (15) calendar days of receipt of a complaint that a Subconsultant has failed to pay workers the general prevailing rate of per diem wages.

6. If LOCAL AGENCY determines that employees of a Subconsultant were not paid the general prevailing rate of per diem wages and if LOCAL AGENCY did not retain sufficient money under the AGREEMENT to pay those employees the balance of wages owed under the general prevailing rate of per diem wages, the CONSULTANT shall withhold an amount of moneys due the Subconsultant sufficient to pay those employees the general prevailing rate of per diem wages if requested by LOCAL AGENCY.

G. Hours of Labor
Eight (8) hours labor constitutes a legal day's work. The CONSULTANT shall forfeit, as a penalty to the LOCAL AGENCY, twenty-five dollars ($25) for each worker employed in the execution of the AGREEMENT by the CONSULTANT or any of its Subconsultants for each calendar day during which such worker is required or permitted to work more than eight (8) hours in any one calendar day and forty (40) hours in any one calendar week in violation of the provisions of the Labor Code, and in particular §§1810 to 1815 thereof, inclusive, except that work performed by employees in excess of eight (8) hours per day, and forty (40) hours during any one week, shall be permitted upon compensation for all hours worked in excess of eight (8) hours per day and forty (40) hours in any week, at not less than one and one-half (1.5) times the basic rate of pay, as provided in §1815. 81 Item 6 C.

Local Assistance Procedures Manual Exhibit 10-R
Cliff Drive Resiliency Project

May 2023
H. Employment of Apprentices

1. Where either the prime AGREEMENT or the subagreement exceeds thirty thousand dollars ($30,000), the CONSULTANT and any subconsultants under him or her shall comply with all applicable requirements of Labor Code §§ 1777.5, 1777.6 and 1777.7 in the employment of apprentices.

2. CONSULTANTs and subconsultants are required to comply with all Labor Code requirements regarding the employment of apprentices, including mandatory ratios of journey level to apprentice workers. Prior to commencement of work, CONSULTANT and subconsultants are advised to contact the DIR Division of Apprenticeship Standards website at https://www.dir.ca.gov/das/, for additional information regarding the employment of apprentices and for the specific journey-to- apprentice ratios for the AGREEMENT work. The CONSULTANT is responsible for all subconsultants’ compliance with these requirements.

Penalties are specified in Labor Code §1777.7.

ARTICLE XIII CONFLICT OF INTEREST
A. During the term of this AGREEMENT, the CONSULTANT shall disclose any financial, business, or other relationship with LOCAL AGENCY that may have an impact upon the outcome of this AGREEMENT or any ensuing LOCAL AGENCY construction project. The CONSULTANT shall also list current clients who may have a financial interest in the outcome of this AGREEMENT or any ensuing LOCAL AGENCY construction project which will follow.

B. CONSULTANT certifies that it has disclosed to LOCAL AGENCY any actual, apparent, or potential conflicts of interest that may exist relative to the services to be provided pursuant to this AGREEMENT. CONSULTANT agrees to advise LOCAL AGENCY of any actual, apparent or potential conflicts of interest that may develop subsequent to the date of execution of this AGREEMENT. CONSULTANT further agrees to complete any statements of economic interest if required by either LOCAL AGENCY ordinance or State law.

C. The CONSULTANT hereby certifies that it does not now have, nor shall it acquire any financial or business interest that would conflict with the performance of services under this AGREEMENT.

D. The CONSULTANT hereby certifies that the CONSULTANT or subconsultant and any firm affiliated with the CONSULTANT or subconsultant that bids on any construction contract or on any Agreement to provide construction inspection for any construction project resulting from this AGREEMENT, has established necessary controls to ensure a conflict of interest does not exist. An affiliated firm is one, which is subject to the control of the same persons, through joint ownership or otherwise.

ARTICLE XIV REBATES, KICKBACKS OR OTHER UNLAWFUL CONSIDERATION The CONSULTANT warrants that this AGREEMENT was not obtained or secured through rebates, kickbacks or other unlawful consideration either promised or paid to any LOCAL AGENCY employee.

For breach or violation of this warranty, LOCAL AGENCY shall have the right, in its discretion, to terminate this AGREEMENT without liability, to pay only for the value of the work actually performed, or to deduct from this AGREEMENT price or otherwise recover the full amount of such rebate, kickback or other unlawful consideration.
82 Item 6 C.

Local Assistance Procedures Manual Exhibit 10-R
Cliff Drive Resiliency Project

May 2023

ARTICLE XV PROHIBITION OF EXPENDING LOCAL AGENCY, STATE, OR FEDERAL FUNDS

FOR LOBBYING
[Include this article in all AGREEMENTs where federal funding will exceed $150,000. If less than $150,000 in federal funds will be expended on the AGREEMENT; delete this article and re-number the subsequent articles.]
A. The CONSULTANT certifies, to the best of his or her knowledge and belief, that:

1. No State, Federal, or LOCAL AGENCY appropriated funds have been paid or will be paid, by or on behalf of the CONSULTANT, to any person for influencing or attempting to influence an officer or employee of any local, State, or Federal agency, a Member of the State Legislature or United States Congress, an officer or employee of the Legislature or Congress, or any employee of a Member of the Legislature or Congress in connection with the awarding or making of this AGREEMENT, or with the extension, continuation, renewal, amendment, or modification of this AGREEMENT.

2. If any funds other than Federal appropriated funds have been paid or will be paid to any person for influencing or attempting to influence an officer or employee of any agency, a Member of Congress, an officer or employee of Congress, or an employee of a member of Congress in connection with this AGREEMENT, the CONSULTANT shall complete and submit Standard Form-LLL, “Disclosure Form to Report Lobbying,” in accordance with its instructions.

B. This certification is a material representation of fact upon which reliance was placed when this transaction was made or entered into. Submission of this certification is a prerequisite for making or entering into this transaction imposed by 31 U.S.C. §1352. Any person who fails to file the required certification shall be subject to a civil penalty of not less than ten thousand dollars ($10,000) and not more than one hundred thousand dollars ($100,000) for each such failure.

C. The CONSULTANT also agrees by signing this document that he or she shall require that the language of this certification be included in all lower tier subagreements, which exceed one hundred thousand dollars ($100,000), and that all such subrecipients shall certify and disclose accordingly.

ARTICLE XVI NON-DISCRIMINATION CLAUSE AND STATEMENT OF COMPLIANCE A. The CONSULTANT’s signature affixed herein and dated shall constitute a certification under penalty of perjury under the laws of the State of California that the CONSULTANT has, unless exempt, complied with the nondiscrimination program requirements of Gov. Code §12990 and 2 CCR § 8103.

B. During the performance of this AGREEMENT, CONSULTANT and its subconsultants shall not deny the AGREEMENT’s benefits to any person on the basis of race, religious creed, color, national origin, ancestry, physical disability, mental disability, medical condition, genetic information, marital status, sex, gender, gender identity, gender expression, age, sexual orientation, or military and veteran status, nor shall they unlawfully discriminate, harass, or allow harassment against any employee or applicant for employment because of race, religious creed, color, national origin, ancestry, physical disability, mental disability, medical condition, genetic information, marital status, sex, gender, gender identity, gender expression, age, sexual orientation, or military and veteran status. CONSULTANT and subconsultants shall insure that the evaluation and treatment of their employees and applicants for employment are free from such discrimination and harassment.

C. CONSULTANT and subconsultants shall comply with the provisions of the Fair Employment and Housing Act (Gov. Code §12990 et seq.), the applicable regulations promulgated there under (2 83 Item 6 C.

Local Assistance Procedures Manual Exhibit 10-R
Cliff Drive Resiliency Project

May 2023
CCR §11000 et seq.), the provisions of Gov. Code §§11135-11139.5, and the regulations or standards adopted by LOCAL AGENCY to implement such article. The applicable regulations of the Fair Employment and Housing Commission implementing Gov. Code §12990 (a-f), set forth 2 CCR §§8100-8504, are incorporated into this AGREEMENT by reference and made a part hereof as if set forth in full.

D. CONSULTANT shall permit access by representatives of the Department of Fair Employment and Housing and the LOCAL AGENCY upon reasonable notice at any time during the normal business hours, but in no case less than twenty-four (24) hours’ notice, to such of its books, records, accounts, and all other sources of information and its facilities as said Department or LOCAL AGENCY shall require to ascertain compliance with this clause.

E. CONSULTANT and its subconsultants shall give written notice of their obligations under this clause to labor organizations with which they have a collective bargaining or other Agreement.

F. CONSULTANT shall include the nondiscrimination and compliance provisions of this clause in all subcontracts to perform work under this AGREEMENT.

G. The CONSULTANT, with regard to the work performed under this AGREEMENT, shall act in accordance with Title VI of the Civil Rights Act of 1964 (42 U.S.C. §2000d et seq.). Title VI provides that the recipients of federal assistance will implement and maintain a policy of nondiscrimination in which no person in the United States shall, on the basis of race, color, national origin, religion, sex, age, disability, be excluded from participation in, denied the benefits of or subject to discrimination under any program or activity by the recipients of federal assistance or their assignees and successors in interest.

H. The CONSULTANT shall comply with regulations relative to non-discrimination in federally-assisted programs of the U.S. Department of Transportation (49 CFR 21 - Effectuation of Title VI of the Civil Rights Act of 1964). Specifically, the CONSULTANT shall not participate either directly or indirectly in the discrimination prohibited by 49 CFR §21.5, including employment practices and the selection and retention of Subconsultants.

I. CONSULTANT, subrecipient or subconsultant will never exclude any person from participation in, deny any person the benefits of, or otherwise discriminate against anyone in connection with the award and performance of any contract covered by 49 CFR 26 on the basis of race, color, sex, or national origin. In administering the LOCAL AGENCY components of the DBE Program Plan, CONSULTANT, subrecipient or subconsultant will not, directly, or through contractual or other arrangements, use criteria or methods of administration that have the effect of defeating or substantially impairing accomplishment of the objectives of the DBE Program Plan with respect to individuals of a particular race, color, sex, or national origin.

ARTICLE XVII DEBARMENT AND SUSPENSION CERTIFICATION
A. The CONSULTANT’s signature affixed herein shall constitute a certification under penalty of perjury under the laws of the State of California, that the CONSULTANT or any person associated therewith in the capacity of owner, partner, director, officer or manager:

1. Is not currently under suspension, debarment, voluntary exclusion, or determination of ineligibility by any federal agency;

2. Has not been suspended, debarred, voluntarily excluded, or determined ineligible by any federal agency within the past three (3) years;

3. Does not have a proposed debarment pending; and
84 Item 6 C.

Local Assistance Procedures Manual Exhibit 10-R
Cliff Drive Resiliency Project

May 2023

4. Has not been indicted, convicted, or had a civil judgment rendered against it by a court of competent jurisdiction in any matter involving fraud or official misconduct within the past three (3) years.

B. Any exceptions to this certification must be disclosed to LOCAL AGENCY. Exceptions will not necessarily result in denial of recommendation for award, but will be considered in determining responsibility. Disclosures must indicate the party to whom the exceptions apply, the initiating agency, and the dates of agency action.

C. Exceptions to the Federal Government excluded parties (https://sam.gov/content/home) maintained by the U.S. General Services Administration are to be determined by FHWA.

ARTICLE XVIII DISADVANTAGED BUSINESS ENTERPRISES (DBE) PARTICIPATION A. CONSULTANT, subrecipient (LOCAL AGENCY), or subconsultant shall take necessary and reasonable steps to ensure that DBEs have opportunities to participate in the contract (49 CFR 26).

To ensure equal participation of DBEs provided in 49 CFR 26.5, the LOCAL AGENCY shows a contract goal for DBEs. CONSULTANT shall make work available to DBEs and select work parts consistent with available DBE subconsultants and suppliers.

CONSULTANT shall meet the DBE goal shown elsewhere in these special provisions or demonstrate that they made adequate Good Faith Efforts (GFE) to meet this goal. It is CONSULTANT’s responsibility to verify at date of proposal opening that the DBE firm is certified as a DBE by using the California Unified Certification Program (CUCP) database and possesses the most specific available North American Industry Classification System (NAICS) codes and work code applicable to the type of work the firm will perform on the contract. Additionally, the CONSULTANT is responsible to document the verification record by printing out the CUCP data for each DBE firm. A list of DBEs certified by the CUCP can be found at https://dot.ca.gov/programs/civil-rights/dbe-search.

All DBE participation will count toward the California Department of Transportation’s federally mandated statewide overall DBE goal. Credit for materials or supplies CONSULTANT purchases from DBEs counts towards the goal in the following manner:
• 100 percent counts if the materials or supplies are obtained from a DBE manufacturer. • 60 percent counts if the materials or supplies are purchased from a DBE regular dealer. • Only fees, commissions, and charges for assistance in the procurement and delivery of materials or supplies count if obtained from a DBE that is neither a manufacturer nor regular dealer. 49 CFR 26.55 defines "manufacturer" and "regular dealer." This AGREEMENT is subject to 49 CFR 26 entitled “Participation by Disadvantaged Business Enterprises in Department of Transportation Financial Assistance Programs”. CONSULTANTs who enter into a federally-funded agreement will assist the LOCAL AGENCY in a good faith effort to achieve California's statewide overall DBE goal.

B. The goal for DBE participation for this AGREEMENT is 19%. Participation by DBE CONSULTANT or subconsultants shall be in accordance with information contained in Exhibit 10- O2: Consultant Contract DBE Commitment attached hereto and incorporated as part of the AGREEMENT. If a DBE subconsultant is unable to perform, CONSULTANT must make a good faith effort to replace him/her with another DBE subconsultant, if the goal is not otherwise met. 85 Item 6 C.

Local Assistance Procedures Manual Exhibit 10-R
Cliff Drive Resiliency Project

May 2023
C. CONSULTANT can meet the DBE participation goal by either documenting commitments to DBEs to meet the AGREEMENT goal, or by documenting adequate good faith efforts to meet the AGREEMENT goal. An adequate good faith effort means that the CONSULTANT must show that it took all necessary and reasonable steps to achieve a DBE goal that, by their scope, intensity, and appropriateness to the objective, could reasonably be expected to meet the DBE goal. If CONSULTANT has not met the DBE goal, complete and submit Exhibit 15-H: Proposer/Contractor Good Faith Efforts to document efforts to meet the goal. Refer to 49 CFR 26 for guidance regarding evaluation of good faith efforts to meet the DBE goal.

D. Contract Assurance
Under 49 CFR 26.13(b):

CONSULTANT, subrecipient or subconsultant shall not discriminate on the basis of race, color, national origin, or sex in the performance of this contract. CONSULTANT shall carry out applicable requirements of 49 CFR 26 in the award and administration of federal-aid contracts.

Failure by the CONSULTANT to carry out these requirements is a material breach of this contract, which may result in the termination of this contract or such other remedy as the recipient deems appropriate, which may include, but is not limited to:
(1) Withholding monthly progress payments;
(2) Assessing sanctions;
(3) Liquidated damages; and/or
(4) Disqualifying CONSULTANT from future proposing as non-responsible E. Termination and Replacement of DBE Subconsultants
CONSULTANT shall utilize the specific DBEs listed to perform the work and supply the materials for which each is listed unless CONSULTANT or DBE subconsultant obtains the LOCAL AGENCY’s written consent. CONSULTANT shall not terminate or replace a listed DBE for convenience and perform the work with their own forces or obtain materials from other sources without authorization from the LOCAL AGENCY. Unless the LOCAL AGENCY’s consent is provided, the CONSULTANT shall not be entitled to any payment for work or material unless it is performed or supplied by the listed DBE on the Exhibit 10-02: Consultant Contract DBE Commitment form.

Termination of DBE Subconsultants
After execution of the AGREEMENT, termination of a DBE may be allowed for the following, but not limited to, justifiable reasons with prior written authorization from the LOCAL AGENCY:

1. Listed DBE fails or refuses to execute a written contract based on plans and specifications for the project.

2. The LOCAL AGENCY stipulated that a bond is a condition of executing the subcontract and the listed DBE fails to meet the LOCAL AGENCY’s bond requirements.

3. Work requires a consultant's license and listed DBE does not have a valid license under Contractors License Law.

4. Listed DBE fails or refuses to perform the work or furnish the listed materials (failing or refusing to perform is not an allowable reason to remove a DBE if the failure or refusal is a result of bad faith or discrimination).

5. Listed DBE's work is unsatisfactory and not in compliance with the contract. 86 Item 6 C.

Local Assistance Procedures Manual Exhibit 10-R
Cliff Drive Resiliency Project

May 2023

6. Listed DBE is ineligible to work on the project because of suspension or debarment.

7. Listed DBE becomes bankrupt or insolvent or exhibits credit unworthiness.

8. Listed DBE voluntarily withdraws with written notice from the Contract.

9. Listed DBE is ineligible to receive credit for the type of work required.

10. Listed DBE owner dies or becomes disabled resulting in the inability to perform the work on the Contract.

11. The LOCAL AGENCY determines other documented good cause.

CONSULTANT must use the following procedures to request the termination of a DBE or portion of a DBE’s work:

1. Send a written notice to the DBE of the CONSULTANT’s intent to use other forces or material sources and include one or more justifiable reasons listed above. Simultaneously send a copy of this written notice to the LOCAL AGENCY. The written notice to the DBE must request they provide any response within five (5) business days to both the CONSULTANT and the LOCAL AGENCY by either acknowledging their agreement or documenting their reasoning as to why the use of other forces or sources of materials should not occur.

2. If the DBE does not respond within five (5) business days, CONSULTANT may move forward with the request as if the DBE had agreed to CONSULTANT’s written notice.

3. Submit CONSULTANT’s DBE termination request by written letter to the LOCAL AGENCY and include:
• One or more above listed justifiable reasons along with supporting documentation. • CONSULTANT’s written notice to the DBE regarding the request, including proof of transmission and tracking documentation of CONSULTANT’s written notice • The DBE's response to CONSULTANT’s written notice, if received. If a written response was not provided, provide a statement to that effect.

The LOCAL AGENCY shall respond in writing to CONSULTANT’s DBE termination request within five (5) business days.

Replacement of DBE Subconsultants
After receiving the LOCAL AGENCY’s written authorization of DBE termination request, CONSULTANT must obtain the LOCAL AGENCY’s written agreement for DBE replacement.

CONSULTANT must find or demonstrate GFEs to find qualified DBE replacement firms to perform the work to the extent needed to meet the DBE commitment.

The following procedures shall be followed to request authorization to replace a DBE firm:

1. Submit a request to replace a DBE with other forces or material sources in writing to the LOCAL AGENCY which must include:
a. Description of remaining uncommitted work item made available for replacement DBE solicitation and participation.
b. The proposed DBE replacement firm's business information, the work they have agreed to perform, and the following:
• Description of scope of work and cost proposal
87 Item 6 C.

Local Assistance Procedures Manual Exhibit 10-R
Cliff Drive Resiliency Project

May 2023
• Proposed subcontract agreement and written confirmation of agreement to perform on the Contract
• Revised Exhibit 10-O2: Consultant Contract DBE Commitment

2. If CONSULTANT has not identified a DBE replacement firm, submits documentation of CONSULTANT’s GFEs to use DBE replacement firms within seven (7) days of LOCAL AGENCY's authorization to terminate the DBE. CONSULTANT may request the LOCAL AGENCY's approval to extend this submittal period to a total of 14 days. Submit documentation of actions taken to find a DBE replacement firm, such as:
• Search results of certified DBEs available to perform the original DBE work identified and or other work CONSULTANT had intended to self-perform, to the extent needed to meet DBE commitment
• Solicitations of DBEs for performance of work identified • Correspondence with interested DBEs that may have included contract details and requirements
• Negotiation efforts with DBEs that reflect why an agreement was not reached • If a DBE's quote was rejected, provide reasoning for the rejection, such as why the DBE was unqualified for the work, or why the price quote was unreasonable or excessive
• Copies of each DBE's and non-DBE's price quotes for work identified, as the LOCAL AGENCY may contact the firms to verify solicitation efforts and determine if the DBE quotes are substantially higher
• Additional documentation that supports CONSULTANT’s GFE The LOCAL AGENCY shall respond in writing to CONSULTANT’s DBE replacement request within five (5) business days.

F. Commitment and Utilization
The LOCAL AGENCY’s DBE program must include a monitoring and enforcement mechanism to ensure that DBE commitments reconcile to DBE utilization.

The LOCAL AGENCY shall request CONSULTANT to:

1. Notify the LOCAL AGENCY’s contract administrator or designated representative of any changes to its anticipated DBE participation

2. Provide this notification before starting the affected work

3. Maintain records including:
• Name and business address of each 1st-tier subconsultant • Name and business address of each DBE subconsultant, DBE vendor, and DBE trucking company, regardless of tier
• Date of payment and total amount paid to each business (see Exhibit 9-F: Monthly Disadvantaged Business Enterprise Payment)
If CONSULTANT is a DBE CONSULTANT, they shall include the date of work performed by their own forces and the corresponding value of the work.
88 Item 6 C.

Local Assistance Procedures Manual Exhibit 10-R
Cliff Drive Resiliency Project

May 2023
If a DBE is decertified before completing its work, the DBE must notify CONSULTANT in writing of the decertification date. If a business becomes a certified DBE before completing its work, the business must notify CONSULTANT in writing of the certification date. CONSULTANT shall submit the notifications to the LOCAL AGENCY. On work completion, CONSULTANT shall complete Exhibit 17-O: Disadvantaged Business Enterprises (DBE) Certification Status Change and submit the form to the LOCAL AGENCY within 30 days of contract acceptance.

Upon work completion, CONSULTANT shall complete Exhibit 17-F: Final Report – Utilization of Disadvantaged Business Enterprises (DBE), First-Tier Subcontractors and submit it to the LOCAL AGENCY within 90 days of contract acceptance. The LOCAL AGENCY will withhold $10,000 until the form is submitted. The LOCAL AGENCY will release the withhold upon submission of the completed form.

In the LOCAL AGENCY’s reports of DBE participation to Caltrans, the LOCAL AGENCY must display both commitments and attainments.

G. Commercially Useful Function
DBEs must perform a commercially useful function (CUF) under 49 CFR 26.55 when performing work or supplying materials listed on the DBE Commitment form. The DBE value of work will only count toward the DBE commitment if the DBE performs a CUF. A DBE performs a CUF when it is responsible for execution of the work of the AGREEMENT and is carrying out its responsibilities by actually performing, managing, and supervising the work involved. To perform a CUF, the DBE must also be responsible, with respect to materials and supplies used on the AGREEMENT, for negotiating price, determining quality and quantity, ordering the material and installing (where applicable), and paying for the material itself.

CONSULTANT must perform CUF evaluation for each DBE working on a federal-aid contract, with or without a DBE goal. Perform a CUF evaluation at the beginning of the DBE’s work and continue to monitor the performance of CUF for the duration of the project.

CONSULTANT must provide written notification to the LOCAL AGENCY at least 15 days in advance of each DBE's initial performance of work or supplying materials for the Contract. The notification must include the DBE's name, work the DBE will perform on the contract, and the location, date, and time of where their work will take place.

Within 10 days of a DBE initially performing work or supplying materials on the Contract, CONSULTANT shall submit to the LPA the initial evaluation and validation of DBE performance of a CUF using the LAPM 9-J: Disadvantaged Business Enterprise Commercially Useful Function Evaluation. Include the following information with the submittal:
• Subcontract agreement with the DBE
• Purchase orders
• Bills of lading
• Invoices
• Proof of payment
CONSULTANT must monitor all DBE’s performance of CUF by conducting quarterly evaluations and validations throughout their duration of work on the Contract using the LAPM 9-J: DBE Commercially Useful Function Evaluation. CONSULTANT must submit to the LOCAL AGENCY 89 Item 6 C.

Local Assistance Procedures Manual Exhibit 10-R
Cliff Drive Resiliency Project

May 2023
these quarterly evaluations and validations by the 5th of the month for the previous three months of work.

CONSULTANT must notify the LOCAL AGENCY immediately if they believe the DBE may not be performing a CUF.

The LOCAL AGENCY will verify DBEs performance of CUF by reviewing the initial and quarterly submissions of LAPM 9-J: DBE Commercially Useful Function Evaluation, submitted supporting information, field observations, and through any additional LOCAL AGENCY evaluations. The LOCAL AGENCY must evaluate DBEs and their CUF performance throughout the duration of a Contract. The LOCAL AGENCY will provide written notice to the CONSULTANT and the DBE at least two (2) business days prior to any evaluation. The CONSULTANT and the DBE must participate in the evaluation. Upon completing the evaluation, the LOCAL AGENCY must share the evaluation results with the CONSULTANT and the DBE. An evaluation could include items that must be remedied upon receipt. If the LOCAL AGENCY determines the DBE is not performing a CUF, the CONSULTANT must suspend performance of the noncompliant work.

CONSULTANT and DBEs must submit any additional CUF related records and documents within five (5) business days of LOCAL AGENCY’s request such as:
• Proof of ownership or lease and rental agreements for equipment • Tax records
• Employee rosters
• Certified payroll records
• Inventory rosters
Failure to submit required DBE Commercially Useful Function Evaluation forms or requested records and documents can result in withholding of payment for the value of work completed by the DBE.

If CONSULTANT and/or the LOCAL AGENCY determine that a listed DBE is not performing a CUF in performance of their DBE committed work, CONSULTANT must immediately suspend performance of the noncompliant portion of the work. LOCAL AGENCY may deny payment for the noncompliant portion of the work. LOCAL AGENCY will ask the CONSULTANT to submit a corrective action plan (CAP) to the LOCAL AGENGY within five (5) days of the noncompliant CUF determination. The CAP must identify how the CONSULTANT will correct the noncompliance findings for the remaining portion of the DBE's work. LOCAL AGENCY has five (5) days to review the CAP in conjunction with the CONSULTANT’s review. The CONSULTANT must implement the CAP within five (5) days of the LOCAL AGENCY's approval. The LOCAL AGENCY will then authorize the prior noncompliant portion of work for the DBE's committed work.

If corrective actions cannot be accomplished to ensure the DBE performs a commercially useful function on the Contract, CONSULTANT may have good cause to request termination of the DBE.

H. A DBE does not perform a CUF if its role is limited to that of an extra participant in a transaction, AGREEMENT, or project through which funds are passed in order to obtain the appearance of DBE participation. In determining whether a DBE is such an extra participant, examine similar transactions, particularly those in which DBEs do not participate.

I. If a DBE does not perform or exercise responsibility for at least thirty percent (30%) of the total cost of its AGREEMENT with its own work force, or the DBE subcontracts a greater portion of the work 90 Item 6 C.

Local Assistance Procedures Manual Exhibit 10-R
Cliff Drive Resiliency Project

May 2023
of the AGREEMENT than would be expected on the basis of normal industry practice for the type of work involved, it will be presumed that it is not performing a CUF.

J. CONSULTANT shall maintain records of materials purchased or supplied from all subcontracts entered into with certified DBEs. The records shall show the name and business address of each DBE or vendor and the total dollar amount actually paid each DBE or vendor, regardless of tier.

The records shall show the date of payment and the total dollar figure paid to all firms. DBE CONSULTANT’s shall also show the date of work performed by their own forces along with the corresponding dollar value of the work.

K. If a DBE subconsultant is decertified during the life of the AGREEMENT, the decertified subconsultant shall notify CONSULTANT in writing with the date of decertification. If a subconsultant becomes a certified DBE during the life of the AGREEMENT, the subconsultant shall notify CONSULTANT in writing with the date of certification. Any changes should be reported to LOCAL AGENCY’s Contract Administrator within thirty (30) calendar days.

L. For projects awarded on or after March 1, 2020, but before September 1, 2023: after submitting an invoice for reimbursement that includes a payment to a DBE, but no later than the 10th of the following month, the prime contractor/consultant must complete and email Exhibit 9-F:

Disadvantaged Business Enterprise Running Tally of Payments to [email protected] with a copy to local administering agencies.

For projects awarded on or after September 1, 2023: Exhibit 9-F is no longer required. Instead, by the 15th of the month following the month of any payment(s), the CONSULTANT must now submit Exhibit 9-P to the LOCAL AGENCY administering the contract. If the CONSULTANT does not make any payments to subconsultants, supplier(s), and/or manufacturers they must report “no payments were made to subs this month” and write this visibly and legibly on Exhibit 9-P.

M. Any subcontract entered into as a result of this AGREEMENT shall contain all of the provisions of this section.

ARTICLE XIX INSURANCE
[Choose either Option 1 or Option 2]
[Option 1 - for AGREEMENT with a scope of services that may require the CONSULTANT or subconsultant to work within the operating state or Local Agency Highway Right of Way; where there would be exposure to public traffic or construction operations.] A. Prior to commencement of the work described herein, CONSULTANT shall furnish LOCAL AGENCY a Certificate of Insurance stating that there is general comprehensive liability insurance presently in effect for CONSULTANT with a combined single limit (CSL) of not less than one million dollars ($1,000,000) per occurrence.

B. The Certificate of Insurance will provide:

1. That the insurer will not cancel the insured’s coverage without thirty (30) calendar days prior written notice to LOCAL AGENCY.

2. That LOCAL AGENCY, its officers, agents, employees, and servants are included as additional insureds, but only insofar as the operations under this AGREEMENT are concerned.

3. That LOCAL AGENCY will not be responsible for any premiums or assessments on the policy.
91 Item 6 C.

Local Assistance Procedures Manual Exhibit 10-R
Cliff Drive Resiliency Project

May 2023
C. CONSULTANT agrees that the bodily injury liability insurance herein provided for, shall be in effect at all times during the term of this AGREEMENT. In the event said insurance coverage expires at any time or times during the term of this AGREEMENT, CONSULTANT agrees to provide at least thirty (30) calendar days prior notice to said expiration date; and a new Certificate of Insurance evidencing insurance coverage as provided for herein, for not less than either the remainder of the term of the AGREEMENT, or for a period of not less than one (1) year. New Certificates of Insurance are subject to the approval of LOCAL AGENCY. In the event CONSULTANT fails to keep in effect at all times insurance coverage as herein provided, LOCAL AGENCY may, in addition to any other remedies it may have, terminate this AGREEMENT upon occurrence of such event.
[Option 2 - for AGREEMENTs with a scope of services that will not require the CONSULTANT or subconsultant to work within the operating state or Local Agency Highway Right of Way where there would be exposure to public traffic or construction CONSULTANT operations.] CONSULTANT is not required to show evidence of general comprehensive liability insurance.

ARTICLE XX FUNDING REQUIREMENTS
A. It is mutually understood between the parties that this AGREEMENT may have been written before ascertaining the availability of funds or appropriation of funds, for the mutual benefit of both parties, in order to avoid program and fiscal delays that would occur if the AGREEMENT were executed after that determination was made.

B. This AGREEMENT is valid and enforceable only if sufficient funds are made available to LOCAL AGENCY for the purpose of this AGREEMENT. In addition, this AGREEMENT is subject to any additional restrictions, limitations, conditions, or any statute enacted by the Congress, State Legislature, or LOCAL AGENCY governing board that may affect the provisions, terms, or funding of this AGREEMENT in any manner.

C. It is mutually agreed that if sufficient funds are not appropriated, this AGREEMENT may be amended to reflect any reduction in funds.

D. LOCAL AGENCY has the option to terminate the AGREEMENT pursuant to Article VI Termination, or by mutual agreement to amend the AGREEMENT to reflect any reduction of funds.

ARTICLE XXI CHANGE IN TERMS
A. This AGREEMENT may be amended or modified only by mutual written agreement of the parties.

B. CONSULTANT shall only commence work covered by an amendment after the amendment is executed and notification to proceed has been provided by LOCAL AGENCY’s Contract Administrator.

C. There shall be no change in CONSULTANT’s Project Manager or members of the project team, as listed in the approved Cost Proposal, which is a part of this AGREEMENT without prior written approval by LOCAL AGENCY’s Contract Administrator.

ARTICLE XXII CONTINGENT FEE
CONSULTANT warrants, by execution of this AGREEMENT that no person or selling agency has been employed, or retained, to solicit or secure this AGREEMENT upon an agreement or understanding, for a commission, percentage, brokerage, or contingent fee, excepting bona fide employees, or bona fide established commercial or selling agencies maintained by CONSULTANT for the purpose of securing 92 Item 6 C.

Local Assistance Procedures Manual Exhibit 10-R
Cliff Drive Resiliency Project

May 2023
business. For breach or violation of this warranty, LOCAL AGENCY has the right to annul this AGREEMENT without liability; pay only for the value of the work actually performed, or in its discretion to deduct from the AGREEMENT price or consideration, or otherwise recover the full amount of such commission, percentage, brokerage, or contingent fee.

ARTICLE XXIII DISPUTES
Prior to either party commencing any legal action under this AGREEMENT, the parties agree to try in good faith, to settle any dispute amicably between them. If a dispute has not been settled after forty-five (45) days of good-faith negotiations and as may be otherwise provided herein, then either party may commence legal action against the other.
[Choose either Option 1 or Option 2]
[Option 1 - Use paragraphs A through C below for all AGREEMENTs without PS&E submittal] A. Any dispute, other than audit, concerning a question of fact arising under this AGREEMENT that is not disposed of by agreement shall be decided by a committee consisting of LOCAL AGENCY’s Contract Administrator and (Insert Department Head or Official), who may consider written or verbal information submitted by CONSULTANT.

B. Not later than thirty (30) calendar days after completion of all work under the AGREEMENT, CONSULTANT may request review by LOCAL AGENCY Governing Board of unresolved claims or disputes, other than audit. The request for review will be submitted in writing.

C. Neither the pendency of a dispute, nor its consideration by the committee will excuse CONSULTANT from full and timely performance in accordance with the terms of this AGREEMENT. [Option 2 - Replace Paragraph B, above, with the following for AGREEMENTs requiring the submission of PS&E]
B. Not later than thirty (30) calendar days after completion of all deliverables necessary to complete the plans, specifications and estimate, CONSULTANT may request review by LOCAL AGENCY Governing Board of unresolved claims or disputes, other than audit. The request for review will be submitted in writing.

ARTICLE XXIV INSPECTION OF WORK
CONSULTANT and any subconsultant shall permit LOCAL AGENCY, the State, and the FHWA if federal participating funds are used in this AGREEMENT; to review and inspect the project activities and files at all reasonable times during the performance period of this AGREEMENT.

ARTICLE XXV SAFETY
A. CONSULTANT shall comply with OSHA regulations applicable to CONSULTANT regarding necessary safety equipment or procedures. CONSULTANT shall comply with safety instructions issued by LOCAL AGENCY Safety Officer and other LOCAL AGENCY representatives.

CONSULTANT personnel shall wear hard hats and safety vests at all times while working on the construction project site.

B. Pursuant to the authority contained in Vehicle Code §591, LOCAL AGENCY has determined that such areas are within the limits of the project and are open to public traffic. CONSULTANT shall comply with all of the requirements set forth in Divisions 11, 12, 13, 14, and 15 of the Vehicle Code.

CONSULTANT shall take all reasonably necessary precautions for safe operation of its vehicles and the protection of the traveling public from injury and damage from such vehicles. 93 Item 6 C.

Local Assistance Procedures Manual Exhibit 10-R
Cliff Drive Resiliency Project

May 2023
C. Any subcontract entered into as a result of this contract, shall contain all of the provisions of this Article.
[Add the following paragraph to all AGREEMENTs, which may require trenching of five feet or deeper] D. CONSULTANT must have a Division of Occupational Safety and Health (CAL-OSHA) permit(s), as outlined in Labor Code §6500 and §6705, prior to the initiation of any practices, work, method, operation, or process related to the construction or excavation of trenches which are five (5) feet or deeper.

ARTICLE XXVI OWNERSHIP OF DATA
A. It is mutually agreed that all materials prepared by CONSULTANT under this AGREEMENT shall become the property of City, and CONSULTANT shall have no property right therein whatsoever.

Immediately upon termination, City shall be entitled to, and CONSULTANT shall deliver to City, reports, investigations, appraisals, inventories, studies, analyses, drawings and data estimates performed to that date, whether completed or not, and other such materials as may have been prepared or accumulated to date by CONSULTANT in performing this AGREEMENT which is not CONSULTANT’s privileged information, as defined by law, or CONSULTANT’s personnel information, along with all other property belonging exclusively to City which is in CONSULTANT’s possession. Publication of the information derived from work performed or data obtained in connection with services rendered under this AGREEMENT must be approved in writing by City.

B. Additionally, it is agreed that the Parties intend this to be an AGREEMENT for services and each considers the products and results of the services to be rendered by CONSULTANT hereunder to be work made for hire. CONSULTANT acknowledges and agrees that the work (and all rights therein, including, without limitation, copyright) belongs to and shall be the sole and exclusive property of City without restriction or limitation upon its use or dissemination by City.

C. Nothing herein shall constitute or be construed to be any representation by CONSULTANT that the work product is suitable in any way for any other project except the one detailed in this Contract.

Any reuse by City for another project or project location shall be at City’s sole risk.

D. Applicable patent rights provisions regarding rights to inventions shall be included in the contracts as appropriate (48 CFR 27 Subpart 27.3 - Patent Rights under Government Contracts for federalaid contracts).

E. LOCAL AGENCY may permit copyrighting reports or other agreement products. If copyrights are permitted; the AGREEMENT shall provide that the FHWA shall have the royalty-free nonexclusive and irrevocable right to reproduce, publish, or otherwise use; and to authorize others to use, the work for government purposes.

ARTICLE XXVII CLAIMS FILED BY LOCAL AGENCY’s CONSTRUCTION CONTRACTOR A. If claims are filed by LOCAL AGENCY’s construction contractor relating to work performed by CONSULTANT’s personnel, and additional information or assistance from CONSULTANT’s personnel is required in order to evaluate or defend against such claims; CONSULTANT agrees to make its personnel available for consultation with LOCAL AGENCY’S construction contract administration and legal staff and for testimony, if necessary, at depositions and at trial or arbitration proceedings.

B. CONSULTANT’s personnel that LOCAL AGENCY considers essential to assist in defending against construction contractor claims will be made available on reasonable notice from LOCAL AGENCY. 94 Item 6 C.

Local Assistance Procedures Manual Exhibit 10-R
Cliff Drive Resiliency Project

May 2023
Consultation or testimony will be reimbursed at the same rates, including travel costs that are being paid for CONSULTANT’s personnel services under this AGREEMENT.

C. Services of CONSULTANT’s personnel in connection with LOCAL AGENCY’s construction contractor claims will be performed pursuant to a written contract amendment, if necessary, extending the termination date of this AGREEMENT in order to resolve the construction claims.

ARTICLE XXVIII CONFIDENTIALITY OF DATA
A. All financial, statistical, personal, technical, or other data and information relative to LOCAL AGENCY’s operations, which are designated confidential by LOCAL AGENCY and made available to CONSULTANT in order to carry out this AGREEMENT, shall be protected by CONSULTANT from unauthorized use and disclosure.

B. Permission to disclose information on one occasion, or public hearing held by LOCAL AGENCY relating to the AGREEMENT, shall not authorize CONSULTANT to further disclose such information, or disseminate the same on any other occasion.

C. CONSULTANT shall not comment publicly to the press or any other media regarding the AGREEMENT or LOCAL AGENCY’s actions on the same, except to LOCAL AGENCY’s staff, CONSULTANT’s own personnel involved in the performance of this AGREEMENT, at public hearings, or in response to questions from a Legislative committee.

D. CONSULTANT shall not issue any news release or public relations item of any nature, whatsoever, regarding work performed or to be performed under this AGREEMENT without prior review of the contents thereof by LOCAL AGENCY, and receipt of LOCAL AGENCY’S written permission.

E. Any subcontract entered into as a result of this contract shall contain all of the provisions of this Article.
[For PS&E contracts add paragraph F, below, to paragraphs A through E, above] F. All information related to the construction estimate is confidential, and shall not be disclosed by CONSULTANT to any entity, other than LOCAL AGENCY, Caltrans, and/or FHWA. All of the materials prepared or assembled by CONSULTANT pursuant to performance of this Contract are confidential and CONSULTANT agrees that they shall not be made available to any individual or organization without the prior written approval of City or except by court order. If CONSULTANT or any of its officers, employees, or subcontractors does voluntarily provide information in violation of this Contract, City has the right to reimbursement and indemnity from CONSULTANT for any damages caused by CONSULTANT releasing the information, including, but not limited to, City’s attorney’s fees and disbursements, including without limitation experts’ fees and disbursements.

ARTICLE XXIX NATIONAL LABOR RELATIONS BOARD CERTIFICATION In accordance with Public Contract Code §10296, CONSULTANT hereby states under penalty of perjury that no more than one final unappealable finding of contempt of court by a federal court has been issued against CONSULTANT within the immediately preceding two-year period, because of CONSULTANT’s failure to comply with an order of a federal court that orders CONSULTANT to comply with an order of the National Labor Relations Board.
95 Item 6 C.

Local Assistance Procedures Manual Exhibit 10-R
Cliff Drive Resiliency Project

May 2023

ARTICLE XXX EVALUATION OF CONSULTANT
CONSULTANT’s performance will be evaluated by LOCAL AGENCY. A copy of the evaluation will be sent to CONSULTANT for comments. The evaluation together with the comments shall be retained as part of the AGREEMENT record.

ARTICLE XXXI PROMPT PAYMENT
A. PROMPT PAYMENT FROM LOCAL AGENCY TO CONSULTANT
The LOCAL AGENCY shall make all project progress payment within 30 days after receipt of an undisputed and properly submitted payment request from CONSULTANT on a professional service contract. If the LOCAL AGENCY fails to pay promptly, the LOCAL AGENCY shall pay interest to the CONSULTANT, which accrues at the rate of 10 percent per annum on the principal amount of a money judgment remaining unsatisfied and pro-rated as necessary. Upon receipt of the payment request, the LOCAL AGENCY shall act in accordance with both of the following:
(1) The LOCAL AGENCY shall review each payment request as soon as feasible after receipt to verify it is a proper payment request.
(2) The LOCAL AGENCY must return any payment request deemed improper by the LOCAL AGENCY to the CONSULTANT as soon as feasible, but not later than seven (7) days, after receipt. A request returned pursuant to this paragraph shall include documentation setting forth in writing the reasons why it is an improper payment request.

B. PROMPT PAYMENT CERTIFICATION
For projects awarded on or after September 1, 2023: the CONSULTANT must now submit Exhibit 9-P to the LOCAL AGENCY administering the contract by the 15th of the month following the month of any payment(s). If the CONSULTANT does not make any payments to subconsultants, supplier(s), and/or manufacturers they must report “no payments were made to subs this month” and write this visibly and legibly on Exhibit 9-P.

The LOCAL AGENCY must verify all Exhibit 9-P information, monitor compliance with prompt payment requirements for DBE and non-DBE firms, and address any shortfalls to the DBE commitment and prompt payment issues until the end of the project. The LOCAL AGENCY must email a copy of Exhibit 9-P to [email protected] before the end of the month after receiving the Exhibit 9-P from the CONSULTANT.

ARTICLE XXXII TITLE VI ASSURANCES
APPENDICES A - E of the TITLE VI ASSURANCES
[The U.S. Department of Transportation Order No.1050.2A requires all federal-aid Department of Transportation contracts between an agency and a consultant to contain Appendices A and E of the Title VI Assurances. Include Appendices B, C, and D if appliable as shown below. In addition, the consultant must include the Title VI Assurances Appendices A and E, and if applicable Appendices B, C, and D in all subcontracts to perform work under the contract.

The clauses of Appendix B of this Assurance shall be included as a covenant running with the land, in any deed from the United States effecting or recording a transfer of real property, structures, use, or improvements thereon or interest therein to a LOCAL AGENCY. 96 Item 6 C.

Local Assistance Procedures Manual Exhibit 10-R
Cliff Drive Resiliency Project

May 2023
The clauses set forth in Appendix C and Appendix D of this Assurance shall be included as a covenant running with the land, in any future deeds, leases, licenses, permits, or similar instruments entered into by the LOCAL AGENCY with other parties:
a. for the subsequent transfer of real property acquired or improved under the applicable activity, project, or program; and
b. for the construction or use of, or access to, space on, over, or under real property acquired or improved under the applicable activity, project, or program.]

APPENDIX A
During the performance of this Agreement, the contractor, for itself, its assignees and successors in interest (hereinafter collectively referred to as CONSULTANT) agrees as follows:
a. Compliance with Regulations: CONSULTANT shall comply with the regulations relative to nondiscrimination in federally assisted programs of the Department of Transportation, Title 49, Code of Federal Regulations, Part 21, as they may be amended from time to time, (hereinafter referred to as the REGULATIONS), which are herein incorporated by reference and made a part of this agreement.
b. Nondiscrimination: CONSULTANT, with regard to the work performed by it during the AGREEMENT, shall not discriminate on the grounds of race, color, sex, national origin, religion, age, or disability in the selection and retention of sub-applicants, including procurements of materials and leases of equipment. CONSULTANT shall not participate either directly or indirectly in the discrimination prohibited by Section 21.5 of the Regulations, including employment practices when the agreement covers a program set forth in Appendix B of the Regulations.
c. Solicitations for Sub-agreements, Including Procurements of Materials and Equipment: In all solicitations either by competitive bidding or negotiation made by CONSULTANT for work to be performed under a Sub- agreement, including procurements of materials or leases of equipment, each potential sub-applicant or supplier shall be notified by CONSULTANT of the CONSULTANT’S obligations under this Agreement and the Regulations relative to nondiscrimination on the grounds of race, color, or national origin. d. Information and Reports: CONSULTANT shall provide all information and reports required by the Regulations, or directives issued pursuant thereto, and shall permit access to its books, records, accounts, other sources of information, and its facilities as may be determined by the recipient or FHWA to be pertinent to ascertain compliance with such Regulations or directives. Where any information required of CONSULTANT is in the exclusive possession of another who fails or refuses to furnish this information, CONSULTANT shall so certify to the recipient or FHWA as appropriate, and shall set forth what efforts CONSULTANT has made to obtain the information. e. Sanctions for Noncompliance: In the event of CONSULTANT’s noncompliance with the nondiscrimination provisions of this agreement, the recipient shall impose such agreement sanctions as it or the FHWA may determine to be appropriate, including, but not limited to:
i. withholding of payments to CONSULTANT under the Agreement within a reasonable period of time, not to exceed 90 days; and/or
ii. cancellation, termination or suspension of the Agreement, in whole or in part. 97 Item 6 C.

Local Assistance Procedures Manual Exhibit 10-R
Cliff Drive Resiliency Project

May 2023
f. Incorporation of Provisions: CONSULTANT shall include the provisions of paragraphs (1) through (6) in every sub-agreement, including procurements of materials and leases of equipment, unless exempt by the Regulations, or directives issued pursuant thereto.

CONSULTANT shall take such action with respect to any sub-agreement or procurement as the recipient or FHWA may direct as a means of enforcing such provisions including sanctions for noncompliance, provided, however, that, in the event CONSULTANT becomes involved in, or is threatened with, litigation with a sub-applicant or supplier as a result of such direction, CONSULTANT may request the recipient enter into such litigation to protect the interests of the State, and, in addition, CONSULTANT may request the United States to enter into such litigation to protect the interests of the United States.

APPENDIX B

CLAUSES FOR DEEDS TRANSFERRING UNITED STATES PROPERTY
The following clauses will be included in deeds effecting or recording the transfer of real property, structures, or improvements thereon, or granting interest therein from the United States pursuant to the provisions of Assurance 4:

NOW THEREFORE, the U.S. Department of Transportation as authorized by law and upon the condition that the recipient will accept title to the lands and maintain the project constructed thereon in accordance with Title 23 U.S.C., the regulations for the administration of the preceding statute, and the policies and procedures prescribed by the FHWA of the U.S. Department of Transportation in accordance and in compliance with all requirements imposed by Title 49, Code of Federal Regulations, U.S. Department of Transportation, Subtitle A, Office of the Secretary, Part 21, Non-discrimination in Federally-assisted programs of the U.S. Department of Transportation pertaining to and effectuating the provisions of Title VI of the Civil Rights Act of 1964 (78 Stat. 252; 42 U.S.C. § 2000d to 2000d-4), does hereby remise, release, quitclaim and convey unto the recipient all the right, title and interest of the U.S.

Department of Transportation in and to said lands described in Exhibit A attached hereto and made a part hereof.
(HABENDUM CLAUSE)
TO HAVE AND TO HOLD said lands and interests therein unto the recipient and its successors forever, subject, however, to the covenants, conditions, restrictions and reservations herein contained as follows, which will remain in effect for the period during which the real property or structures are used for a purpose for which Federal financial assistance is extended or for another purpose involving the provision of similar services or benefits and will be binding on the recipient, its successors and assigns. The recipient, in consideration of the conveyance of said lands and interest in lands, does hereby covenant and agree as a covenant running with the land for itself, its successors and assigns, that (1) no person will on the grounds of race, color, or national origin, be excluded from participation in, be denied the benefits of, or be otherwise subjected to discrimination with regard to any facility located wholly or in part on, over, or under such lands hereby conveyed [,] [and]* (2) that the recipient will use the lands and interests in lands and interest in lands so conveyed, in compliance with all requirements imposed by or pursuant to Title 49, Code of Federal Regulations, U.S. Department of Transportation, Subtitle A, Office of the Secretary, Part 21, Non-discrimination in Federally-assisted programs of the U.S. Department of Transportation, Effectuation of Title VI of the Civil Rights Act of 1964, and as said Regulations and Acts may be amended [, and (3) that in the event of breach of any of the abovementioned non-discrimination conditions, the Department will have a right to enter or re-enter said lands and facilities on said lands, and that above described land and facilities will thereon revert to and vest in and become the absolute property of the U.S. Department of Transportation and its assigns as such interest existed prior to this instruction].*
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May 2023
(*Reverter clause and related language to be used only when it is determined that such a clause is necessary in order to make clear the purpose of Title VI.)

APPENDIX C

CLAUSES FOR TRANSFER OF REAL PROPERTY ACQUIRED OR IMPROVED UNDER THE

ACTIVITY, FACILITY, OR PROGRAM
The following clauses will be included in deeds, licenses, leases, permits, or similar instruments entered into by the recipient pursuant to the provisions of Assurance 7(a):

A. The (grantee, lessee, permittee, etc. as appropriate) for himself/herself, his/her heirs, personal representatives, successors in interest, and assigns, as a part of the consideration hereof, does hereby covenant and agree [in the case of deeds and leases add “as a covenant running with the land”] that:

1. In the event facilities are constructed, maintained, or otherwise operated on the property described in this (deed, license, lease, permit, etc.) for a purpose for which a U.S.

Department of Transportation activity, facility, or program is extended or for another purpose involving the provision of similar services or benefits, the (grantee, licensee, lessee, permittee, etc.) will maintain and operate such facilities and services in compliance with all requirements imposed by the Acts and Regulations(as may be amended) such that no person on the grounds of race, color, or national origin, will be excluded from participation in, denied the benefits of, or be otherwise subjected to discrimination in the use of said facilities.

B. With respect to licenses, leases, permits, etc., in the event of breach of any of the above Nondiscrimination covenants, the recipient will have the right to terminate the (lease, license, permit, etc.) and to enter, re-enter, and repossess said lands and facilities thereon, and hold the same as if the (lease, license, permit, etc.) had never been made or issued.* C. With respect to a deed, in the event of breach of any of the above Non-discrimination covenants, the recipient will have the right to enter or re-enter the lands and facilities thereon, and the above described lands and facilities will there upon revert to and vest in and become the absolute property of the recipient and its assigns.* (*Reverter clause and related language to be used only when it is determined that such a clause is necessary to make clear the purpose of Title VI.)

APPENDIX D

CLAUSES FOR CONSTRUCTION/USE/ACCESS TO REAL PROPERTY ACQUIRED UNDER THE

ACTIVITY, FACILITY OR PROGRAM
The following clauses will be included in deeds, licenses, permits, or similar instruments/agreements entered into by the recipient pursuant to the provisions of Assurance 7(b):

A. The (grantee, licensee, permittee, etc., as appropriate) for himself/herself, his/her heirs, personal representatives, successors in interest ,and assigns, as a part of the consideration hereof, does hereby covenant and agree (in the case of deeds and leases add, “as a covenant running with the land”) that (1) no person on the ground of race, color, or national origin, will be excluded from participation in, denied the benefits of, or be otherwise subjected to discrimination in the use of said facilities, (2) that in the construction of any improvements on, 99 Item 6 C.

Local Assistance Procedures Manual Exhibit 10-R
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over, or under such land, and the furnishings of services thereon, no person on the ground of race, color, or national origin, will be excluded from participation in, denied the benefits or, or otherwise be subjected to discrimination, (3) that the (grantee, licensee, lessee, permittee, etc.) will use the premises in compliance with all other requirements imposed by or pursuant to the Acts and Regulations, as amended, set forth in this Assurance.

B. With respect to (licenses, leases, permits, etc.) in the event of breach of any of the above of the above Non-discrimination covenants, the recipient will have the right to terminate the (license, permits, etc., as appropriate) and to enter or re-enter and repossess said land and the facilities thereon, and hold the same as if said (license, permit, etc., as appropriate) had never been made or issued.*
C. With respect to deeds, in the event of breach of any of the above Non-discrimination covenants, the recipient will there upon revert to and vest in and become the absolute property of the recipient and its assigns.

APPENDIX E
During the performance of this contract, the CONSULTANT, for itself, its assignees, and successors in interest (hereinafter referred to as the “CONSULTANT”) agrees to comply with the following nondiscrimination statutes and authorities, including, but not limited to:

Pertinent Non-Discrimination Authorities:
• Title VI of the Civil Rights Act of 1964 (42 U.S.C. § 2000d et seq., 78 stat. 252), prohibits discrimination on the basis of race, color, national origin); and 49 CFR Part 21. • The Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970, (42 U.S.C. § 4601), (prohibits unfair treatment of persons displaced or whose property has been acquired because of Federal or Federal-aid programs and projects); • Federal-Aid Highway Act of 1973, (23 U.S.C. § 324 et seq.), prohibits discrimination on the basis of sex;
• Section 504 of the Rehabilitation Act of 1973, (29 U.S.C. § 794 et seq.), as amended, (prohibits discrimination on the basis of disability); and 49 CR Part 27; • The Age Discrimination Act of 1975, as amended, (42 U.S.C. § 6101 et seq.), prohibits discrimination on the basis of age);
• Airport and Airway Improvement Act of 1982, (49 U.S.C. § 471, Section 47123), as amended, (prohibits discrimination based on race, creed, color, national origin, or sex); • The Civil Rights Restoration Act of 1987, (PL 100-209), (Broadened the scope, coverage and applicability of Title VI of the Civil Rights Act of 1964, The Age Discrimination Act of 1975 and Section 504 of the Rehabilitation Act of 1973, by expanding the definition of the terms “programs or activities” to include all of the programs or activities of the Federal-aid recipients, sub-recipients and contractors, whether such programs or activities are Federally funded or not);
• Titles II and III of the Americans with Disabilities Act, which prohibit discrimination of the basis of disability in the operation of public entities, public and private transportation systems, places of 100
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Local Assistance Procedures Manual Exhibit 10-R
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public accommodation, and certain testing entities (42 U.S.C. §§ 12131 – 12189) as implemented by Department of Transportation regulations 49 C.F.R. parts 37 and 38; • The Federal Aviation Administration’s Non-discrimination statute (49 U.S.C. § 47123) (prohibits discrimination on the basis of race, color, national origin, and sex); • Executive Order 12898, Federal Actions to Address Environmental Justice in Minority Populations and Low-Income Populations, which ensures discrimination against minority populations by discouraging programs, policies, and activities with disproportionately high and adverse human health or environmental effects on minority and low-income populations; • Executive Order 13166, Improving Access to Services for Persons with Limited English Proficiency, and resulting agency guidance, national origin discrimination includes discrimination because of Limited English Proficiency (LEP). To ensure compliance with Title VI, you must take reasonable steps to ensure that LEP persons have meaningful access to your programs (70 Fed. Reg. at 74087 to 74100);
• Title IX of the Education Amendments of 1972, as amended, which prohibits you from discriminating because of sex in education programs or activities (20 U.S.C.1681 et seq).

ARTICLE XXXIII NOTIFICATION
All notices hereunder and communications regarding interpretation of the terms of this AGREEMENT and changes thereto, shall be effected by the mailing thereof by registered or certified mail, return receipt requested, postage prepaid, and addressed as follows:

CONSULTANT:
(CONSULTANT)
(NAME) ,Project Manager
(ADDRESS)
LOCAL AGENCY:
(LOCAL AGENCY)
(NAME) , Contract Administrator
(ADDRESS)

ARTICLE XXXIV CONTRACT
The two parties to this AGREEMENT, who are the before named CONSULTANT and the before named LOCAL AGENCY, hereby agree that this AGREEMENT constitutes the entire AGREEMENT which is made and concluded in duplicate between the two parties. Both of these parties for and in consideration of the payments to be made, conditions mentioned, and work to be performed; each agree to diligently perform in accordance with the terms and conditions of this AGREEMENT as evidenced by the signatures below.
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Local Assistance Procedures Manual Exhibit 10-R
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May 2023

ARTICLE XXXV SIGNATURES
(Name of LOCAL AGENCY) (Name of CONSULTANT)
(Signature)
(Name of Signer)
(Signature)
(Name of Signer)
Date: Date:
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Capitola City Council
Agenda Report
Meeting: November 9, 2023
From: Police Department
Subject: 2023 Holiday Parking
Recommended Action: Authorize the suspension of parking meter and pay station operation to allow free three-hour parking in the Village Parking Meter Zone A (1) from November 23, 2023, through December 25, 2023.

Background: The Capitola Business Improvement Association (BIA) has submitted its annual request to City Council to offer free three-hour parking in the Village during the holiday season. City Council has authorized this program since 2001, with only one exception in 2003.

Discussion: The three-hour parking limit and the paid parking encourage parking rotation, which benefits Village businesses. Although the Village is less congested in late-fall through early- winter than in the late-spring through early-fall, the need for time-limited parking still prevails.

The Capitola BIA has submitted a letter requesting that the Council authorize suspending parking meter and pay station operation to allow free three-hour parking in the Village from November 23, 2023, through December 25, 2023, to encourage holiday shopping and dining (Attachment 1).

Fiscal Impact: Staff estimates that in 2022, the suspension of the Village parking meters and pay stations reduced parking meter revenue by $40,000. The Fiscal Year 2023-2024 budget accounts for suspending Village meter and pay station operation for the holiday shopping period.

Attachments:

1. BIA Holiday Parking Request
Report Prepared By: Andrew Dally, Chief of Police
Reviewed By: Julia Gautho, City Clerk
Approved By: Jamie Goldstein, City Manager
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October 19, 2023
Capitola City Council
City of Capitola
420 Capitola Ave
Capitola, CA 95010
Dear City Council,
The Capitola Village and Wharf BIA requests your consideration of the annual free parking during the upcoming holiday. Traditionally the 3 hour parking is free from Thanksgiving day through Christmas.

We understand that free parking comes at a substantial price.

However, our customers and visitors as well as the residents of Capitola have come to count on this generous policy of the city.

The businesses in Capitola Village appreciate your considering our request.

Sincerely,
Anthony Guajardo
Chair, Capitola Village and Wharf BIA

CAPITOLA VILLAGE & WHARF BUSINESS IMPROVEMENT AREA
P.O. BOX 806, CAPITOLA, CA 95010

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Capitola City Council
Agenda Report
Meeting: November 9, 2023
From: Community Development Department
Subject: 1098 38th Avenue Project
Recommended Action: Adopt a resolution authorizing the City Manager to finalize the loan agreement with MidPen Housing to assist with predevelopment activities for a 100% affordable multifamily rental housing development located at 1098 38th Avenue.

Background: On March 10, 2023, MidPen Housing, a local non-profit affordable housing developer, acquired 1098 38th Avenue. Upon acquiring the property, the non-profit approached City staff with a request for $250,000 of funding for predevelopment planning costs.

On June 22, 2023, the City Council received a presentation on a future 100% affordable multifamily rental housing development located at 1098 38th Avenue and directed staff to prepare a loan agreement to assist with predevelopment activities.

Analysis: MidPen Housing intends to construct a 100% affordable housing development at 1098 38th Avenue. Since acquiring the site, the non-profit has been working on buildout scenarios for the site. After much consideration, MidPen has decided to pursue a 52-unit, multifamily housing development.

Recently, MidPen hired Architects FORA to design the future multifamily housing development. MidPen is requested $250,000 for predevelopment planning of the project, including $200,000 for architectural design, $32,000 for civil and survey costs, and $19,800 for geotechnical reports and testing, with the expectation that the City would consider providing additional construction funding in the future.

The City has approximately $2 million in funds in the Housing Successor Agency Fund due to a recent loan pay-off. The Housing Successor Agency funds may be utilized for the new construction of an affordable housing development for households earning 80 percent or less of the area median income (AMI).

The City Attorney’s office prepared a loan agreement in the amount of $250,000 to assist with predevelopment planning of 1098 38th Avenue utilizing the Housing Successor Agency Funds (Attachment 2).

Fiscal Impact: The City has approximately $2 million in the Housing Successor Agency Fund. MidPen’s request for $250,000 will be fully funded through the Housing Successor Agency fund.

Attachments:

1. Resolution

2. Loan Agreement
Report Prepared By: Katie Herlihy, Community Development Director Reviewed By: Julia Moss, City Clerk; Samantha Zutler, City Attorney Approved By: Jamie Goldstein, City Manager
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RESOLUTION NO.

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CAPITOLA

AUTHORIZING A PREDEVELOPMENT LOAN AGREEMENT WITH MP RAIL TRAIL

ASSOCIATES, LP, A CALIFORNIA LIMITED PARTNESHIP, FOR AN AFFORDABLE HOUSING DEVELOPMENT AT 1098 38th AVENUE, CAPITOLA, CA, 95010 WHEREAS, MP Rail Trail Associates, LP, a California limited partnership (“Borrower”), an entity controlled by Mid-Peninsula San Carlos Corporation, a California nonprofit public benefit corporation, is the owner of approximately 1.97 acres of real property located at 1098 38th Avenue, Capitola, California (“Property”); and
WHEREAS, the Borrower desires to construct and operate a multi-family residential housing development on the Property affordable to households earning 30% to 80% of Area Median Income (“AMI”) for Santa Cruz County (“Project”). The City desires that the Property be developed to create affordable housing to help provide units affordable to low, very-low and extremely-low income households, consistent with the City’s adopted Housing Element; and WHEREAS, the Borrower will incur several predevelopment expenses (“Predevelopment Costs”) in connection with assessing the Project’s feasibility, designing the Project, and applying for governmental approvals necessary to construct the Project; and WHEREAS, the Borrower has requested funding from the City to pay for a portion of the Predevelopment Costs, and upon satisfaction of the conditions precedent set forth in the Predevelopment Loan Agreement, attached to this resolution as Exhibit A, and evidenced by a predevelopment note and predevelopment deed of trust (as defined in the Predevelopment Loan Agreement), the City has agreed to use funds in its Low and Moderate Income Housing Asset Fund established pursuant to Health and Safety Code § 34176 (d), and provide a loan to Borrower with a total principal amount not to exceed TWO HUNDRED FIFTY THOUSAND AND 00/100 DOLLARS ($250,000.00) (the “Predevelopment Loan”); and
WHEREAS, until such time as the Borrower has submitted formal applications to City for all required land use entitlements to develop and construct the Project on the Property (e.g. design review, density bonus, etc.), and received City approval for such land use entitlements and associated environmental review as may be required by the California Environmental Quality Act (“CEQA”) and the National Environmental Policy Act (“NEPA”), which project approvals may be granted or denied in the City’s discretion, the City will not be committed to approving the Project.

WHEREAS, the Predevelopment Loan Agreement addresses funding to pay for predevelopment due diligence, surveys, geotechnical investigation, civil, architectural and design services, and other predevelopment work, and is one of the types of early-stage agreements often entered into before a lead agency decides on the specifics of a project; and NOW, THEREFORE, BE IT HEREBY RESOLVED, that the City Council of the City of Capitola finds that the approval of the Predevelopment Loan Agreement shall not and does not, as a practical matter, commit the City of Capitola to the proposed Project and, consistent with Section 15004 (b)(4) of the State CEQA Guidelines, affirms as follows: (1) considering all the surrounding circumstances, the preliminary nature of the Predevelopment Loan Agreement does not commit the 106
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City as a practical matter to approve the land use entitlements for the proposed Project; (2) the specific parameters of the proposed Project are unknown at this stage, and therefore, it is premature to conduct a meaningful analysis and environmental review of the proposed Project under CEQA and/or NEPA, if applicable; (3) once Borrower submits formal applications to City for the necessary land use entitlements required for the proposed Project, the environmental review required under CEQA, and NEPA if applicable, will be performed; (4) the Predevelopment Loan Agreement does not bind or commit the City to any definite course of action related to the proposed Project prior to compliance with CEQA; (5) the Predevelopment Loan Agreement does not restrict the City from considering any feasible mitigation measures and alternatives, including the “no project” alternative, if relevant as part of the review of the proposed Project under CEQA; and (6) the Predevelopment Loan Agreement does not restrict the City from denying the proposed Project; and BE IT FURTHER RESOLVED, by the City Council of the City of Capitola that the Predevelopment Loan Agreement, in the form attached hereto as Exhibit A, between the City of Capitola and MP Rail Trail Associates, LP, a California limited partnership, for an affordable housing development at 1098 38th Avenue, Capitola, CA, is hereby approved; and BE IT FURTHER RESOLVED, by the City Council of the City of Capitola that (i) the City Manager and City Attorney are authorized to make and agree to such changes and modifications to the Predevelopment Loan Agreement which do not significantly increase the obligations or decrease the benefits of the City thereunder, and (ii) the City Manager is authorized to execute and enter into the Predevelopment Loan Agreement on behalf of the City of Capitola with MP Rail Trail Associates, LP, a California limited partnership, and to take all such actions as are necessary to implement the Predevelopment Loan Agreement.

I HEREBY CERTIFY that the foregoing Resolution was passed and adopted by the City Council of the City of Capitola on the 9th day of November 2023, by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:
_____________________
Margaux Keiser, Mayor
ATTEST:
____________________ ___
Julia Gautho, City Clerk
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PREDEVELOPMENT LOAN AGREEMENT
THIS PREDEVELOPMENT LOAN AGREEMENT (“Agreement”) is entered into effective as of ______________, 2023 (“Effective Date”), by and between the CITY OF CAPITOLA, a California municipal corporation (“City”), and MP Rail Trail Associates, L.P., a California limited partnership (“Borrower”). The City and the Borrower are referred to herein individually as a “Party” and collectively as the “Parties.”

RECITALS
A. Borrower is the owner of approximately 1.97 acres of real property located at 1098 38th Avenue, Capitola, California, more particularly described in the legal description attached hereto as Exhibit A and identified as Assessor Parcel Number 034-172-01 (the “Property”).

B. Borrower desires to construct and operate a multi-family residential housing development on the Property affordable to households earning 30% to 80% of Area Median Income (“AMI”) for Santa Cruz County (“Project”). The City desires that the Property be developed to create affordable housing to help provide units affordable to low, very-low and extremely-low income households, consistent with the City’s adopted Housing Element.

C. The Borrower will incur several predevelopment expenses (“Predevelopment Costs”) in connection with assessing the Project’s feasibility, designing the Project, and applying for governmental approvals necessary to construct the Project.

D. Borrower has requested funding from the City to pay for a portion of the Predevelopment Costs, and upon satisfaction of the conditions precedent set forth in this Agreement and evidenced by a Predevelopment Note and Predevelopment Deed of Trust (as each are defined below), the City has agreed to use funds in its Low and Moderate Income Housing Asset Fund (“LMIHAF”) established pursuant to Health and Safety Code § 34176 (d), and provide a loan to Borrower with a total principal amount not to exceed TWO HUNDRED FIFTY THOUSAND AND 00/100 DOLLARS ($250,000.00) (the “Predevelopment Loan”).

E. Until such time as the Borrower has submitted formal applications to City for all required land use approvals to develop and construct the Project on the Property (e.g. design review, density bonus, etc.) (hereinafter, the “Land Use Entitlements”), and received City approval for such Land Use Entitlements and associated environmental review as may be required by the California Environmental Quality Act (“CEQA”) and the National Environmental Policy Act (“NEPA”) (collectively, the “Project Approvals”), which Project Approvals may be granted or denied in the City’s discretion, the City will not be committed to approving the Project.

F. City and Borrower acknowledge that this Agreement addresses funding to pay for predevelopment due diligence, surveys, geotechnical investigation, civil, architectural and design services, and other predevelopment work, and is one of the types of early-stage agreements often entered into before a lead agency decides on the specifics of a project. The Parties further 108
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acknowledge that: (1) considering all the surrounding circumstances, the preliminary nature of this Agreement does not commit City as a practical matter to approve the Land Use Entitlements for the proposed Project; and (2) the specific parameters of the proposed Project are unknown at this stage, and therefore, it is premature to conduct a meaningful analysis and environmental review of the proposed Project under CEQA and/or NEPA, if applicable. The Parties agree that once Borrower submits formal applications to City for the necessary Land Use Entitlements, the environmental review required under CEQA, and NEPA if applicable, will be performed.

NOW, THEREFORE, in consideration of the mutual covenants contained herein and good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows.

ARTICLE 1
RECITALS; DEFINITIONS; TERM AND TERMINATION.

1.1 Incorporation of Recitals. The Parties acknowledge the truth of the foregoing recitals which are hereby incorporated into this Agreement by this reference.

1.2 Definitions. The following terms shall have the meanings set forth below or as indicated in the Sections referenced below whenever used in this Agreement and the Exhibits attached hereto:
“Agreement” shall mean this Predevelopment Loan Agreement. “AMI” is defined in Recital B.
“Applicable Laws” is defined in Section 10.1.
“Borrower” shall mean MP Rail Trail Associates, L.P., a California limited partnership.
“CEQA” is defined in Recital E.
“City” shall mean the City of Capitola, a California municipal corporation. “Claims” is defined in Section 7.2.
“Effective Date” shall mean the date set forth in the introductory paragraph of this Agreement.
“Environmental Laws” is defined in Section 7.4.
“Hazardous Materials” is defined in Section 7.3.
“Indemnitees” is defined in Section 7.2.
“Land Use Entitlements” is defined in Recital E.
“LMIHAF” is defined in Recital D.
“NEPA” is defined in Recital E.
“Official Records” is defined in Section 3.2.
“Party” or “Parties” shall mean, respectively, City and Borrower individually or collectively.
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“Predevelopment Costs” is defined in Recital C and more particularly described in Exhibit B.
“Predevelopment Deed of Trust” is defined in Section 3.2 and substantially in the form attached as Exhibit D.
“Predevelopment Loan” is defined in Recital D.
“Predevelopment Loan Documents” is defined in Section 4.3.2. “Predevelopment Loan Proceeds” is defined in Section 2.1.1. “Predevelopment Note” is defined in Section 3.1 and substantially in the form attached as Exhibit C.
“Prevailing Wage Laws” is defined in Section 13.2.
“Project” is defined in Recital B.
“Project Approval Date” is defined in Section 1.3.1.
“Project Approvals” is defined in Recital E.
“Property” is defined in Recital A and more particularly described in Exhibit A. “Regulatory Agreement” is defined in Section 4.5.1.
“Term” is defined in Section 1.3.1.
“Transfer” is defined in Section 5.2.

1.3 Term and Termination; Predevelopment Loan Forgiveness.

1.3.1 Term. The term of this Agreement shall begin on the Effective Date and shall expire two (2) years thereafter (“Term”), unless extended as provided herein. If, prior to expiration of the Term, the City considers and approves the Project Approvals, then as the date of approval of the Project Approvals (“Project Approval Date”), the Term shall automatically be amended and thereafter shall expire two (2) years after the Project Approval Date. In addition to the aforementioned provision providing for an automatic extension of the Term, the Term of this Agreement may be extended either prior to or after the Project Approval Date for up to two additional periods of six (6) months each upon presentation of a written request from the Borrower outlining its efforts to secure the Project Approvals and/or obtain construction and permanent financing to develop and construct the Project, together with a schedule of tasks to be accomplished during the additional period. The City Manager may approve, conditionally approve, or deny the extension(s) request in his or her sole discretion, and any decision to approve or conditionally approve an extension of the Term shall only be effective upon the execution of an amendment to this Agreement. Notwithstanding the foregoing, upon closing of construction financing for the Project, the City and Borrower agree to amend the Predevelopment Loan to: (i) extend the Term to fifty-five (55) years from the date of issuance of a certificate of occupancy for the Project; (ii) modify the Predevelopment Loan repayment terms to include annual residual receipt payments that shall be due and payable on a pro-rata residual receipts basis in accordance with an agreed upon formula, to be set forth in the amended Predevelopment Note; and (iii) if applicable, combine the Predevelopment Loan amount already disbursed with any new funding approved by the City for Project construction.
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1.3.2 Termination. City shall have the right to terminate this Agreement during the Term upon Borrower’s default under this Agreement and failure to cure within the applicable cure period specified in Section 6.1. If City terminates this Agreement during the Term pursuant to this Section, then the principal balance on the Predevelopment Loan and accrued interest thereon shall be immediately due and payable.

ARTICLE 2
PREDEVELOPMENT LOAN PROVISIONS.

2.1 Predevelopment Loan. Using funds in the LMIHAF, City agrees to loan Borrower, and Borrower agrees to borrow from and repay to the City, the Predevelopment Loan in the maximum principal amount of TWO HUNDRED FIFTY THOUSAND AND 00/100 DOLLARS ($250,000.00) according to the terms and conditions set forth in this Agreement:

2.1.1 Predevelopment Loan Proceeds; Interest. The proceeds of the Predevelopment Loan (the “Predevelopment Loan Proceeds”) shall not be disbursed unless and until Borrower has supplied the City with such documentation as the City deems necessary to substantiate the payment of the Predevelopment Loan for eligible uses, as set forth in Section

2.1.2, below. From the date of initial disbursement of the Predevelopment Loan Proceeds to Borrower, the unpaid principal balance on the Predevelopment Loan shall accrue simple interest at the rate of three percent (3%) per annum. Principal and interest may be prepaid in whole or in part at any time, and from time to time, without notice or penalty.

2.1.2 Funding Disbursement. After Borrower's satisfaction of the conditions set forth in Section 4.3 below, the Predevelopment Loan shall be funded in accordance with the following requirements:
(a) Following satisfaction of the conditions set forth herein, the City shall disburse the Predevelopment Loan Proceeds to Borrower up to the amount of the Predevelopment Loan, for the sole purpose of paying for those Predevelopment Costs set forth in Exhibit B.
(b) The Predevelopment Loan Proceeds will be disbursed to Borrower only upon a request for disbursement by Borrower and upon the City's approval of invoices, contracts and other documentation satisfactory to City delineating Predevelopment Costs satisfactorily performed. Borrower shall submit to the City a written request for disbursement of a specific dollar amount. The City shall review such request and the supporting documentation and, within ten (10) business days from receipt thereof, shall either (i) approve such request and make the requested disbursement, or (ii) disapprove all or a portion of such request, and notify Borrower in writing of the reason for such disapproval, in which case Borrower shall modify its request to correct the stated deficiency and repeat the process outlined above. (c) Borrower's request(s) for disbursement of Predevelopment Loan Proceeds under this Agreement and actual disbursement by the City shall be completed no later than the expiration of the Term or termination of this Agreement. 111
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(d) Nothing herein shall be deemed to require disbursement of the full amount of the Predevelopment Loan if the requirements above are not satisfied.

ARTICLE 3
PREDEVELOPMENT LOAN SECURITY.

3.1 Predevelopment Note. The Predevelopment Loan shall be evidenced by a promissory note (the "Predevelopment Note") executed by Borrower, in favor of the City and substantially in the form attached as Exhibit C. Borrower shall execute and deliver the Predevelopment Note to City concurrently with the execution of this Agreement and the Predevelopment Deed of Trust. The Predevelopment Note shall evidence the repayment obligations by Borrower of the Predevelopment Loan.

Borrower shall have the right to prepay the Predevelopment Note at any time and from time to time, without penalty or premium, provided that any prepayment of principal must be accompanied by interest accrued but unpaid to the date of prepayment. Prepayments shall be applied first to accrued but unpaid interest and then to principal.

Unless City agrees otherwise in writing, the entire unpaid principal balance and all interest and other sums accrued under the Predevelopment Note shall be due and payable upon expiration of the Term of this Agreement or the Transfer (as defined in Section 5.2) absent the prior written consent of City of all or any part of or interest in the Property except for a Transfer permitted under Section 5.3 of this Agreement.

3.2 Predevelopment Deed of Trust. The Predevelopment Note shall be secured by a short form deed of trust (the “Predevelopment Deed of Trust”) executed by Borrower, in the form attached to this Agreement as Exhibit D. Borrower shall execute, acknowledge, and deliver the Predevelopment Deed of Trust to City concurrently with the execution of this Agreement and the Predevelopment Note. Upon delivery by Borrower of the Predevelopment Deed of Trust to City, City may thereafter record the Predevelopment Deed of Trust against the Property in the Official Records of the Office of the Santa Cruz County Recorder (“Official Records”).

3.3 Non-Recourse Provisions. Except as expressly provided in this Section 3.3, Borrower shall have no personal liability for payment of the principal of, or interest on the Predevelopment Note, and the sole recourse of City with respect to the payment of the principal of, and interest on the Predevelopment Note shall be to the Property and any improvements thereon and any other collateral held by City as security for the Predevelopment Note; provided however, nothing contained in the foregoing limitation of liability shall: (i) limit or impair the enforcement against all such security for the Predevelopment Note of all the rights and remedies of the City thereunder; (ii) be deemed in any way to impair the right of the City to assert the unpaid principal amount of the Predevelopment Note as demand for money within the meaning and intendment of Section 431.70 of the California Code of Civil Procedure or any successor provision thereto; or (iii) be deemed in any way to limit the rights of the City to obtain specific 112
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performance by Borrower of its covenants under this Agreement, other than the covenants to pay the City principal and interest due under the Predevelopment Note.

The foregoing limitation of liability is intended to apply only to the obligation for the repayment of the principal of, and payment of interest on the Predevelopment Note; nothing contained herein is intended to relieve the Borrower of its obligation to indemnify the City under this Agreement, or liability for: (i) fraud or willful misrepresentation by the Borrower; (ii) the failure to pay taxes, assessments or other charges which may create liens on the Property that are payable or applicable prior to any foreclosure under the Predevelopment Deed of Trust (to the full extent of such taxes, assessments or other charges); (iii) the fair market value of any personal property or fixtures removed or disposed of by the Borrower other than in accordance with the Predevelopment Deed of Trust; and/or (iv) the misappropriation of any proceeds by the Borrower under any insurance policies or awards resulting from condemnation or the exercise of the power of eminent domain or by reason of damage, loss or destruction to any portion of the Property and any improvement thereon.

ARTICLE 4
USE AND DISBURSEMENT OF PREDEVELOPMENT LOAN PROCEEDS.

4.1 Use Requirements. The Predevelopment Loan Proceeds shall be used solely and exclusively for Predevelopment Costs for the Project as set forth in Exhibit B and such other costs related to the Project as the City may approve in writing in its sole discretion. As more particularly described in Exhibit B, Borrower's predevelopment activities shall include preparation of geotechnical reports, architectural and civil engineering plans, and surveys necessary to secure the Project Approvals from City as are required to develop the Project and apply for construction and permanent financing for the Project.

4.2 Change in Predevelopment Costs. Borrower shall notify the City in a timely manner of any changes to the Predevelopment Costs to be performed under this Agreement. A written authorization by the City Manager must be obtained to make any changes to the Predevelopment Costs to be reimbursed under this Agreement.

4.3 Conditions Precedent to Disbursement of Predevelopment Loan Proceeds. City’s obligation to disburse the Predevelopment Loan Proceeds is conditioned upon satisfaction of all the following conditions as determined by City in its sole discretion:

4.3.1 Borrower’s representations and warranties set forth in Section 4.5 below remain true and correct in all material respects;

4.3.2 Borrower’s execution and delivery to the City of this Agreement, the Predevelopment Note and Predevelopment Deed of Trust (the “Predevelopment Loan Documents”), and recording of the Predevelopment Deed of Trust against the Property in the Official Records;

4.3.3 Borrower’s delivery to the City for its review and approval of a title report showing fee title to the Property vested in Borrower and copies of all exceptions to title; 113
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4.3.4 Borrower’s delivery to the City of evidence of insurance coverage in the form and in such amounts as set forth in Article 8;

4.3.5 Borrower’s submission to City of complete applications for the Land Use Entitlements and payment of all application fees required in connection therewith; and

4.3.6 Borrower’s delivery to the City of copies of Borrower’s articles of incorporation and bylaws.

4.4 No Obligation to Disburse Predevelopment Loan Proceeds Upon Default.

Notwithstanding any other provision of this Agreement, the City shall have no obligation to disburse any portion of the Predevelopment Loan Proceeds to Borrower (except for expenses previously approved by City and expended by Borrower) following:

4.4.1 the failure of any of Borrower’s representations and warranties set forth in Section 4.5 of this Agreement to be true and correct in all material respects;

4.4.2 the conditions precedent to disbursement of the Predevelopment Loan Proceeds set forth in Section 4.3 have not been satisfied on or before the expiration of the Term, unless an extension thereof is approved by the City Manager in writing pursuant to Section 1.3.1;

4.4.3 expiration or termination of this Agreement in accordance with its terms;

4.4.4 termination of this Agreement by mutual agreement of the Parties; or

4.4.5 the occurrence of an Event of Default under this Agreement or the Predevelopment Loan Documents which remains uncured beyond any applicable cure period.

4.5 Borrower’s Representations and Warranties. Borrower represents and warrants to the City that:

4.5.1 Borrower covenants and agrees that if the Project Approvals are approved by City and the Project is constructed by Borrower, for a term of fifty-five (55) years from the date of issuance of a certificate of occupancy for the Project1, 5 of the multi-family residential housing units will be made available at rents affordable to and occupied by households earning 30% to 60% of AMI for Santa Cruz County and shall otherwise adhere to the requirements of California Health and Safety Code § 343176.1 (a)(3), and the balance of the multi-family residential housing units will be made available at rents affordable to and occupied by households earning no more than 80% of AMI for Santa Cruz County pursuant to the terms of an Affordable Housing Agreement and Declaration of Restrictive Covenants (“Regulatory Agreement”), in a form prepared by and subject to such terms and conditions desired by and/or agreed to by the City Manager and City Attorney and Borrower and to be recorded against the Property in the Official Records in connection with the issuance of a building permit by City for the construction of the Project upon the Property. Furthermore, in the event City provides additional funding in

1 The date of issuance of a certificate of occupancy for the Project will be memorialized through the execution and recording in the Official Records of a Certificate of Completion, the form of which will be attached as an exhibit to the Regulatory Agreement.
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connection with construction of the Project as mentioned in Section 1.3.1 above, the terms of the Regulatory Agreement shall be modified to address the affordability level of the housing units restricted to rents affordable to households earning no more than 80% of AMI in a manner consistent with requirements applicable to the source of the City’s additional funding.

4.5.2 Borrower possesses fee title to the Property and, to the best of Borrower's knowledge after reasonable inquiry, the Property is not subject to any covenant, condition, restriction, or agreement that would hinder or prevent Borrower’s performance of its obligations under this Agreement or the Predevelopment Loan Documents. If at any time the foregoing statements become untrue, the City shall have the right to terminate this Agreement upon written notice to Borrower.

4.5.3 All approvals have been obtained in connection with Borrower’s execution of this Agreement and the Predevelopment Loan Documents, and all related agreements and documents, to the effect that no breach of or acceleration of performance under any agreement or document to which Borrower is a party will result from such execution;

4.5.4 Predevelopment Loan Proceeds advanced by the City pursuant to this Agreement are advanced wholly for the benefit of Borrower;

4.5.5 Borrower is a duly organized limited partnership, validly existing and in good standing under the laws of the State of California. Borrower has all requisite power and authority to develop, own and operate the proposed Project, to carry on its business as now conducted, and to execute, deliver and perform its obligations under this Agreement and the Predevelopment Loan Documents;

4.5.6 The execution, delivery and performance of this Agreement and the Predevelopment Loan Documents have been duly authorized by Borrower, and this Agreement and the Predevelopment Loan Documents, when duly executed and delivered, will constitute the valid and binding obligations of Borrower enforceable in accordance with their respective terms.

Borrower’s execution of this Agreement and the Predevelopment Loan Documents and performance thereunder will not result in a breach of or constitute a default under any agreement, indenture or other instrument to which Borrower is a party or by which Borrower may be bound.

The persons executing this Agreement and the Predevelopment Loan Documents on behalf of Borrower have been duly authorized to do so;

4.5.7 There are no pending or, to the best of Borrower’s knowledge, threatened actions or proceedings before any court or administrative agency which may adversely affect the financial condition or operation of Borrower or any of its members or managers or Borrower’s ability to carry out the obligations of Borrower under this Agreement. Borrower is not the subject of any action under federal or state Bankruptcy Law;

4.5.8 Borrower covenants and agrees to use said Predevelopment Loan Proceeds solely to pay for the Predevelopment Costs;

4.5.9 Borrower covenants and agrees to promptly provide all information required and requested by City to process, evaluate, and analyze the Land Use Entitlements and 115
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associated CEQA and NEPA review necessary for the City to consider and take action on the Project Approvals; and

4.5.10 Borrower is responsible for all obligations created by this Agreement and the Predevelopment Loan Documents, including, without limitation, the repayment of all principal and interest, if any, which may become due and payable under this Agreement, the Predevelopment Loan Documents, and any other instruments provided for herein. No creditor or other person shall have any right or action against City on account of any debts, obligations, or liabilities of Borrower.

ARTICLE 5

LIMITATIONS ON CHANGE IN OWNERSHIP, MANAGEMENT

AND CONTROL OF BORROWER

5.1 Change Pursuant to this Agreement. Borrower has represented that it possess the necessary expertise, skill and ability to carry out the development of the Project on the Property pursuant to this Agreement. The qualifications, experience, financial capacity and expertise of Borrower is of particular concern to the City. It is because of these qualifications, experience, financial capacity and expertise that the City has entered into this Agreement with Borrower. No voluntary or involuntary successor, assignee or transferee of Borrower shall acquire any rights or powers under this Agreement, except as expressly provided herein.

5.2 Prohibition on Transfer. Prior to the expiration of the Term of this Agreement, Borrower shall not, except as expressly permitted by this Agreement, directly or indirectly, voluntarily, involuntarily or by operation of law make or attempt any total or partial sale, transfer, conveyance, assignment or lease (collectively, “Transfer”) of the whole or any part of the Property or this Agreement, without the prior written approval of City. Any such attempt to assign this Agreement without the City’s consent shall be null and void and shall confer no rights or privileges upon the purported assignee. In addition to the foregoing, prior to the expiration of the Term of this Agreement, except as expressly permitted by this Agreement, Borrower shall not undergo any significant change of ownership without the prior written approval of City. For purposes of this Agreement, a “significant change of ownership” shall mean a transfer of the beneficial interest of more than forty-nine percent (49%) in aggregate of the present ownership and /or control of Borrower, taking all transfers into account on a cumulative basis.

5.3 Permitted Transfers. Notwithstanding any contrary provision hereof, the prohibitions set forth in this Article shall not be deemed to prevent: (i) the granting of utility easements or permits to facilitate development of the Property; (ii) the dedication of any property required pursuant to the Project Approvals; (iii) the lease of individual units to tenants for occupancy as their principal residence in accordance with the Regulatory Agreement; (iv) assignments creating security interests for the purpose of financing the acquisition, construction or permanent financing of the Project or the Property, or Transfers directly resulting from the foreclosure of, or granting of a deed in lieu of foreclosure of, such a security interest; or (v) the 116
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admission of limited partners to the Borrower entity in connection with tax credit financing, and any subsequent transfer of such limited partnership interests, including any transfer of stock or equity in the limited partners that does not change management or operational control of the Project.

5.4 Requirements for Proposed Transfers. The City may, in the exercise of its sole discretion, consent to a proposed Transfer of this Agreement, the Property or portion thereof if all of the following requirements are met (provided however, the requirements of this Section 5.4 shall not apply to Transfers described in Section 5.3):

5.4.1 The proposed transferee demonstrates to the City’s satisfaction that it has the qualifications, experience and financial resources necessary and adequate as may be reasonably determined by the City to competently develop the Project and to otherwise fulfill the obligations undertaken by the Borrower under this Agreement.

5.4.2 The Borrower and the proposed transferee shall submit for City review and approval all instruments and other legal documents proposed to effect any Transfer of this Agreement, the Property or interest therein together with such documentation of the proposed transferee’s qualifications and development capacity as the City may reasonably request.

5.4.3 The proposed transferee shall expressly assume all of the rights and obligations of the Borrower under this Agreement and the Predevelopment Loan Documents arising after the effective date of the Transfer and all obligations of Borrower arising prior to the effective date of the Transfer (unless City expressly agrees that Borrower may remain responsible for such obligations) and shall agree to be subject to and assume all of Borrower’s obligations pursuant to this Agreement and the Predevelopment Loan Documents.

5.4.4 The Transfer shall be effectuated pursuant to a written instrument satisfactory to the City in form recordable in the Official Records.

5.4.5 Consent to any proposed Transfer may be given by the City Manager unless the City Manager, in his or her discretion, refers the matter of approval to the City Council.

If the City rejects a proposed Transfer, the City, as applicable, shall provide the reasons for such rejection in writing within thirty (30) days following receipt of written request by Borrower, and representatives of the City shall meet with Borrower and the proposed transferee to discuss in good faith the reasons for the rejection and Borrower’s and transferee’s responses thereto.

5.5 In the absence of specific written agreement by the City, no Transfer by Borrower shall be deemed to relieve the Borrower or any other party from any obligation under this Agreement or the Predevelopment Loan Documents.

5.6 Without limiting any other remedy City may have under this Agreement or the Predevelopment Loan Documents, or under law or equity, this Agreement may be terminated by City if without the prior written approval of the City, Borrower assigns or Transfers this Agreement or the Property. This Section 5.6 shall not apply to Transfers described in Section

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5.7 Borrower shall reimburse City for all costs, including but not limited to attorneys’ fees, incurred in reviewing instruments and other legal documents proposed to affect a Transfer under this Agreement and in reviewing the qualifications and financial resources of a proposed successor, assignee, or transferee within ten days following City’s delivery to Borrower of an invoice detailing such costs. This Section 5.7 shall not apply to Transfers described in Section

5.3. ARTICLE 6

SECURITY FINANCING AND RIGHTS OF MORTGAGEES

6.1 Mortgages and Deeds of Trust for Development. Mortgages and deeds of trust, or any other reasonable security instrument are permitted to be placed upon the Property only for the purpose of securing loans for financing the acquisition of the Property, the design and construction of the Project and other expenditures reasonably necessary for development of the Property. Borrower shall not enter into any conveyance for such financing without the prior written approval of the City Manager or his or her designee. As used herein, the terms “mortgage” and “deed of trust” shall mean any security instrument used in financing real estate acquisition, construction and land development.

6.1.1 Subordination. City agrees that if required by construction and/or permanent lenders, the Predevelopment Deed of Trust will be subordinated to deeds of trust or other security instruments approved by the City.

6.2 Holder Not Obligated to Construct. The holder of any mortgage, deed of trust authorized by this Agreement shall not be obligated to construct or complete the Project or to guarantee such construction or completion.

6.3 Notice of Default and Right to Cure. Whenever City delivers any notice of default hereunder, City shall concurrently deliver a copy of such notice to each holder of record of any mortgage or deed of trust secured by the Property provided that City has been provided with the address for delivery of such notice. City shall have no liability to any such holder for any failure by the City to provide such notice to such holder. Each such holder shall have the right, but not the obligation, at its option, to cure or remedy any such default or breach.

6.4 City Right to Cure Defaults. In the event of a breach or default by Borrower under a mortgage or deed of trust secured by the Property, City may (but has no obligation to) cure the default, without acceleration of the subject loan, following prior notice thereof to the holder of such instrument and Borrower. In such event, Borrower shall be liable for, and City shall be entitled to reimbursement from Borrower for all costs and expenses incurred by City associated with and attributable to the curing of the default or breach and such sum shall constitute a part of the indebtedness secured by the Predevelopment Deed of Trust.

6.5 Holder to be Notified. Borrower, for itself, its successors and assigns hereby warrants and agrees that each term contained herein dealing with security financing and rights of holders shall be either inserted into the relevant deed of trust or mortgage or acknowledged by the holder prior to its creating any security right or interest in the Property. 118
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6.6 Modifications to Agreement. City shall not unreasonably withhold is consent to modifications of this Agreement requested by Project lenders or investors provided such modifications do not alter City’s substantive rights and obligations under this Agreement.

6.7 Estoppel Certificates. Any Party shall, at any time, and from time to time, within thirty (30) days after receipt of written request from the other Party, execute and deliver to such Party a written statement certifying that, to the knowledge of the certifying Party: (i) this Agreement is in full force and effect and a binding obligation of the Parties (if such be the case), (ii) this Agreement has not been amended or modified, or if so amended, identifying the amendments, and (iii) the requesting Party is not in default in the performance of its obligations under this Agreement, or if in default, describing the nature of any such defaults.

ARTICLE 7

ENVIRONMENTAL MATTERS

7.1 No City Liability; Borrower’s Covenants. City shall not be responsible for the cost of any soil, groundwater or other environmental remediation or other response activities for any Hazardous Materials, if any, existing or occurring on the Property or any portion thereof, and Borrower shall be solely responsible for all actions and costs associated with any such activities required by any regulatory agency with jurisdiction over the Property and/or required for the development of the Project, the Property, or any portion thereof. Upon receipt of any notice regarding the presence, release or discharge of Hazardous Materials in, on or under the Property, or any portion thereof, Borrower (as long as Borrower owns the property which is the subject of such notice) agrees to timely initiate and diligently pursue and complete all appropriate response, remediation and removal actions for the presence, release or discharge of such Hazardous Materials within such deadlines as specified by applicable Environmental Laws. Borrower hereby covenants and agrees that:

7.1.1 Borrower shall not knowingly permit the Project or the Property or any portion of either to be a site for the use, generation, treatment, manufacture, storage, disposal or transportation of Hazardous Materials or otherwise knowingly permit the presence or release of Hazardous Materials in, on, under, about or from the Project or the Property with the exception of any previously disclosed existing conditions on the Property and cleaning supplies and other materials customarily used in construction, rehabilitation, use or maintenance of residential property and used, stored and disposed of in compliance with Hazardous Materials Laws, and

7.1.2 Borrower shall keep and maintain the Project and the Property and each portion thereof in compliance with, and shall not cause or permit the Project or the Property or any portion of either to be in violation of, any Hazardous Materials Laws.

7.2 Environmental Indemnification. Borrower shall indemnify, defend (with counsel approved by City) and hold the City and its elected and appointed officials, officers, agents and employees (collectively, “Indemnitees”) harmless from and against any and all liability, loss, cost, expense (including without limitation reasonable attorneys’ fees and costs of litigation), claim, demand, action, suit, judicial or administrative proceeding, penalty, deficiency, fine, order, and damage (all of the foregoing collectively “Claims”) including without limitation any expenses associated with the investigation, assessment, monitoring, response, removal, 119
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treatment, abatement or remediation of Hazardous Materials and administrative, enforcement or judicial proceedings resulting, arising, or based directly or indirectly in whole or in part, upon (i) the presence, release, use, generation, discharge, storage or disposal or the alleged presence, release, discharge, storage or disposal of any Hazardous Materials on, under, in or about, or the transportation of any such Hazardous Materials to or from, the Property, or (ii) the failure of Borrower, Borrower’s employees, agents, contractors, subcontractors, or any person acting on behalf of any of the foregoing to comply with Hazardous Materials Laws or the covenants set forth in Section 7.1. The foregoing indemnity shall further apply to any residual contamination in, on, under, about or emanating from the Property or affecting any natural resources, and to any contamination of any property or natural resources arising in connection with the generation, use, handling, treatment, storage, transport or disposal of any such Hazardous Materials, and irrespective of whether any of such activities were or will be undertaken in accordance with Hazardous Materials Laws. The provisions of this Section 7.2 shall survive the issuance of a Certificate of Completion for the Project and the expiration or earlier termination of this Agreement. Borrower’s indemnification obligation under this Section 7.2 shall not apply to acts described in clause (i) above caused by the gross negligence or willful misconduct of an Indemnitee.

7.2.1 No Limitation. Borrower hereby acknowledges and agrees that Borrower’s duties, obligations and liabilities under this Agreement, including, without limitation, under Section 7.2 above, are in no way limited or otherwise affected by any information the City may have concerning the Property and/or the presence in, on, under, about or emanating from the Property of any Hazardous Materials, whether the City obtained such information from the Borrower or from its own investigations. It is further agreed that City does not and shall not waive any rights against Borrower that they may have by reason of this indemnity and hold harmless agreement because of the acceptance by City, or the deposit with City by Borrower, of any of the insurance policies described in this Agreement.

7.3 Hazardous Materials. As used herein, the term “Hazardous Materials” means any substance, material or waste which is or becomes regulated by any federal, state or local governmental authority, and includes without limitation (i) petroleum or oil or gas or any direct or indirect product or by-product thereof; (ii) asbestos and any material containing asbestos; (iii) any substance, material or waste regulated by or listed (directly or by reference) as a “hazardous substance”, “hazardous material”, “hazardous waste”, “toxic waste”, “toxic pollutant”, “toxic substance”, “solid waste” or “pollutant or contaminant” in or pursuant to, or similarly identified as hazardous to human health or the environment in or pursuant to, the Toxic Substances Control Act [15 U.S.C. 2601, et seq.]; the Comprehensive Environmental Response, Compensation and Liability Act [42 U.S.C. Section 9601, et seq.], the Hazardous Materials Transportation Authorization Act [49 U.S.C. Section 5101, et seq.], the Resource Conservation and Recovery Act [42 U.S.C. 6901, et seq.], the Federal Water Pollution Control Act [33 U.S.C. Section 1251], the Clean Air Act [42 U.S.C. Section 7401, et seq.], the California Underground Storage of Hazardous Substances Act [California Health and Safety Code Section 25280, et seq.], the California Hazardous Substances Account Act [California Health and Safety Code Section 25300, et seq.], the California Hazardous Waste Act [California Health and Safety Code Section 25100, et seq.], the California Safe Drinking Water and Toxic Enforcement Act [California Health and Safety Code Section 25249.5, et seq.], and the Porter-Cologne Water Quality Control Act [California Water Code Section 13000, et seq.], as they now exist or are hereafter amended, 120
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together with any regulations promulgated thereunder; (iv) any substance, material or waste which is defined as such or regulated by any “Superfund” or “Superlien” law, or any Environmental Law; or (v) any other substance, material, chemical, waste or pollutant identified as hazardous or toxic and regulated under any other federal, state or local environmental law, including without limitation, asbestos, polychlorinated biphenyls, petroleum, natural gas and synthetic fuel products and by-products.

7.4 Environmental Laws. As used herein, the term “Environmental Laws” means all federal, state or local statutes, ordinances, rules, regulations, orders, decrees, judgments or common law doctrines, and provisions and conditions of permits, licenses and other operating authorizations regulating, or relating to, or imposing liability or standards of conduct concerning (i) pollution or protection of the environment, including natural resources; (ii) exposure of persons, including employees and agents, to Hazardous Materials (as defined above) or other products, raw materials, chemicals or other substances; (iii) protection of the public health or welfare from the effects of by-products, wastes, emissions, discharges or releases of chemical substances from industrial or commercial activities; (iv) the manufacture, use or introduction into commerce of chemical substances, including without limitation, their manufacture, formulation, labeling, distribution, transportation, handling, storage and disposal; or (iv) the use, release or disposal of toxic or hazardous substances or Hazardous Materials or the remediation of air, surface waters, groundwaters or soil, as now or may at any later time be in effect, including but not limited to the Toxic Substances Control Act [15 U.S.C. 2601, et seq.]; the Comprehensive Environmental Response, Compensation and Liability Act [42 U.S.C. Section 9601, et seq.], the Hazardous Materials Transportation Authorization Act [49 U.S.C. Section 5101, et seq.], the Resource Conservation and Recovery Act [42 U.S.C. 6901, et seq.], the Federal Water Pollution Control Act [33 U.S.C. Section 1251], the Clean Air Act [42 U.S.C. Section 7401, et seq.], the California Underground Storage of Hazardous Substances Act [California Health and Safety Code Section 25280, et seq.], the California Hazardous Substances Account Act [California Health and Safety Code Section 25300, et seq.], the California Hazardous Waste Act [California Health and Safety Code Section 25100, et seq.], the California Safe Drinking Water and Toxic Enforcement Act [California Health and Safety Code Section 25249.5, et seq.], and the PorterCologne Water Quality Control Act [California Water Code Section 13000, et seq.], as each of the foregoing now exist or are hereafter amended, together with any regulations promulgated thereunder.

ARTICLE 8
INDEMNITY AND INSURANCE.

8.1 Indemnity. Borrower shall indemnify, defend (with counsel approved by City in its sole discretion) and hold Indemnitees harmless from and against any and all Claims, including without limitation, Claims arising directly or indirectly, in whole or in part, as a result of or in connection with Borrower’s or Borrower’s contractors, subcontractors, agents, consultants or employees development, construction, improvement, operation, ownership or maintenance of the Project or the Property, or any part thereof or otherwise arising out of or in connection with Borrower’s performance under this Agreement. Borrower’s indemnification obligations under this Section 8.1 shall not extend to Claims resulting from the gross negligence or willful misconduct of Indemnitees. The provisions of this Section 8.1 shall survive the issuance of a Certificate of Completion for the Project and the expiration or earlier termination of this 121
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Agreement. It is further agreed that City does not and shall not waive any rights against Borrower that they may have by reason of this indemnity and hold harmless agreement because of the acceptance by City, or the deposit with City by Borrower, of any of the insurance policies described in this Agreement.

8.2 Insurance Coverage. The Borrower shall maintain or cause to be maintained the following insurance coverage throughout the Term and provide evidence satisfactory to the City of such coverage:

8.2.1 Borrower and any contractor or subcontractor who performs work on the Property shall secure worker's compensation insurance to the extent required by law, including Employer's Liability coverage, with limits not less than One Million Dollars ($1,000,000) each accident.

8.2.2 Borrower and any contractor or subcontractor who performs work on the Property shall maintain Comprehensive General Liability insurance with limits not less than Two Million Dollars ($2,000,000) each occurrence combined single limit for Bodily Injury and Property Damage, including coverage for Contractual Liability, Person Injury, Broad form Property Damage, Products and Completed Operations to cover any claims arising out of Borrower's performance under this Agreement. Such policy or policies shall be written on an occurrence basis and shall name the Indemnitees as additional insureds.

8.2.3 Borrower and any contractor or subcontractor who performs work on the Property shall maintain Comprehensive Automobile Liability insurance with limits not less than One Million Dollars ($1,000,000) each occurrence combined single limit for Bodily Injury and Property Damage, including coverage for owned, non-owned and hired vehicles, as applicable.

Such policy or policies shall be written on an occurrence basis and shall name the Indemnitees as additional insureds.

8.2.4 Companies writing the insurance required hereunder shall be licensed to do business in the State of California. Insurance shall be placed with insurers with a current A.M.

Best's rating of no less than A-VIII.

8.2.5 Prior to disbursement of the Predevelopment Loan Proceeds, Borrower shall furnish City with certificates of insurance in form acceptable to City evidencing the required insurance coverage and duly executed endorsements evidencing such additional insured status.

The certificates shall contain a statement of obligation on the part of the carrier to notify City of any material adverse change, cancellation, termination or non-renewal of the coverage at least thirty (30) days in advance of the effective date of any such material adverse change, cancellation, termination or non-renewal.

8.2.6 If any insurance policy or coverage required hereunder is canceled or reduced, Borrower shall, within fifteen (15) calendar days after receipt of notice of such cancellation or reduction in coverage, but in no event later than the effective date of cancellation or reduction, file with City a certificate showing that the required insurance has been reinstated or provided through another insurance company or companies. Upon failure to so file such certificate, City may, without further notice and at its option, procure such insurance coverage at 122
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Borrower’s expense, and Borrower shall promptly reimburse City for such expense upon receipt of billing from City

8.2.7 Coverage provided by Borrower and any contractor or subcontractor shall be primary insurance and shall not be contributing with any insurance, or self-insurance maintained by City, and the policies shall so provide. The insurance policies shall contain a waiver of subrogation for the benefit of the City. Borrower shall furnish the required certificates and endorsements to City prior to the commencement of construction of the Project and shall provide City with certified copies of the required insurance policies upon request of City.

ARTICLE 9
DEFAULT AND REMEDIES.

9.1 Borrower Default. The occurrence of one or more of the following events shall constitute a default under this Agreement, and City shall thereupon be entitled, at its option, to declare all indebtedness referred to in this Agreement immediately due and payable and City shall be entitled to all legal recourse against Borrower and to pursue and enforce, either successively or concurrently, all rights and remedies set forth in this Agreement or any collateral instrument held by City or accruing to City by law, and such other rights and remedies as a lender may have, default being:

9.1.1 Failure of Borrower to perform any of the covenants or agreements on its part contained in this Agreement or in any collateral instrument made by Borrower in favor of City with respect to the Predevelopment Loan as evidenced by this Agreement or the Predevelopment Loan Documents; or the intentional or unintentional misrepresentation of any statement or warranty made by Borrower in connection with this Agreement or the Predevelopment Loan Documents; or

9.1.2 The filing of a complaint for receivership against Borrower, or the filing of a voluntary or involuntary petition for bankruptcy or for re-organization by the Borrower (unless such complaint or petition be released, discharged or stayed within forty five (45) days of such filing); or if Borrower shall become insolvent or make a general assignment for the benefit of creditors or consent to the appointment of a receiver of all or any of its assets, or voluntarily suspends its usual business.

City shall advise Borrower in writing of any default under this Section and may deliver notices of default to Borrower personally, by certified mail or by registered mail. Borrower shall have thirty (30) days from the date of the receipt of the notice to cure such default, except in a case where a default is not susceptible to cure within thirty (30) days, and the Borrower initiates cure within the thirty (30) day period and diligently pursues the cure proceedings. In this event, Borrower shall have such additional time as is reasonably necessary to complete cure of the default, but in no event longer than one hundred fifty (150) days.

9.2 Default by City.

9.2.1 The failure of City to perform any of its obligations under this Agreement or the Predevelopment Loan Documents shall entitle Borrower to pursue an action for specific 123
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performance only. Borrower shall have no other remedy or recourse at law or in equity and hereby waives any and all claims and legal recourse against the City for damages of any nature and description.

9.2.2 Borrower shall advise the City in writing of any default under this Section and the Borrower may deliver notices of default to the City personally or by certified or registered mail. The City shall have thirty (30) days from the date of receipt of the notice to cure the default, except in a case where a default is not susceptible to cure within thirty (30) days, and the City initiates cure within the thirty (30) day period and diligently pursues the cure proceedings. In this event, the City shall have such additional time as Borrower determines is reasonably necessary to complete cure of the default.

ARTICLE 10

MISCELLANEOUS PROVISIONS

10.1 Conformity with Law and Safety. Borrower shall carry out and shall cause its consultants and contractors to carry out its obligations under this Agreement and the construction of the Project in conformity with all applicable federal, state and local laws, rules, ordinances and regulations, including without limitation, all applicable federal and state labor laws and standards, including Prevailing Wage Laws and Environmental Laws, applicable provisions of the California Public Contracts Code, the City zoning and development standards, building, plumbing, mechanical and electrical codes, all other provisions of the City's Municipal Code, and all applicable disabled and handicapped access requirements, including without limitation, the Americans with Disabilities Act, 42 U.S.C. Section 12101, et seq., Government Code Section 4450, et seq., Government Code Section 11135, et seq., and the Unruh Civil Rights Act, Civil Code Section 51, et seq. (collectively, the “Applicable Laws”). Borrower agrees to defend, indemnify and hold the Indemnitees harmless from any and all Claims arising out of any noncompliance with, or violations of, such Applicable Laws by Borrower.

10.2 Prevailing Wage Requirements. If required by applicable federal or state law, Borrower and its contractors, subcontractors and agents shall comply with California Labor Code Section 1720 et seq. and the regulations adopted pursuant thereto (and if required by applicable federal law, the Davis Bacon Act and implementing regulations) (all of the foregoing, “Prevailing Wage Laws”), and shall be responsible for carrying out the requirements of such provisions to the extent applicable. If applicable, Borrower shall submit to City a plan for monitoring payment of prevailing wages and at Borrower’s expense shall implement such plan and comply with all applicable reporting and recordkeeping requirements.

10.3 Indemnity. To the greatest extent allowed by law, Borrower shall indemnify, defend (with counsel approved by City in its sole discretion) and hold the Indemnitees harmless from and against all Claims which directly or indirectly, in whole or in part, are caused by, arise in connection with, result from, relate to, or are alleged to be caused by, arise in connection with, or relate to, the payment or requirement of payment of prevailing wages (including without limitation, all claims that may be made by contractors, subcontractors or other third party claimants pursuant to Labor Code Sections 1726 and 1781) or the requirement of competitive bidding in connection with the Project, the failure to comply with any applicable state or federal labor laws, regulations or standards in connection with this Agreement, including but not limited 124
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to the Prevailing Wage Laws, or any act or omission of Borrower related to this Agreement with respect to the payment or requirement of payment of prevailing wages or the requirement of competitive bidding, whether or not any insurance policies shall have been determined to be applicable to any such Claims. The provisions of this Section shall survive the expiration or earlier termination of this Agreement. The Borrower’s indemnification obligations set forth in this Section shall not apply to Claims to the extent arising from the gross negligence or willful misconduct of the Indemnitees.

10.4 Notices. Except as otherwise specified in this Agreement, all notices to be sent pursuant to this Agreement shall be made in writing and sent to the Parties at their respective addresses specified below or to such other address as a Party may designate by written notice delivered to the other Parties in accordance with this Section. All such notices shall be sent by:
(i) personal delivery, in which case notice is effective upon delivery; (ii) certified or registered mail, return receipt requested, in which case notice shall be deemed delivered on receipt if delivery is confirmed by a return receipt; or (iii) nationally recognized overnight courier, with charges prepaid or charged to the sender’s account, in which case notice is effective on delivery if delivery is confirmed by the delivery service.

CITY: City of Capitola
420 Capitola Avenue
Capitola, CA 95010
Attn: Jamie Goldstein, City Manager
With a copy to: Burke, Williams & Sorensen, LLP
1 California Street, Suite 3050
San Francisco, CA 94111-5432
Attn: Samantha W. Zutler
BORROWER: MP Rail Trail Associates, L.P.
c/o MidPen Housing Corporation
303 Vintage Park Drive, Suite 250
Foster City, CA 94404
Attn: Director of Real Estate Development
With a copy to: [ ]

10.5 Waivers; Modification. No waiver of any breach of any covenant or provision of this Agreement shall be deemed a waiver of any other covenant or provision hereof, and no waiver shall be valid unless in writing and executed by the waiving Party. An extension of time for performance of any obligation or act shall not be deemed an extension of the time for performance of any other obligation or act, and no extension shall be valid unless in writing and executed by the Party granting the extension. This Agreement may be amended or modified only by a written instrument executed by the Parties.
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10.6 Survival. All representations made by Borrower hereunder and Borrower’s obligations specifically identified to survive shall survive the expiration or termination of this Agreement.

10.7 Headings; Interpretation; Statutory References. The section headings and captions used herein are solely for convenience and shall not be used to interpret this Agreement.

The Parties acknowledge that this Agreement is the product of negotiation and compromise on the part of both Parties, and the Parties agree, that since both Parties have participated in the negotiation and drafting of this Agreement, this Agreement shall not be construed as if prepared by one of the Parties, but rather according to its fair meaning as a whole, as if both Parties had prepared it.

10.8 Action or Approval. Whenever action and/or approval by City is required under this Agreement, the City’s Authorized Representative or his or her designee may act on and/or approve such matter unless specifically provided otherwise, or unless the City’s Authorized Representative determines in his or her discretion that such action or approval requires referral to City Council for consideration.

10.9 Entire Agreement. This Agreement, including Exhibits A through D attached hereto and incorporated herein by this reference, together with the Predevelopment Note contains the entire agreement between the Parties with respect to the subject matter hereof, and supersedes all prior written or oral agreements, understandings, representations or statements between the Parties with respect to the subject matter hereof. If the Exhibits to this Agreement are inconsistent with this Agreement, the more restrictive requirements shall control, as determined by the City Manager. In the event of a conflict between this Agreement and the Predevelopment Note, the more restrictive requirements shall control, as determined by the City Manager.

10.10 Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be an original and all of which taken together shall constitute one instrument. The signature page of any counterpart may be detached therefrom without impairing the legal effect of the signature(s) thereon provided such signature page is attached to any other counterpart identical thereto having additional signature pages executed by the other Party. Any executed counterpart of this Agreement may be delivered to the other Party by facsimile and shall be deemed as binding as if an originally signed counterpart was delivered.

10.11 Severability. If any term, provision, or condition of this Agreement is held by a court of competent jurisdiction to be invalid or unenforceable, the remainder of this Agreement shall continue in full force and effect unless an essential purpose of this Agreement is defeated by such invalidity or unenforceability.

10.12 No Third Party Beneficiaries. Except as expressly set forth herein, nothing contained in this Agreement is intended to or shall be deemed to confer upon any person, other than the Parties and their respective successors and assigns, any rights or remedies hereunder.

10.13 Time of the Essence; Calculation of Time Periods. Time is of the essence for each condition, term, obligation and provision of this Agreement. Unless otherwise specified, in 126
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computing any period of time described in this Agreement, the day of the act or event after which the designated period of time begins to run is not to be included and the last day of the period so computed is to be included, unless such last day is not a business day, in which event the period shall run until the next business day. The final day of any such period shall be deemed to end at 5:00 p.m., local time at the Property. For purposes of this Agreement, a “business day” means a day that is not a Saturday, Sunday, a federal holiday or a state holiday under the laws of the State of California.

10.14 No Partnership or Joint Venture. The relationship between the City and Borrower created by this Predevelopment Loan Agreement shall not be one of partnership or joint venture, but rather shall be one of lender and borrower.

10.15 Usury. If a court of competent jurisdiction determines, by way of final, unappealable order or judgment, that the interest rate charged under the Note is usurious, then such rate shall automatically and retroactively be reduced to the maximum rate allowed under applicable law.

10.16 Conflict of Interest Prohibited. Neither Borrower nor an employee, officer, director, partner or member of Borrower, or immediate family member of any preceding, shall have served as an elected officer, an employee, or a City or City board, committee or commission member, who has directly or indirectly influenced the making of this Agreement.

In accordance with Government Code Section 1090 and the Political Reform Act, Government Code section 87100 et seq., no person who is a director, officer, partner, trustee or employee or consultant of the Borrower, or immediate family member of any of the preceding, shall make or participate in a decision, made by the City, the City or a City or City board, commission or committee, if it is reasonably foreseeable that the decision will have a material effect on any source of income, investment or interest in real property of that person or Borrower.

Interpretation of this section shall be governed by the definitions and provisions used in the Political Reform Act, Government Code section 87100 et seq., its implementing regulations manual and codes.

10.17 Audit. The City may conduct an audit of Borrower's financial, performance and compliance records maintained in connection with Borrower's obligations under this Agreement and the Note. In the event of such audit, Borrower's employees shall make all such financial, performance and compliance records available to the City. City agrees to provide Borrower an opportunity to discuss and respond to any findings before a final audit report is filed.

10.18 Non-Discrimination. Borrower hereby agrees to take steps to ensure that the Borrower, as well as any person who contracts with the Borrower, shall not, on the basis of race, color, religion, ancestry, national origin, age, sex, pregnancy, marital status, disability, sexual orientation, or AIDS be excluded from participation in the development, leasing and/or sale of the Property or the Project.

10.19 Governing Law; Venue. This Agreement shall be governed by and construed in accordance with the laws of the State of California without regard to principles of conflicts of 127
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laws. Any action to enforce or interpret this Agreement shall be filed and heard in the Superior Court of Santa Cruz County, California.

10.20 Exhibits. The following Exhibits are attached to this Agreement and incorporated by this reference:

A Legal Description of the City Property
B Approved Predevelopment Costs
C Form of Predevelopment Promissory Note
D Form of Predevelopment Deed of Trust – Short Form
SIGNATURES ON FOLLOWING PAGE(S).

IN WITNESS WHEREOF, the Parties have entered into this Agreement effective as of the date first written above.

CITY:

CITY OF CAPITOLA,
a California municipal corporation
By:

Jamie Goldstein, City Manager
ATTEST:
__________________________, City Clerk
APPROVED AS TO FORM:

BURKE, WILLIAMS, & SORENSON, LLP
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Samantha Zutler, City Attorney
BORROWER:

MP Rail Trail Associates, L.P.
a California limited partnership
By: MP Rail Trail LLC,
a California limited liability company,
its general partner
By: Mid-Peninsula San Carlos Corporation,
a California nonprofit public benefit corporation,
its sole member/manager
By: ____________________________
Matthew O. Franklin, President/CEO
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Exhibit A

LEGAL DESCRIPTION OF THE PROPERTY
The land referred to is situated at 1098 38th Avenue, in the City of Capitola, County of Santa Cruz, State of California, and legally described as follows:
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Exhibit B

APPROVED PREDEVELOPMENT COSTS
Architectural Design Services $200,000.00
Civil Engineering, Design & Surveying $ 30,200.00
Geotechnical Investigation & Analysis $ 19,800.00
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Exhibit C

FORM OF PREDEVELOPMENT PROMISSORY NOTE
$250,000.00 Capitola, California
_____________, 2023
FOR VALUE RECEIVED, MP Rail Trail Associates, L.P., a California limited partnership (“Borrower”) hereby promises to pay to the order of the City of Capitola, a California municipal corporation (the "City"), Two Hundred Fifty Thousand and 00/100 Dollars ($250,000.00) (or so much as has been advanced), plus interest thereon as set forth below.

1. Borrower's Obligation. This promissory note (the "Predevelopment Note") evidences Borrower's obligation to pay City the principal sum of Two Hundred Fifty Thousand and 00/100 Dollars ($250,000.00) (“Predevelopment Loan”) plus interest thereon for the funds loaned to Borrower by City to finance certain predevelopment costs associated with the development of the Project pursuant to the Predevelopment Loan Agreement (the "Agreement") between Borrower and City of approximately even date herewith. All capitalized terms not otherwise defined in this Predevelopment Note shall have the meanings set forth in the Agreement.

2. Interest. The Predevelopment Loan shall bear simple interest at the rate of three percent (3%) simple interest per annum from the date of initial disbursement.

3. Term and Repayment Requirements. The term of this Predevelopment Note (the "Term"), shall commence as of the Effective Date of the Agreement and shall expire in accordance with Section 1.3.1 of the Agreement. This Predevelopment Note may be prepaid in whole or in part at any time, and from time to time, without notice or penalty. This Predevelopment Note shall be due and payable as set forth in Section 1.3.2 and Section 3.1 of the Agreement.

4. No Assumption. This Predevelopment Note shall not be assumable by the successors and assigns of Borrower without the prior written consent of City.

5. Terms of Payment.
(a) All payments due under this Predevelopment Note shall be paid in currency of the United States of America, which at the time of payment is lawful for the payment of public and private debts.
(b) All payments on this Predevelopment Note shall be paid to City at: City of Capitola, 420 Capitola Avenue, Capitola, CA 95010, attention: Finance Department or to such other person or place as City may from time to time designate. 132
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(c) All payments on this Predevelopment Note shall be without expense to City, and Borrower agrees to pay all costs and expenses, including re-conveyance fees and reasonable attorney's fees of City, incurred in connection with the payment of this Predevelopment Note and the release of any security hereof. (d) Notwithstanding any other provision of this Predevelopment Note, or any instrument securing the obligations of Borrower under this Predevelopment Note, if, for any reason whatsoever, the payment of any sums by Borrower pursuant to the terms of this Predevelopment Note would result in the payment of interest which would exceed the amount that City may legally charge under the laws of the State of California, then the amount by which payments exceeds the lawful interest rate shall automatically be deducted from the principal balance owing on this Predevelopment Note, so that in no event shall Borrower be obligated under the terms of this Predevelopment Note to pay any interest which would exceed the lawful rate.
(e) This Predevelopment Note shall be nonrecourse against Borrower, as further set forth in Section 3.3 of the Agreement.

6. Default.
(a) Any of the following shall constitute an event of default under this Predevelopment Note:
(i) Any failure to pay, in full, any payment required under this Predevelopment Note within ten (10) calendar days of written notice that such payment is due;
(ii) Any failure in the performance by Borrower of any term, condition, provision or covenant set forth in this Predevelopment Note subject to the notice and cure period set forth in the Agreement;
(iii) The occurrence of any event of default under the Agreement or any other instrument securing the obligations of Borrower under this Predevelopment Note or under any other promissory notes hereafter issued by Borrower to City pursuant to the Agreement, subject to notice and cure periods, if any, set forth therein.
(b) Upon the occurrence of such an event of default, the entire unpaid principal balance, together with all interest thereon, and together with all other sums then payable under this Predevelopment Note shall at the option of City become immediately due and payable upon written notice by City to Borrower without further demand. (c) The failure to exercise the remedy set forth in Subsection 6(b) above or any other remedy provided by law upon the occurrence of one or more of the foregoing events of default shall not constitute a waiver of the right to exercise any remedy at any subsequent time in respect to the same or any other default. The acceptance by City 133
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hereof of any payment which is less than the total of all amounts due and payable at the time of such payment shall not constitute a waiver of the right to exercise any of the foregoing remedies or options at that time or at any subsequent time or nullify any prior exercise of any such remedy or option, without the express consent of City, except as and to the extent otherwise provided by law.

7. Waivers.
(a) Borrower hereby waives diligence, presentment, protest, and demand, and notice of protest, notice of demand, notice of dishonor and notice of non-payment of this Predevelopment Note. Borrower expressly agrees that this Predevelopment Note or any payment hereunder may be extended from time to time, and that City may accept further security or release any security for this Predevelopment Note, all without in any way affecting the liability of Borrower.
(b) No extension of time for payment of this Predevelopment Note or any installment hereof made by agreement by City with any person now or hereafter liable for payment of this note shall operate to release, discharge, modify, change or affect the original liability of Borrower under this Predevelopment Note, either in whole or in part. (c) The obligations of Borrower under this Predevelopment Note shall be absolute and Borrower waives any and all rights to offset, deduct or withhold any payments or charges due under this Predevelopment Note for any reason whatsoever.

8. Miscellaneous Provisions.
(a) All notices to City or Borrower shall be given in the manner and at the addresses set forth in the Agreement, or to such addresses as City and Borrower may hereinafter designate.
(b) Borrower promises to pay all costs and expenses, including reasonable attorney's fees, incurred by City in the enforcement of the provision of this Predevelopment Note, regardless of whether suit is filed to seek enforcement. (c) This Predevelopment Note may not be changed orally, but only by an agreement in writing signed by the party against whom enforcement of any waiver, change, modification or discharge is sought.
(d) This Predevelopment Note shall be governed by and construed in accordance with the laws of the State of California.
(e) The times for the performance of any obligations hereunder shall be strictly construed, time being of the essence.

SIGNATURES ON FOLLOWING PAGE(S).
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This document, together with the Agreement and Predevelopment Deed of Trust, contains the entire agreement between the Parties as to the Predevelopment Loan. It may not be modified except upon written consent of the Parties.

BORROWER:

MP Rail Trail Associates, L.P.
a California limited partnership
By: MP Rail Trail LLC,
a California limited liability company,
its general partner
By: Mid-Peninsula San Carlos Corporation,
a California nonprofit public benefit corporation,
its sole member/manager
By: ____________________________
Matthew O. Franklin, President/CEO
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Exhibit D
FORM OF PREDEVELOPMENT DEED OF TRUST – SHORT FORM
[see attached]
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Capitola City Council
Agenda Report
Meeting: November 9, 2023
From: City Manager Department
Subject: Resolution Against Banning Materials
Recommended Action: Adopt a resolution against banning books and materials in the Santa Cruz Public Library system. (Continued from October 26, 2023)
Background: The Santa Cruz Public Libraries (SCPL) system delivers information, education, and enrichment through a network of ten neighborhood libraries. In addition, SCPL maintains a web-based digital library, a Bookmobile, and community-based programming. Residents can explore a wide range of interests from academic research, book clubs and literacy programs to digital photography, locally produced music, and local history.

The City of Capitola is home to a Santa Cruz County Public Library, located at 2005 Wharf Road. The library has been open since 2021. Other branch locations include Aptos, Boulder Creek, Branciforte, Downtown Santa Cruz, Felton, Garfield Park, La Selva Beach, Live Oak and Scotts Valley.

On October 12, 2023, City Council Member Brown requested that staff bring forward a resolution against the banning of books and materials at the Santa Cruz Public Libraries system.

Discussion: The City of Capitola supports the Santa Cruz Public Libraries’ values of relevance, inclusiveness, community engagement, responsive service, and safe environment. According to the American Library Association (ALA), there were 32 attempts in California to restrict access to books in 2022. The City of Capitola supports the SCPL’s commitment to provide open access and information, as well as allowing free inquiry, and opposes banning books and materials.

Fiscal Impact: There is no fiscal impact associated with the proposed resolution.

Attachments:

1. Resolution
Report Prepared By: Julia Gautho, City Clerk
Approved By: Jamie Goldstein, City Manager
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RESOLUTION NO. XXXX

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CAPITOLA

AGAINST BANNING BOOKS AND MATERIALS IN THE SANTA CRUZ PUBLIC LIBRARIES SYSTEM
WHEREAS, the role of libraries is to provide works and information reflective of diverse perspectives and lived experiences; and
WHEREAS, the Santa Cruz Public Library’s Strategic Plan for 2022-2025 has a goal to “create an organizational culture of equity and inclusion and provide equitable and relevant services to all;” and
WHEREAS, we appreciate our library staff who are often on the front lines of the fight for the freedom to read; and
WHEREAS, according to the American Library Association (ALA), there were 1,269 attempts to censor materials in public libraries in 2022, nearly double the previous year; and WHEREAS, according to the ALA, there were 32 attempts in California to restrict access to books in 2022, covering 87 titles, with the most challenged titles being Gender Queer: A Memoir and Beyond Magenta: Transgender Teens Speak Out; and WHEREAS, according to the Office for Intellectual Freedom at the ALA, six of the top seven titles requested to be banned nationwide in 2022 featured LGBTQ+ content (the seventh was Toni Morrison’s The Bluest Eye); and
WHEREAS, book banning is incompatible with a healthy democracy; WHEREAS, governing bodies in Missouri, Virginia, Arkansas, Texas, Florida, and others have endorsed banning books and have defunded public libraries or threatened to cut funding for public libraries who do not comply.

NOW, THEREFORE, MAY IT BE RESOLVED, that the City of Capitola supports the Library Advisory Commission’s commitment to open access and information as well as allowing free inquiry throughout the Santa Cruz Public Library system, and opposes banning books and materials.

MAY IT BE FURTHER RESOLVED, that the City Council of the City of Capitola affirms that library funding will not be affected by choices in material selection.

I HEREBY CERTIFY that the foregoing Resolution was passed and adopted by the City Council of the City of Capitola on the XX day of XX, 2023, by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:
__________________________
Margaux Keiser, Mayor
ATTEST:
__________________________
Julia Gautho, City Clerk
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RESOLUTION AGAINST

BOOK/MATERIAL BAN
October 26, 2023 139
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Background
 10/11/2023: City Council received a request from
the Library Advisory Commission (LAC) to adopt
resolution against banned materials in the Santa
Cruz Public Library System
 10/12/2023: Vice Mayor Brown requested staff
bring the item for City Council consideration
 10/26/2023: Council Member Clarke pulled the
item for discussion, following public comment
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Recommended Action
 Adopt a resolution against banning books and
materials in the Santa Cruz Public Library system.
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Capitola City Council
Agenda Report
Meeting: November 9, 2023
From: Police Department
Subject: 2023 Special Event Report
Recommended Action: Receive report on 2023 special events; provide direction regarding changes to specific special event permit conditions; and approve recurring minor and general special events for 2024.

Background: In February 2002, the City Council approved Resolution No. 3202, adopting a special event permit program and fee schedule. The purpose of the program was to provide regulations and guidelines for special events occurring within the City limits and to recover costs associated with those events.

Special events are divided into two categories: general special events and minor special events. General special events are those with more than 200 attendees or notable impacts on City services or a neighborhood. Minor special events are activities with fewer than 200 people and limited impacts. Minor special events can be approved by the City Manager, while all applications for new general special events must be presented to the City Council for review and consideration.

If there are no significant modifications and there are no major problems with the event, recurring special events may be approved by the City Manager for the upcoming calendar year. The City Council has the discretion to request a review of a recurring special event if there is an identifiable concern related to past events.

The purpose of this report and presentation is to review the 2023 special events, identify any issues, and determine if any additional review should be required for any recurring events in 2024. If no issues are identified for an event, and the event organizer proposes no significant changes, staff will issue permits for those recurring special events in 2024.

Discussion: This year’s special events returned to pre-pandemic levels. In 2020, staff issued 12 general special event permits, 27 minor special event permits, and five Art and Cultural Commission event permits. Below are the planned reoccurring events for 2024.

Planned 2024 General Special Events
 Surfer’s Path 10K/5K  Capitola Art & Wine Festival
 Surfer’s Path Half Marathon  Capitola Beach Festival  Capitola Custom Classic Car Show  Mermaid Triathlon/Duathlon  Twilight Concerts (12)  Monte Fireworks Extravaganza  Wharf to Wharf Race  Wahine 10K/6K
 Movies at the Beach (3)  Women on Waves Surf Contes
Planned 2024 Minor Special Events
 Village Sip & Stroll #1  AIDS/Lifecyle Bicycle Ride
 Operation Surf  Food Truck Fridays at Monterey Park (4)  Good Friday Paddle Out  Sunday Art at the Beach (3)
 Village Easter Egg Hunt  California Coast Classic
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 Village Sip & Stroll #2  First Responder Surf Contest  Skate-tola  Halloween Parade
 Walk for Angelman’s Syndrome  Village Sip & Stroll #3  Fill the Boot for MDA  Surfing Santa
 Veteran Surf Alliance Paddle Out
Future Special Events: Staff from Planning, Police, Public Works, and Recreation have been working with the City Attorney’s office to review the current Capitola Municipal Code and policies regarding special events. Staff intends to present a comprehensive update to the City Council for consideration by the end of the year. The goal of this comprehensive update is to:
 Review and revise the Municipal Code (noise ordinance, objective standards for special events, regulations for use of City public spaces);
 Streamline the approval process for special event permits;  Redefine thresholds for special events (general vs. minor);  Review cost sharing and fees for staff time (overtime costs, lifeguard costs).

Fiscal Impact: Each special event requires additional work from City staff. In addition to the overtime hours listed below, each event requires scheduling changes, additional trash pickup, and cleaning services.
 Art & Wine – 151.5 overtime hours from Police Department staff  Capitola Beach Festival- 51.5 overtime hours from Police Department staff  Capitola Custom Classic Car Show- 22 overtime hours from Police Department staff  Surfers Path – 17 overtime hours from Police Department staff  Wharf to Wharf- 79 overtime hours from Police Department staff The total amount of overtime staff costs reimbursed to the City was approximately $39,544.

Report Prepared By: Sarah Ryan, Police Captain
Reviewed By: Julia Gautho, City Clerk; Andy Dally, Police Chief; Jim Malberg, Finance Director Approved By: Jamie Goldstein, City Manager
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Art and Wine Festival OT Hours
Officer PEO OT CSO OT Officer OT Sergeant OT Grand Total

12.5 12 2 1 for 2023
2 2 2 12 Art & Wine

2.5 13 12.5 3 Festival
12 2

2.5 9.5
2 2
12 2
12 4
12 2
1 0 31.5 27 77 16 151.5
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Capitola Custom Classic Car Show OT Hours
Officer PEO OT CSO OT Officer OT Sergeant OT Grand Total 6 2.5 1.5 2.5 for 2023
7 2.5
13 5 1.5 2.5 0 22
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Surfer's Path OT Hours
Officer PEO OT CSO OT Officer OT Sergeant OT Grand Total 44 5 for 2023
4 84005 17
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Wharf to Wharf OT Hours
Officer PEO OT CSO Officer OT Sergeant OT Grand Total
7 6.5 7 7 1.5 for 2023
7 72 Wharf to
67 Wharf
1 7
5 1
7 14 6.5 7 41 10.5 79
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Capitola Beach Festival OT Hours
Officer PEO OT CSO OT Officer OT Sergeant OT Grand Total

5.5 2 6 for 2023
6 Capitola
2 Beach
6 Festival
6 6
6 6

5.5 0 0 40 6 51.5
Parking Costs -
Saturday and Sunday:
101, 201, 202, 203, 204, 205, 206 = 7 Spaces x $18 Per Day = $126 x 2 Days = $252 Saturday Only:
102, 148, 149 = 3 Spaces x $18 Per Day = $54
Sunday Only:
128, 129 = 2 Spaces x $18 Per Day = $36
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2023 SPECIAL
EVENT

PERMITS
Sarah Ryan, Police
Captain
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Purpose • Receive Report on 2023 Special Events
• Provide direction regarding changes to
specific recurring special events, permits
• Determine need for additional review of
planned recurring 2024 special events
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Special Event Background • Police Department issues SE permits

1. General SE Permits - > 200 attendees and
impacts to city services

2. Minor SE Permits - < 200 attendees and
minimal impacts to city services

3. Art & Cultural Commission/City Events
2023 Staff Issued 10 General SE Permits, 26
Minor SE Permits, and 5 Permits to the Art
& Cultural Commission
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10 General Special Events
• Beyond the Flood Benefits Concert
• February Surfer’s Path 10k/5k
• Capitola Art & Wine Festival • May Surfer’s Path Half Marathon • Capitola Beach Festival • Capitola Custom Classic Car Show • Women on Waves
• Wharf to Wharf • October Surfer’s Path Wahine 10k/6k
• Oktoberfest
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26 Minor Special Events
• Village Sip and Stroll
(3 total) • California Coast
Classic Ride
• Operation Surf • Veteran Surf
Alliance Paddle Out
• Fill the Boot for
Muscular Dystrophy
• Halloween Parade
• Skate-Tola
• Surfing Santa
• Walk for Angelman’s
Syndrome
• Food Truck Fridays
Event at Monterey
Park
• First Responder’s
Surf Contest • AIDS/Lifecycle
Bicycle Ride
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Six City-Organized Special Events
• Sunday Art/Music at the Beach
• Wednesday Night Twilight Concerts
• Friday Night Movies at the Beach
• Ukrainian Cultural Event (Art at the Beach) • Beyond the Flood benefit concert • Jojo’s Birthday Celebration
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2023 Recap
• Joint Command with Central FDIncident Command System • Capitola Lifeguard Program
• Staff billed organizers 321 police hours,
66 public works hours. • Staff committee project: update and improve processes and guidelines
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Future Special Event Process
• Review and revise Municipal Codes
• Streamline approval process
• Redefine thresholds for special events
(general vs minor)
• Review cost sharing and fees for staff
time (overtime costs, lifeguard costs)
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Recommendation
• Provide direction regarding changes to specific recurring special event permit conditions, and • Determine if any additional review should be required for any planned recurring 2024 special events
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Capitola City Council
Agenda Report
Meeting: November 9, 2023
From: Recreation Division
Subject: Capitola Lifeguard Season Overview
Recommended Action: Receive a report on Capitola Lifeguard service season statistics and approve the proposed operation schedule for future summer and fall seasons.

Background: On July 28, 2022, the City Council approved changes to the Recreation Coordinator job description to include the development and supervision of the Capitola Lifeguard Service. The Recreation Coordinator: Beach Lifeguard Services assisted in developing and supervising the Capitola Lifeguard Service’s first season of operations, which concluded in October.

Previously, the City held an agreement with the City of Santa Cruz Fire Department (Santa Cruz) for lifeguard services, which ended in September 2022. The contract with Santa Cruz provided for lifeguard services from Memorial Day Weekend to Labor Day Weekend, after which Santa Cruz would reduce their seasonal staff pool and shift services based on conditions and demand.

This 2023 season the City provided lifeguard services during that same time period, plus weekend-only services from the weekend after Labor Day until October 15, which the City Council approved in the Fiscal Year 2023-24 budget.

In September 2023, staff applied to become a Certified Open Water Lifeguard Agency through the United States Lifesaving Association (USLA). USLA is a national organization that certifies lifeguard agencies and ensures that their training program meets or exceeds professional standards. The application has been reviewed and approved at the regional level under the California Surf Lifesaving Association (CSLSA) and will progress to USLA for final approval in November 2023.

Discussion: The City has a responsibility, as a USLA Certified Agency, to provide annual statistics that contribute to USLA national data collection. The City uses a web-based software, Watchtower, to record incidents and identify data trends based on activity on the beach. Below is a summary of data collected from beach activity from Summer and Fall 2023:
 Top two public events that created the most contacts/enforcement actions by lifeguards:

July 4th and Art & Wine Festival
 Beach attendance (contacts/enforcement actions) dropped after August 19th (schools returned)
 Following August 19th, majority of activity shifted to weekends, with the exception of Labor Day weekend
Staff is in the process of preparing an update to the City’s Special Event Permit process for City Council review. This work has led to questions about when to bill for lifeguard services in response to events that involve activities in, or adjacent to, the ocean, and other events that draw large crowds to Capitola Beach.

Special events regularly require increased staffing levels or workloads. Examples include increased Police Department staffing, parking and/or road closures, and additional garbage pickup. Currently, event producers are billed for staff time related to the extra services necessary for their event. Dense crowds and alcohol are significant risk factors for beach safety, and staff recommends that costs for increased lifeguard services should be expensed to event producers. 158
Item 7 C.

Lifeguard operation staff consists of an on-duty Lifeguard Lieutenant (LT) and the appropriate number of Lifeguards (LG) for operations (two per tower). In circumstances where the towers are not able to be used, this is still the appropriate staffing during the busy season or events. The minimum staffing level is one LT and two LGs on Tower 1. The addition of Tower 2 provides faster response time and is needed when the beach is crowded and when the visual workload of scanning demands particular attention. When crowd size, conditions, or an emergency response requires additional lifeguard staffing, beyond the minimum staffing levels, it is referred to as a “callback”. During events, any callbacks due to an emergency would not be billed to the event producer.

Based on the data obtained during Summer 2023 and the pending new Special Event Permit process, staff has recommended operation schedules for future summer and fall lifeguard services.

Summer Season
Staff Recommendation: Operate both towers from Memorial Day weekend to Labor Day weekend, seven days a week. During the last half of August, staff will monitor conditions and crowds at the beach and reduce staffing to Tower 1 if necessary.

Alternative: Operate from Memorial Day weekend to mid-August, seven days a week. After midAugust, when school has returned, beach lifeguards would be provided on weekends (Saturday & Sunday) until mid-October. This option would reduce the number of days lifeguards are working by 14 days.

Fall Season
Staff Recommendation: Operate Tower 1 on weekends for beach public safety from the end of the summer season (Labor Day weekend) to mid-October. Events that operate during this season would be billed for staffing of Tower 2 and any callbacks necessary to support the large crowd and/or if the event includes activities in the ocean (e.g. swim races, paddling events, etc.).

Alternative: Operate Tower 1 and Tower 2 on weekends for beach public safety from the end of the summer season to mid-October. Events that operate during this season would be billed for callbacks necessary to support the large crowd, or if the event requires City lifeguard staff specifically dedicated to the event.

Fiscal Impact: The direct daily cost of Tower 1 operation (1 LT & 2 LG) is $557 per 8-hour day.

The addition of Tower 2 (2 LG) is $353 for a direct cost total of $910/day to operate the two towers.

For billing purposes, the City overhead is an additional 30%. Callbacks due to excessive crowds could be billed and could include up to 4 additional lifeguards.

Report Prepared By: Nikki Bryant LeBlond; Recreation Division Manager Reviewed By: Julia Gautho, City Clerk
Approved By: Jamie Goldstein, City Manager
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Capitola Lifeguard Service
season statistics and
operation schedule
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BACKGROUND
• Staff from Planning, Police, Public Works and
Recreation have been reviewing the code and
polices regarding special events.
• Staff intends to present an update to Council
by the end of the year.
• Review and Revise Municipal Code
• Streamline approval process for Special Event
Permits
• Redefine Thresholds for Special Events
• Review cost sharing and fee for staff time
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BACKGROUND
• Capitola Lifeguard Service’s first season
concluded in October.
• Season began May 26- Memorial Day
Weekend
• Seven days a week
• Ended after Labor Day Monday
• After Labor Day Weekend, service
provided on weekends until October 15
• Events and Weekend visitors
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BACKGROUND
• Staff applied to United States Lifesaving
Association (USLA) in September
• Certified Open Water Lifeguard Agency
• On November 4th, the City was approved as
a USLA Certified Lifeguard Agency.
• November 2026
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What does Lifeguard
Service accomplish?
• Community Outreach
• Educate
• Guide
• Represent the City of Capitola
• Emergency Response
• Anticipate
• Prevent
• Respond
2 1
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Higher Risk Populations
of Drowning
Youth Males Race and
Ethnicity Epilepsy
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Activities Associated with
Drowning
Swimming Boating Diving Alcohol
Consumption
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Prevention Action
Public
Contacts Enforcement
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Public Safety
Contact
• Educate Beachgoers
• Beach and Water Hazards
• Unsafe Activities
• Water Conditions
• General Information
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ENFORCEMENT
• Lifeguard role in enforcement

1. Educate beachgoers

2. Inform the public on City
Municode

3. Update PD on beach activity that
requires their service
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Digital
Command
Center
Legal
Documentation
Statistics
Correlates External Factors with
Calls for Service
Quality of service
Document statistics for USLA
Shows us how we can protect our
community in a more significant
way
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End of Season Statistics
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Major
Medical &
Rescues X
hour of the
day
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Calls for
Service
X
Air
Temperature
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Tide Height
X
Rescues &
Assists
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Swell Height
X
Rescue &
Assists
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2023 Season Graph Monthly
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May Graph Day to Day
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June Graph Day to Day
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July Graph Day to Day
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August Graph Day to Day
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September Graph Day to Day
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October Graph Day to Day
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DISCUSSION
• Review of the Special Event Permit policies
led to questions regarding billing for staff
time
• Current practice to bill for staff time
specifically dedicated to the event
• Lifeguard services should be included in
event planning and billing when:
• The event will create a dense crowd (also
likely to include alcohol)
• Includes a water element that requires
specific LG staffing
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Item 7 C.

DISCUSSION
• Lifeguard Operation Staffing
• One Lifeguard Lieutenant (LT)/Supervisor
• Lifeguards (LG) two per tower (4 total)
• Minium Staffing
• 1 LT & 2 LG
• Regardless if towers are available
• Dense crowds increases risk and demand more
from LG
• Tower 2 is necessary in this circumstance
• Callback: lifeguards that are not scheduled but
available during an emergency or conditions
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Item 7 C.

FISCAL IMPACT Total direct cost to operate
Tower 1 & 2: $910.24 per 8-
hour day
Direct Cost (8-hour day) Overhead for Billing
Tower 1 $557: City expense 0%
Tower 2 $352: billed to event 30%
Up to 4 LG $22.06 per hour per person 30%
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RECOMMENDED ACTION
•
•
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RECOMMENDED ACTION
•
•
•
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RECOMMENDED ACTION
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Questions
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Capitola City Council
Agenda Report
Meeting: November 9, 2023
From: Community Development Department
Subject: Citywide Housing Element Adoption
Recommended Action: Adopt a resolution to adopt the Addendum to the General Plan Update Environmental Impact Report and the 6
th Cycle Housing Element, and direct staff to submit the Housing Element to the State of California for certification.

Background: In accordance with applicable State housing law, local jurisdictions are legally required to adopt plans and programs for housing that provide opportunities for, and do not unduly constrain, housing development. The Housing Element, which is one of seven State-mandated components of the City’s General Plan, is a mechanism by which the State requires local jurisdictions to provide a variety of housing options and strive toward reaching regional housing needs. The Housing Element should also maintain civic and local responsibility toward economic, environmental, and fiscal factors and community goals stated within adopted General Plan documents.

Housing Elements are required to be updated every eight years. The City’s current Housing Element was adopted by the Capitola City Council in 2015 and certified by the State of California in 2016 and will be in effect through December 2023. The City is required by law to update the Housing Element for the 2023-2031 planning period (also known as the sixth cycle) and have the updated Housing Element adopted and sent to the California Department of Housing and Community Development (HCD) for certification by December 15, 2023.

On May 12, 2022, the City Council authorized an agreement with RRM Design Group (RRM) for the preparation of the 2023-2031 Housing Element. Staff worked with RRM to assess existing and projected housing needs, reviewed the existing Housing Element, and began work on the updated Housing Element.

Pursuant to applicable State housing law, the City solicited public input from all segments of the community in the preparation of the Housing Element. Public comment was accepted at each of the meetings below:
 Stakeholder meetings (November 2022)
 Two community workshops (February 16, 2023, and May 16, 2023)  Online housing survey (November 2022 – March 2023)
 Planning Commission meetings (February 2, May 4, June 1, October 5, October 19)  City Council meetings (February 9, June 8, October 12)  Joint Planning Commission and City Council work session (March 16, 2023) On May 10, 2023, a draft of the Housing Element was published for public review. Following the thirtyday publishing period (during which the draft Housing Element was mentioned during a Planning Commission meeting and a City Council meeting), the initially published draft was updated to incorporate additional information as requested during the public review period.

On July 5, 2023, Capitola’s Housing Element was submitted to the State of California Department of Housing and Community Development (HCD), initiating the required 90-day review process. Since submission to HCD, staff has received two rounds of preliminary comments from the State. In response to each round of comments, the Housing Element was updated, republished for public review, and resubmitted to HCD (August 29, 2023, and September 19, 2023). 190
Item 7 D.

On October 3, 2023, the City received official comments from the HCD (Attachment 3). The letter included requests for additional information and incorporating new strategies that go beyond SB9 and ADU laws to create additional housing mobility opportunities within single-family neighborhoods. In response to the request, the housing element consultant team is suggesting a program to allow duplexes on corner lots in single-family neighborhoods. This program has been accepted by HCD in other jurisdictions with certified Housing Elements.

On October 5, 2023, the Planning Commission received an update on the Housing Element and directed staff to incorporate HCD recommendations, as well as edits to state lands, the shopping center program, and the community benefits incentives program into the draft, and prepare the document for adoption hearings. The Planning Commission recommended adding a new program to work with the State during the 6th Cycle to initiate discussions and possible planning for housing opportunities on state lands, including the DMV site and New Brighton State Park. They also asked staff to modify the shopping center program and community benefits incentives program to ensure deliverables are based on the outcome of the current mall redevelopment land-use study.

On October 12, 2023, the City Council received an update on the Housing Element and directed staff to incorporate public comment, Planning Commission, and the California Department of Housing and Community Development recommendations into the Draft Housing Element, and to update and prepare the document for adoption.

On October 17, 2023, City staff met with HCD staff and received additional comments on the updated draft related to missing middle housing, sites capacity, public-owned sites, and environmental constraints.

On October 19, 2023, the Planning Commission had a special meeting and forwarded a unanimous positive recommendation to the City Council to adopt the draft housing element, with additional modifications to the timing of deliverables, missing middle housing, sites capacity, public-owned sites, and environmental constraints. The current draft for adoption incorporates all edits recommended by the Planning Commission and HCD staff.

Discussion: The purpose of this agenda item is to officially adopt the 6th Cycle Housing Element and the addendum to the General Plan EIR.

The latest draft, published on October 13, 2023, is available in hard copy at Capitola City Hall and the Capitola Library. The Housing Element is also available on the City’s website Housing Element Update page at the following link: https://www.cityofcapitola.org/communitydevelopment/page/2023-2031- housing-element-update.

Revisions to HCD’s first response can be found in blue font. Revisions to HCD’s second response can be found in blue font with yellow highlight. The third revisions based on the Planning Commission and City Council direction are in blue font with blue highlight. The most recent revision based on Planning Commission recommendation for adoption are in blue font with green highlight.

As mentioned above, City staff received two rounds of comments and attended three meetings with HCD.

The HCD comments varied from minor edits and requests for additional information, to requiring greater commitments to programs, adding new programs, and modifying the sites inventory. With regards to the sites inventory, the City received comments from HCD and the public related to overreliance on the mall site, distribution of sites City-wide, and no net loss.

During the October Planning Commission and City Council updates, staff received direction to incorporate the following into the final draft for adoption:

1. Add Mobility Strategies. Revisit density on low and medium multifamily zones. Allow duplexes on corner lots in single-family zone with objective standards;

2. Amend Community Benefits Overlay and incorporate objective standards;

3. Provide additional information on Capitola Mall, religious sites, small lot consolidation, and constraints;
191
Item 7 D.

4. Revise the programs on Community Benefits and Shopping Centers to align with the outcome of the mall study;

5. Add a program to initiate discussion related to housing and state lands;

6. Incorporate feedback provided within public comments; and

7. Update the timing of commitments to ensure on-time completion.

8. Include additional information on missing middle housing, sites capacity, public-owned sites, and environmental constraints
The following identifies the next steps for the Housing Element update.

Next Steps Date
City Council Adoption November 9, 2023
Submit Housing Element to HCD for Certification November 10, 2023 HCD Certification 60 days review
CEQA: An addendum to the General Plan Update Environmental Impact Report for the 2023-2031 Housing Element is included as Attachment 4. The General Plan Update EIR is available at https://www.cityofcapitola.org/communitydevelopment/page/capitola-general-plan.

Fiscal Impact: The General Plan update includes numerous commitments to affordable housing projects.

Staff intends to apply for grants to fund future project commitments.

Attachments:

1. Resolution

2. HCD Response Letter

3. Addendum to General Plan EIR

4. Draft Housing Element available at the following link:
https://www.cityofcapitola.org/communitydevelopment/page/2023-2031-housing-elementupdate.

Report Prepared By: Katie Herlihy, Community Development Director Reviewed By: Julia Gautho, City Clerk; Samantha Zutler, City Attorney Approved By: Jamie Goldstein, City Manager
192
Item 7 D.
4868-4926-5549 v1
RESOLUTION NO.

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

CAPITOLA ADOPTING AN ADDENDUM TO THE GENERAL

PLAN UPDATE ENVIRONMENTAL IMPACT REPORT AND

ADOPTING A GENERAL PLAN AMENDMENT REPLACING
THE 2015-2023 HOUSING ELEMENT WITH AN UPDATED
2023-2031 HOUSING ELEMENT, INCLUDING POLICIES AND

PROGRAMS AFFIRMATIVELY FURTHERING FAIR

HOUSING
WHEREAS, the California legislature has found that “California has a housing supply and affordability crisis of historic proportions. The consequences of failing to effectively and aggressively confront this crisis are hurting millions of Californians, robbing future generations of the chance to call California home, stifling economic opportunities for workers and businesses, worsening poverty and homelessness, and undermining the state’s environmental and climate objectives.” (Gov. Code Section 65589.5.); and
WHEREAS, the legislature has further found that “Among the consequences of those actions are discrimination against low-income and minority households, lack of housing to support employment growth, imbalance in jobs and housing, reduced mobility, urban sprawl, excessive commuting, and air quality deterioration.” (Gov. Code Section 65589.5.); and WHEREAS, the legislature adopted the Housing Crisis Act of 2019 (SB 330) which states that “California needs an estimated 180,000 additional homes annually to keep up with population growth, and the Governor has called for 3.5 million new homes to be built over 7 years”; and WHEREAS, State Housing Element Law (Government Code Sections 65580 et seq.) requires that the City Council adopt a Housing Element for the eight-year period 2023-2031 to accommodate the City of Capitola’s (City’s) regional housing need allocation (RHNA) of 1336 housing units, comprised of 430 very-low income units, 282 low-income units, 168 moderateincome units, and 455 above moderate-income units; and WHEREAS, to comply with State Housing Element Law, the City has prepared the Capitola 2023-2031 Housing Element (the Housing Element); and WHEREAS, as provided in Government Code Section 65350 et. seq., the Housing Element constitutes a General Plan Amendment; and
WHEREAS, as provided in Government Code Section 65352.3, the City contacted California Native American tribes on the contact list provided by the Native American Heritage Commission and informed them of the opportunity for consultation under SB 18; and WHEREAS, no California Native American tribe requested consultation; and 193
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4868-4926-5549 v1
WHEREAS, as provided in Government Code Section 65352, the City referred the Housing Element to appropriate agencies;
WHEREAS, the City has prepared the Housing Element in accordance with State Housing Element Law; and
WHEREAS, State law requires that the City take meaningful steps to promote and affirmatively further fair housing (Gov. Code Section 65583(c)(5)); and WHEREAS, the Housing Element must be adopted to comply with State law, accommodate the RHNA, affirmatively further fair housing, and facilitate and encourage a variety of housing types for all income levels, including multifamily housing (Gov. Code Sections 65583.2 and 65583(c)); and
WHEREAS, the preparation, adoption, and implementation of the Housing Element requires a diligent effort to include all economic segments of the community; and WHEREAS, the City conducted an extensive community outreach program including an conducting an online housing needs survey from November 022 through March 2023, conducting stakeholder interviews in November 2022, engaging the development community and housing advocates, facilitating community workshops on February 16, 2023 and May 16, 2023, and holding study sessions with the Planning Commission and City Council on February 2, 2023, February 9, 2023, and March 16, 2023; and
WHEREAS, staff published a draft Housing Element on May 10, 2023, for a 30-day public review and comment period. During the public review and comment period, the draft was presented during a virtual community meeting on May 16, 2023, a Planning Commission meeting on June 1, 2023, and a City Council meeting on June 8, 2023; and WHEREAS, staff received comments and made extensive revisions to the draft in response to public input; and
WHEREAS, in accordance with Government Code Section 65585(b), on July 5, 2023, the City submitted the draft Housing Element to the State Department of Housing and Community Development (HCD) for its review; and
WHEREAS, on July 26, 2023, the City met with HCD to review the draft Housing Element prior to HCD’s issuance of its findings letter; and
WHEREAS, on August 29, 2023, the City posted the second draft of the Housing Element on its website, with redlined modifications for public review.

WHEREAS, on September 6, 2023 the City met with HCD to review the draft Housing Element prior to HCD’s issuance of its findings letter; and 194
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4868-4926-5549 v1
WHEREAS, on September 19, 2023, the City posted the third draft of the Housing Element on its website, with all additional modifications highlighted in yellow for public review; and WHEREAS, on October 3, 2023, the City received a letter from HCD providing its findings regarding the draft Housing Element. The findings stated that while the draft Housing Element addressed many statutory requirements, revisions would be necessary to comply with State Housing Element Law (Article 10.6 of the Government Code); and WHEREAS, on October 5, 2023, staff provided a briefing to the Planning Commission on HCD’s findings, and on October 12, 2023 staff provided a briefing to the City Council on HCD’s findings, including opportunities for public comment; and WHEREAS, the City systematically analyzed HCD’s findings and identified areas needing responses or revisions; and
WHEREAS, the City has responded to each of these issues and revised the Housing Element so that it substantially complies with all Government Code requirements; and WHEREAS, the City notified all interested parties of the availability of the updated draft, the opportunity to provide comments, and the dates of upcoming public hearings; and WHEREAS, the City provided notice of the October 19, 2023 Planning Commission special meeting as required by law; and
WHEREAS, on October 17, 2023, the City met with HCD and received additional comments on the Housing Element;
WHEREAS, on June 26, 2014 the City Council certified a Final Environmental Impact Report (SCH 2013072002) (FEIR) for the General Plan Update, adopting the Mitigation Monitoring and Reporting Program and Statement of Overriding Considerations; and WHEREAS, an EIR Addendum (Addendum) to the FEIR has been prepared in accordance with Section 15162 of the California Environmental Quality Act (CEQA) Guidelines, which demonstrates that none of the conditions requiring preparation of a subsequent EIR or negative declaration have occurred, and that the changes that are part of the Housing Element update would not result in any significant impacts not considered under the original EIR; and WHEREAS, on October 19, 2023, the Planning Commission held a duly noticed public hearing at which time it reviewed the Housing Element and all pertinent maps, documents and exhibits, the staff report and all attachments, and oral and written public comments, and determined the Housing Element to be consistent with State law and the General Plan of the of the City of Capitola, and adopted a Resolution recommending that the City Council adopt the 2023-2031 Housing Element with revisions necessary to obtain certification from HCD; and WHEREAS, the City provided notice of the November 9, 2023 City Council meeting as required by law; and
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4868-4926-5549 v1
WHEREAS, on November 9, 2023, the City Council conducted a duly and properly noticed public hearing to take public testimony and consider this Resolution regarding the Addendum and the proposed Housing Element, reviewed the Housing Element and all pertinent maps, documents and exhibits, including HCD’s findings, the City’s response to HCD’s findings, the staff report and all attachments, and oral and written public comments.

NOW, THEREFORE, BE IT RESOLVED, that the City Council hereby finds that, based on substantial evidence in the record:

1. The foregoing recitals are true and correct and are incorporated by reference into this action.

2. The City Council has reviewed and considered the Addendum to the General Plan Update Environmental Impact Report for the Housing Element, and finds that none of the conditions requiring preparation of a subsequent EIR or negative declaration have occurred, and that the changes that are part of the Housing Element update would not result in any significant impacts not considered under the original EIR.

3. The proposed 2023-2031 Housing Element is consistent with the objectives, policies, general land uses and programs specified in the General Plan. The Housing Element is consistent with the General Plan Land Use Element goals and policies set forth below:
 Goal LU-1 Maintain and enhance Capitola’s distinctive identity and unique sense of place.
 Goal LU-4 Protect and enhance the special character of residential neighborhoods.  Goal LU-5 Ensure that new residential development respects the existing scale, density, and character of neighborhoods; Policy LU-5.1 Neighborhood Characteristics -- Require new residential development to strengthen and enhance the unique qualities of the neighborhood in which it is located.
 Goal LU-8 Support the long-term transformation of Capitola Mall into a more pedestrianfriendly commercial district with high quality architecture and outdoor amenities attractive to shoppers and families; Policy LU-8.2 Parking Lot Redevelopment -- Encourage the development of commercial and mixed-use structures on existing Capitola Mall surface parking lots located adjacent to 41st Avenue and Capitola Road including both sides of 41st Avenue; and Action LU-8.2 Infrastructure Improvement Funding -- Identify funding sources for infrastructure improvements that will stimulate investment and redevelopment of the Capitola Mall property and provide urban amenities attractive to residential and mixed-use development.
 Goal LU-9 Encourage high quality development within the 41st Avenue corridor that creates an active and inviting public realm; Policy LU-9.3 Destination -- Establish 41st Avenue as an attractive destination with activities for families and people of all ages that occur throughout the day and night. Where feasible, incorporate public art into public spaces; and Policy LU-9.5 Neighborhood Impacts. Minimize negative impacts — particularly traffic, parking, and noise — on residential neighborhoods adjacent to the corridor. Incorporate design or mitigation measures into projects to avoid or minimize neighborhood impacts.
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 Goal LU-12 Utilize key public facilities and properties in a manner that enhances the quality of life of Capitola‘s residents.

Furthermore, the 2023-2031 Housing Element is consistent with the following 2015-2023 Housing Element goals: Goal 1.0 Housing Production -- Diversity in housing type and affordability level to accommodate the needs of Capitola Residents; Goal 2.0 Affordable Housing Development -- Increased and protected supply of housing affordable to extremely-low, very- low, low and moderate-income households; Goal 3.0 Housing for Persons with Special Needs -- Accessible housing and appropriate supportive services that provide equal housing opportunities for special needs populations; Goal 4.0 Housing Assistance -- Increased Assistance for extremely low, very low, low and moderate income residents to rent or purchase homes; Goal 5.0 Neighborhood Vitality -- Maintain, preserve and improve the character of existing residential neighborhoods; Goal 6.0 Resource Conservation -- Fulfill the City’s housing needs while promoting an environmentally sensitive, compact community that is a pedestrian oriented, neighborhoodcentered community, using resources in a sustainable manner.

4. The 2023-2031 Housing Element is consistent with the General Plan and City of Capitola Municipal Code because the Housing Element includes implementation programs to study amendments to ensure consistency with the General Plan and Municipal Code.

5. Based on substantial evidence in the record, the non-vacant sites identified in the Housing Element site inventory to accommodate the RHNA do not constitute an impediment to planned residential development on the site during the planning period.

Section 65583.2(g)(2) of the Government Code requires that any jurisdiction relying on non-vacant sites to meet more than 50 percent of the RHNA for lower-income households must make findings that the existing use on the non-vacant site is not an impediment to residential development during the planning period. The findings must be made on substantial evidence that the existing use is likely to be discontinued during the planning period. The City has provided such substantial evidence in the Housing Element that the existing uses have already been or will be discontinued, or will incorporate residential components into existing uses during the planning period. This is based on the physical characteristics, existing uses, redevelopment potential (including improvement to land value ratio, floor area ratio, and known developer interest), location and context, local knowledge, and environmental and infrastructure constraints.

The sites inventory analysis demonstrates that all of the selected sites represent the best opportunities to add significant numbers of units to the City’s housing stock and possess the highest potential for becoming available for residential development over the 8-year planning period. Several non-vacant parcels selected to accommodate lower-income units where a property owner or developer has stated recent interest to the City in developing residential uses include:
• Six parcels along 41st Avenue
• 3720 Capitola Road
• 1404 38th Avenue
• 4148 and 4160 Clares Avenue
• 1098 38th Avenue
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• 1840 41st Avenue
• 4243 Capitola Road
• Two sites at 4401 Capitola Road
• 4450 Capitola Road
• 1430 41st Avenue
The sites inventory analysis has also identified at least eight non-vacant parcels, selected to accommodate lower-income units, that already contain discontinued uses (which have a greater likelihood of being redeveloped with residential units):
• 1430 41st Avenue
• 1210 41st Avenue
• 3825 Clares Street
• 1098 38th Avenue
• Four sites at 911 Capitola Avenue
The sites inventory analysis has also identified approximately 23 non-vacant parcels selected to accommodate lower-income units which have the potential for lot consolidation based on adjacency with like properties. Further, sites with newer business or known long-term leases were not included, as they have a lower probability of redeveloping within the next housing cycle. The age of construction, potential for lot consolidation, vacancy rate, under-developed/under-utilized nature of the site, and owner interest where applicable indicate that reuse of these sites with housing or mixed use mixed-use development during the planning period is likely.

6. As required by Government Code Section 65585(e), the City Council has considered the findings made by HCD in HCD’s letter to the City dated October 3, 2023, as required by Government Code Section 65585(f). The City has revised the draft Housing Element to address each of the findings in the HCD letter to substantially comply with the requirements of Article

10.6 of the Government Code as interpreted by HCD or has included an explanation as to why no changes were necessary, all as described in Attachment A, which is incorporated by this reference.

7. The Housing Element substantially complies with Housing Element Law, as provided in Government Code 65580 et seq. and contains all provisions required by Housing Element Law.

8. The City Council of the City of Capitola hereby adopts the Addendum to the General Plan Update Final Environmental Impact Report as prepared in compliance with the California Environmental Quality Act, as shown in Attachment B to this Resolution, incorporated herein, and directs the City Clerk to file or cause to be filed a Notice of Determination in compliance with State law.

9. The 2015-2023 Housing Element is hereby repealed in its entirety, and the 2023-31 Housing Element, as shown in Attachment C to this Resolution, incorporated herein, is adopted.

10. This Resolution shall become effective upon adoption by the City Council. 198
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11. The Community Development Director or designee is hereby authorized and directed to file all necessary material with the Department of Housing and Community Development for the Department to find that the Housing Element is in conformance with State Housing Element Law no later than December 15, 2023, with a request for a compliance determination, and is further directed and authorized to make all non-substantive changes to the Housing Element to make it internally consistent or to address any non-substantive changes or amendments requested by the Department to achieve certification.

12. The Community Development Director or designee is hereby authorized directed to distribute copies of the Housing Element in the manner provided in Government Code Sections 65357 (requiring that copies be provided to specific public entities and persons submitting comments, as well as made available to the general public) and 65589.7 (requiring that copies be submitted to water and sewer service providers).

I HEREBY CERTIFY that the above and foregoing resolution was passed and adopted by the City Council of the City of Capitola at its regular meeting held on the 9 th day of
November, 2023, by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:
________________________
Mayor
ATTEST: ________________________
City Clerk
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ATTACHMENT A
Pursuant to Government Code section 65585, subdivision (b), HCD reviewed the draft Housing Element and reported the results of its review.

The following changes were requested by HCD:

1. General HCD Comment Topic Area 1: Promote and affirmatively further fair housing opportunities and promote housing throughout the community or communities for all persons regardless of race, religion, sex, marital status, ancestry, national origin, color, familial status, or disability, and other characteristics... (Gov. Code, § 65583, subd. (c)(5).)
HCD Finding 1a: Goals, Actions, Metrics, and Milestones: Promoting housing mobility removes barriers to higher opportunity and income areas and strategically enhances access to housing choices and affordability. The element must include significant actions to promote housing mobility within the City and relative to the region to promote more inclusive communities.

While the element includes some potentially meaningful actions, largely, these actions are limited to the regional housing need allocation (RHNA) or geographically targeted to high and highest resource areas which is the entire City. Instead, programs to promote housing mobility should consider geographic targeting such as highest resource and relatively higher median income areas or areas of lesser intensity. In addition, the element should consider additional actions with numerical targets (e.g., 200 units) beyond rehabilitation, accessory dwelling units (ADU) and following state laws. Examples of additional actions could include upzoning areas, increasing housing choices (e.g., duplexes to fourplexes), targeting funding, allowing conversion of existing space beyond state ADU and junior accessory dwelling unit (JADU) laws and homesharing.

City Response 1a: The analysis has been updated to address HCD’s finding. To further facilitate affordable housing in the City, Capitola has included the following provisions in the Development Standards program of the Housing Element (p. 3-18):
 Corner lot duplexes in the R-1 zone: Allow corner lots in single-family neighborhoods to accommodate duplex units. Such a strategy is intended to provide flexibility compared to SB 9 requirements, with the goal of introducing moderately priced homes in the neighborhoods. Objective development standards will be used for these projects.  Examine the maximum densities in the RM-L and RM-M zones to determine if higher density limits will help facilitate multi-family development in the City.  The Fair Housing Actions table in the Housing Element expands on facilitating housing production using these actions.
p. 5-39 and 5-40 (Table 5-1)
The City is also implementing the following strategies to meet 200-unit numerical target:
 ADUs SB9 (Program 1.9)
 Shared housing program
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2. General HCD Comment Topic Area 2: An inventory of land suitable and available for residential development, including vacant sites and sites having realistic and demonstrated potential for redevelopment during the planning period to meet the locality’s housing need for a designated income level, and an analysis of the relationship of zoning and public facilities and services to these sites. (Gov. Code, § 65583, subd. (a)(3).)
Identify actions that will be taken to make sites available during the planning period with appropriate zoning and development standards and with services…(Gov. Code, § 65583, subd. (c)(1).) HCD Finding 2a: Capitola Mall: While the element provides information regarding the current uses on the Capitola Mall site, it must still describe the extent to which existing uses may continue to constitute an impediment to residential development. For example, the element cites a previous application and trends in commercial uses but should also evaluate the extent to which existing commercial uses may preclude residential development in the planning period.

For example, the element could address existing lease agreements, easements or property conditions that may preclude residential development, whether uses will discontinue or how uses will continue through redevelopment, replacement parking and site planning consideration, potential phasing of the project, development on non-commercial portions of the site, and other factors that support the site’s redevelopment during the planning period.

Additionally, given the reliance on the Capitola Mall site to meet the RHNA, the element should include a program that commits to facilitating development and monitoring approvals of the projects (e.g., coordination with applicants to approve entitlements, supporting funding applications, expanding approvals, and monitoring of project progress, including rezoning or identification of additional sites, if necessary).

City Response 2a: The analysis has been updated to address HCD’s finding and describe existing leases in more detail and describe phasing. Language has also been added to p. 5-11 for the City to develop alternative strategies to meet the RHNA requirement if it becomes apparent that the mall development is not achievable.

HCD Finding 2b: Realistic Capacity: While the element lists recent projects in the MU-N and C-C zones to estimate realistic development capacity on those sites, the element must further analyze the likelihood of 100 percent nonresidential development and account for this likelihood in the calculation of residential capacity.

City Response 2b: The analysis has been updated to address HCD’s finding. Language has been added to p. 4-7 to discuss the likelihood of 100 percent nonresidential development.

HCD Finding 2c: Suitability of Nonvacant Sites and Zoning for Lower-Income Households: The element includes sites in the R-1 zone (with a maximum density of 8.7 du/ac) with existing congregational or educational uses currently listed as sites appropriate to meet the lowerincome RHNA. However, the element must demonstrate densities appropriate to accommodate housing for lower-income households. For communities with densities that meet specific standards (at least 20 units per acre for Capitola), no analysis is required. (Gov. Code, § 65583.2, subd. (c)(3).) Otherwise, an analysis must demonstrate appropriate densities based on factors 201
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such as market demand, financial feasibility, and development experience within identified zones. In addition, the element should further evaluate the extent existing uses impede additional development. For example, the element mentions excess surface parking and underutilized buildings but should discuss whether those uses will continue or discontinue and if continuing, how the use impacts additional development. Based on the outcomes of this analysis, the element should add or modify programs, including, if applicable, meeting by right requirements pursuant to Government Code section 65583.2, subdivision (h) and (i).

City Response 2c: The analysis has been updated to address HCD’s finding. Information about density under SB 4 has been added to page 4-31; additional narrative has been added to pg. 4- 28; additional narrative about underutilized sites and parking have been added to pg. 4-3. In addition, school sites will no longer include lower-income units.

HCD Finding 2d: Small Sites: Sites smaller than half an acre are deemed inadequate to accommodate housing for lower-income households unless it is demonstrated, with sufficient evidence, that sites of equivalent size and affordability were successfully developed during the prior planning period or other evidence demonstrates the suitability of these sites. The element mentions some past production on small sites and reports that most of the small sites are under common ownership but should also discuss the potential for consolidation. For example, the element could evaluate the circumstances potentially leading to consolidation such as existing shared access, necessity for consolidation to share access, necessity for consolidation to promote financial feasibility, meet development standards or facilitate site planning. Based on the outcomes of this analysis, the element should add or modify action to encourage lot consolidation. For example, the element could consider graduated density as an additional incentive to promote lot consolidation.

City Response 2d: The analysis has been updated to address HCD’s finding. Additional narrative has been added to p. 4-24. Additional discussion has been added to facilitate shared access and provide needed densities for lower income units
HCD Finding 2e: Publicly-Owned Sites: The element mentions publicly-owned sites but should also discuss their suitability for development in the planning period, including status, anticipated schedule and any known barriers to development in the planning period. Based on the outcomes of this analysis, programs should be added or modified to comply with surplus land act requirements, if applicable, target numerical objectives consistent with the inventory and commit to a schedule of actions to facilitate development, including alternative actions if necessary.

City Response 2e: The analysis has been updated to address HCD’s finding. Additional narrative has been added to p. 4-28. In addition, a new Program (1.10) added to pg. 5-13 to address school sites and the Planning Commission’s desire to facilitate discussions about future housing on State-owned properties. Income allocations on school-owned sites have been changed from low income to moderate and above moderate income.

HCD Finding 2f: Environmental Constraints: While the element generally describes a few environmental conditions within the City, it must relate those conditions to identified sites and 202
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describe any other known environmental or other constraints that could impact housing development on identified sites in the planning period, such as lot shape, access, contamination, overlays, and easements.

City Response 2f: The analysis has been updated to address HCD’s finding. Responsive language has been added to pp. 4-39, 4-42. Maps have been added to Constraints section.

HCD Finding 2g: Electronic Sites Inventory: For your information, pursuant to Government Code section 65583.3, the City must submit an electronic sites inventory with its adopted housing element. The City must utilize standards, forms, and definitions adopted by HCD. Please see HCD’s housing element webpage at https://www.hcd.ca.gov/planning-and-communitydevelopment/housing-elements for a copy of the form and instructions. The City can reach out to HCD at [email protected] for technical assistance.

City Response 2g: City has noted, will submit after Housing Element adoption.

HCD Finding 2h: Programs: Based on the results of a complete sites inventory and analysis, the City may need to add or revise programs to address a shortfall of sites or zoning available to encourage a variety of housing types.

City Response 2h: The analysis has been updated to address HCD’s finding. Language has been added to Program 1.6 (p. 5-8), and a new Program 1.10 has been added (p. 5-13) about publicly owned lands.

3. General HCD Comment Topic Area 3: An analysis of potential and actual governmental constraints upon the maintenance, improvement, or development of housing for all income levels, including… …land use controls, building codes and their enforcement, site improvements, fees and other exactions required of developers, and local processing and permit procedures…(Gov. Code, § 65583, subd. (a)(5).)
Address and, where appropriate and legally possible, remove governmental and nongovernmental constraints to the maintenance, improvement, and development of housing, including housing for all income levels and housing for persons with disabilities…(Gov. Code, § 65583, subd. (c)(3).) HCD Finding 3a: Fees and Exaction: While the element provides a general overview of fees in the City, it should further analyze the total fees as a proportion to the overall development cost.

Upon this analysis, the element may need to add or modify programs to reduce fees, as appropriate.

City Response 3a: The analysis has been updated to address HCD’s finding (see p. 3-28).

HCD Finding 3b: Other Locally Adopted Ordinances – Incentives for Community Benefit: While the element provides some general information on the City’s Incentives for Community Benefit Ordinance, it should analyze the Ordinance’s impact on housing supply and affordability. For example, the element should describe the process which applicants must go through to qualify for these incentives, including any discretionary hearings or standards that might apply. Upon this analysis, the element may need to add or modify a program, as appropriate. 203
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City Response 3b: The analysis has been updated to address HCD’s finding (see pp. 3-13, 3-18).

In addition, Program 1.6 has language about Community Benefits Zoning Code requirements being amended to meet objective standards (p. 5-9).

HCD Finding 3c: Constraints on Housing for Persons with Disabilities: Program 3.4 commits to permit large residential care facilities in zones where residential uses are permitted but should also clarify these uses will be permitted regardless of licensing and similar to other uses of the same type in the same zone.

City Response 3c: The analysis has been updated to address HCD’s finding (see p. 3-26).

HCD Finding 3d: Programs: Upon a complete analysis of potential governmental constraints, the City may need to revise or add programs and address and remove or mitigate any identified constraints.

City Response 3d: The analysis and programs have been modified to address HCD’s finding. See Program 1.6; Program 3.4.
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Addendum to the
Capitola General Plan Update
Environmental Impact Report
for the
2023-2031 Housing Element
LEAD AGENCY:

City of Capitola
420 Capitola Avenue
Capitola, CA 95010
Contact: Ms. Katie Herlihy, AICP, Community Development Director PREPARED BY:

Morse Planning Group
Draft
November 3, 2023
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Addendum to the Capitola General Plan Update EIR
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TABLE OF CONTENTS
.

1.0 Introduction............................................................................................................................................... 1-1

1.1 Statutory Authority and Requirements........................................................................................ 1-1

1.2 Purpose of an Initial Study ........................................................................................................... 1-3

1.3 Responsible and Trustee Agencies............................................................................................... 1-3

1.4 Incorporation by Reference ......................................................................................................... 1-4

2.0 Project Description.................................................................................................................................... 2-1

2.1 Project Location............................................................................................................................ 2-1

2.2 Environmental Setting.................................................................................................................. 2-1

2.3 Existing General Plan and Zoning ................................................................................................. 2-1

2.4 Project Description....................................................................................................................... 2-1

2.5 Permits and Approvals ............................................................................................................... 2-11

3.0 Supplemental Environmental Checklist Form........................................................................................... 3-1

4.0 Environmental Analysis............................................................................................................................. 4-1

4.1 Aesthetics..................................................................................................................................... 4-7

4.2 Agriculture and Forestry Resources........................................................................................... 4-11

4.3 Air Quality................................................................................................................................... 4-15

4.4 Biological Resources................................................................................................................... 4-21

4.5. Cultural and Tribal Cultural Resources....................................................................................... 4-27

4.6. Energy......................................................................................................................................... 4-33

4.7 Geology and Soils ....................................................................................................................... 4-35

4.8 Greenhouse Gases...................................................................................................................... 4-43

4.9 Hazards and Hazardous Materials.............................................................................................. 4-47

4.10 Hydrology and Water Quality..................................................................................................... 4-53

4.11 Land Use and Planning ............................................................................................................... 4-63

4.12 Mineral Resources...................................................................................................................... 4-67

4.13 Noise........................................................................................................................................... 4-69

4.14 Population and Housing ............................................................................................................. 4-73

4.15 Public Services............................................................................................................................ 4-77

4.16 Recreation .................................................................................................................................. 4-81

4.17 Transportation............................................................................................................................ 4-85

4.18. Utilities and Service Systems...................................................................................................... 4-91

4.19 Wildfire..................................................................................................................................... 4-103

4.20 Addendum Determination ....................................................................................................... 4-109

4.21 References................................................................................................................................ 4-111

4.22 Report Preparation Personnel.................................................................................................. 4-113 207
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List of Exhibits
Exhibit 2-1 Regional Location Map................................................................................................................. 2-2 List of Tables
Table 2-1 Regional Housing Needs Assessment 2023-2031......................................................................... 2-8 Table 2-2 Comparison of Sites Inventory and RHNA................................................................................... 2-9 Table 2-3 Inventory of Land Suitable for Residential Development Summary............................................ 2-9 Table 2-4 Summary of Housing Units......................................................................................................... 2-10 Table 4.14-1 2020 and 2040 Population and Housing Projections................................................................. 4-75 Table 4.18-1 Soquel Creek Water District Projected Demands for Water...................................................... 4-96 Table 4.18-2 City of Santa Cruz Water Department Projected Demands for Water ...................................... 4-97 208
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1.0 INTRODUCTION
The Capitola General Plan 2023-2031 Housing Element (herein referenced as the “project,” “proposed project,” or “2023-2031 Housing Element”) involves adoption and implementation of these General Plan components.

Following a preliminary review of the proposed project, the City of Capitola has determined that the proposed project is subject to the guidelines and regulations of the California Environmental Quality Act (CEQA).

1.1 STATUTORY AUTHORITY AND REQUIREMENTS
This environmental document has been prepared in conformance with CEQA (California Public Resources Code [PRC] Section 21000 et seq.); CEQA Guidelines (California Code of Regulations [CCR], Title 14, Section 15000 et seq.); and the rules, regulations, and procedures for implementation of CEQA, as adopted by the City of Capitola.

In accordance with CEQA Guidelines Sections 15051 and 15367, the City of Capitola (City) is identified as the Lead Agency for the proposed project. This document has been prepared in accordance with CEQA Guidelines Sections 15164 (Addendum to an EIR on Negative Declaration) and 15168 (Program EIR) to explain the rationale for determining that the proposed Capitola 2023-2031 Housing Element would not create any new or substantially more severe significant effects on the environmental that were not analyzed in the Capitola General Plan Update Environmental Impact Report (EIR).

In determining whether an Addendum is the appropriate document to analyze modifications to the General Plan EIR, CEQA Guidelines Section 15164 states:
(a) The lead agency or responsible agency shall prepare an addendum to a previously certified EIR if some changes or additions are necessary but none of the conditions described in Section 15162 calling for preparation of a subsequent EIR have occurred.
(b) An addendum to an adopted negative declaration may be prepared if only minor technical changes or additions are necessary or none of the conditions described in Section 15162 calling for the preparation of a subsequent EIR or negative declaration have occurred. (c) An addendum need not be circulated for public review but can be included in or attached to the final EIR or adopted negative declaration.
(d) The decision-making body shall consider the addendum with the final EIR or adopted negative declaration prior to making a decision on the project.
(e) A brief explanation of the decision not to prepare a subsequent EIR pursuant to Section 15162 should be included in an addendum to an EIR, the lead agency’s required findings on the project, or elsewhere in the record. The explanation must be supported by substantial evidence.

Since the Capitola General Plan EIR has been certified, the environmental impacts of subsequent activities proposed under the General Plan must be examined in light of the impact analysis in the certified EIR to determine if additional CEQA documentation must be prepared. One of the standards that applies is whether, under Public Resources Code Section 21166 and CEQA Guidelines Sections 15162, there are new significant effects or other grounds that require preparation of a subsequent EIR in support of further agency action on the project. Under these guidelines, a subsequent shall be prepared if any of the following criteria are met:
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(a) When an EIR has been certified or negative declaration adopted for a project, no subsequent EIR shall be prepared for that project unless the lead agency determines, on the basis of substantial evidence in light of the whole record, one or more of the following:
1) Substantial changes are proposed in the project which will require major revisions of the previous EIR or negative declaration due to the involvement of new significant environmental effects or a substantial increase in the severity of previously identified significant effects; 2) Substantial changes occur with respect to the circumstances under which the project is undertaken which will require major revisions of the previous EIR or negative declaration due to the involvement of new significant environmental effects or a substantial increase in the severity of previously identified significant effects; or
3) New information of substantial importance, which was not known and count not have been known with the exercise of reasonable diligence at the time the previous EIR was certified as complete or the negative declaration was adopted, shows any of the following:

A. The project will have one or more significant effects not discussed in the previous EIR or negative declaration;
B. Significant effects previously examined will be substantially more severe than shown in the previous EIR;
C. Mitigation measures or alternatives previously found not to be feasible would in fact be feasible and would substantially reduce one or more significant effects of the project, but the project proponents decline to adopt the mitigation measure or alternative; or D. Mitigation measures or alternatives which are considerably different from those analyzed in the previous EIR would substantially reduce one or more significant effects on the environment, but the project proponents decline to adopt the mitigation measure or alternative.

As demonstrated in the environmental analysis contained herein in the Addendum, none of the conditions that had been analyzed in the Capitola General Plan EIR would change with adoption of the proposed 2023-2031 Housing Element. Furthermore, no new information of substantial importance meeting the criteria listed in CEQA Guidelines Section 15162 has been identified in the environmental analysis.

The environmental documentation, which is ultimately selected by the City in accordance with CEQA, is intended as an informational document undertaken to provide an environmental basis for subsequent discretionary actions relevant to the project. The resulting documentation is not, however, a policy document and its approval and/or certification neither presupposes nor mandates any actions on the part of those agencies from whom permits and other discretionary approvals would be required.
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1.2 PURPOSE OF AN INITIAL STUDY
The purposes of an Initial Study are to:

1. Identify environmental impacts;

2. Provide the lead agency with information to use as the basis for deciding whether to prepare an EIR or a negative declaration;

3. Enable an applicant or lead agency to modify a project, mitigating adverse impacts before an EIR is required to be prepared;

4. Facilitate environmental assessment early in the design of the project;

5. Document the factual basis of the finding in a negative declaration that a project would not have a significant environmental effect;

6. Eliminate needless EIRs;

7. Determine whether a previously prepared EIR could be used for the project; and

8. Assist in the preparation of an EIR, if required, by focusing the EIR on the effects determined to be significant, identifying the effects determined not to be significant, and explaining the reasons for determining that potentially significant effects would not be significant.

CEQA Guidelines Section 15063 identifies specific disclosure requirements for inclusion in an Initial Study.

Pursuant to those requirements, an Initial Study shall include:
▪ A description of the project, including the location of the project ▪ Identification of the environmental setting
▪ Identification of environmental effects by use of a checklist, matrix, or other method, provided that entries on a checklist or other form are briefly explained to indicate that there is some evidence to support the entries
▪ Discussion of ways to mitigate significant effects identified, if any ▪ Examination of whether the project is compatible with existing zoning, plans, and other applicable land use controls
▪ The name(s) of the person(s) who prepared or participated in the preparation of the Initial Study

9. With regards to the context of an Addendum, the Initial Study serves as the basis for substantial evidence that none of the elements of CEQA Guidelines Section 15162 requiring a subsequent EIR are triggered.

1.3 RESPONSIBLE AND TRUSTEE AGENCIES
Certain projects or actions undertaken by a Lead Agency require subsequent oversight, approvals, or permits from other public agencies in order to be implemented. Such other agencies are referred to as Responsible Agencies and Trustee Agencies. Pursuant to CEQA Guidelines Sections 15381 and 15386, as amended, Responsible Agencies and Trustee Agencies are respectively defined as follows:
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“Responsible Agency” means a public agency, which proposes to carry out or approve a project, for which [a] Lead Agency is preparing or has prepared an EIR or Negative Declaration. For the purposes of CEQA, the term “responsible agency” includes all public agencies other than the Lead Agency, which have discretionary approval power over the project. (Section 15381)
“Trustee Agency” means a state agency having jurisdiction by law over natural resources affected by a project, which are held in trust for the people of the State of California. Trustee Agencies include; The California Department of Fish and Wildlife, The State Lands Commission; The State Department of Parks and Recreation and The University of California with regard to sites within the Natural Land and Water Reserves System. (Section 15386)
For this project, the City of Capitola is the Lead Agency and has the sole responsibility of processing and approving the project. There are no Responsible or Trustee Agencies that have oversight, approval, or permit responsibility associated with the project, or require consultation with the City of Capitola. In addition, no other agency is required to approve the 2023-2031 Housing Element, but the 2023-2031 Housing Element will be reviewed by the California Department of Housing and Community Development for the purpose of determining whether it complies with the requirements of State Housing Element law.

1.4 INCORPORATION BY REFERENCE
Pertinent documents relating to this Initial Study have been cited in accordance with CEQA Guidelines Section 15150, which encourages incorporation by reference as a means of reducing redundancy and length of environmental reports. The following documents are hereby incorporated by reference into this EIR. Information contained within these documents has been utilized for this Initial Study. These documents are available for review at the City of Capitola Community Development Department located at 420 Capitola Avenue, Capitola, California 95010, and online, if available, with the links provided below.

The Capitola General Plan. The Capitola General Plan (General Plan) is the City's "blueprint" for all future development and conservation within the community. The General Plan has seven State-mandated elements:

Land Use; Housing; Open Space; Conservation; Safety; Noise; and Mobility, and includes an optional, Economic Development Element.

On June 26, 2014, the Capitola City Council adopted the General Plan Update to replace the City's previous 1989 General Plan. The General Plan Update provides new goals and policies to promote sustainability, improve protections of residential neighborhoods and historic resources, and enhance economic vitality. The 2015-2023 Housing Element was adopted by the Capitola City Council on November 25, 2015 and certified by the California Department of Housing and Community Development (HCD) on February 4, 2016. The Land Use Element of the General Plan was updated on March 13, 2019.

Capitola General Plan | City of Capitola California
The Capitola General Plan Update Environmental Impact Report. The Environmental Impact Report (EIR) for the City of Capitola General Plan Update (State Clearinghouse Number [SCH No.] 2013072002) evaluates the environmental effects associated with the adoption and implementation of the General Plan Update initiated by the City of Capitola.
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General Plan Update EIR Conclusions. The General Plan Update (GPU) EIR reviewed the following topics:

Aesthetics, Air Quality, Biological Resources, Cultural Resources, Geology, Soils and Seismicity, Hazards and Hazardous Materials, Hydrology and Water Quality, Land Use and Planning, Noise, Population and Housing, Public Services (Fire Protection and Emergency Medical Services, Police Protection, School Services, Library Services), Parks and Recreation, Transportation and Traffic, and Utilities and Service Systems, and Greenhouse Gas Emissions.

The GPU EIR concluded the following significant unavoidable impacts:
▪ Air Quality – Impacts AIR-2 and AIR-6
▪ Hydrology and Water Quality – Impacts HYDRO -2 and HYDRO -9 ▪ Transportation and Traffic – Impacts TRANS-1 and TRANS-6 ▪ Utilities and Service Systems – Impacts UTIL-1, UTIL-2, and UTIL-3 ▪ Greenhouse Gas Emissions – Impacts GHG-1 and GHG-3
The GPU EIR concluded all other impacts were less than significant.

The City Council certified the GPU EIR on June 26, 2014, as well as adopted a Statement of Overriding Considerations for significant, unavoidable impacts, and adopted a Mitigation Monitoring and Reporting Program.

The GPU EIR can be found on the City’s website using the following link under the Supporting Documents heading.

Capitola General Plan | City of Capitola California
Capitola Municipal Code. The Capitola Municipal Code (Municipal Code), codified through Ordinance 1060, passed June 8, 2023, consists of codes and ordinances adopted by the City. These include standards intended to regulate land use, development, health and sanitation, water quality, public facilities, and public safety.

Title 15 of the Municipal Code, Buildings and Construction (revised March 2023), specifies rules and regulations for construction, alteration, and building for uses of human habitation and occupation. Title 16 of the Municipal Code, Subdivisions (revised April 2023), regulates and controls the division of land within the city. Title 17 of the Municipal Code, Zoning (revised April 2023), identifies land uses permitted and prohibited according to the zoning category of particular parcels and establishes the development standards and regulations for each zone.

Capitola Municipal Code (codepublishing.com)
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2.0 PROJECT DESCRIPTION

2.1 PROJECT LOCATION
Capitola is a coastal community located along the Monterey Bay. The City of Capitola is centrally located in Santa Cruz County, east of the City of Santa Cruz; Refer to Exhibit 2-1, Regional Location Map. With a land area of 1.7 square miles, Capitola is home to a population of approximately 10,000 residents. Highway 1 runs east-west along the northern border of the City. Highway 17 is located northwest of Capitola and connects the coastal communities to Silicon Valley and San Francisco Bay Area to the north.

2.2 ENVIRONMENTAL SETTING

2.2.1 EXISTING LAND USES
Capitola is a unique coastal community with its own special sense of place. Capitola is a popular visitor destination due to its beaches, historic charm, visitor amenities, and scenic location. The heart of Capitola is the Village, which features an assortment of shops, restaurants, vacation rentals, and recreational amenities. An assortment of residential neighborhoods contributes to the unique identity and family-friendly character of the community.

Capitola is also home to the Capitola Mall, King’s Plaza, and other region-serving retail establishments along 41st Avenue.

Capitola has been fully urbanized for many years, and development includes a mix of housing types, employment districts with commercial and industrial uses, park and recreational amenities, and convenient transportation choices.

2.3 GENERAL PLAN AND ZONING DESIGNATIONS
Not Applicable (Citywide).

2.4 PROJECT DESCRIPTION
The project is the adoption and implementation of the 2023-2031 Housing Element. The 2023-2031 Housing Element represents an update of the City’s 2015-2023 Housing Element. The Housing Element is an integral component of the City’s General Plan, as it addresses existing and future housing needs of all types for persons of all economic segment groups in the City. The Housing Element serves as a tool for decision-makers and the public in understanding and meeting housing needs in Capitola. While the law does not require local governments to actually construct housing to meet identified needs, it does require that the community address housing needs in its discretionary planning actions.
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Exhibit 2-1 Regional Location Map
Source: City of Capitola General Plan Update EIR (December 2013) 216
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PURPOSE AND ORGANIZATION OF THE HOUSING ELEMENT
The Housing Element is one of the seven mandatory elements of a General Plan. Through policies, procedures, and incentives, it provides an action-plan for maintaining and expanding the housing supply in the City of Capitola.

The Housing Element is organized into the following sections and appendices.

Sections Appendices
Executive Summary
Chapter 1: Introduction
Chapter 2: Housing Needs Assessment
Chapter 3: Constraints on Housing Production
Chapter 4: Housing Need and Opportunities
Chapter 5: Housing Plan
Appendix A: Glossary of Terms
Appendix B: Community Outreach Summary
Appendix C: 2015-2023 Housing Element Program
Evaluation
Appendix D: Sites Inventory
Appendix E: Affirmatively Furthering Fair Housing
(AFFH)
Capitola’s Housing Element for the 6th cycle planning period of June 30, 2023 to December 15, 2031 describes policies and programs that include:
▪ Identification and analysis of existing and projected housing needs, resources, and constraints; ▪ A statement of goals, policies, quantified objectives, and scheduled programs for preservation, improvement and development of housing;
▪ Identification of adequate sites for housing; and
▪ Adequate provision for existing and projected needs of all economic segments of the community.

Element
Pursuant to Government Code Section 65583, the housing element contains four basic parts:

1. Analysis of demographic, social, and housing characteristics, current and future housing needs due to population growth and change, and other factors affecting housing need;

2. Analysis of governmental and nongovernmental constraints that affect the development, maintenance, and improvement of housing for all income groups and people with disabilities;

3. Inventory of resources available to address the City’s housing needs, including available land for housing, as well as the financial resources and administrative capacity to manage housing programs; and

4. Specific actions or programs to address the development, improvement, and conservation of housing to meet current and future needs. This includes goals, policies, and specific housing programs. 217
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HOUSING GOALS AND POLICIES
The 2023-2031 Housing Element goals and policies are listed below. Refer to the 2023-2031 Housing Element (separate document) for a full description of the programs associated with each goal.

GOAL 1.0 HOUSING PRODUCTION
Diversity in housing types and affordability levels to accommodate the needs of Capitola residents.

Housing Production Policies
Policy 1.1 Provide adequate sites and supporting infrastructure to accommodate present and future housing needs of Capitola residents.

Policy 1.2 Encourage mixed-use developments.

Policy 1.3 Provide opportunities for the development of alternative housing options, such as Accessory Dwelling Units.

Policy 1.4 Periodically review development regulations, permit processes, and fees and their effect on development to ensure that such requirements facilitate housing production and rehabilitation.

GOAL 2.0 AFFORDABLE HOUSING DEVELOPMENT
Increased and protected supply of housing affordable to extremely-low, very-low, low, and moderate-income households.

Affordable Housing Policies
Policy 2.1 Encourage continued affordability of affordable rental housing supply in existing mobile home parks, subsidized rental housing, and special needs housing.

Policy 2.2 Continue participation in state and federally sponsored programs designed to maintain housing affordability, including the HUD Housing Choice Voucher (HCV) Program.

Policy 2.3 Preserve existing unrestricted affordable rental housing during the Housing Element planning period.

Policy 2.4 Promote the development of affordable housing.

Policy 2.5 Maintain the City’s Housing Trust Fund.

Policy 2.6 Encourage the production of affordable ownership and rental housing through the City’s Affordable “Inclusionary” Housing Ordinance.

GOAL 3.0: HOUSING FOR PERSONS WITH SPECIAL NEEDS
Accessible housing and appropriate supportive services that provide equal housing opportunities for special needs populations.

Special Housing Needs Policies
Policy 3.1 Support and facilitate programs that address the housing needs of special needs groups, including the elderly population, homeless persons, single-parent headed households, large households, 218
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extremely low-income households, and persons with disabilities, including developmental disabilities.

Policy 3.2 Continue the provision of city-initiated incentives to encourage affordable units in development projects.

Policy 3.3 Support the development of accessible and affordable housing that is designed to serve all ages and is readily accessible to support services.

Policy 3.4 Provide assistance for seniors and disabled to maintain and improve their homes.

Policy 3.5 Facilitate and encourage the development of rental units appropriate for families with children, including the provision of supportive services such as childcare.

Policy 3.6 Encourage the integration of special needs housing in residential environments, readily accessible to public transit, shopping, public amenities, and supportive services.

Policy 3.7 Encourage the provision of supportive services for persons with special needs to further the greatest level of independence and equal housing opportunities.

Policy 3.8 Investigate and encourage the development of a variety of housing options for seniors including Congregate Housing, Continuing Care Retirement Communities (CCRCs), Assisted Living, Mobile Home Parks, co-housing, accessory dwelling units, and Independent Living.

Policy 3.9 Encourage the establishment of childcare centers and family childcare homes in all appropriate zoning districts.

GOAL 4.0: HOUSING ASSISTANCE
Increased assistance for extremely low, very low, low, and moderate income residents to rent or purchase homes.

Housing Assistance Policies
Policy 4.1 Maintain the City’s rental and ownership assistance programs.

Policy 4.2 Explore and pursue City participation in other affordable homeownership assistance programs in the private market.

Policy 4.3 Support the provision of childcare services, employment training, rental assistance, and other supportive services to enable households to be self-sufficient.

Policy 4.4 Seek and support collaborative partnerships of nonprofit organizations and the development community to aid in the provision of affordable housing.

GOAL 5.0: NEIGHBORHOOD VITALITY
Maintain, preserve, and improve the character of existing residential neighborhoods.

Neighborhood Vitality Policies
Policy 5.1 Ensure a compatible relationship between new housing and circulation patterns and encourage pedestrian and bicycle-friendly communities to minimize traffic impacts on quality of life. 219
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Policy 5.2 Protect the integrity of existing single-family and multifamily neighborhoods by promoting balanced site design and architecture.

Policy 5.3 Assist individual neighborhoods in establishing their own identity through the development of neighborhood amenities (e.g., pocket parks, lighting, signs), mixed-use neighborhood nodes, and pedestrian and sustainability improvements.

Policy 5.4 Promote the repair, improvement, and rehabilitation of housing and encourage replacement of substandard housing to enhance quality of life in neighborhoods.

Policy 5.5 Improve the quality of housing and neighborhoods by educating landlords, tenants, and property owners about code compliance issues and enforcing compliance with building and property maintenance standards.

GOAL 6.0: RESOURCE CONSERVATION
Fulfill the City’s housing needs while promoting an environ-mentally sensitive, compact community that is pedestrian-oriented and neighborhood-centered, using resources in a sustainable manner.

Resource Conservation Policies
Policy 6.1 Encourage the use of alternative modes of transportation.

Policy 6.2 Strive to maintain a jobs/housing balance.

Policy 6.3 Promote Green Building techniques, development, and construction standards that provide for resource conservation.

Policy 6.4 Promote the use of renewable energy technologies (such as solar and wind) in new and rehabilitated housing when possible.

Policy 6.5 Ensure that adequate water supplies and sewer services continue to be available for residents and businesses.

GOAL 7.0: AFFIRMATIVELY FURTHERING FAIR HOUSING
Equal access to housing opportunities regardless of one’s unique characteristics as protected by local, state and federal fair housing laws.

Fair Housing Policies
Policy 7.1 Promote meaningful and informed participation of residents, community groups, and governmental agencies in all local housing and community development activities.

Policy 7.2 Comply with federal, state, and local Fair Housing and anti-discrimination laws, and affirmatively further fair housing for all, ensuring equal access to housing regardless of their special circumstances as protected by fair housing laws.

Policy 7.3 Promote housing mobility by expanding housing choices and increasing housing opportunities in higher resource areas.

Policy 7.4 Protect tenants from discriminatory housing practices and displacement. 220
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Policy 7.5 Promote the integration of affordable and special needs housing projects in existing neighborhoods.

Policy 7.6 Collaborate with and support efforts of organizations dedicated to eliminating housing discrimination.

REGIONAL HOUSING NEEDS ASSESSMENT
California Government Code Article 10.6, Section 65580 – 65589.8, Chapter 3 of Division 1 of Title 7 sets forth the legal requirements for a housing element and encourages the provision of affordable and decent housing in suitable living environments for all communities to meet statewide goals. The 2023-2031 Housing Element is a statement by the City of Capitola of its current and future housing needs identified in a policy document that sets forth the City’s goals, policies, and programs to address those identified needs.

Specifically, Government Code Section 65580 states the housing element shall consist of “…an identification and analysis of existing and projected housing needs and a statement of goals, polices, quantified objectives, financial resources and scheduled programs for the preservation, improvement, and development of housing.” The housing element must also contain a housing plan with quantified objectives for the implementation of the goals and objectives described in the housing element. State law requires the housing element be updated every eight years or as otherwise required by State law.

Government Code Article 10.6, Section 65589 – 65589.8, Chapter 3 of Division 1 of Title 7 sets forth the legal requirements for a housing element and encourages the provision of affordable and decent housing in all communities to meet statewide goals. This Initial Study evaluates the environmental effects of the adoption and implementation of the Capitola 2023-2031 Housing Element. The planning period is from June 30, 2023 through December 15, 2031.

Government Code Section 65583 requires that housing elements include the following components:
▪ A review of the previous element’s goals, policies, programs, and objectives to ascertain the effectiveness of each of these components, as well as the overall effectiveness of the Housing Element;
▪ An assessment of housing needs and an inventory of resources and constraints related to the meeting of these needs;
▪ An analysis and program for preserving assisted housing developments; ▪ A Statement of community goals, quantified objectives, and policies relative to the preservation, improvement and development of housing;.
▪ A program which sets forth an eight-year schedule of actions that the City is undertaking or intends to undertake, in implementing the policies set forth in the Housing Element.

Several factors influence the demand for housing in the City of Capitola. Four major “needs” categories considered in the Housing Element include:
1) housing needs resulting from overcrowding;
2) housing needs that result when households are paying more than they can afford for housing; 221
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3) housing needs of "special needs groups" such as the elderly, large families, female heads of households, households with persons with disabilities (including persons with developmental disabilities), and the homeless;
4) housing needs resulting from population growth in the City and surrounding region California housing element law requires that each city and county develop local housing programs designed to meet their “fair share” of housing needs for all income groups. The California Department of Housing and Community Development (HCD), Housing Policy Division develops the Regional Housing Needs Assessments (RHNA) for each region of the State, represented by councils of governments. The Association of Monterey Bay Area Governments (AMBAG) determines the housing allocation for each city and county within its three-county jurisdiction, which includes Santa Cruz County. AMBAG assigned Capitola a housing allocation of 1,336 units, as shown in Table 2-1, Regional Housing Needs Allocation 2023-2031. The RHNA covers the period of June 30, 2023 through December 15, 2031.

TABLE 2-1
REGIONAL HOUSING NEEDS ALLOCATION 2023-2031
Income Category Number of Units
Extremely Low Income 215
Very Low Income 2151
Low Income 282
Moderate Income 169
Above Moderate Income 455
Total Units 1,336
Source: City of Capitola, 2023-2031 Housing Element (July 2023) Notes:

1. The City has a RHNA allocation of 430 very low income units (inclusive of extremely low income units). While the RHNA did not separately define housing needs for extremely low income households, the very low income allocation can be split evenly between very low- and extremely low income households.

Residential Sites Inventory
The inventory is detailed in 2023-2031 Housing Element Chapter 4: Housing Need and Opportunities.

Comparison of Sites Inventory and RHNA
Properties identified in the sites inventory have the combined capacity to accommodate approximately 1,453 additional housing units on underutilized sites. These sites, and the associated existing land use regulations, can facilitate the production of 448 extremely low-/very low-income units, 298 low-income units, 239 moderateincome units, and 468 above-moderate-income units during the planning period. Refer to Table 2-2. 222
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TABLE 2-2

COMPARISON OF SITES INVENTORY AND RHNA

LOWER MODERATE ABOVE

MODERATE TOTAL
RHNA 712 169 455 1,336
Site Inventory
Recyclable Land* 840 195 455 1,480
Rezone/Overlay Sites* 0 0 0 0
Accessory Dwelling Units (ADUs) 10 30 10 50
TOTAL 850 225 455 1,530
Surplus/Deficit +138 +56 -- +194
Source: City of Capitola, 2023-2031 Housing Element Table 4-7 (October 2023) Notes:
*Includes vacant sites, underutilized land, and pending projects An inventory of land suitable for residential development is shown in Table 2-3.

TABLE 2-3

INVENTORY OF LAND SUITABLE FOR RESIDENTIAL DEVELOPMENT SUMMARY

EXTREMELY

LOW / VERY

LOW INCOME

LOW INCOME MODERATE
INCOME
ABOVE

MODERATE
INCOME
TOTAL

RESIDENTIAL

CAPACITY
6 th Cycle RHNA 430 282 169 455 1,336
R-1 (Churches) 6 4 --- --- 10
RM-L 5 3 4 6 18
RM-M 31 21 1 2 55
MU-N 49 33 30 61 173
C-R 297 198 119 274 888
C-C 105 76 41 102 324
CF 7 5 --- --- 12
ADUs 6 4 30 10 50
TOTAL 506 344 225 455 1,530
Source: City of Capitola, 2023-2031 Housing Element Table 4-8 (October 2023) Notes:
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Summary of Residential Capacity on Vacant, Recyclable, and ADU Sites The analysis indicates that the City’s inventory of underutilized/recyclable sites, along with entitled units under plan review and potential Accessory Dwelling Unit (ADU) production has the potential for the development of 1,453 residential units on existing residential properties and within existing zoning categories. A detailed sites inventory table is also presented in 2023-2031 Housing Element Appendix D.

Table 2-4 shows the distribution of the City’s RHNA allocation and low and very-low income units. While the projects focus on areas rich in transit and other amenities, the projections are spread throughout the City in various districts and neighborhoods. This includes infill single-family, ADUs and multiple-family, high density corridors, urban density corridors, and transit-oriented development.

TABLE 2-4

SUMMARY OF HOUSING UNITS

SUB-AREA

LOW AND

VERY LOW

INCOME UNITS

TOTAL UNITS PERCENT OF
RHNA
Residential Recycling
Single Family Zone (Religious Sites Only) 10 10 0.7%
Multi-Family Residential Zones 60 73 5.4%
Commercial Zones That Permit Residential Projects 676 1,212 90.8% Mixed Use Neighborhood Zone 82 173 12.9%
Community Facility Zone (Schools Only) 12 12 0.9%
Accessory Dwelling Units (ADUs) 10 50 3.7%
TOTAL* 850 1,530 114.5%
Source: City of Capitola, 2023-2031 Housing Element Table 4-9 (October 2023) Notes:
*Total RHNA for lower and very low: 712; total RHNA is 1,336 The 2023-2031 Housing Element identifies sites evaluated previously for potential environmental impacts in the General Plan Update EIR. The 2023-2031 Housing Element Update identifies a range of tentatively reserved sites that could be developed to meet the City’s 6
th cycle RHNA throughout Capitola. Some of these sites may differ from those identified in the City of Capitola General Plan and could require land use changes in the future that would allow for increased density or other provisions.

Government Code Section 65583 (c)(1)(A) states that cities have up to three years from the time a Housing Element is adopted to rezone sites, including adoption of minimum density and development standards. The sites inventory (provided in 2023-2031 Housing Element Appendix D) yields housing units that provide more than 100 percent of the RHNA requirements. Furthermore, each future development proposal associated with implementation of the Housing Element would be subject to environmental analysis, as applicable, pursuant to CEQA Guidelines Section 15168(c) and as required by State law, to evaluate potential impacts specific to that proposal.
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Housing Element Assumptions
This document is based on the following assumptions:

1. General Plan Consistency. The 2023-2031 Housing Element is consistent with the adopted City of Capitola General Plan. As the General Plan is updated in the future, the City will ensure that the updated General Plan is consistent with the policies contained in the Housing Element.

2. Purpose of Housing Element Environmental Review. This Initial Study is not intended to and does not address the particular impacts of future housing projects on any site identified in the 2023-2031 Housing Element. The Initial Study is limited to the review of potential environmental impacts resulting from the adoption and implementation of the 2023-2031 Housing Element and is not intended to analyze impacts of current or future specific development activities.

3. Project-Specific Environmental Review. In the City of Capitola, all housing development proposals are subject to a CEQA review process.

2.5 PERMITS AND APPROVALS
The City of Capitola is the Applicant. The project requires the following City of Capitola legislative/discretionary approvals:
▪ General Plan Amendment
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3.0 SUPPLEMENTAL ENVIRONMENTAL CHECKLIST FORM

FOR USE WHEN THE CITY IS REVIEWING SUBSEQUENT DISCRETIONARY ACTIONS PURSUANT TO A PREVIOUSLY APPROVED OR CERTIFIED ENVIRONMENTAL DOCUMENT.

1. Project Title: 2023-2031 Housing Element

2. Lead Agency Name and Address:

City of Capitola
11333 Valley Boulevard
Capitola, CA 91731

3. Contact Person and Phone Number:

Ms. Katie Herlihy, AICP, Community Development
P: 831.475.7300 ext 216
E: [email protected]

4. Project Location:

The City of Capitola is centrally located in Santa Cruz County, east of the City of Santa Cruz with a land area of 1.7 square miles; Refer to Exhibit 2-1, Regional Location Map. The project applies to all properties within the municipal boundaries of the City of Capitola.

5. Project Sponsor’s Name and Address:

City of Capitola
420 Capitola Avenue, Capitola, CA 95010

6. General Plan Designation: Not Applicable (Citywide)

7. Zoning: Not Applicable (Citywide)

8. Previous Environmental Document: Please describe the previously adopted ND or MND or the previously certified EIR (include the date the document was adopted or certified, the date the project was approved by the City, the date the NOD was filed with the County, and a summary of potentially significant effects identified in the CEQA document).

The Capitola General Plan Update Environmental Impact Report concluded the following significant unavoidable impacts:
▪ Air Quality – Impacts AIR-2 and AIR-6
▪ Hydrology and Water Quality – Impacts HYDRO -2 and HYDRO -9 ▪ Transportation and Traffic – Impacts TRANS-1 and TRANS-6 ▪ Utilities and Service Systems – Impacts UTIL-1, UTIL-2, and UTIL-3 ▪ Greenhouse Gas Emissions – Impacts GHG-1 and GHG-3
The GPU EIR concluded all other impacts were less than significant.

The City Council certified the GPU EIR on June 26, 2014, as well as adopted a Statement of Overriding Considerations for significant unavoidable impacts, and adopted a Mitigation Monitoring and Reporting Program.
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9. Description of the Project:

Refer to Section 2.4, Project Description.

10. Surrounding Land Uses and Setting:

Capitola is a coastal community located along the Monterey Bay. The City of Capitola is centrally located in Santa Cruz County, east of the City of Santa Cruz. Highway 1 runs east-west along the northern border of the City. Highway 17 is located northwest of Capitola and connects the coastal communities to Silicon Valley and San Francisco Bay Area to the north.

11. Other public agencies whose approval is required (e.g., permits, financing approval or participation agreement).

Refer to Section 2.5, Permits and Approvals.

12. Have California Native American tribes traditionally and culturally affiliated with the project area requested consultation pursuant to Public Resources Code Section 21080.3.1? If so, is there a plan for consultation that includes, for example, the determination of significance of impacts to tribal cultural resources, procedures regarding confidentiality While not required, the City complied with Tribal Cultural Resources consultation requirements and formal notification was sent to eight tribes. The City received no requests for consultation. 228
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4.0 ENVIRONMENTAL ANALYSIS

EVALUATION OF ENVIRONMENTAL IMPACTS
In accordance with CEQA, Public Resources Code Sections 21000-21178.1, this Modified Initial Study has been prepared to analyze whether any new or more significant environmental impacts could occur from implementation of the proposed project. The purpose of this Initial Study is to inform the decision makers, affected agencies, and the public of potential environmental impacts associated with the implementation of the proposed project. This section analyzes the potential environmental impacts associated with the proposed project. The issue areas evaluated in this Initial Study include those cited in Section 3.0.

As the General Plan EIR has been certified, the environmental impacts ofsubsequent activities proposed under the General Plan must be examined in light of the impact analysis in the certified EIR to determine if additional CEQA documentation must be prepared. One of the standards that applies is whether, under Public Resources Code Section 21166 and CEQA Guidelines Sections 15162 and 15163, there are new significant effects or other grounds that require preparation of a subsequent EIR or supplemental EIR in support of further agency action on the project. Under these guidelines, a subsequent orsupplemental EIR shall be prepared if any ofthe following criteria are met:
(a) When an EIR has been certified or negative declaration adopted for a project, no subsequent EIR shall be prepared for that project unless the lead agency determines, on the basis of substantial evidence in light of the whole record, one or more of the following:
1) Substantial changes are proposed in the project which will require major revisions of the previous EIR or negative declaration due to the involvement of new significant environmental effects or a substantial increase in the severity of previously identified significant effects; 2) Substantial changes occur with respect to the circumstances under which the project is undertaken which will require major revisions of the previous EIR or negative declaration due to the involvement of new significant environmental effects or a substantial increase in the severity of previously identified significant effects; or
3) New information of substantial importance, which was not known and count not have been known with the exercise of reasonable diligence at the time the previous EIR was certified as complete or the negative declaration was adopted, shows any of the following:

A. The project will have one or more significant effects not discussed in the previous EIR or negative declaration;
B. Significant effects previously examined will be substantially more severe than shown in the previous EIR;
C. Mitigation measures or alternatives previously found not to be feasible would in fact be feasible and would substantially reduce one or more significant effects of the project, but the project proponents decline to adopt the mitigation measure or alternative; or D. Mitigation measures or alternatives which are considerably different from those analyzed in the previous EIR would substantially reduce one or more significant effects on the environment, but the project proponents decline to adopt the mitigation measure or alternative. 229
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As demonstrated in Environmental Analysis Sections 4.1 through 4.19, none of the conditions that had been analyzed in the General Plan EIR would change with adoption of the 2023-2031 Housing Element. Furthermore, no new information of substantial importance meeting the criteria listed in CEQA Guidelines Section 15162 has been identified.

A Housing Element does not propose or require development of any residential use, rather, it establishes local goals, policies, and actions the City would implement and/or facilitate to address identified housing issues. In accordance with State law, Housing Elements must be updated every eight years to establish current housing and land use strategies reflective of changing needs, resources, and conditions.

The 2023-2031 Housing Element is a policy document that would not change land use designations or in and of themselves authorize any development within the City. While the City is required by State law to facilitate development commensurate with its allocated share of regional housing needs, no change in the location or nature of allowable development would be authorized by the 2023-2031 Housing Element.

Future development proposals would be required to comply with all applicable regulations and development standards, along with project-specific conditions and mitigation measures to reduce potential impacts required as part of the development review and environmental impact processes. 1) A finding of “No New Impact/No Impact” means that the potential impact was fully analyzed and/or mitigated in the prior CEQA document and no new or different impacts will result from the proposed activity. A brief explanation is required for all answers except “No New Impact/No Impact” answers that are adequately supported by the information sources a lead agency cites in the parentheses following each question. A “No New Impact/No Impact” answer is adequately supported if the referenced information sources show that the impact simply does not apply to projects like the one involved (e.g. the project falls outside a fault rupture zone). A “No New Impact/No Impact” answer should be explained where it is based on project-specific factors as well as general standards (e.g., the project will not expose sensitive receptors to pollutants, based on a project-specific screening analysis). 2) A finding of “New Mitigation is Required” means that the project may have a new potentially significant impact on the environment or a substantially more severe impact than analyzed in the previously approved or certified CEQA document and that new mitigation is required to address the impact. 3) A finding of “New Potentially Significant Impact” means that the project may have a new potentially significant impact on the environment or a substantially more severe impact than analyzed in the previously approved or certified CEQA document that cannot be mitigated to below a level of significance or be avoided.
4) A finding of “Reduced Impact” means that a previously infeasible mitigation measure is now available, or a previously infeasible alternative is now available that will reduce a significant impact identified in the previously prepared environmental document.
5) All answers must take account of the whole action involved, including off-site as well as on-site, cumulative as well as project-level, indirect as well as direct, and construction as well as operational impacts.
6) Earlier analyses may be used where, pursuant to the tiering, program EIR, or other CEQA process, an effect has been adequately analyzed in an earlier EIR or negative declaration. Section 15063(c)(3)(D). In this case, a brief discussion should identify the following:
a) Earlier Analyses Used. Identify and state where they are available for review. 230
Item 7 D.

Addendum to the Capitola General Plan Update EIR
For the 2023-2031 Housing Element
Draft | November 2023 4-3
b) Impacts Adequately Addressed. Identify which effects from the above checklist were within the scope of and adequately analyzed in an earlier document pursuant to applicable legal standards, and state whether such effects were addressed by mitigation measures based on the earlier analysis. Describe the mitigation measures which were incorporated or refined from the earlier document and the extent to which they address site-specific conditions for the proposed action. c) Infeasible Mitigation Measures. Since the previous EIR was certified or previous ND or MND was adopted, discuss any mitigation measures or alternatives previously found not to be feasible that would in fact be feasible or that are considerably different from those previously analyzed and would substantially reduce one or more significant effects of the project, but the project proponents decline to adopt the mitigation measures or alternatives. d) Changes in Circumstances. Since the previous EIR was certified or previous ND or MND was adopted, discuss any changes in the project, changes in circumstances under which the project is undertaken and/or "new information of substantial importance" that cause a change in conclusion regarding one or more effects discussed in the original document. 7) Lead agencies are encouraged to incorporate into the checklist references to information sources for potential impacts (e.g. general plans, zoning ordinances). Reference to a previously prepared or outside document should, where appropriate, include a reference to the page or pages where the statement is substantiated.
8) Supporting Information Sources. A source list should be attached, and other sources used or individuals contacted should be cited in the discussion.
9) This is only a suggested form, and lead agencies are free to use different formats; however, lead agencies should normally address the questions from this checklist that are relevant to a project's environmental effects in whatever format is selected.
10) The explanation of each issue should identify:
a) the significance criteria or threshold, if any, used to evaluate each question; b) differences between the proposed activity and the previously approved project described in the approved ND or MND or certified EIR; and
c) the previously approved mitigation measure identified, if any, to reduce the impact to less than significance.
231
Item 7 D.

Addendum to the Capitola General Plan Update EIR
For the 2023-2031 Housing Element
Draft | November 2023 4-4

NEW SIGNIFICANT ENVIRONMENTAL EFFECTS OR SUBSTANTIALLY MORE

SEVERE SIGNIFICANT ENVIRONMENTAL EFFECTS COMPARED TO THOSE

IDENTIFIED IN THE PREVIOUS CEQA DOCUMENT
The subject areas checked below were determined to be new significant environmental effects or to be previously identified effects that have a substantial increase in severity either due to a change in project, change in circumstances or new information of substantial importance, as indicated by the checklist and discussion in Section 4.1 through Section 4.19.

Aesthetics Land Use and Planning
Agriculture and Forestry Resources Mineral Resources
Air Quality Noise
Biological Resources Population and Housing
Cultural and Tribal Cultural Resources Public Services
Energy Recreation
Geology and Soils Transportation
Greenhouse Gas Emissions Utilities and Service Systems
Hazards and Hazardous Materials Wildfire
Hydrology and Water Quality
232
Item 7 D.

Addendum to the Capitola General Plan Update EIR
For the 2023-2031 Housing Element
Draft | November 2023 4-5

LEAD AGENCY DETERMINATION
On the basis of this evaluation:

No substantial changes are proposed in the project and there are no substantial changes in the circumstances under which the project will be undertaken that will require major revisions to the previous approved ND or MND or certified EIR due to the involvement of new significant environmental effects or a substantial increase in the severity of previously identified significant effects. Also, there is no "new information of substantial importance" as that term is used in CEQA Guidelines Section 15162(a)(3). Therefore, the previously adopted ND or MND or previously certified EIR is adequately discusses the potential impacts of the project without modification.

No substantial changes are proposed in the project and there are no substantial changes in the circumstances under which the project will be undertaken that will require major revisions to the previous approved ND or MND or certified EIR due to the involvement of new significant environmental effects or a substantial increase in the severity of previously identified significant effects. Also, there is no "new information of substantial importance" as that term is used in CEQA Guidelines Section 15162(a)(3). Therefore, the previously adopted ND, MND or previously certified EIR adequately discusses the potential impacts of the project; however, minor changes require the preparation of an ADDENDUM.

Substantial changes are proposed in the project or there are substantial changes in the circumstances under which the project will be undertaken that will require major revisions to the previous ND, MND or EIR due to the involvement of significant new environmental effects or a substantial increase in the severity of previously identified significant effects. Or, there is "new information of substantial importance," as that term is used in CEQA Guidelines Section 15162(a)(3). However, all new potentially significant environmental effects or substantial increases in the severity of previously identified significant effects are clearly reduced to below a level of significance through the incorporation of mitigation measures agreed to by the project applicant.

Therefore, a SUBSEQUENT MND is required.

Substantial changes are proposed in the project or there are substantial changes in the circumstances under which the project will be undertaken that will require major revisions to the previous environmental document due to the involvement of significant new environmental effects or a substantial increase in the severity of previously identified significant effects. Or, there is "new information of substantial importance," as that term is used in CEQA Guidelines Section 15162(a)(3). However, only minor changes or additions or changes would be necessary to make the previous EIR adequate for the project in the changed situation. Therefore, a SUPPLEMENTAL EIR is required.

Substantial changes are proposed in the project or there are substantial changes in the circumstances under which the project will be undertaken that will require major revisions to the previous environmental document due to the involvement of significant new environmental effects or a substantial increase in the severity of previously identified significant effects. Or, there is "new information of substantial importance," as that term is used in CEQA Guidelines Section 15162(a)(3). Therefore, a SUBSEQUENT EIR is required. 233
Item 7 D.

Addendum to the Capitola General Plan Update EIR
For the 2023-2031 Housing Element
Draft | November 2023 4-6
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Item 7 D.

Addendum to the Capitola General Plan Update EIR
For the 2023-2031 Housing Element
Draft | November 2023 4-7

4.1 AESTHETICS
Would the project, except as provided in Public Resources Code Section 21099:

New
Potentially
Significant
Impact
New Impact
Requiring New
Mitigation
No New
Impact/
No Impact
Reduced
Impact
A. Have a substantial adverse effect on a scenic vista? ✓ B. Substantially damage scenic resources, including, but not limited to, trees, rock outcroppings, and historic buildings within a state scenic highway? ✓ C. In nonurbanized areas, substantially degrade the existing visual character or quality of public views of the site and its surroundings? (Public views are those that are experienced from publicly accessible vantage point). In an urbanized area, would the project conflict with applicable zoning and other regulations governing scenic quality?
✓
D. Create a new source of substantial light or glare, which would adversely affect day or nighttime views in the area? ✓
Note: Certain projects within a transit priority area need not evaluate aesthetics (Public Resources Code Section 21099).

PRIOR ENVIRONMENTAL FINDINGS
General Plan Update EIR
The table below summarizes the aesthetics impacts and mitigation measures, if applicable.

AESTHETICS – SUMMARY OF IMPACTS AND MITIGATION MEASURES Impact Significance Before
Mitigation Mitigation Measures Significance With Mitigation AES-1: The proposed Plan would not have a substantial
adverse effect on a scenic vista. Less Than Significant Impact Not Applicable AES-2: The proposed Plan would not substantially damage scenic resources, including, but not limited to, trees, rock outcroppings, and historic buildings, within a State scenic highway.

No Impact Not Applicable
AES-3: The proposed Plan would not result in substantial degradation of the existing visual character or quality of Capitola or its surroundings.

Less Than Significant Impact Not Applicable
AES-4: The proposed Plan would not create a new source
of substantial light or glare which would adversely affect day or nighttime views in the area.

Less Than Significant Impact Not Applicable
AES-5: The proposed Plan, in combination with past,
present, and reasonably foreseeable projects, would result in less than significant cumulative impacts with respect to aesthetics.

Less Than Significant Impact Not Applicable
Source: Capitola General Plan Update Environmental Impact Report (June 2014), Table 1-1, Summary of Impacts and Mitigation Measures 235
Item 7 D.

Addendum to the Capitola General Plan Update EIR
For the 2023-2031 Housing Element
Draft | November 2023 4-8

IMPACT ANALYSIS
The 2023-2031 Housing Element includes policies and programs that are applicable City-wide and are designed to facilitate the construction of housing units to meet the City’s share of the regional housing need. The 2023-2031 Housing Element Chapter 4, Housing Need and Opportunities identifies potential residential sites and densities, inclusive of recyclable residential land, religious facility sites and State land housing, vacant and non-vacant land, and the Capitola Mall site. The 2023-2031 Housing Element Chapter 5, Housing Plan identifies the Goals, Policies, and Programs and Quantified Objectives that are based upon expected availability of resources to address the City’s housing needs, expectations regarding future housing development, as well as prior objectives established in earlier housing plans.

The 2023-2031 Housing Element is a policy document that would not change land use designations or in and of themselves authorize any development within the City. While the City is required by State law to facilitate development commensurate with its allocated share of regional housing needs, no change in the location or nature of allowable development would be authorized by the 2023-2031 Housing Element.

A. WOULD THE PROJECT HAVE A SUBSTANTIAL ADVERSE EFFECT ON A SCENIC VISTA? The GPU EIR identified that one of the guiding principles of the General Plan includes the protection and enhancement of natural resources including the beaches, creek, ocean, and lagoon which contribute to Capitola’s scenic beauty. Future development under the General Plan would be subject to existing laws and regulations that serve to protect scenic vistas in the Plan Area. The City’s zoning ordinance includes provisions that regulate building height, building placement, and establish standards for lot coverage and usable open space.

The General Plan includes policies and actions relevant to the protection of scenic vistas: Policy LU-4.7 Planning Projects, Action LU-5.1 Design Review, Policy LU-6.9 Capitola Wharf, Policy LU-7.3 Scenic Resources, Action LU-7.1 Village Design Guidelines, and Policy LU-10.1 New Development. The GPU EIR concluded less than significant impacts to a scenic vista with implementation of the aforementioned General Plan policies and actions, and regulatory requirements.

The City of Capitola is a largely built out community with a mix of residential, commercial/industrial, and parks/open space uses. One of the General Plan guiding principles includes the protection and enhancement of natural resources including the beaches, creek, ocean, and lagoon which contribute to Capitola’s scenic beauty.

There are no officially designated scenic vistas or view corridors in Capitola. However, there are many places in the City that allow for expansive views of the community, ocean to the southwest and foothills to the north.

B. WOULD THE PROJECT PROPOSED PLAN HAVE A SUBSTANTIAL ADVERSE EFFECT ON A SCENIC VISTA.

The General Plan includes policies and actions relevant to scenic vistas: Policy LU-4.7 Planning Projects, Action LU-5.1 Design Review, Policy LU-6.9 Capitola Wharf, Policy LU-7.3 Scenic Resources, Action LU-7.1 Village Design Guidelines, and Policy LU-10.1 New Development. The GPU EIR concluded less than impacts to scenic vistas with implementation of the aforementioned General Plan policies and actions, and regulatory requirements. 236
Item 7 D.

Addendum to the Capitola General Plan Update EIR
For the 2023-2031 Housing Element
Draft | November 2023 4-9
The proposed project does not involve construction on any particular site in the City. Future development proposals associated with implementation of the proposed project would be required to comply with all applicable regulations and development standards, along with project-specific conditions and mitigation measures to reduce potential impacts required as part of the development review and environmental impact processes. This can include, but is not limited to, Municipal Code requirements; and General Plan goals, policies, and implementation programs, including those identified in the proposed project.

Adoption and implementation of the proposed project would not substantially alter the visual character of the City, nor would it have adverse impacts relative to the scenic vistas. Thus, impacts remain as less than significant impacts.

Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard.

C. WOULD THE PROJECT SUBSTANTIALLY DAMAGE SCENIC RESOURCES, INCLUDING, BUT NOT

LIMITED TO, TREES, ROCK OUTCROPPINGS, AND HISTORIC BUILDINGS WITHIN A STATE SCENIC HIGHWAY?
The General Plan includes policies relevant to scenic resources: Policy LU-10.4 Highway 1 Interchange and Policy LU-12.6 McGregor Property. The GPU EIR concluded no impacts to scenic resources within a State scenic highway with implementation of the aforementioned General Plan policies and regulatory requirements.

There are no officially designated scenic highways within the City limits of Capitola. However, Highway 1 which passes through Capitola is eligible to become officially designated. No scenic vistas, trees, rock outcroppings, or state scenic highways occur within the City of Capitola. The proposed project applies to the entire City, and the 2023-2031 Housing Element only identifies sites where new housing may be developed consistent with adopted land use policy. The proposed project does not involve construction at any particular site in the City. Thus, adoption and implementation of the proposed project ensures impacts remain as no impacts.

Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard.

C. IN NONURBANIZED AREAS, WOULD THE PROJECT SUBSTANTIALLY DEGRADE THE EXISTING VISUAL CHARACTER OR QUALITY OF PUBLIC VIEWS OF THE SITE AND ITS SURROUNDINGS? (PUBLIC VIEWS ARE THOSE THAT ARE EXPERIENCED FROM PUBLICLY ACCESSIBLE VANTAGE POINT). IN AN URBANIZED AREA, WOULD THE PROJECT CONFLICT WITH APPLICABLE ZONING AND OTHER REGULATIONS GOVERNING SCENIC QUALITY?
The General Plan includes goals, policies, and actions relevant to the protection of scenic vistas and the preservation of the character of existing distinct neighborhoods: Policy LU-1.1 Community Character, Policy LU1.2 Design Quality, Action LU-1.1 Design Guidelines, Goal LU-2, Policy LU-2.1 Historic Structures, Policy LU-2.2 Modification Standards, Policy LU-2.3 Preservation Incentives, Policy LU-2.4 Public Awareness, Policy LU-3.1 Historic Structures, Policy LU-3.3 Infill Development, Goal LU-4, Policy LU-4.2 Neighborhood Diversity, Policy LU4.3 Existing Housing, Policy LU-4.5 Neighborhood Amenities, Policy LU-4.6 Natural Features, Goal LU-5, Policy LU5.1 Neighborhood Characteristics, Policy LU-5.2 Development Impacts, Policy LU-5.3 Mass and Scale, Policy LU5.5 Architectural Character, Action LU-5.1 Design Review, Policy LU-7.1 New Development Design. The GPU EIR 237
Item 7 D.

Addendum to the Capitola General Plan Update EIR
For the 2023-2031 Housing Element
Draft | November 2023 4-10
concluded less than significant visual character impacts with implementation of the aforementioned General Plan goals, policies, and actions.

The City of Capitola is considered an urbanized area. The proposed project involves a policy-level document, and as such, does not include any site-specific development designs or proposals. Therefore, it is not possible at this time to conduct an assessment of potential site-specific visual impacts relative to future development proposals associated with implementation of the proposed project.

However, future development proposals associated with implementation of the proposed project would be required to comply with all applicable regulations and development standards, along with project-specific conditions and mitigation measures to reduce potential impacts required as part of the development review and environmental impact processes. This can include, but is not limited to, Municipal Code requirements; and General Plan goals, policies, and implementation programs, including those identified in the proposed project. Thus, adoption and implementation of the proposed project ensures visual character and scenic quality impacts remain as less than significant impacts.

Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard.

E. WOULD THE PROJECT CREATE A NEW SOURCE OF SUBSTANTIAL LIGHT OR GLARE WHICH WOULD ADVERSELY AFFECT DAY OR NIGHTTIME VIEWS IN THE AREA? The City of Capitola is located within a moderately urbanized context. Future development under the General Plan would create new sources of light and glare. However, regulations in the Municipal Code and policies in the General Plan would substantially minimize adverse impacts. The General Plan includes a policy relevant to light and glare: Policy LU-5.2 Development Impacts. The GPU EIR concluded less than significant light and glare impacts with implementation of the aforementioned General Plan policy.

The proposed project involves policy-level documents, and as such, does not include any site-specific development designs or proposals, nor does it address new lighting sources. As such, it is not possible at this time to conduct an assessment of potential site-specific light and glare impacts relative to future development proposals associated with implementation of the proposed project. Generally, potential glare and lighting glare impacts can be mitigated through use of non-reflective building materials and lighting that is shielded downward.

Future development proposals associated with implementation of the proposed project would be required to comply with all applicable regulations and development standards, along with project-specific conditions and mitigation measures to reduce potential impacts required as part of the development review and environmental impact processes. This can include, but is not limited to, Municipal Code requirements; and General Plan goals, policies, and implementation programs, including those identified in the proposed project. The case-by-case review of future development proposals associated with implementation of the proposed project ensures that light and glare impacts are addressed through minimization and/or mitigation. Thus, adoption and implementation of the proposed project ensures impacts remain as less than significant impacts.

Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard. 238
Item 7 D.

Addendum to the Capitola General Plan Update EIR
For the 2023-2031 Housing Element
Draft | November 2023 4-11

4.2 AGRICULTURE AND FORESTRY RESOURCES
In determining whether impacts to agricultural resources are significant environmental effects, lead agencies may refer to the California Agricultural Land Evaluation and Site Assessment Model (1997) prepared by the California Department of Conservation as an optional model to use in assessing impacts on agriculture and farmland. In determining whether impacts to forest resources, including timberland, are significant environmental effects, lead agencies may refer to information compiled by the California Department of Forestry and Fire Protection regarding the state’s inventory of forest land, including the Forest and Range Assessment Project and the Forest Legacy Assessment project; and forest carbon measurement methodology provided in Forest Protocols adopted by the California Air Resources Board.

Would the project:

New
Potentially
Significant
Impact
New Impact
Requiring New
Mitigation
No New
Impact/
No Impact
Reduced
Impact
A. Convert Prime Farmland, Unique Farmland, or Farmland of Statewide Importance (Farmland), as shown on the maps prepared pursuant to the Farmland Mapping and Monitoring Program of the California Resources Agency, to non-agricultural use?
✓
B. Conflict with existing zoning for agricultural use, or a Williamson Act contract? ✓
C. Conflict with existing zoning for, or cause rezoning of, forest land (as defined in Public Resources Code Section 12220(g)), timberland (as defined by Public Resources Code Section 4526), or timberland zoned Timberland Production (as defined by Government Code Section 51104(g))?
✓
D. Result in the loss of forest land or conversion of forest land to non-forest use? ✓
E. Involve other changes in the existing environment, which, due to their location or nature, could result in conversion of Farmland, to nonagricultural use or conversion of forest land to non-forest use? ✓

PRIOR ENVIRONMENTAL FINDINGS
General Plan Update EIR
CEQA Guidelines Section 15128 allows environmental issues for which there is no likelihood of significant impact to be “scoped out” and not analyzed further in an EIR. It was determined that the proposed Plan (General Plan) would not result in significant impacts with respect to Agriculture and Forestry Resources, and as such were not analyzed in the GPU EIR.
239
Item 7 D.

Addendum to the Capitola General Plan Update EIR
For the 2023-2031 Housing Element
Draft | November 2023 4-12

IMPACT ANALYSIS
The 2023-2031 Housing Element includes policies and programs that are applicable City-wide and are designed to facilitate the construction of housing units to meet the City’s share of the regional housing need. The 2023-2031 Housing Element Chapter 4, Housing Need and Opportunities identifies potential residential sites and densities, inclusive of recyclable residential land, religious facility sites and State land housing, vacant and non-vacant land, and the Capitola Mall site. The 2023-2031 Housing Element Chapter 5, Housing Plan identifies the Goals, Policies, and Programs and Quantified Objectives that are based upon expected availability of resources to address the City’s housing needs, expectations regarding future housing development, as well as prior objectives established in earlier housing plans.

The 2023-2031 Housing Element is a policy document that would not change land use designations or in and of themselves authorize any development within the City. While the City is required by State law to facilitate development commensurate with its allocated share of regional housing needs, no change in the location or nature of allowable development would be authorized by the 2023-2031 Housing Element.

A. WOULD THE PROJECT CONVERT PRIME FARMLAND, UNIQUE FARMLAND, OR FARMLAND OF

STATEWIDE IMPORTANCE (FARMLAND), AS SHOWN ON THE MAPS PREPARED PURSUANT TO

THE FARMLAND MAPPING AND MONITORING PROGRAM OF THE CALIFORNIA RESOURCES AGENCY, TO NON-AGRICULTURAL USE?
The proposed project involves policy-level documents, and as such, does not include any site-specific development designs or proposals. No properties in Capitola are designated as Prime Farmland, Unique Farmland, or Farmland of Statewide Importance (Farmland). Thus, adoption and implementation of the proposed project ensures impacts remain as no impacts.

Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard.

B. WOULD THE PROJECT CONFLICT WITH EXISTING ZONING FOR AGRICULTURAL USE, OR A WILLIAMSON ACT CONTRACT?
The City and surrounding area are developed and urbanized. No agricultural land exists or is zoned for agricultural use within the City, and no property within the City is under a Williamson contract. The proposed project involves policy-level documents, and as such, does not include any site-specific development designs or proposals.

Therefore, the proposed project would not affect any land zoned for agricultural uses and would not conflict with a Williamson Act Contract. Thus, adoption and implementation of the proposed project ensures impacts remain as no impacts.

Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard. 240
Item 7 D.

Addendum to the Capitola General Plan Update EIR
For the 2023-2031 Housing Element
Draft | November 2023 4-13
C. WOULD THE PROJECT CONFLICT WITH EXISTING ZONING FOR, OR CAUSE REZONING OF, FOREST LAND (AS DEFINED IN PUBLIC RESOURCES CODE SECTION 12220(G)), TIMBERLAND (AS DEFINED BY PUBLIC RESOURCES CODE SECTION 4526), OR TIMBERLAND ZONED TIMBERLAND PRODUCTION (AS DEFINED BY GOVERNMENT CODE SECTION 51104(G))? There is no zoning designation for forest land in the City of Capitola, and no areas within the City are classified as forest or timberland as defined by Public Resources Code Section 4526. Forestry operations do not occur within the City. Also, no property within the City supports trees capable of 10 percent native tree cover of any species, including hardwoods, under natural conditions, or that allows for management of one or more forest resources, including timber, aesthetics, fish and wildlife, biodiversity, water quality, recreation, and other public benefits.

The proposed project involves policy-level documents, and as such, does not include any site-specific development designs or proposals. Therefore, the proposed project would not result in the rezoning of forest land, timberland, or timberland zoned Timberland Production. Thus, adoption and implementation of the proposed project ensures impacts remain as no impacts.

Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard.

D. WOULD THE PROJECT RESULT IN THE LOSS OF FOREST LAND OR CONVERSION OF FOREST LAND TO NON-FOREST USE?
Refer to Response 4.2.C.

Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard.

E. WOULD THE PROJECT INVOLVE OTHER CHANGES IN THE EXISTING ENVIRONMENT, WHICH, DUE TO THEIR LOCATION OR NATURE, COULD RESULT IN CONVERSION OF FARMLAND, TO NONAGRICULTURAL USE OR CONVERSION OF FOREST LAND TO NON-FOREST USE? The City contains no forest land, nor is any property within the City zoned for agriculture. The proposed project involves policy-level documents, and as such, does not include any site-specific development designs or proposals.

Therefore, the proposed project would not result in changes to the environment that lead to the conversion of farmland to a non-agricultural use or forest land to a non-forest use. Thus, adoption and implementation of the proposed project ensures impacts remain as no impacts.

Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard. 241
Item 7 D.

Addendum to the Capitola General Plan Update EIR
For the 2023-2031 Housing Element
Draft | November 2023 4-14
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242
Item 7 D.

Addendum to the Capitola General Plan Update EIR
For the 2023-2031 Housing Element
Draft | November 2023 4-15

4.3 AIR QUALITY
Where available, the significance criteria established by the applicable air quality management or air pollution control district may be relied upon to make the following determinations.

Would the project:

New
Potentially
Significant
Impact
New Impact
Requiring
New
Mitigation
No New
Impact/
No Impact
Reduced
Impact
A. Conflict with or obstruct implementation of the applicable air quality plan? ✓ B. Result in a cumulatively considerable net increase of any criteria pollutant for which the project region is non-attainment under an applicable federal or state ambient air quality standard?
✓
C. Expose sensitive receptors to substantial pollutant concentrations? ✓ D. Result in other emissions (such as those leading to odors) adversely affecting a substantial number of people? ✓

PRIOR ENVIRONMENTAL FINDINGS
General Plan Update EIR
The table below summarizes the air quality impacts and mitigation measures, if applicable.

AIR QUALITY – SUMMARY OF IMPACTS AND MITIGATION MEASURES Impact Significance Before
Mitigation Mitigation Measures Significance With Mitigation AIR-1: Citywide construction activities under the proposed Plan would result in a considerable increase of criteria pollutants, and thus, could violate air quality standards.

Significant AIR-1a
AIR-1b Less Than Significant
AIR-2: Implementation of the proposed Plan could result in an overall increase in mobile and stationary source
emissions within the City, which could exceed Monterey
Bay Unified Air Pollution Control District air quality
standards.

Significant AIR-2: No Mitigation Available Significant Unavoidable AIR-3: Implementation of the proposed Plan could result in an overall increase in odors within the City. Less Than Significant Not Applicable Less Than Significant AIR-4: Implementation of the Capitola General Plan could result in an overall increase in localized and carbon
monoxide hotspot emissions within the city, which could exceed Monterey Bay Unified Air Pollution Control District air quality standards.

Less Than Significant Not Applicable Less Than Significant AIR-5: The proposed Plan may conflict with or hinder
implementation of the Association of Monterey Bay Area
Government’s regional comprehensive plan guidelines and the Monterey Bay Unified Air Pollution Control District Air Quality Management Plan.

Less Than Significant Not Applicable Less Than Significant AIR-6: Regional air quality emissions resulting from
operational buildout of the Capitola General Plan could impact regional air quality levels on a cumulatively
considerable basis.

Significant AIR-6 Significant Unavoidable
Source: Capitola General Plan Update Environmental Impact Report (June 2014), Table 1-1, Summary of Impacts and Mitigation Measures 243
Item 7 D.

Addendum to the Capitola General Plan Update EIR
For the 2023-2031 Housing Element
Draft | November 2023 4-16

IMPACT ANALYSIS
The 2023-2031 Housing Element includes policies and programs that are applicable City-wide and are designed to facilitate the construction of housing units to meet the City’s share of the regional housing need. The 2023-2031 Housing Element Chapter 4, Housing Need and Opportunities identifies potential residential sites and densities, inclusive of recyclable residential land, religious facility sites and State land housing, vacant and non-vacant land, and the Capitola Mall site. The 2023-2031 Housing Element Chapter 5, Housing Plan identifies the Goals, Policies, and Programs and Quantified Objectives that are based upon expected availability of resources to address the City’s housing needs, expectations regarding future housing development, as well as prior objectives established in earlier housing plans.

The 2023-2031 Housing Element is a policy document that would not change land use designations or in and of themselves authorize any development within the City. While the City is required by State law to facilitate development commensurate with its allocated share of regional housing needs, no change in the location or nature of allowable development would be authorized by the 2023-2031 Housing Element.

A. WOULD THE PROJECT CONFLICT WITH OR OBSTRUCT IMPLEMENTATION OF THE APPLICABLE AIR QUALITY PLAN?
B. WOULD THE PROJECT RESULT IN A CUMULATIVELY CONSIDERABLE NET INCREASE OF ANY

CRITERIA POLLUTANT FOR WHICH THE PROJECT REGION IS NON-ATTAINMENT UNDER AN APPLICABLE FEDERAL OR STATE AMBIENT AIR QUALITY STANDARD? The General Plan includes the following relevant goals, policies, and actions: Goal OSC-3, Policy OSC-3.1 Air Quality Management Plans, Policy OSC-3.2 Development Design, Policy OSC-3.3 Best Management Practices, Policy OSC3.6 Sensitive Receptors. Policy OSC-3.7 Roadway Materials, Policy SN-4.4 Green Building, Goal OSC-4, Policy OSC4.1 On-Site Energy Generation, Policy OSC-4.2 Grid-Neutral Development, Policy OSC-4.3 Photovoltaic Panels, Policy OSC-4.4 Solar Heaters, Policy OSC-4.5 Solar Access, Policy OSC-4.6 Passive Solar Design, Goal OSC-11, Policy OSC-11.1 Solid Waste Diversion, Policy OSC-11.2 City Diversion Rate, Policy OSC-11.3 Demolition Material Recycling, Policy OSC-11.4 Building Design, Policy OSC-11.5 Recycling and Composting Space, Policy OSC-11.6 Reusable Goods, Policy OSC-11.7 Consumption/Waste Reduction, Action OSC-11.1, Action OSC-11.3 Recycled Asphalt Pavement, Goal LU-3, Policy LU-3.1 Land Use Diversity, Policy LU-3.2 Walkability, Policy LU-3.4 Transit and Pedestrian Access, Policy LU-3.5 Pedestrian and Bicycle Connections, Policy LU-3.7 Regional Outlook, Goal MO-1, Policy MO-1.1 Responsive Transportation Services, Policy MO-1.2 Reduced Vehicle Trips, Policy MO-1.3 Regional Collaboration, Policy MO-1.4 Highway 1 Capacity, Action MO-1.2 Regional Plan Implementation, Action MO-1.3 Highway 1 Crossings, Goal MO-2, Policy MO-2.1 Complete Streets, Policy MO-2.3 Community Context, Policy MO2.4 Maintenance, Policy MO-2.5 Existing Rights-of-Way, Policy MO-2.6 Non-Motorized Connectivity, Action MO2.1 Complete Street Standards, Action MO-2.2 Capital Improvement Program, Action MO-2.3 Dedications, Action MO-3.2 Signal Timing, Policy MO-6.5 Transportation Alternatives, Policy MO-7.1 Regional Cooperation, Policy MO7.2 Transit-Friendly Development, Policy MO-7.6 Rail Service, Action MO-7.1 Improved Transit Coverage, Policy MO-8.1 Bicycle Transportation Plan, Policy MO-8.2 Regional System, Action MO-8.3 Bicycle Connections, and Action MO-8.5 Highway 1 Interchanges.

The GPU EIR concluded that buildout of the General Plan would have significant unavoidable impacts relative to conflicting with an applicable plan and net increase of criteria pollutants under Federal or state air quality 244
Item 7 D.

Addendum to the Capitola General Plan Update EIR
For the 2023-2031 Housing Element
Draft | November 2023 4-17
standards with implementation of the aforementioned General Plan goals, policies, and actions, regulatory requirements, and mitigation measures AQ-1 and AQ-2.

The Monterey Bay Unified Air Pollution Control District (MBUAPCD) is one of 35 air quality management districts established to protect air quality in California. It is responsible for regulating stationary, indirect, and area sources of pollution within the North Central Coast Air Basin (NCCAB). The MBUAPCD's jurisdiction includes Monterey, Santa Cruz, and San Benito Counties. The City of Capitola is located in the NCCAB.

Construction-Related Impacts. The GPU EIR concluded that with the implementation of GPU EIR Mitigation Measures AIR-1a and AIR-1b, impacts would be less than significant.

Operational-Related Impacts. The GPU EIR concluded that no mitigation was available to reduce operationalrelated emissions, thus, impacts associated with the GPU would remain significant and unavoidable.

The proposed project involves policy-level documents, and as such, does not include any site-specific development designs or proposals. And while adoption and implementation of the 2023-2031 Housing Element would not directly result in the construction of new housing or pollutant emissions, it could facilitate housing construction consistent with adopted land use policy, which could then create potential pollutant emissions. A case-by-case review of future development proposals associated with implementation of the proposed project would be necessary to ensure that potential pollutant emissions do not conflict with or obstruct implementation of the applicable air quality plan, result in a cumulatively considerable net increase of any criteria pollutant, or be inconsistent with Federal, State, and local air quality standards; the applicable Air Quality Management Plan; and the General Plan goals, policies, and standards relative to air quality.

Future development proposals associated with implementation of the proposed project would be required to comply with all applicable regulations and development standards, along with project-specific conditions and mitigation measures to reduce potential impacts required as part of the development review and environmental impact processes. This can include, but is not limited to, Federal and State laws, regulations, and air quality standards; applicable Air Quality Management Plan; MBUAPCD rules and programs; Municipal Code requirements; and General Plan goals, policies, and implementation programs, including those identified in the proposed project, relative to air quality.

The previously noted goals, policies, actions, laws, regulations, standards, rules, and programs along with GPU EIR Mitigation Measures AIR-1a and AIR-1b ensure proposed project impacts are reduced to the maximum extent feasible, and that ambient air quality standard impacts remain as less than significant, while the air quality plan remains as significant and unavoidable as there are no applicable mitigation measures.

Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard.

C. WOULD THE PROJECT EXPOSE SENSITIVE RECEPTORS TO SUBSTANTIAL POLLUTANT CONCENTRATIONS?
Land uses that are considered more sensitive to changes in air quality than others are referred to as sensitive receptors. Land uses such as primary and secondary schools, hospitals, and convalescent homes are considered to be sensitive to poor air quality because the very young, the old, and the infirm are more susceptible to respiratory infections and other air quality-related health problems than the general public. Residential uses are 245
Item 7 D.

Addendum to the Capitola General Plan Update EIR
For the 2023-2031 Housing Element
Draft | November 2023 4-18
considered sensitive because people in residential areas are often at home for extended periods of time, so they could be exposed to pollutants for extended periods. Per the GPU EIR, sensitive receptors within the City of Capitola include residential uses, schools, and libraries.

The GPU EIR determined that implementation of the General Plan would not directly result in increased population or new development. However, future development could result in mobile sources of emissions associated with vehicle trips, as well as project-level construction related emissions. Sensitive receptors could be potentially subject to stationary and/or vehicular emissions and pollutants such as toxic air contaminants from stationary sources, carbon monoxide (CO) emissions from vehicular traffic, and/or diesel emissions from constructionrelated emissions.

The GPU EIR concluded that implementation of the General Plan could result in increased exposure of sensitive land uses to localized concentrations of TACs that would exceed Monterey Bay Unified Air Pollution Control District’s (MBUAPCD) recommended significance thresholds. However, future development within Capitola would be required to comply with MBUAPCD rules and regulations, including Rule 1000: Permit Guidelines and Requirements for Sources Emitting Toxic Air Contaminants. Additionally, any potential source of stationary emissions would be subject to MBUAPCD review and approval to ensure emissions do not create or substantially contribute to air quality violations. Stationary sources with potential toxic air contaminants would also be subject to MBUAPCD review and approval to ensure that there are no significant impacts to adjacent residents, sensitive receptors and/or other land uses. The GPU EIR concluded less than significant impacts relative to localized emissions and carbon monoxide impacts to sensitive receptors.

The GPU EIR concluded that buildout of the General Plan would result in less than significant impacts relative to exposing sensitive receptors to substantial pollutant concentrations.

The General Plan includes goals, policies, and actions relevant to substantial pollutant concentrations: Goal OSC3, Policy OSC-3.5 Health Risk Assessments, Policy MO-3.1 Arterial Streets, Policy MO-3.2 Street Widening, Policy MO-3.3 Level of Service Standard, Action MO-3.1 Neighborhood Traffic, Action MO-3.2 Signal Timing, and Action MO-3.3 Traffic Monitoring. The GPU EIR concluded less than significant pollutant concentration impacts with implementation of the aforementioned General Plan policies and actions.

The proposed project involves policy-level documents, and as such, does not include any site-specific development designs or proposals. The 2023-2031 Housing Element is a policy document that establishes City direction for facilitating housing development pursuant to adopted land use plans. Future development proposals associated with implementation of the proposed project would be required to comply with the density and intensity standards set forth in the General Plan and current Zoning Ordinance.

In addition, future development proposals associated with implementation of the proposed project would be required to comply with all applicable regulations and development standards, along with project-specific conditions and mitigation measures to reduce potential impacts required as part of the development review and environmental impact processes. This can include, but is not limited to, Federal, State, and local laws, regulations, and air quality standards; MBUAPCD rules; Building Code requirements; Municipal Code requirements; General Plan goals, policies, and implementation programs; and GPU EIR Mitigation Measures AIR-1a and AIR-1b. The GPU EIR identified Mitigation Measure Mitigation Measures AIR-1a and AIR-1b would reduce impacts to less than significant for residential and other sensitive land uses. Thus, adoption and implementation of the proposed project would not directly result in the exposure of persons to substantial pollutant concentrations. 246
Item 7 D.

Addendum to the Capitola General Plan Update EIR
For the 2023-2031 Housing Element
Draft | November 2023 4-19
The previously noted goals, policies, actions, laws, regulations, standards, rules, programs, and mitigation measure ensure proposed project impacts are reduced to the maximum extent feasible, and that air quality impacts to sensitive receptors remain as less than significant.

Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard.

D. WOULD THE PROJECT RESULT IN OTHER EMISSIONS (SUCH AS THOSE LEADING TO ODORS) ADVERSELY AFFECTING A SUBSTANTIAL NUMBER OF PEOPLE?
Potential operational airborne odors could be created by cooking activities associated with the residential and commercial (i.e., food service) uses within the City. These odors would be similar to existing residential and food service uses throughout the city and would be confined to the immediate vicinity of the new buildings. Restaurants are also typically required to provide ventilation systems that avoid substantial adverse odor impacts.

The General Plan accommodates the development of residential, commercial, industrial, public/religious, and open space/parks/recreation uses. These uses are not identified by the MBUAPCD as significant odor generators.

Additionally, the policies included in the General Plan would reduce mobile and stationary source emissions and odors associated with diesel fuel by focusing on land use patterns that improve air quality, reduce air pollution from stationary sources, and encourage/enable more sustainable transit behavior. Consequently, implementation of the General Plan would not create operational-related objectionable odors affecting a substantial number of people within the City. The GP EIR concluded odor impacts to be less than significant.

The General Plan includes a policy relevant to odors: Policy SN-4.3 Sensitive Receptors. The GPU EIR concluded less than significant odor impacts with implementation of the aforementioned General Plan policy.

The proposed project involves policy-level documents, and as such, does not include any site-specific development designs or proposals. The 2023-2031 Housing Element is a policy document that establishes City direction for facilitating housing development pursuant to adopted land use plans. Future development proposals associated with implementation of the proposed project would be required to comply with the density and intensity standards set forth in the Capitola General Plan and current Zoning Ordinance.

Adoption and implementation of the proposed project would not directly result in the exposure of persons to other emissions or odors. However, future development proposals associated with implantation of the proposed project would be required to comply with all applicable regulations and development standards, along with project-specific conditions and mitigation measures to reduce potential impacts required as part of the development review and environmental impact processes. This can include, but is not limited to, Federal and State laws, regulations, and air quality standards; applicable Air Quality Management Plan; MBUAPCD rules and programs; Municipal Code requirements; and General Plan goals, policies, and implementation programs, including those identified in the proposed project, relative to air quality. The previously noted goals, policies, actions, laws, regulations, standards, rules, and programs along with GPU EIR Mitigation Measures AIR-1a and AIR-1b ensure proposed project impacts are reduced to the maximum extent feasible, and that other emissions or odor impacts remain as less than significant impacts.

Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard. 247
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For the 2023-2031 Housing Element
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Item 7 D.

Addendum to the Capitola General Plan Update EIR
For the 2023-2031 Housing Element
Draft | November 2023 4-21

4.4 BIOLOGICAL RESOURCES
Would the project:

New
Potentially
Significant
Impact
New Impact
Requiring
New
Mitigation
No New
Impact/
No Impact
Reduced
Impact
A. Have a substantial adverse effect, either directly or through habitat modifications, on any species identified as a candidate, sensitive, or special status species in local or regional plans, policies, or regulations, or by the California Department of Fish and Wildlife or U.S. Fish and Wildlife Service?
✓
B. Have a substantial adverse effect on any riparian habitat or other sensitive natural community identified in local or regional plans, policies, regulations or by the California Department of Fish and Wildlife or U.S. Fish and Wildlife Service? ✓
C. Have a substantial adverse effect on state or federally protected wetlands (including, but not limited to, marsh, vernal pool, coastal, etc.) through direct removal, filling, hydrological interruption, or other means? ✓
D. Interfere substantially with the movement of any native resident or migratory fish or wildlife species or with established native resident or migratory wildlife corridors, or impede the use of native wildlife nursery sites?
✓
E. Conflict with any local policies or ordinances protecting biological resources, such as a tree preservation policy or ordinance? ✓
F. Conflict with the provisions of an adopted Habitat Conservation Plan, Natural Community Conservation Plan, or other approved local, regional, or state habitat conservation plan?
✓

PRIOR ENVIRONMENTAL FINDINGS
General Plan Update EIR
The table below summarizes the biological resources impacts and mitigation measures, if applicable.

BIOLOGICAL RESOURCES – SUMMARY OF IMPACTS AND MITIGATION MEASURES Impact Significance Before
Mitigation Mitigation Measures Significance With Mitigation BIO-1: The proposed Plan would not result in significant impacts to special-status plant and animal species in the Plan Area.

Less Than Significant Not Applicable
BIO-2: The proposed Plan would not result in significant impacts to riparian habitat or other sensitive natural
community.

Less Than Significant Not Applicable
BIO-3: The proposed Plan would not result in significant impacts to federally protected wetlands. Less Than Significant Not Applicable BIO-4: The proposed Plan would not interfere substantially with the movement of any native resident or migratory fish or wildlife species, or with established native resident or migratory wildlife corridors, or impede the use of native wildlife nursery sites.

Less Than Significant Not Applicable
249
Item 7 D.

Addendum to the Capitola General Plan Update EIR
For the 2023-2031 Housing Element
Draft | November 2023 4-22
BIOLOGICAL RESOURCES – SUMMARY OF IMPACTS AND MITIGATION MEASURES Impact Significance Before
Mitigation Mitigation Measures Significance With Mitigation BIO-5: The proposed Plan would not conflict with
Capitola’s Community Tree and Forest Management
Ordinance.

Less Than Significant Not Applicable
BIO-6: The proposed Plan would not conflict with the
Monterey Bay National Marine Sanctuary Management
Plan.

Less Than Significant Not Applicable
Source: Capitola General Plan Update Environmental Impact Report (June 2014), Table 1-1, Summary of Impacts and Mitigation Measures

IMPACT ANALYSIS
The 2023-2031 Housing Element includes policies and programs that are applicable City-wide and are designed to facilitate the construction of housing units to meet the City’s share of the regional housing need. The 2023-2031 Housing Element Chapter 4, Housing Need and Opportunities identifies potential residential sites and densities, inclusive of recyclable residential land, religious facility sites and State land housing, vacant and non-vacant land, and the Capitola Mall site. The 2023-2031 Housing Element Chapter 5, Housing Plan identifies the Goals, Policies, and Programs and Quantified Objectives that are based upon expected availability of resources to address the City’s housing needs, expectations regarding future housing development, as well as prior objectives established in earlier housing plans.

The 2023-2031 Housing Element is a policy document that would not change land use designations or in and of themselves authorize any development within the City. While the City is required by State law to facilitate development commensurate with its allocated share of regional housing needs, no change in the location or nature of allowable development would be authorized by the 2023-2031 Housing Element.

A. WOULD THE PROJECT HAVE A SUBSTANTIAL ADVERSE EFFECT, EITHER DIRECTLY OR THROUGH

HABITAT MODIFICATIONS, ON ANY SPECIES IDENTIFIED AS A CANDIDATE, SENSITIVE, OR

SPECIAL STATUS SPECIES IN LOCAL OR REGIONAL PLANS, POLICIES, OR REGULATIONS, OR BY THE CALIFORNIA DEPARTMENT OF FISH AND GAME OR U.S. FISH AND WILDLIFE SERVICE? Subsequent projects under the General Plan that would involve development in areas where special status plant and animal species may occur would be subject to separate project-level environmental review pursuant to CEQA in order to identify and mitigate impacts to special-status species. Applicable federal, State, and local regulations, along with the proposed Plan goals, policies, and actions, would reduce potential impacts to special-status plant and animal species.

The General Plan includes goals, policies, and actions relative to special-status plant and animal species: Goal OSC6, Policy OSC-6.1 Natural Diversity, Policy OSC-6.2 Environmentally Sensitive Areas, Policy OSC-6.3 Development Projects, Policy OSC-6.4 Regulatory Compliance, Policy OSC-6.6 Monterey Bay, Policy OSC-6.7 Regional Collaboration, Goal OSC-7, Policy OSC-7.1 Riparian Landscaping, Policy OSC-7.2 Soquel Creek, Policy OSC-7.3 Creek Alterations, Policy OSC-7.4 Creek Alteration Impacts, Policy OSC-7.5 Creek Restoration, Policy OSC-7.6 Wetland Protection, Policy OSC-7.7 Biological Study, Policy OSC-7.8 Wetland Habitat, Policy OSC-7.9 Creek Recreation and Access, and Action OSC-7.1 Riparian Plant List. The GPU EIR concluded less than significant impacts with implementation of the aforementioned General Plan goals, policies, and actions. 250
Item 7 D.

Addendum to the Capitola General Plan Update EIR
For the 2023-2031 Housing Element
Draft | November 2023 4-23
Various special status plant and animal species are known to occur or could potentially occur within the City.

Although development within natural resource areas or areas potentially containing special-status plant and animal species is not anticipated, there is the potential for future development associated with implementation of the proposed project to significantly impact, either directly, or through habitat modifications, special status plant and wildlife species.

The proposed project would not result in a substantial adverse effect, either directly or through habitat modifications, on any sensitive species. Thus, adoption and implementation of the proposed project ensures impacts remain as less than significant impacts.

Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard.

B. WOULD THE PROJECT HAVE A SUBSTANTIAL ADVERSE EFFECT ON ANY RIPARIAN HABITAT OR

OTHER SENSITIVE NATURAL COMMUNITY IDENTIFIED IN LOCAL OR REGIONAL PLANS, POLICIES, REGULATIONS OR BY THE CALIFORNIA DEPARTMENT OF FISH AND GAME OR U.S. FISH AND WILDLIFE SERVICE?
The General Plan includes goals, policies, and actionsrelative to riparian habitats: Policy OSC-6.1 Natural Diversity, Policy OSC-6.3 Development Projects, Policy OSC-6.4 Regulatory Compliance, Policy OSC-6.6 Monterey Bay, Policy OSC-6.7 Regional Collaboration, Policy OSC-7.1 Riparian Landscaping, Policy OSC-7.2 Soquel Creek, Policy OSC-7.3 Creek Alterations, Policy OSC-7.4 Creek Alteration Impacts, Policy OSC-7.5 Creek Restoration, Policy OSC-7.6 Wetland Protection, Policy OSC-7.7 Biological Study, Policy OSC-7.8 Wetland Habitat, Policy OSC-7.9 Creek Recreation and Access, and Action OSC-7.1 Riparian Plant List. The GPU EIR concluded less than significant impacts with implementation of the aforementioned General Plan goals, policies, and actions.

Riparian corridors in the City include the woodland along the west side of Soquel Creek from the Stockton Avenue Bridge to the Highway One overpass (Soquel Creek Riparian corridor), the Noble Gulch Riparian corridor, and the Tannery Gulch Riparian corridor. These corridors provide important natural resources, visual relief, and support for numerous wildlife and native vegetation.

The proposed project would not result in a substantial adverse effect on any riparian habitat or other sensitive natural community. Thus, adoption and implementation of the proposed project ensures impacts remain as less than significant impacts.

Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard.

C. WOULD THE PROJECT HAVE A SUBSTANTIAL ADVERSE EFFECT ON FEDERALLY PROTECTED WETLANDS AS DEFINED BY SECTION 404 OF THE CLEAN WATER ACT (INCLUDING, BUT NOT LIMITED TO, MARSH, VERNAL POOL, COASTAL, ETC.) THROUGH DIRECT REMOVAL, FILLING, HYDROLOGICAL INTERRUPTION, OR OTHER MEANS?
The General Plan includes policies relative to wetlands: Policy OSC-6.1 Natural Diversity, Policy OSC-6.2 Environmentally Sensitive Areas, Policy OSC-6.3 Development Projects, Policy OSC-6.4 Regulatory Compliance, Policy OSC-6.6 Monterey Bay, Policy OSC-6.7 Regional Collaboration, Policy OSC-7.1 Riparian Landscaping, Policy 251
Item 7 D.

Addendum to the Capitola General Plan Update EIR
For the 2023-2031 Housing Element
Draft | November 2023 4-24
OSC-7.2 Soquel Creek, Policy OSC-7.3 Creek Alterations, Policy OSC-7.4 Creek Alteration Impacts, Policy OSC-7.5 Creek Restoration, Policy OSC-7.6 Wetland Protection, Policy OSC-7.7 Biological Study, Policy OSC-7.8 Wetland Habitat, Policy OSC-7.9 Creek Recreation and Access, and Action OSC-7.1 Riparian Plant List. The GPU EIR concluded less than significant impacts with implementation of the aforementioned General Plan policies and actions.

Future development activities within the City could potentially result in significant impacts to federally protected wetlands. Existing regulations would help to ensure that development associated with the proposed project would not cause a significant impact to federally protected wetlands. Compliance with the Local Coastal Plan, General Plan, and Municipal Code, would minimize potential impacts to wetlands. Future development associated with implementation of the proposed project could involve development in areas of potential wetlands, and would be subject to separate project-level environmental review pursuant to CEQA in order to identify and mitigate impacts.

The proposed project would not result in a substantial adverse effect on federally protected wetlands. Thus, adoption and implementation of the proposed project ensures impacts remain as less than significant impacts.

Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard.

D. WOULD THE PROJECT INTERFERE SUBSTANTIALLY WITH THE MOVEMENT OF ANY NATIVE

RESIDENT OR MIGRATORY FISH OR WILDLIFE SPECIES OR WITH ESTABLISHED NATIVE RESIDENT

OR MIGRATORY WILDLIFE CORRIDORS, OR IMPEDE THE USE OF NATIVE WILDLIFE NURSERY SITES?
The General Plan includes policies relative to native residents, migratory wildlife corridors, or native wildlife nursery sites: Policy OSC-6.1 Natural Diversity, Policy OSC-6.2 Environmentally Sensitive Areas, Policy OSC-6.3 Development Projects., Policy OSC-6.4 Regulatory Compliance, Policy OSC-6.6 Monterey Bay, Policy OSC-6.7 Regional Collaboration, Policy OSC-7.1 Riparian Landscaping, Policy OSC-7.2 Soquel Creek, Policy OSC-7.3 Creek Alterations, Policy OSC-7.4 Creek Alteration Impacts, Policy OSC-7.5 Creek Restoration, Policy OSC-7.6 Wetland Protection, Policy OSC-7.7 Biological Study, Policy OSC-7.8 Wetland Habitat, Policy OSC-7.9 Creek Recreation and Access, and Action OSC-7.1 Riparian Plant List. The GPU EIR concluded less than significant impacts with implementation of the aforementioned General Plan policies and actions.

Given the urbanized context of the City and the extent of existing development, opportunities for wildlife movement in the urbanized portion of the City are limited. Existing development, including buildings, major roadways, or other similar improvements, represent substantial barriers to wildlife movement. However, Soquel Creek runs through the middle of the City into the Monterey Bay. The creek is a year-round water source for the wildlife in the adjoining riparian corridor as well as an important wetland habitat. The lagoon area of the creek is the only significant habitat for migratory non-marine waterbirds within Capitola. In addition, the Creek and Lagoon supports steelhead with resident trout and non-sport species and southwestern pond turtles.

Monarch butterfly habitats are located along Soquel Creek and in the Escalona Gulch area. These areas provide overwintering sites for the migrating Monarch butterfly and are considered environmentally sensitive habitat areas (ESHA). The orientation of the groves to wind and sun, the size and density of the trees, and the quiet, undisturbed setting are among the factors that make these sites among the few in Santa Cruz County suitable for the butterflies. Both Escalona Gulch and Soquel Creek Monarch butterfly groves lie within areas designated for preservation as open space. Just outside the city limits between New Brighton Road and New Brighton State Park 252
Item 7 D.

Addendum to the Capitola General Plan Update EIR
For the 2023-2031 Housing Element
Draft | November 2023 4-25
campground is another overwintering site for Monarch butterflies. This grove is partly on State Park property and partly on private residential parcels.

The proposed project does not propose any changes to Soquel Creek or changes in land uses to areas containing Monarch butterfly habitats. Wildlife would continue to move within these areas.

Compliance with the Local Coastal Plan, General Plan, and Municipal Code, would minimize potential impacts to wildlife movement. Thus, adoption and implementation of the proposed project ensures impacts remain as less than significant impacts.

Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard.

E. WOULD THE PROJECT CONFLICT WITH ANY LOCAL POLICIES OR ORDINANCES PROTECTING BIOLOGICAL RESOURCES, SUCH AS A TREE PRESERVATION POLICY OR ORDINANCE? The General Plan includes several policies relative to tree management and tree removal: Policy OSC-6.1 Natural Diversity, Policy OSC-6.2 Environmentally Sensitive Areas, Policy OSC-6.3 Development Projects, and Policy OSC6.4 Regulatory Compliance. The GPU EIR concluded less than significant impacts with implementation of the aforementioned General Plan policies and actions.

Municipal Code Chapter 12.12, Community Tree and Forest Management, establishes regulations relating to the protection, planting, maintenance, removal, and replacement of trees, and sets forth the process for development of a comprehensive plan for the planting and maintenance of a sustained community forest within the City.

The proposed project would not directly involve removal of trees; however, future development associated with implementation of the proposed project could potentially involve the removal of trees within the City. The Community Tree and Forest Management Ordinance requires a tree permit prior to the removal of any non-fruit bearing trees within the City. Permits for heritage tree removal are discretionary and are approved by the planning commission only in accordance with CEQA and if specific findings can be made. Permits for non-heritage tree removal are ministerial and are approved by the community development director or designee if specific findings can be made.

The proposed project would not conflict with any policies or ordinances protecting biological resources or trees.

Thus, adoption and implementation of the proposed project ensures impacts remain as less than significant impacts.

Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard. 253
Item 7 D.

Addendum to the Capitola General Plan Update EIR
For the 2023-2031 Housing Element
Draft | November 2023 4-26
F. WOULD THE PROJECT CONFLICT WITH THE PROVISIONS OF AN ADOPTED HABITAT

CONSERVATION PLAN, NATURAL COMMUNITY CONSERVATION PLAN, OR OTHER APPROVED LOCAL, REGIONAL, OR STATE HABITAT CONSERVATION PLAN?
The General Plan includes policies relative to an adopted plan: Policy LU-3.7 Regional Outlook, Policy LU-13.4 New Brighton State Beach, Policy LU-13.6 Beach Management, Policy LU-13.7 Beach Structures, Action LU-14.3 Coastal Recreation, Policy OSC-6.1 Natural Diversity, Policy OSC-6.2 Environmentally Sensitive Areas, Policy OSC-6.3 Development Projects, Policy OSC-6.4 Regulatory Compliance, Policy OSC-6.6 Monterey Bay, Policy OSC-6.7 Regional Collaboration, and Policy OSC-6.8 Eco-Tourism. The GPU EIR concluded less than significant impacts with implementation of the aforementioned General Plan policies and actions.

The Monterey Bay National Marine Sanctuary Management Plan is the only conservation related plan that is applicable to Capitola.

The proposed project would not conflict with the Monterey Bay National Marine Sanctuary Management Plan.

Thus, adoption and implementation of the proposed project ensures impacts remain as less than significant impacts.

Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard. 254
Item 7 D.

Addendum to the Capitola General Plan Update EIR
For the 2023-2031 Housing Element
Draft | November 2023 4-27

4.5 CULTURAL AND TRIBAL CULTURAL RESOURCES
Would the project:

New
Potentially
Significant
Impact
New Impact
Requiring
New
Mitigation
No New
Impact/
No Impact
Reduced
Impact
A. Cause a substantial adverse change in the significance of a historical resource as defined in CEQA Guidelines Section 15064.5? ✓
B. Cause a substantial adverse change in the significance of an archaeological resource pursuant to CEQA Guidelines Section15064.5? ✓
C. Disturb any human remains, including those interred outside of formal cemeteries? ✓
D. Cause a substantial adverse change in the significance of a tribal cultural resource, defined in Public Resources Code Section 21074 as either a site, feature, place, cultural landscape that is geographically defined in terms of the size and scope of the landscape, sacred place, or object with cultural value to a California Native American tribe, and that is:
1) Listed or eligible for listing in the California Register of Historical Resources, or in the local register of historical resources as defined in Public Resources Code Section 5020.1(k)?
✓
2) A resource determined by the lead agency, in its discretion and supported by substantial evidence, to be significant pursuant to the criteria set forth in subdivision (c) of Public Resources Code Section 5024.1? In applying the criteria set forth in subdivision (c) of Public Resources Code Section 5024.1, the lead agency shall consider the significance of the resource to a California Native American tribe.
✓

PRIOR ENVIRONMENTAL FINDINGS
General Plan Update EIR
The table below summarizes the cultural resources impacts and mitigation measures, if applicable.

CULTURAL RESOURCES – SUMMARY OF IMPACTS AND MITIGATION MEASURES Impact Significance Before
Mitigation Mitigation Measures Significance With Mitigation CULT-1: The Plan would not cause a substantial adverse
change in the significance of a historical resource as
defined in Section 15064.5.

Less Than Significant
CULT-2: Construction activities associated with
implementation of the proposed Plan could cause a
substantial adverse change in the significance of an
archaeological resource pursuant to Section 15064.5.

Significant CULT-2 Less Than Significant
CULT-3: Construction activities associated with
implementation of the proposed Plan could directly or
indirectly destroy a unique paleontological resource or site or unique geologic feature.

Significant CULT-3: Refer to Mitigation
Measure CULT-2
Less Than Significant
CULT-4: Construction activities associated with
implementation of the proposed Plan could disturb human Significant CULT-4: Refer to Mitigation Measure CULT-2 Less Than Significant
255
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Addendum to the Capitola General Plan Update EIR
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Draft | November 2023 4-28
CULTURAL RESOURCES – SUMMARY OF IMPACTS AND MITIGATION MEASURES Impact Significance Before
Mitigation Mitigation Measures Significance With Mitigation remains, including those interred outside of formal
cemeteries.

CULT-5: The Plan, in combination with past, present, and reasonably foreseeable projects, would result in less-than significant cumulative impacts with respect to cultural resources.

Less Than Significant
Source: Capitola General Plan Update Environmental Impact Report (June 2014), Table 1-1, Summary of Impacts and Mitigation Measures Tribal Cultural Resources
Assembly Bill 52 (AB 52) was signed into law in 2014 and added tribal cultural resources thresholds to CEQA Guidelines Appendix G.

The GPU EIR was certified in June 2014 and was not subject to AB 52. However, the GPU EIR included an extensive analysis of potential impacts to cultural resources. The GPU EIR found there is the potential for discovering such resources during construction of future development proposals in Capitola.

IMPACT ANALYSIS
The 2023-2031 Housing Element includes policies and programs that are applicable City-wide and are designed to facilitate the construction of housing units to meet the City’s share of the regional housing need. The 2023-2031 Housing Element Chapter 4, Housing Need and Opportunities identifies potential residential sites and densities, inclusive of recyclable residential land, religious facility sites and State land housing, vacant and non-vacant land, and the Capitola Mall site. The 2023-2031 Housing Element Chapter 5, Housing Plan identifies the Goals, Policies, and Programs and Quantified Objectives that are based upon expected availability of resources to address the City’s housing needs, expectations regarding future housing development, as well as prior objectives established in earlier housing plans.

The 2023-2031 Housing Element is a policy document that would not change land use designations or in and of themselves authorize any development within the City. While the City is required by State law to facilitate development commensurate with its allocated share of regional housing needs, no change in the location or nature of allowable development would be authorized by the 2023-2031 Housing Element.

A. WOULD THE PROJECT CAUSE A SUBSTANTIAL ADVERSE CHANGE IN THE SIGNIFICANCE OF A HISTORICAL RESOURCE AS DEFINED IN CEQA GUIDELINES SECTION 15064.5? The General Plan includes goals, policies, and actions relative to historic resources: Goal LU-2, Policy LU-2.1 Historic Structures, Policy LU-2.2 Modification Standards, Policy LU-2.3 Preservation Incentives, Policy LU-2.4 Public Awareness, Action LU-2.1 Historic Structures List, Action LU-2.2 Public Outreach, Action LU-2.3 Historic Preservation Guidelines, Action LU-2.4, Goal LU-7, Policy LU-7.1 New Development Design, and Policy LU-7.3 Scenic Resources. The GPU EIR concluded less than significant impacts with implementation of the aforementioned General Plan goals, policies, and actions, and regulatory requirements. 256
Item 7 D.

Addendum to the Capitola General Plan Update EIR
For the 2023-2031 Housing Element
Draft | November 2023 4-29
There are 65 designated historic structures that are listed or are eligible for listing on the National Register of Historic Places, the California Historic Resources Inventory, or the Capitola Register of Historic Features within the city. In addition to designated historic structures, there are also several potential historic structures that have been identified by the City. Additionally, four areas of the City are identified as National Register Historic Districts.

The GPU EIR noted that future development and/or redevelopment activities within or adjacent to these sites or districts could potentially cause a substantial adverse change in the significance of a historical resource and concluded impacts to be less than significant.

The proposed project involves policy-level documents, and as such, does not include any site-specific development designs or proposals. Thus, it is not possible at this time to conduct an assessment of potential site-specific historical resource impacts relative to future development proposals associated with implementation of the proposed project. Instead, a case-by-case review of future development proposals associated with implementation of the proposed project would be carried out to ensure that historically significant buildings and resources are preserved, as applicable, and that the future development proposals are consistent with all applicable General Plan goals and policies and Municipal Code regulations relative to historic resources. Thus, adoption and implementation of the proposed project ensures impacts remain as less than significant impacts.

Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard.

B. WOULD THE PROJECT CAUSE A SUBSTANTIAL ADVERSE CHANGE IN THE SIGNIFICANCE OF AN ARCHAEOLOGICAL RESOURCE PURSUANT TO CEQA GUIDELINES SECTION 15064.5? The General Plan includes goals, policies, and actions relative to archaeological resources: Goal LU-2, Policy LU2.4 Public Awareness, and Action LU-2.2 Public Outreach. The GPU EIR concluded less than significant impacts with implementation of the aforementioned General Plan goals, policies, and actions, regulatory requirements, and mitigation measure CULT-2.

The City of Capitola contains areas identified by the Local Coastal Program as having a likelihood of prehistoric cultural resources, including archaeological resources. Future development and/or redevelopment activities within these areas could potentially cause a substantial adverse change in the significance of a known or unknown archaeological resource.

The proposed project involves policy-level documents, and as such, does not include any site-specific development designs or proposals. Thus, it is not possible at this time to conduct an assessment of potential site-specific archaeological resource impacts relative to future development proposals associated with implementation of the proposed project. Instead, A case-by-case review of future development proposals associated with implementation of the proposed project would be carried out to confirm the absence or presence of archaeological resources, as applicable, and that the future development proposals are consistent with all applicable General Plan goals and policies and Municipal Code regulations relative to archaeological resources, as well as GPU EIR Mitigation Measure CULT-2. Thus, adoption and implementation of the proposed project ensures impacts remain as less than significant impacts.

Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard. 257
Item 7 D.

Addendum to the Capitola General Plan Update EIR
For the 2023-2031 Housing Element
Draft | November 2023 4-30
C. WOULD THE PROJECT DISTURB ANY HUMAN REMAINS, INCLUDING THOSE INTERRED OUTSIDE OF FORMAL CEMETERIES?
The GPU EIR concluded less than significant with mitigation impacts with implementation of regulatory requirements and mitigation measure CULT-4.

The GPU EIR identified that future development could have a significant environmental impact if it would disturb human remains, including those interred outside of formal cemeteries. The City of Capitola is built on the location of an Indian village that existed for more than a 1,000 years and contains areas identified within the Local Coastal Program Map I-1 as having a likelihood of prehistoric cultural resources. There are no other formal cemeteries within the City of Capitola.

Human remains are defined as any physical remains of a human being. The term "human remains" encompasses more than human bones. In ancient as well as historic times, Tribal Traditions included, but were not limited to, the burial of associated cultural resources (funerary objects) with the deceased, and the ceremonial burning of human remains. These remains are to be treated in the same manner as bone fragments that remain intact.

Associated funerary objects are objects that, as part of the death rite or ceremony of a culture, are reasonably believed to have been placed with individual human remains either at the time of death or later; other items made exclusively for burial purposes or to contain human remains can also be considered as associated funerary objects.

The Native American Graves Protection and Repatriation Act (NAGPRA) provides guidance that agencies shall consult with organizations on whose aboriginal lands the remains and cultural items might be discovered, who are reasonably known to have a cultural relationship to the human remains and other cultural items.

In the event human remains are encountered during earth removal or disturbance activities associated with future development proposals associated with implementation of the proposed project, all activities would cease immediately and a qualified archaeologist and Native American monitor would be immediately contacted.

California Health and Safety Code Section 7050.5 states that no further disturbance shall occur until the County Coroner has made a determination of origin and disposition pursuant to Public Resources Code Section 5097.98.

The County Coroner must be notified of the find immediately. If the remains are determined to be prehistoric, the Coroner would notify the Native American Heritage Commission (NAHC), which will determine and notify a Most Likely Descendant (MLD). With the permission of the landowner or his/her authorized representative, the MLD may inspect the site of the discovery. The MLD shall complete the inspection within 48 hours of notification by the NAHC. The MLD may recommend scientific removal and nondestructive analysis of human remains and items associated with Native American burials.

The proposed project involves policy-level documents, and as such, does not include any site-specific development designs or proposals. Thus, it is not possible at this time to conduct an assessment of potential site-specific historical resource impacts relative to future development proposals associated with implementation of the proposed project. Instead, A case-by-case review of future development proposals associated with implementation of the proposed project would be carried out to confirm the absence or presence of human remains, and that the future development proposals comply with Health and Safety Code and Public Resources Code protocols. Thus, adoption and implementation of the proposed project ensures impacts remain as less than significant impacts.

Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard. 258
Item 7 D.

Addendum to the Capitola General Plan Update EIR
For the 2023-2031 Housing Element
Draft | November 2023 4-31
D. WOULD THE PROJECT CAUSE A SUBSTANTIAL ADVERSE CHANGE IN THE SIGNIFICANCE OF A TRIBAL CULTURAL RESOURCE, DEFINED IN PUBLIC RESOURCES CODE SECTION 21074 AS EITHER

A SITE, FEATURE, PLACE, CULTURAL LANDSCAPE THAT IS GEOGRAPHICALLY DEFINED IN TERMS

OF THE SIZE AND SCOPE OF THE LANDSCAPE, SACRED PLACE, OR OBJECT WITH CULTURAL VALUE TO A CALIFORNIA NATIVE AMERICAN TRIBE, AND THAT IS:

1. LISTED OR ELIGIBLE FOR LISTING IN THE CALIFORNIA REGISTER OF HISTORICAL RESOURCES, OR

IN THE LOCAL REGISTER OF HISTORICAL RESOURCES AS DEFINED IN PUBLIC RESOURCES CODE SECCTION 5020.1(K)?

2. A RESOURCE DETERMINED BY THE LEAD AGENCY, IN ITS DISCRETION AND SUPPORTED BY

SUBSTANTIAL EVIDENCE, TO BE SIGNIFICANT PURSUANT TO CRITERIA SET FORTH IN SUBDIVISION (C) OF PUBLIC RESOURCES CODE SECTION 5024.1? IN APPLYING THE CRITERIA SET FORTH IN SUBDIVISION (C) OF PUBLIC RESOURCES CODE SECTION 5024.1, THE LEAD AGENCY

SHALL CONSIDER THE SIGNIFICANCE OF THE RESOURCE TO A CALIFORNIA NATIVE AMERICAN TRIBE.

Tribal Consultation
Chapter 532, Statutes of 2014 (AB 52), requires that Lead Agencies evaluate a project’s potential to impact “tribal cultural resources.” Such resources include “[s]ites, features, places, cultural landscapes, sacred places, and objects with cultural value to a California Native American tribe that are eligible for inclusion in the California Register of Historical resources or included in a local register of historical resources.” AB 52 also gives Lead Agencies the discretion to determine, supported by substantial evidence, whether a resource qualifies as a “tribal cultural resource.”
Also, per AB 52 (specifically Public Resources Code [PRC] Section 21080.3.1), Native American consultation is required upon request by a California Native American tribe that has previously requested that the City provide it with notice of such projects.

While tribal consultation is not required for an Addendum, the City contacted the Native American Heritage Commission (NAHC) in July 2023 requesting a list of potential Native American contacts for consultation. The NAHC provided a Tribal Consultation List to the City on July 27, 2023. In addition, the City reviewed its list of tribes that had requested AB 52 notification.

The City sent letters via email for the purposes of SB 181 and AB 52 consultation to eight tribes listed below on August 2, 2023:

1. Muwekma Ohlone Indian Tribe of the SF Bay Area

2. Amah Mutsun Tribal Band – Ed Ketchum, Vice-Chairperson

3. Amah Mutsun Tribal Band – Valentin Lopez, Chairperson

4. Amah MutsunTribal Band of Mission San Juan Bautista – Irene Zwierlein, Chairperson 1 SB 18 (Chapter 905, Statutes of 2004) (Public Resources Code Section 65352.3) requires cities and counties to contact and consult with California Native American tribes prior to amending or adopting any general plan or specific plan, or designating land as open space. 259
Item 7 D.

Addendum to the Capitola General Plan Update EIR
For the 2023-2031 Housing Element
Draft | November 2023 4-32

5. Costanoan Ohlone Rumsen-Mutsen Tribe – Patrick Orozco, Chairman

6. Indian Canyon Mutsun Band of Costanoan – Kanyon Sayers-Roods, MLD Contact

7. Indian Canyon Mutsun Band of Costanoan – Ann Marie Sayers, Chairperson

8. Wuksachi Indian Tribe/Eshom Valley Band – Kenneth Woodrow, Chairperson The City’s letter specifically noted that the Housing Element is required to be updated every eight years, and within Santa Cruz County, jurisdictions are required to prepare, adopt, and receive certification from the California Department of Housing and Community Development (HCD) of their 6th cycle Housing Element by December 15, 2023. As such, the City respectfully requested that each tribe respond within 30 days for the both the SB 18 and AB 32 consultation.

At the conclusion of the 30-day period, the City received no requests for SB 18 or AB 52 consultation. However, the Amah Mutsun Tribal Band of San Juan Bautista and A.M.T.B. Inc. provided a Letter of Response to the City on August 17, 2023. The Letter of Response provided recommendations regarding cultural sensitivity training, qualified California trained archeological monitors to be present during earth movement, and qualified native American monitors during earth movement. In addition, hourly rates for monitoring were provided in the Letter of Response.

Impact Analysis
Whatever the linguistic affiliation, Native Americans in and around the City of Capitola exhibited similar organization and resource procurement strategies. Villages were based on clan or lineage groups. Their home/base sites are marked by midden deposits, often with bedrock mortars. During their seasonal rounds to exploit plant resources, small groups would migrate within their traditional territory in search of specific plants and animals. Their gathering strategies often left behind signs of special use sites, usually grinding slicks on bedrock boulders, at the locations of the resources.

Given the long-standing history of the multiple tribes in and around the City of Capitola, there is the potential that the construction of future development proposals associated with implementation of the proposed project would impact tribal cultural resources. Past construction and development practices in the City were not as sensitive to tribal cultural resources as current practices. Thus, ground-disturbing activities, such as grading or excavation, could disturb previously unidentified subsurface resources.

The proposed project involves policy-level documents, and as such, does not include any site-specific development designs or proposals. Thus, it is not possible at this time to conduct an assessment of potential site-specific tribal cultural resource impacts relative to future development proposals associated with implementation of the proposed project. Instead, A case-by-case review of future development proposals associated with implementation of the proposed project would be carried out to confirm the absence or presence of tribal cultural resources, as applicable, and that the future development proposals are consistent with all applicable General Plan goals and policies and Municipal Code regulations relative to tribal cultural resources. Thus, adoption and implementation of the proposed project ensures impacts remain as less than significant impacts.

Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard. 260
Item 7 D.

Addendum to the Capitola General Plan Update EIR
For the 2023-2031 Housing Element
Draft | November 2023 4-33

4.6 ENERGY
Would the project:

New
Potentially
Significant
Impact
New Impact
Requiring
New
Mitigation
No New
Impact/
No Impact
Reduced
Impact
A. Result in potentially significant environmental impact due to wasteful, inefficient, or unnecessary consumption of energy resources, during project construction or operation?
✓
B. Conflict with or obstruct a state or local plan for renewable energy or energy efficiency? ✓

PRIOR ENVIRONMENTAL FINDINGS
General Plan Update EIR
The GPU EIR disclosed that buildout of the General Plan would entail the commitment of nonrenewable and/or slowly renewable energy resources. As the community continues to develop, the GPU EIR noted that both residential and nonresidential development would require further commitment of energy resources in the form of natural gas and electricity generated by coal, hydroelectric power, or nuclear energy. Increased motor vehicle travel within the City resulting from the General Plan also would be accompanied by increased consumption of petroleum products. However, the GPU EIR did not identify any impacts due to wasteful, inefficient, or unnecessary consumption of energy resources, or due to a conflict with or obstruction of a State or local plan for renewable energy or energy efficiency.

The AMBAG Regional Energy Plan was developed and adopted in 2006, and later updated in 2008. The objective of the regional energy plan to lay out the region’s joint approach to establishing an energy vision through objectives, goals, and action plans that will mitigate future energy impacts on the region. This cooperative approach is leveraged to reduce overall costs and challenges of compliance with AB 32 requirements. The 2006 Energy Plan laid out a set of four Plan objectives, goals, and action steps for the region, as listed in GPU EIR Table

4.15-7. As shown in GPU EIR Table 4.15-7, the General Plan would be consistent with the AMBAG Regional Energy Plan.

The GPU EIR concluded less than significant impacts to energy resources.

IMPACT ANALYSIS
The 2023-2031 Housing Element includes policies and programs that are applicable City-wide and are designed to facilitate the construction of housing units to meet the City’s share of the regional housing need. The 2023-2031 Housing Element Chapter 4, Housing Need and Opportunities identifies potential residential sites and densities, inclusive of recyclable residential land, religious facility sites and State land housing, vacant and non-vacant land, and the Capitola Mall site. The 2023-2031 Housing Element Chapter 5, Housing Plan identifies the Goals, Policies, and Programs and Quantified Objectives that are based upon expected availability of resources to address the 261
Item 7 D.

Addendum to the Capitola General Plan Update EIR
For the 2023-2031 Housing Element
Draft | November 2023 4-34
City’s housing needs, expectations regarding future housing development, as well as prior objectives established in earlier housing plans.

The 2023-2031 Housing Element is a policy document that would not change land use designations or in and of themselves authorize any development within the City. While the City is required by State law to facilitate development commensurate with its allocated share of regional housing needs, no change in the location or nature of allowable development would be authorized by the 2023-2031 Housing Element.

A. WOULD THE PROJECT RESULT IN POTENTIALLY SIGNIFICANT ENVIRONMENTAL IMPACT DUE TO

WASTEFUL, INEFFICIENT, OR UNNECESSARY CONSUMPTION OF ENERGY RESOURCES, DURING PROJECT CONSTRUCTION OR OPERATION?
B. WOULD THE PROJECT CONFLICT WITH OR OBSTRUCT A STATE OR LOCAL PLAN FOR RENEWABLE ENERGY OR ENERGY EFFICIENCY?
The proposed project involves policy-level documents, and as such, does not include any site-specific development designs or proposals. Future development proposals associated with implementation of the proposed project would be required to comply with all applicable regulations and development standards, including but not limited to the most current adopted version of the California Building Code and California Green Building Standards Code, along with project-specific conditions and mitigation measures to reduce potential energy impacts required as part of the development review and environmental impact processes. The proposed project would not result in impacts to energy resources, or conflict with or obstruct any plans addressing renewable energy or energy efficiency. Thus, adoption and implementation of the proposed project ensures impacts remain as no impacts.

Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard. 262
Item 7 D.

Addendum to the Capitola General Plan Update EIR
For the 2023-2031 Housing Element
Draft | November 2023 4-35

4.7 GEOLOGY AND SOILS
Would the project:

New
Potentially
Significant
Impact
New Impact
Requiring
New
Mitigation
No New
Impact/
No Impact
Reduced
Impact
A. Directly or indirectly cause potential substantial adverse effects, including the risk of loss, injury, or death involving:
1) Rupture of a known earthquake fault, as delineated on the most recent Alquist-Priolo Earthquake Fault Zoning Map issued by the State Geologist for the area or based on other substantial evidence of a known fault? Refer to Division of Mines and Geology Special Publication 42. ✓
2) Strong seismic ground shaking? ✓
3) Seismic-related ground failure, including liquefaction? ✓ 4) Landslides? ✓
B. Result in substantial soil erosion or the loss of topsoil? ✓ C. Be located on a geologic unit or soil that is unstable, or that would become unstable as a result of the project, and potentially result in on-or off-site landslide, lateral spreading, subsidence, liquefaction, or collapse? ✓
D. Be located on expansive soil, as defined in Table 18-1-B of the Uniform Building Code (1994), creating substantial risks to life or property? ✓ E. Have soils incapable of adequately supporting the use of septic tanks or alternative waste water disposal systems where sewers are not available for the disposal of waste water?
✓
F. Directly or indirectly destroy a unique paleontological resource or site or unique geologic feature? ✓

PRIOR ENVIRONMENTAL FINDINGS
General Plan Update EIR
The table below summarizes the geology and soils impacts and mitigation measures, if applicable.

GEOLOGY AND SOILS – SUMMARY OF IMPACTS AND MITIGATION MEASURES Impact Significance Before
Mitigation Mitigation Measures Significance With Mitigation GEO-1: The proposed Plan would not expose people or
structures to potential substantial adverse effects, including the risk of loss, injury, or death involving surface rupture along a known active fault; strong seismic ground shaking; seismic-related ground failure, including liquefaction; and landslides.

Less Than Significant
GEO-2: Implementation of the proposed Plan would not
result in substantial soil erosion or the loss of topsoil. Less Than Significant 263
Item 7 D.

Addendum to the Capitola General Plan Update EIR
For the 2023-2031 Housing Element
Draft | November 2023 4-36
GEOLOGY AND SOILS – SUMMARY OF IMPACTS AND MITIGATION MEASURES Impact Significance Before
Mitigation Mitigation Measures Significance With Mitigation GEO-3: Development under the proposed Plan would not
result in a significant impact related to development on unstable geologic units and soils or result in on- or off-site landslide, lateral spreading, subsidence, liquefaction, or collapse.

Less Than Significant
GEO-4: Development under the proposed Plan would not
create substantial risks to life or property as a result of its location on expansive soil.

Less Than Significant
GEO-5: Development under the proposed Plan would not
result in impacts associated with the use of septic tanks or alternative waste water disposal systems where sewers
are not available for the disposal of wastewater.

Less Than Significant
GEO-6: The proposed Plan, in combination with past,
present, and reasonably foreseeable projects, would not result in significant cumulative impacts with respect to geology and soils.

Less Than Significant
Source: Capitola General Plan Update Environmental Impact Report (June 2014), Table 1-1, Summary of Impacts and Mitigation Measures

IMPACT ANALYSIS
The 2023-2031 Housing Element includes policies and programs that are applicable City-wide and are designed to facilitate the construction of housing units to meet the City’s share of the regional housing need. The 2023-2031 Housing Element Chapter 4, Housing Need and Opportunities identifies potential residential sites and densities, inclusive of recyclable residential land, religious facility sites and State land housing, vacant and non-vacant land, and the Capitola Mall site. The 2023-2031 Housing Element Chapter 5, Housing Plan identifies the Goals, Policies, and Programs and Quantified Objectives that are based upon expected availability of resources to address the City’s housing needs, expectations regarding future housing development, as well as prior objectives established in earlier housing plans.

The 2023-2031 Housing Element is a policy document that would not change land use designations or in and of themselves authorize any development within the City. While the City is required by State law to facilitate development commensurate with its allocated share of regional housing needs, no change in the location or nature of allowable development would be authorized by the 2023-2031 Housing Element.

A. WOULD THE PROJECT DIRECTLY OR INDIRECTLY CAUSE POTENTIAL SUBSTANTIAL ADVERSE EFFECTS, INCLUDING THE RISK OF LOSS, INJURY, OR DEATH INVOLVING:

1. RUPTURE OF A KNOWN EARTHQUAKE FAULT, AS DELINEATED ON THE MOST RECENT ALQUISTPRIOLO EARTHQUAKE FAULT ZONING MAP ISSUED BY THE STATE GEOLOGIST FOR THE AREA OR BASED ON OTHER SUBSTANTIAL EVIDENCE OF A KNOWN FAULT? REFER TO DIVISION OF MINES AND GEOLOGY SPECIAL PUBLICATION 42.

The GPU EIR concluded that no Alquist-Priolo Earthquake Fault Zones have been identified within the City Area.

Therefore, the risk of surface fault rupture within the City Area is considered low. 264
Item 7 D.

Addendum to the Capitola General Plan Update EIR
For the 2023-2031 Housing Element
Draft | November 2023 4-37
California, including the City of Capitola, is subject to the effects of seismic activity due to the active faults that traverse the area. Active faults are defined as those that have experienced surface displacement within Holocene time (approximately the last 11,000 years) and/or are in a State-designated Alquist-Priolo Earthquake Fault Zone.

No Alquist-Priolo Earthquake Fault zones exist within the City of Capitola. Thus, adoption and implementation of the proposed project ensures impacts remain as less than significant impacts.

Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard.

2. STRONG SEISMIC GROUND SHAKING?
The General Plan includes goals, policies, and actions relative to seismic ground shaking: Goal SN-2, Policy SN-2.1 Development Restrictions, Policy SN-2.2 Mitigation, Policy SN-2.3 Seismic Analysis, Policy SN-2.4 Bluff Erosion, Policy SN-2.5 Retrofits, Policy SN-2.6 Hazard Considerations, Policy SN-2.7 Public Outreach, Policy SN-2.8 Critical Facilities and Services, Policy SN-2.9 State Standard, Action SN-2.1 Funding, Action SN-2.2 Transportation Infrastructure, Action SN-2.3 Data Accuracy, and Action SN-2.4 URM Program. The GPU EIR concluded less than significant impacts with implementation of the aforementioned General Plan goals, policies, and actions, and regulatory requirements.

The City of Capitola, similar to the rest of California, is located within a seismically active region as a result of being located near the active margin between the North American and Pacific tectonic plates. The City is subject to seismic ground shaking due to the close proximity and potential earthquake magnitude of the San Andreas, the Zayante, and the Palo Colorado-San Gregorio faults.

The intensity of groundshaking and degree of impact would depend upon the magnitude of the earthquake, distance to the epicenter, and the geology of the area between the epicenter and the development site.

Additionally, the soil and geologic structure underlying a development site would influence the amount of damage that the site may experience. Potential damage to existing and new structures cannot be precluded. Structural vulnerabilities in older buildings that are less earthquake resistant are most likely to contribute to the largest source of injury and economic loss, as a result of an earthquake. Damage to infrastructure, including roadways, bridges, water and wastewater lines, gas lines, power poles, storm drainage, and other public facilities, could also occur due to an earthquake event.

The proposed project involves policy-level documents, and as such, does not include any site-specific development designs or proposals. The California Building Code includes specific design measures, which are based on the determination of Site Classification and Seismic Design Categories specific to a project site. These design measures are intended to maximize structural stability in the event of an earthquake. Future development proposals associated with implementation of the proposed project would be required to comply with all applicable regulations and development standards, including but not limited to the most current adopted version of the California Building Code, along with project-specific conditions and mitigation measures, to reduce potential impacts required as part of the development review and environmental impact processes. Thus, adoption and implementation of the proposed project ensures impacts remain as less than significant impacts with implementation of regulatory requirements and standard conditions of approval.

Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard. 265
Item 7 D.

Addendum to the Capitola General Plan Update EIR
For the 2023-2031 Housing Element
Draft | November 2023 4-38

3. SEISMIC-RELATED GROUND FAILURE, INCLUDING LIQUEFACTION?

4. LANDSLIDES?
The General Plan includes goals, policies, and actions relative to seismic ground shaking: Goal SN-2, Policy SN-2.1 Development Restrictions, Policy SN-2.2 Mitigation, Policy SN-2.3 Seismic Analysis, Policy SN-2.4 Bluff Erosion, Policy SN-2.5 Retrofits, Policy SN-2.6 Hazard Considerations, Policy SN-2.7 Public Outreach, Policy SN-2.8 Critical Facilities and Services, Policy SN-2.9 State Standard, Action SN-2.1 Funding, Action SN-2.2 Transportation Infrastructure, Action SN-2.3 Data Accuracy, and Action SN-2.4 URM Program. The GPU EIR concluded less than significant impacts with implementation of the aforementioned General Plan goals, policies, and actions, and regulatory requirements.

Seismic agitation of relatively loose saturated sands, silty sands, and some silts can result in a buildup of pore pressure. If the pore pressure exceeds the overburden stresses, a temporary quick condition known as liquefaction can occur. Liquefaction effects can manifest in several ways including: 1) loss of bearing; 2) lateral spread; 3) dynamic settlement; and 4) flow failure. Lateral spreading has typically been the most damaging mode of failure.

In general, the more recent that a sediment has been deposited, the more likely it will be susceptible to liquefaction. Other factors that must be considered are groundwater, confining stresses, relative density, and the intensity and duration of seismically-induced ground shaking.

The geologic and topographic characteristics of an area often determine its potential for landslides. Steep slopes, the extent of erosion, and the rock composition of a hillside all contribute to the potential slope failure and landslide events.

Capitola contains areas with slopes greater than 50 percent, which are susceptible to landslides and mudflows as shown on GPU EIR Figure 4.5-3. The majority of these areas are coastal bluffs, escarpments of decomposed rock, or soil resulting from erosion or faulting with a vertical elevation of at least 10 feet. Coastal bluff areas within Capitola that have steep topography include Cliff Drive and surrounding open space as well as shoreline residences and open space areas of the Depot Hill neighborhood, between the Village and New Brighton State Park. In addition to the coastal bluffs, there are areas along Soquel Creek, Nobel Gulch, and Tannery Gulch that have steep slopes that could be susceptible to landslides and mudflows.

The proposed project involves policy-level documents, and as such, does not include any site-specific development designs or proposals. Future development proposals associated with implementation of the proposed project would be required to comply with all applicable regulations and development standards, including but not limited to the most current adopted version of the California Building Code, preparation of site-specific geologic studies, project-specific conditions, and mitigation measures as applicable, to reduce potential impacts required as part of the development review and environmental impact processes. Thus, adoption and implementation of the proposed project ensures seismic-related ensures ground failure impacts remain as less than significant impacts with implementation of regulatory requirements and standard conditions of approval, and that earthquakeinduced landslides impacts remain as less than significant impacts.

Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard. 266
Item 7 D.

Addendum to the Capitola General Plan Update EIR
For the 2023-2031 Housing Element
Draft | November 2023 4-39
B. WOULD THE PROJECT RESULT IN SUBSTANTIAL SOIL EROSION OR THE LOSS OF TOPSOIL? The General Plan includes goals, policies, and actions relative to soil erosion or loss of topsoil: Goal SN-2, Policy SN-2.1 Development Restrictions, Policy SN-2.2 Mitigation, Policy SN-2.3 Seismic Analysis, Policy SN-2.4 Bluff Erosion, Policy SN-2.5 Retrofits, Policy SN-2.6 Hazard Considerations, Policy SN-2.7 Public Outreach, Policy SN-2.8 Critical Facilities and Services, Policy SN-2.9 State Standard, Action SN-2.1 Funding, Action SN-2.2 Transportation Infrastructure, Action SN-2.3 Data Accuracy, and Action SN-2.4 URM Program. The GPU EIR concluded less than significant impacts with implementation of the aforementioned General Plan goals, policies, and actions, and regulatory requirements.

The proposed project involves policy-level documents, and as such, does not include any site-specific development designs or proposals. Future development proposals associated with implementation of the proposed project involving demolition and/or construction activities would be subject to compliance with the California Building Code, as well as the requirements set forth in the National Pollutant Discharge Elimination System (NPDES) Storm Water General Construction Permit for construction activities. The NPDES Storm Water General Construction Permit requires preparation of a Storm Water Pollution Prevention Plan, which would identify specific erosion and sediment control Best Management Practices that would be implemented to protect storm and non-storm water runoff during construction and post-development activities, inclusive of low impact development (LID) design considerations and operational and maintenance requirements. Compliance with the California Building Code and NPDES would minimize effects from erosion and ensure consistency with the Central Coast Regional Water Quality Control Board Water Quality Control Plan. Thus, adoption and implementation of the proposed project ensures that soil erosion impacts remain as less than significant impacts with implementation of regulatory requirements and standard conditions of approval.

Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard.

C. WOULD THE PROJECT BE LOCATED ON A GEOLOGIC UNIT OR SOIL THAT IS UNSTABLE, OR THAT

WOULD BECOME UNSTABLE AS A RESULT OF THE PROJECT, AND POTENTIALLY RESULT IN AN

ON-SITE OR OFF-SITE LANDSLIDE, LATERAL SPREADING, SUBSIDENCE, LIQUEFACTION OR COLLAPSE?
Refer to Responses A.1.3 and A.1.4.

Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard.

D. WOULD THE PROJECT BE LOCATED ON EXPANSIVE SOIL, AS DEFINED IN TABLE 18-1-B OF THE UNIFORM BUILDING CODE (1994), CREATING SUBSTANTIAL RISKS TO LIFE OR PROPERTY? The General Plan includes goals, policies, and actions relative to expansive soils: Goal SN-2, Policy SN-2.1 Development Restrictions, Policy SN-2.2 Mitigation, Policy SN-2.6 Hazard Considerations, Policy SN-2.7 Public Outreach, Policy SN-2.9 State Standard, and Action SN-2.3 Data Accuracy. The GPU EIR concluded less than significant impacts with implementation of the aforementioned General Plan goals, policies, and actions, and regulatory requirements.
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Expansive soils can be a problem, as variation in moisture content will cause a volume change in the soil. Expansive soils heave when moisture is introduced and contract as they dry. During inclement weather and/or excessive landscape watering, moisture infiltrates the soil and causes the soil to heave (expansion). When drying occurs the soils will shrink (contraction). Repeated cycles of expansion and contraction of soils can cause pavement, concrete slabs on grade and foundations to crack. This movement can also result in misalignment of doors and windows.

The proposed project involves policy-level documents, and as such, does not include any site-specific development designs or proposals. Future development proposals associated with implementation of the proposed project would be required to comply with all applicable regulations and development standards, including but not limited to the most current adopted version of the California Building Code, preparation of site-specific geologic studies, project-specific conditions, and mitigation measures, as applicable, to reduce potential impacts required as part of the development review and environmental impact processes. Thus, adoption and implementation of the proposed project ensures that expansive soil impacts remain as less than significant impacts with implementation of regulatory requirements and standard conditions of approval.

Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard.

E. WOULD THE PROJECT HAVE SOILS INCAPABLE OF ADEQUATELY SUPPORTING THE USE OF

SEPTIC TANKS OR ALTERNATIVE WASTE WATER DISPOSAL SYSTEMS WHERE SEWERS ARE NOT AVAILABLE FOR THE DISPOSAL OF WASTE WATER?
All existing development within the City is connected to a sewer system for the disposal of wastewater. The proposed project involves policy-level documents, and as such, does not include any site-specific development designs or proposals. Future development proposals associated with implementation of the proposed project would be required to connect to a sewer system, as well as comply with all applicable regulations, development standards, project-specific conditions, and mitigation measures, as applicable. Thus, adoption and implementation of the proposed project ensures that septic tank or alternative waste water disposal system impacts remain as less than significant impacts.

Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard.

F. WOULD THE PROJECT DIRECTLY OR INDIRECTLY DESTROY A UNIQUE PALEONTOLOGICAL RESOURCE OR SITE OR UNIQUE GEOLOGIC FEATURE?
The City of Capitola contains areas identified within the Local Coastal Program Map I-1 as having a likelihood of prehistoric cultural resources, including paleontological resources. The entire coastal bluff area in Capitola is composed at least partially of the Purisima Formation. Paleontological resources found within the City have been located in this Purisima Formation. The GPU EIR identified that future development and/or redevelopment within Archaeological/Paleontological Sensitivity Areas could potentially destroy a unique paleontological resource, and would be subject to the Coastal Act, Municipal Code, and GPU EIR Mitigation Measure CULT-2 to avoid or mitigate impacts to paleontological resources.
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The proposed project involves policy-level documents, and as such, does not include any site-specific development designs or proposals. There is the potential that future development projects could uncover paleontological resources or unique geologic features. Thus, adoption and implementation of the proposed project ensures that unique paleontological resources or geological features impacts remain as less than significant impacts with implementation of regulatory requirements, standard conditions of approval, and GPU EIR Mitigation Measure CULT-2.

Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard. 269
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4.8 GREENHOUSE GASES
Would the project:

New
Potentially
Significant
Impact
New Impact
Requiring
New
Mitigation
No New
Impact/
No Impact
Reduced
Impact
A. Generate greenhouse gas emissions, either directly or indirectly, that may have a significant impact on the environment? ✓
B. Conflict with an applicable plan, policy, or regulation adopted for the purpose of reducing the emissions of greenhouse gases? ✓

PRIOR ENVIRONMENTAL FINDINGS
General Plan Update EIR
The table below summarizes the greenhouse gas emissions impacts and mitigation measures, if applicable.

GREENHOUSE GAS EMISSIONS – SUMMARY OF IMPACTS AND MITIGATION MEASURES Impact Significance Before
Mitigation Mitigation Measures Significance With Mitigation GHG-1: GHG emissions associated with the proposed
Plan would exceed MBAUAPCD’s proposed GHG
significance threshold of 2,000 MTCO2e per year.

Significant GHG-1 Significant Unavoidable
GHG-2: The proposed Plan would not conflict with
applicable plans, policies, or regulations adopted for the purpose of reducing GHG emissions.

Less Than Significant Not Applicable
GHG-3: The proposed Plan, in combination with past,
present, and reasonably foreseeable projects, would result in a significant cumulative impact with respect to GHG
emissions.

Significant
GHG-3:

Implement Mitigation
Measure GHG-1
Significant Unavoidable
Source: Capitola General Plan Update Environmental Impact Report (June 2014), Table 1-1, Summary of Impacts and Mitigation Measures

IMPACT ANALYSIS
The 2023-2031 Housing Element includes policies and programs that are applicable City-wide and are designed to facilitate the construction of housing units to meet the City’s share of the regional housing need. The 2023-2031 Housing Element Chapter 4, Housing Need and Opportunities identifies potential residential sites and densities, inclusive of recyclable residential land, religious facility sites and State land housing, vacant and non-vacant land, and the Capitola Mall site. The 2023-2031 Housing Element Chapter 5, Housing Plan identifies the Goals, Policies, and Programs and Quantified Objectives that are based upon expected availability of resources to address the City’s housing needs, expectations regarding future housing development, as well as prior objectives established in earlier housing plans.

The 2023-2031 Housing Element is a policy document that would not change land use designations or in and of themselves authorize any development within the City. While the City is required by State law to facilitate 271
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development commensurate with its allocated share of regional housing needs, no change in the location or nature of allowable development would be authorized by the 2023-2031 Housing Element.

A. WOULD THE PROJECT GENERATE GREENHOUSE GAS EMISSIONS, EITHER DIRECTLY OR INDIRECTLY, THAT MAY HAVE A SIGNIFICANT IMPACT ON THE ENVIRONMENT? B. WOULD THE PROJECT CONFLICT WITH AN APPLICABLE PLAN, POLICY, OR REGULATION ADOPTED FOR THE PURPOSE OF REDUCING THE EMISSIONS OF GREENHOUSE GASES? The General Plan includes numerous policies relative to greenhouse gas emissions, plans, policies, or regulations, which are restated on GPU EIR pages 4.15-17 to 4.15-22. The GPU EIR concluded less than significant impacts and significant unavoidable impacts with implementation of General Plan policies and actions, and mitigation measures.

The proposed project involves policy-level documents, and as such, does not include any site-specific development designs or proposals. Future development proposals associated with implementation of the proposed project would be required to comply with all applicable regulations and development standards, including but not limited to the most current adopted version of the California Building Code and California Green Building Standards Code, along with project-specific conditions and mitigation measures to reduce potential impacts required as part of the development review and environmental impact processes.

In addition, the General Plan includes goals and policies in the Open Space and Conservation Element that address that following topics:
▪ General Environmental Sustainability and Stewardship
▪ Climate Change and Greenhouse Gas Reduction
▪ Air Quality
▪ Renewable Energy Sources and Energy Conservation
▪ Biological Resources
▪ Water Quality and Conservation
▪ Food Production
▪ Waste Reduction
The Open Space and Conservation Element goals and policies support actions to reduce the use of resources and energy, and thus, the creation of greenhouse gas emissions. Future development proposals associated with implementation of the proposed project would be subject to these policies, as applicable.

The GPU EIR identified that Mitigation Measure GHG-1 (Preparation, Adoption, and Implementation of Climate Action Plan) would be applicable to future development proposals in the City. The City adopted its first Climate Action Plan (CAP) on October 22, 2015. The CAP identifies strategies and actions to reduce greenhouse gas emissions from City government operations and community activities to support the State of California’s efforts to mitigate the effects of climate change.
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Thus, adoption and implementation of the proposed project ensures greenhouse gas emissions or conflicts with adopted plans, policies, and regulations remain as less than significant impacts with implementation of Mitigation Measure GHG-1 (Climate Action Plan).

Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard. 273
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4.9 HAZARDS AND HAZARDOUS MATERIALS
Would the project:

New
Potentially
Significant
Impact
New Impact
Requiring
New
Mitigation
No New
Impact/
No Impact
Reduced
Impact
A. Create a significant hazard to the public or the environment through the routine transport, use, or disposal of hazardous materials? ✓
B. Create a significant hazard to the public or the environment through reasonably foreseeable upset and accident conditions involving the release of hazardous materials into the environment?
✓
C. Emit hazardous emissions or handle hazardous or acutely hazardous materials, substances, or waste within one-quarter mile of an existing or proposed school? ✓ D. Be located on a site which is included on a list of hazardous materials sites compiled pursuant to Government Code Section 65962.5 and, as a result, would it create a significant hazard to the public or the environment? ✓
E. For a project located within an airport land use plan or, where such a plan has not been adopted, within two miles of a public airport or public use airport, would the project result in a safety hazard for people residing or working in the project area? ✓
F. Impair implementation of or physically interfere with an adopted emergency response plan or emergency evacuation plan? ✓

PRIOR ENVIRONMENTAL FINDINGS
General Plan Update EIR
The table below summarizes the hazards and hazardous materials impacts and mitigation measures, if applicable.

HAZARDS AND HAZARDOUS MATERIALS– SUMMARY OF IMPACTS AND MITIGATION MEASURES Impact Significance Before
Mitigation Mitigation Measures Significance With Mitigation HAZ-1: The proposed Plan would not create a significant hazard to the public or the environment through the routine transport, use, or disposal of hazardous materials.

Less Than Significant Not Applicable
HAZ-2: The proposed Plan would not create a significant hazard to the public or the environment through reasonably foreseeable upset and accident conditions involving the release of hazardous materials into the environment.

Less Than Significant Not Applicable
HAZ-3: The proposed Plan would not result in significant impacts associated with hazardous emissions or handling of hazardous or acutely hazardous materials, substances, or waste within ¼-mile of an existing or proposed school.

Less Than Significant Not Applicable
HAZ-4: Implementation of the Plan would not create a
significant hazard to the public or the environment as a result of development on a site which is included on a list of hazardous materials sites compiled pursuant to
Government Code Section 65962.5.

Less Than Significant Not Applicable
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HAZARDS AND HAZARDOUS MATERIALS– SUMMARY OF IMPACTS AND MITIGATION MEASURES Impact Significance Before
Mitigation Mitigation Measures Significance With Mitigation HAZ-5: Implementation of the proposed Plan would not
result in a safety hazard for people residing or working in the area due to development within an airport land use
plan or, where such a plan has not been adopted, within 2 miles of a public airport or public use airport.

No Impact Not Applicable
HAZ-6: Implementation of the proposed Plan would not
result in a safety hazard for people residing or working in the Plan Area due to development in the vicinity of a
private airstrip.

No Impact Not Applicable
HAZ-7: The proposed Plan would not impair
implementation of or physically interfere with an adopted emergency response plan or emergency evacuation plan.

Less Than Significant Not Applicable
HAZ-8: Implementation of the proposed Plan would not
expose people or structures to a significant risk of loss, injury, or death involving wildland fires, including where wildlands are adjacent to urbanized areas or where
residences are intermixed with wildlands.

Less Than Significant Not Applicable
HAZ-9: The proposed Plan, in combination with past,
present, and reasonably foreseeable projects, would result in less-than-significant cumulative impacts with respect to hazards and hazardous materials.

Less Than Significant Not Applicable
Source: Capitola General Plan Update Environmental Impact Report (June 2014), Table 1-1, Summary of Impacts and Mitigation Measures

IMPACT ANALYSIS
The 2023-2031 Housing Element includes policies and programs that are applicable City-wide and are designed to facilitate the construction of housing units to meet the City’s share of the regional housing need. The 2023-2031 Housing Element Chapter 4, Housing Need and Opportunities identifies potential residential sites and densities, inclusive of recyclable residential land, religious facility sites and State land housing, vacant and non-vacant land, and the Capitola Mall site. The 2023-2031 Housing Element Chapter 5, Housing Plan identifies the Goals, Policies, and Programs and Quantified Objectives that are based upon expected availability of resources to address the City’s housing needs, expectations regarding future housing development, as well as prior objectives established in earlier housing plans.

The 2023-2031 Housing Element is a policy document that would not change land use designations or in and of themselves authorize any development within the City. While the City is required by State law to facilitate development commensurate with its allocated share of regional housing needs, no change in the location or nature of allowable development would be authorized by the 2023-2031 Housing Element. 276
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A. WOULD THE PROJECT CREATE A SIGNIFICANT HAZARD TO THE PUBLIC OR THE ENVIRONMENT THROUGH THE ROUTINE TRANSPORT, USE, OR DISPOSAL OF HAZARDOUS MATERIALS? B. WOULD THE PROJECT CREATE A SIGNIFICANT HAZARD TO THE PUBLIC OR THE ENVIRONMENT

THROUGH REASONABLY FORESEEABLE UPSET AND ACCIDENT CONDITIONS INVOLVING THE RELEASE OF HAZARDOUS MATERIALS INTO THE ENVIRONMENT?
C. WOULD THE PROJECT EMIT HAZARDOUS EMISSIONS OR HANDLE HAZARDOUS OR ACUTELY

HAZARDOUS MATERIALS, SUBSTANCES, OR WASTE WITHIN ONE-QUARTER MILE OF AN EXISTING OR PROPOSED SCHOOL?
D. WOULD THE PROJECT BE LOCATED ON A SITE WHICH IS INCLUDED ON A LIST OF HAZARDOUS MATERIALS SITES COMPILED PURSUANT TO GOVERNMENT CODE SECTION 65962.5 AND, AS A RESULT, WOULD IT CREATE A SIGNIFICANT HAZARD TO THE PUBLIC OR THE ENVIRONMENT? The GPU EIR concluded that buildout of the General Plan would result in no impact or less than significant impacts relative to following hazards: a) significant hazard to the public or the environment through the routine transport, use, or disposal of hazardous materials, b) the project creates a significant hazard to the public or the environment through reasonably foreseeable upset and accident conditions involving the release of hazardous materials into the environment, c) the project emits hazardous emissions or handle hazardous or acutely hazardous materials, substances, or waste within one-quarter mile of an existing or proposed school, d) the project is located on a site which is included on a list of hazardous materials sites compiled pursuant to Government Code section 65962.5 and, as a result, would it create a significant hazard to the public or the environment.

The General Plan includes numerous policies relative to hazards and hazardous materials plans, policies, or regulations, which are restated on GPU EIR pages 4.6-10 to 4.6-22. The GPU EIR concluded no impacts or less than significant impacts with implementation of General Plan policies and actions.

Routine Transport, Use or Disposal of Hazardous Materials The General Plan includes policies relative to the routine transport, use or disposal 0f hazardous materials: Policy SN-4.1 Mitigation Processes., Policy SN-4.3 Sensitive Receptors; Policy SN-4.4 Green Building, Policy SN-4.5 County Coordination, Action SN-4.1 City Staff Training, and Action SN-4.2 Municipal Code Review. The GPU EIR concluded less than significant impacts with implementation of General Plan policies and actions, and regulatory requirements.

Businesses that use, transport, or dispose of hazardous materials are required to comply with Federal, State, and local hazardous materials regulations. Specifically, truck traffic, including trucks that transport chemicals, is restricted to designated routes per Municipal Code Chapter 10.48.

A number of facilities currently operate within the City of Capitola that use, store, or dispose of hazardous materials. These operations, if improperly designed or managed, could create a significant hazard to the public or the environment through the routine transport, use, or disposal of such materials. However, compliance with applicable Federal, State, and local laws and regulations regarding the handling of these materials minimize this risk.
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The proposed project involves policy-level documents, and as such, does not include any site-specific development designs or proposals. Future development proposals associated with implementation of the proposed project would be required to comply with all applicable regulations and development standards, including but not limited to the most current adopted version of the California Building Code, project-specific conditions, and mitigation measures, as applicable, to reduce potential impacts required as part of the development review and environmental impact processes. Thus, adoption and implementation of the proposed project ensures that impacts remain as less than significant impacts with implementation of regulatory requirements and standard conditions of approval.

Hazardous Materials
The General Plan includes policies and actions relative to hazardous materials: Policy SN-4.1 Mitigation Processes, Policy SN-4.2 Site Assessments, Policy SN-4.3 Sensitive Receptors, Policy SN-4.4 Green Building, Policy SN-4.5 County Coordination, Action SN-4.1 City Staff Training, Policy SN-5.1 Coordination with Other Agencies, Policy SN5.2 Community Groups, Policy SN-5.3 Emergency and Evacuation Routes, Policy SN-5.4 Urban Area Security Initiative, Action SN-5.1 Emergency Response Plan, Action SN-5.2 County Preparedness Exercises, Action SN-5.3 Preparedness Training; Action SN-5.4 Preparedness Outreach, Action SN-5.5 Critical Facilities, and Action SN-5.6 Local Hazard Mitigation Plan. The GPU EIR concluded less than significant impacts with implementation of General Plan policies and actions, and regulatory requirements.

The General Plan would facilitate new development, including residential, commercial, and mixed-use, within the city. Some new development, particularly in non-residential areas, could occur on properties that could be contaminated. Construction of new buildings and improvements would have the potential to release potentially hazardous materials, including contaminated soils, into the environment during site grading and excavation operations. Similarly, demolition of existing structures would potentially result in the release of hazardous building materials (e.g., asbestos, lead paint) into the environment. Use of hazardous materials after construction could potentially include cleaning solvents, fertilizers, pesticides, and other materials used in the regular maintenance and operation of the proposed uses.

Also, a number of sites in the City are listed on the Cortese Database, compiled pursuant to Government Code Section 65962.5. Some of the sites are listed as closed, indicating that they have been investigated and/or remediated to the satisfaction of the lead responsible agency (i.e., RWQCB, DTSC, or DEHS). However, compliance with applicable Federal, State, and local laws and regulations regarding the handling of these materials minimize this risk.

The proposed project involves policy-level documents, and as such, does not include any site-specific development designs or proposals. Future development proposals associated with implementation of the proposed project would be required to comply with all applicable regulations and development standards, including but not limited to the most current adopted version of the California Building Code, project-specific conditions, and mitigation measures, as applicable, to reduce potential impacts required as part of the development review and environmental impact processes. Thus, adoption and implementation of the proposed project ensures that impacts remain as less than significant impacts with implementation of regulatory requirements and standard conditions of approval.
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Hazardous Emissions, Materials, Substances, or Waste Within ¼-Mile of an Existing or Proposed School The General Plan includes policies and actions relative to hazardous emissions, materials, substances within ¼- mile of an existing or proposed school: Policy SN-4.1 Mitigation Processes, Policy SN-4.2 Site Assessments, Policy SN-4.3 Sensitive Receptors, Policy SN-4.4 Green Building, Policy SN-4.5 County Coordination, Action SN-4.1 City Staff Training, Action SN-4.2 Municipal Code Review, Policy SN-5.1 Coordination with Other Agencies, Policy SN5.2 Community Groups, Policy SN-5.3 Emergency and Evacuation Routes, Policy SN-5.4 Urban Area Security Initiative, Action SN-5.1 Emergency Response Plan, Action SN-5.2 County Preparedness Exercises, Action SN-5.3 Preparedness Training, Action SN-5.4 Preparedness Outreach, Action SN-5.5 Critical Facilities, and Action SN-5.6 Local Hazard Mitigation Plan. The GPU EIR concluded less than significant impacts with implementation of General Plan policies and actions.

New Brighton Middle School and Opal Cliff ’s Elementary School are located within the City. Both of these school sites are surrounded by residential neighborhoods and are located more than ¼-mile from any existing or planned non-residential land uses.

While the risk of exposure to hazardous materials cannot be eliminated, measures can be implemented to maintain risk at acceptable levels. Compliance with measures established by Federal, State, and local regulatory agencies are considered adequate to offset the negative effects related to the use, storage, emission, and transport of hazardous materials at future development sites within ¼-mile of a school.

The proposed project involves policy-level documents, and as such, does not include any site-specific development designs or proposals. Future development proposals associated with implementation of the proposed project would be required to comply with all applicable policies, regulations, and development standards, along with project-specific conditions and mitigation measures to reduce potential impacts required as part of the development review and environmental impact processes. Adoption and implementation of the proposed project would not pose a significant hazard to the public or the environment, or involve the transportation, use, or storage of hazardous or potentially hazardous materials. Thus, adoption and implementation of the proposed project ensures impacts remain as less than significant impacts.

Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard.

E. FOR A PROJECT LOCATED WITHIN AN AIRPORT LAND USE PLAN OR, WHERE SUCH A PLAN HAS

NOT BEEN ADOPTED, WITHIN TWO MILES OF A PUBLIC AIRPORT OR PUBLIC USE AIRPORT,

WOULD THE PROJECT RESULT IN A SAFETY HAZARD FOR PEOPLE RESIDING OR WORKING IN THE PROJECT AREA?
The General Plan included no policies relative to an airport land use plan or safety hazards for people residing or working within two miles of an airport. The GPU EIR concluded no impacts.

There are no private airstrips within or in the near vicinity of the City. The nearest airstrip, the Monterey Bay Academy airstrip, is located approximately 6.5 miles southeast of the City.

The proposed project involves policy-level documents, and as such, does not include any site-specific development designs or proposals. Thus, adoption and implementation of the proposed project ensures impacts remain as no impacts.
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Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard.

F. WOULD THE PROJECT IMPAIR IMPLEMENTATION OF OR PHYSICALLY INTERFERE WITH AN ADOPTED EMERGENCY RESPONSE PLAN OR EMERGENCY EVACUATION PLAN? The General Plan includes policies relative to emergency response on evacuation plans: Policy SN-5.1 Coordination with Other Agencies, Policy SN-5.2 Community Groups, Policy SN-5.3 Emergency and Evacuation Routes, Policy SN-5.4 Urban Area Security Initiative, Action SN-5.1 Emergency Response Plan, Action SN-5.2 County Preparedness Exercises, Action SN-5.3 Preparedness Training, Action SN-5.4 Preparedness Outreach, Action SN5.5 Critical Facilities, and Action SN-5.6 Local Hazard Mitigation Plan. The GPU EIR concluded less than significant impacts with implementation of General Plan policies and actions, and regulatory requirements.

The Santa Cruz County Operational Area Emergency Management Plan establishes a comprehensive approach to the organizational structure and emergency management responsibilities in Santa Cruz County, including prevention, preparedness, response, and recovery. Capitola is also within the region covered by the Bay Area Urban Area Security Initiative (UASI), which provides federal financial assistance for terrorism preparedness planning.

The proposed project involves policy-level documents, and as such, does not include any site-specific development designs or proposals. Adoption and implementation of the proposed project would not impair the implementation of the Santa Cruz County Operational Area Emergency Management Plan or interfere with other applicable emergency response or evacuation plans. Thus, adoption and implementation of the proposed project ensures impacts remain as less than significant impacts.

Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard. 280
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4.10 HYDROLOGY AND WATER QUALITY
Would the project:

New
Potentially
Significant
Impact
New Impact
Requiring
New
Mitigation
No New
Impact/
No Impact
Reduced
Impact
A. Violate any water quality standards or waste discharge requirements or otherwise substantially degrade surface or ground water quality?  B. Substantially decrease groundwater supplies or interfere substantially with groundwater recharge such that the project may impede sustainable groundwater management of the basin?

C. Substantially alter the existing drainage pattern of the site or area, including through the alteration of the course of a stream or river or through the addition of impervious surfaces, in a manner which would:
1) Result in a substantial erosion or siltation on- or off-site?  2) Substantially increase the rate or amount of surface runoff in a manner which would result in flooding on- or off-site? 
3) Create or contribute runoff water which would exceed the capacity of existing or planned stormwater drainage systems or provide substantial additional sources of polluted runoff?

4) Impede or redirect flood flows? 
D. In flood hazard, tsunami, or seiche zones, risk release of pollutants due to project inundation? 
E. Conflict with or obstruct implementation of a water quality control plan or sustainable groundwater management plan? 

PRIOR ENVIRONMENTAL FINDINGS
General Plan Update EIR
The table below summarizes the hydrology and water quality impacts and mitigation measures, if applicable.

HYDROLOGY AND WATER QUALITY – SUMMARY OF IMPACTS AND MITIGATION MEASURES Impact Significance Before
Mitigation Mitigation Measures Significance With Mitigation HYDRO-1: The proposed Plan would not violate any water
quality standards or waste discharge requirements. Less Than Significant Not Applicable HYDRO-2: The proposed Plan could substantially deplete
groundwater supplies or interfere substantially with
groundwater recharge such that there would be a net
deficit in aquifer volume or a lowering of the local
groundwater table level.

Significant No Mitigation Available Significant Unavoidable HYDRO-3: The proposed Plan would not substantially alter the existing drainage pattern of the Plan Area or vicinity, including through the alteration of the course of a stream or Less Than Significant Not Applicable
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HYDROLOGY AND WATER QUALITY – SUMMARY OF IMPACTS AND MITIGATION MEASURES Impact Significance Before
Mitigation Mitigation Measures Significance With Mitigation river, in a manner which would result in substantial erosion, siltation, or flooding on- or off-site.

HYDRO-4: The proposed Plan would not create or
contribute runoff water, which would exceed the capacity of existing or planned stormwater drainage systems or
provide substantial additional sources of polluted runoff.

Less Than Significant Not Applicable
HYDRO-5: The proposed Plan would not otherwise
substantially degrade water quality. Less Than Significant Not Applicable HYDRO-6: The proposed Plan would not result in a
significant impact with respect to the placement of housing or structures, which would impede or redirect flood flows within a 100-year flood hazard area as mapped on a
Federal Flood Hazard Boundary or Flood Insurance Rate
Map or other flood hazard delineation map.

Less Than Significant Not Applicable
HYDRO-7: The proposed Plan would not expose people or
structures to a significant risk of loss, injury or death involving flooding, including flooding as a result of the failure of a levee or dam.

No Impact Not Applicable
HYDRO-8: The proposed Plan would not result in
significant adverse effects related to inundation by seiche, tsunami, or mudflow.

Less Than Significant Not Applicable
HYDRO-9: The proposed Plan, in combination with past,
present, and reasonably foreseeable development, could
result in significant cumulative impacts with respect to hydrology and water quality.

Significant No Mitigation Available Significant Unavoidable Source: Capitola General Plan Update Environmental Impact Report (June 2014), Table 1-1, Summary of Impacts and Mitigation Measures

IMPACT ANALYSIS
The 2023-2031 Housing Element includes policies and programs that are applicable City-wide and are designed to facilitate the construction of housing units to meet the City’s share of the regional housing need. The 2023-2031 Housing Element Chapter 4, Housing Need and Opportunities identifies potential residential sites and densities, inclusive of recyclable residential land, religious facility sites and State land housing, vacant and non-vacant land, and the Capitola Mall site. The 2023-2031 Housing Element Chapter 5, Housing Plan identifies the Goals, Policies, and Programs and Quantified Objectives that are based upon expected availability of resources to address the City’s housing needs, expectations regarding future housing development, as well as prior objectives established in earlier housing plans.

The 2023-2031 Housing Element is a policy document that would not change land use designations or in and of themselves authorize any development within the City. While the City is required by State law to facilitate development commensurate with its allocated share of regional housing needs, no change in the location or nature of allowable development would be authorized by the 2023-2031 Housing Element.

A. WOULD THE PROJECT VIOLATE ANY WATER QUALITY STANDARDS OR WASTE DISCHARGE

REQUIREMENTS OR OTHERWISE SUBSTANTIALLY DEGRADE SURFACE OR GROUND WATER QUALITY?
The General Plan includes policies relative to water quality standards, waste discharge requirements, degradation of surface or ground water: Policy OSC-8.1 Creek Areas, Policy OSC-8.2 Non-Point Source Pollution, Policy OSC-8.3 282
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Best Management Practices, Policy OSC-8.4 Landscaping and Re-Vegetation, Policy OSC-8.5 Native Plants, Policy OSC-8.6 City Properties, Policy OSC-8.7 Regional Collaboration, Policy OSC-8.8 Drainage Plans, Policy OSC-8.9 Impervious Surfaces, Action OSC-8.1 Stormwater Infrastructure, Action OSC-8.2 Funding for Stormwater Management, and Action OSC-8.3 Stormwater Management Program. The GPU EIR concluded less than significant impacts with implementation of General Plan policies and actions.

Surface water and groundwater quality in the City of Capitola is similar to that which is characterized for other urbanized areas surrounding the City and within Santa Cruz County. The City encourages development projects to be designed with pervious materials and landscaped areas to enhance on-site capture and absorption of stormflows. Also, through the implementation of National Pollution Discharge Elimination System (NPDES) program requirements, the City guards against high pollutant loads and erosive materials in surface runoff.

The proposed project involves policy-level documents, and as such, does not include any site-specific development designs or proposals. Future development proposals associated with implementation of the proposed project would be required to provide for the elimination/reduction of pollutant discharges, including capture and treatment of dry weather and first flush runoff in a manner consistent with Central Coast Regional Water Quality Control Board (CCRWQCB) requirements. All storm water discharges must comply with applicable provisions of Santa Cruz County’s NPDES permit. As a co-permittee, the City is responsible for implementation of the requirements of the NPDES permit issued to the County. Consistent with CCRWQCB/NPDES and City requirements, appropriate Best Management Practices (BMPs) would be required throughout construction processes of future development proposals, thereby controlling potential discharge of pollutants, preventing sewage spills, and avoiding discharge of sediments into streets, stormwater channels, or waterways. In addition, long-term water quality impacts associated with future development proposals associated with implementation of the proposed project would also be avoided through the implementation of structural, non-structural and treatment control BMPs and operational and maintenance requirements that are identified in the Water Quality Management Plan (WQMP) prepared for each future development proposal to ensure that long-term water quality impacts are minimized. Thus, adoption and implementation of the proposed project ensures impacts remain as less than significant impacts.

Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard.

B. WOULD THE PROJECT SUBSTANTIALLY DECREASE GROUNDWATER SUPPLIES OR INTERFERE

SUBSTANTIALLY WITH GROUNDWATER RECHARGE SUCH THAT THE PROJECT MAY IMPEDED SUSTAINABLE GROUNDWATER MANAGEMENT OF THE BASIN?
The General Plan includes policies relative to water quality standards, waste discharge requirements, degradation of surface or ground water: Policy OSC-8.1 Creek Areas, Policy OSC-8.2 Non-Point Source Pollution, Policy OSC-8.3 Best Management Practices, Policy OSC-8.4 Landscaping and Re-Vegetation, Policy OSC-8.5 Native Plants, Policy OSC-8.6 City Properties, Policy OSC-8.7 Regional Collaboration, Policy OSC-8.8 Drainage Plans, Policy OSC-8.9 Impervious Surfaces, Action OSC-8.1 Stormwater Infrastructure, Action OSC-8.2 Funding for Stormwater Management, and Action OSC-8.3 Stormwater Management Program. The GPU EIR concluded significant unavoidable impacts with implementation of General Plan policies and actions.

The City has been fully urbanized for many years with established hydrology and water quality systems. 283
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The City of Capitola water providers are Soquel Creek Water District (SqCWD) and the City of Santa Cruz Water Department (SCWD). Approximately 90 percent of the total water used by the City of Capitola is provided by the SqCWD, which serves the areas primarily east of 41st Avenue. Approximately 10 percent of the total water used by the City of Capitola is provided by the SCWD, which serves the areas primarily west of 41st Avenue.

The SqCWD relies solely on groundwater from aquifers underlying the Soquel-Aptos area. The SqCWD extracts groundwater from the deep water-bearing zones within the Purisima formation. Several SqCWD wells are located in this unit; however, SqCWD also operates production wells in the other units. The SqCWD also extracts groundwater from the semi-confined and unconfined units of the Aromas, a 400-foot thick aquifer divided into two units. The uppermost unit is about 225 feet thick, and the lowermost unit is about 175 feet thick. All of the SqCWD production wells in the Aromas are located in the lowermost unit.

Water supply for the SCWD relies entirely on rainfall, surface runoff, and groundwater infiltration occurring within watersheds located in Santa Cruz County. No water is imported from federal, State or other outside sources. The supply system is comprised of four main production elements, 1) the North Coast streams, 2) the San Lorenzo River, 3) Loch Lomond Reservoir, and 4) the Live Oak ground water wells.

The General Plan could result in an increased demand of up to 124 acre-feet/year (afy), which could indirectly result in the over-drafting of the groundwater table. In addition, other cumulative projects within the Basin could further exacerbate this impact. As such, groundwater impacts were concluded to be significant unavoidable.

The proposed project involves policy-level documents, and as such, does not include any site-specific development designs or proposals. Future development proposals associated with implementation of the proposed project would be reviewed by the City to determine if there is any change to existing runoff conditions or potential increases in the amount of impervious surfaces. In addition, future development proposals associated with implementation of the proposed project would be required to comply with all applicable policies, regulations, and development standards, along with project-specific conditions and mitigation measures to reduce potential impacts required as part of the development review and environmental impact processes. Thus, adoption and implementation of the proposed project ensures impacts remain as significant unavoidable impacts.

Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard.

C. WOULD THE PROJECT SUBSTANTIALLY ALTER THE EXISTING DRAINAGE PATTERN OF THE SITE

OR AREA, INCLUDING THROUGH THE ALTERATION OF THE COURSE OF STREAM OR RIVER, IN A MANNER WHICH WOULD:

1. RESULT IN SUBSTANTIAL EROSION OR SILTATION ON- OR OFF-SITE?

2. SUBSTANTIALLY INCREASE THE RATE OR AMOUNT OF SURFACE RUNOFF IN A MANNER WHICH WOULD RESULT IN FLOODING ON- OR OFF-SITE?

3. CREATE OR CONTRIBUTE RUNOFF WATER WHICH WOULD EXCEED THE CAPACITY OF EXISTING

OR PLANNED STORMWATER DRAINAGE SYSTEMS OR PROVIDE SUBSTANTIAL ADDITIONAL SOURCES OF POLLUTED RUNOFF?
The General Plan includes policies relative to runoff capacity or polluted runoff: OSC-8.1 Creek Areas, Policy OSC8.4 Landscaping and Re-Vegetation, Policy OSC-8.8 Drainage Plans, Policy OSC-8.9 Impervious Surfaces, and 284
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Action OSC-8.3. The GPU EIR concluded less than significant impacts with implementation of General Plan policies and actions.

The proposed project involves policy-level documents, and as such, does not include any site-specific development designs or proposals. As such, the proposed project does not propose to alter the existing drainage pattern of any site in the City, nor does it propose to alter any streams or rivers resulting in substantial erosion, surface runoff resulting in flooding, or runoff existing the system’s capacity. Any future development proposals associated with implementation of the proposed project would occur on urban land consistent with adopted land use policy, which provides for protection of existing drainage courses. Thus, adoption and implementation of the proposed project ensures impacts remain as less than significant impacts.

Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard.

4. IMPEDE OR REDIRECT FLOOD FLOWS?
The General Plan includes policies relative to runoff capacity or polluted runoff: OSC-8.1 Creek Areas, Policy OSC8.4 Landscaping and Re-Vegetation, Policy OSC-8.8 Drainage Plans, Policy OSC-8.9 Impervious Surfaces, and Action OSC-8.3. The GPU EIR concluded less than significant impacts with implementation of General Plan policies and actions.

The proposed project involves policy-level documents, and as such, does not include any site-specific development designs or proposals. Infrastructure exists with the City, and thus, storm water runoff associated with future development proposals associated with implementation of the proposed project would continue to be conveyed and discharged into the local stormwater system. Additionally, construction of future development proposals associated with implementation of the proposed project would be restricted within the individual site boundary.

As such, implementation of the proposed project would not lead to on-site or off-site siltation or erosion impeding or redirecting flood flow. Thus, adoption and implementation of the proposed project ensures impacts remain as less than significant impacts.

Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard.

D. WOULD THE PROJECT IN FLOOD HAZARD, TSUNAMI, OR SEICHE ZONES, RISK RELEASE OF POLLUTANTS DUE TO PROJECT INUNDATION?
Flooding
The General Plan includes policies relative to flooding and flood hazards: Policy OSC-8.1 Creek Areas, Policy OSC8.8 Drainage Plans, Action OSC-8.1 Stormwater Infrastructure, Action OSC-8.2 Funding for Stormwater Management, Action OSC-8.3 Stormwater Management Program. The GPU EIR concluded less than significant impacts with implementation of General Plan policies and actions.

According to FEMA and shown on GPU EIR Figure 4.7-2, all of Soquel Creek (within the City limits) and a portion of Noble Gulch are located within the 100-year flood zone. The flood zone is relatively narrow and generally follows the flow path of the main channel. Moving upstream from the creek mouth, the elevation of the 100-year 285
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flood zone (i.e., the base flood elevation) becomes progressively higher than the water surface elevations associated with the periodic formation of the Lagoon during the summer months.

Noble Gulch is a significant drainage that flows into Soquel Creek at the Village. Approximately 30+ years ago, the last approximately 2,000 feet of the Gulch (east of Bay Avenue) was diverted via a 72-inch drainage pipe that extends under the current Pacific Cove Mobile Home Park. During a heavy storm in March of 2011, rushing water overwhelmed the drainage pipe creating an upwards surge that tore apart the ground beneath several mobile homes. The water cascaded down Capitola Avenue into the Village, causing considerable damage to homes and businesses. This storm event and the failed drainage pipe, demonstrates the potential risks and vulnerability of flooding in the Village. Storm events occur relatively frequently and the Village is located at the end of Soquel Creek which is a very large watershed. Flows associated with large storm events often result in significant amounts of vegetation debris including trees and limbs which can get blocked, particularly at the Stockton Bridge, further exacerbating flood conditions.

Dam Inundation
Based on the Local Hazard Mitigation Plan, there are no levees or dams that would impact the City upon failure.

Tsunami
The General Plan includes policies relative to tsunamis: Policy OSC-8.1 Creek Areas, Policy OSC-8.9 Impervious Surfaces, Action OSC-8.1 Stormwater Infrastructure, Action OSC-8.2 Funding for Stormwater Management, and Action OSC-8.3 Stormwater Management Program. The GPU EIR concluded less than significant impacts with implementation of General Plan policies and actions.

As shown on GPU EIR Figure 4.7-3, nearly all of Capitola Village is located within the tsunami inundation area, as mapped by California Emergency Management Agency (Cal EMA). Other areas include a portion of Soquel Creek, from Capitola Beach to approximately one river mile upstream to Highway 1, and a portion of Noble Gulch (about ¼-mile), which flows into Soquel Creek. The Capitola shoreline would also be inundated. However, while the coastal cliffs would block inland flows, substantial erosion would likely occur as the result of a tsunami.

In the event of a tsunami, people or structures within these areas could be exposed to a significant risk of loss, injury, or death due to flooding. The tsunami inundation area, as mapped by Cal EMA, is considered a maximum estimate (i.e., based upon the maximum tsunami run-up), taking into consideration a number of extreme, yet realistic, tsunami sources.

Seiche
The General Plan includes policies relative to seiches: Policy OSC-8.1 Creek Areas, Policy OSC-8.9 Impervious Surfaces, Action OSC-8.1 Stormwater Infrastructure, Action OSC-8.2 Funding for Stormwater Management, and Action OSC-8.3 Stormwater Management Program. The GPU EIR concluded less than significant impacts with implementation of General Plan policies and actions.

A seiche is an oscillation wave generated in a closed or partially closed body of water, which can be compared to the back-and-forth sloshing in a bath tub. Seiches can be caused by winds, changes in atmospheric pressure, underwater earthquakes, tsunamis, or landslides into the water body. Bodies of water such as bays, harbors, reservoirs, ponds, and swimming ponds can experience seiche waves up to several feet in height during a strong 286
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earthquake. The City is located within an inundation zone of tsunamis generated by earthquakes, as discussed above, and includes large bodies of water, such as Soquel Cove and Soquel Lagoon. Therefore, seiches could result along beach areas and creeks within the City in association with a tsunami event.

Mudflow
The General Plan includes policies relative to mudflow: Policy OSC-8.1 Creek Areas, Policy OSC-8.9 Impervious Surfaces, Action OSC-8.1 Stormwater Infrastructure, Action OSC-8.2 Funding for Stormwater Management, and Action OSC-8.3 Stormwater Management Program. The GPU EIR concluded less than significant impacts with implementation of General Plan policies and actions.

Mud and debris flows are mass movements of dirt and debris that occur after intense rainfall, earthquakes, and severe wildfires. The speed of a slide depends on the amount of precipitation, steepness of the slope, and alternate freezing and thawing of the ground. Based on the Local Hazard Mitigation Plan, due to steep topography, there is a potential for mudflows to occur below Wharf Road and above Soquel Creek, which could impact the Stockton Avenue Bridge and the Village.

Impact Analysis
The proposed project involves policy-level documents, and as such, does not include any site-specific development designs or proposals.

Implementation of the proposed project could result in the placement of housing within a flood hazard area, as well as subject to a tsunami, seiche, or mudflow hazards. Future development within the City could result in the placement of structures in existing FEMA-designated 100-year Special Flood Hazard Areas (SFHAs). Municipal Code Chapter 17.50 includes standards for construction in flood hazard zones. Future development within the 100-year flood zone requires the placement of fill to elevate structures above the 100-year floodplain elevation. In order for a project to be considered outside of the floodplain and no longer subject to special flood hazard requirements, the project applicant has to submit an application to Federal Emergency Management Agency (FEMA) for a Letter of Map Revision – Fill (LOMR-F) after the fill has been placed. After FEMA has revised the Flood Insurance Rate Map (FIRM) to show that the project is now outside of the SFHA, the City would no longer be required to apply the minimum National Flood Insurance Program (NFIP) floodplain management standards to structures built on the land and the mandatory flood insurance requirements would no longer apply.

Thus, adoption and implementation of the proposed project ensures impacts remain as less than significant impacts.

Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard.

E. WOULD THE PROJECT CONFLICT WITH OR OBSTRUCT IMPLEMENTATION OF A WATER QUALITY CONTROL PLAN OR SUSTAINABLE GROUNDWATER MANAGEMENT PLAN? The Water Quality Control Plan for the Central Coastal Basin (Basin Plan) is the Regional Water Quality Control Board's master water quality control planning document. It designates beneficial uses and water quality objectives for waters of the State, including surface waters and groundwater. It also includes programs of implementation 287
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to achieve water quality objectives. The current Basin Plan consists of the 2019 Basin Plan edition and all of the following amendments approved after March 2019.

The Water Quality Control Plan for the Central Coast Basin Plan2is the water quality control plan for the geographic area that encompasses all of Santa Cruz, San Benito, Monterey, San Luis Obispo, and Santa Barbara Counties as well as the southern one-third of Santa Clara County, and small portions of San Mateo, Kern, and Ventura Counties. Included in the region are urban areas such as the Monterey Peninsula and the Santa Barbara coastal plain; prime agricultural lands as the Salinas, Santa Maria, and Lompoc Valleys; National Forest lands, extremely wet areas like the Santa Cruz mountains; and arid areas like the Carrizo Plain. The Basin Plan designates beneficial uses, establishes water quality objectives, and contains implementation programs and policies to achieve those objectives for all waters addressed through the Basin Plan.

In 2014, the Governor signed the Sustainable Groundwater Management Act (SGMA) into law and took effect on January 1, 2015, which requires governments and water agencies of high and medium priority basins to halt overdraft and bring groundwater basins into balanced levels of pumping and recharge. SGMA empowers local agencies to form Groundwater Sustainability Agencies (GSAs) to manage basins sustainably and requires those GSAs to adopt Groundwater Sustainability Plans (GSPs) for crucial groundwater basins in California. The SGMA is the first legislation in the state’s history to mandate comprehensive sustainable groundwater resources management.

Santa Cruz Mid-County Groundwater Sustainability Plan3
The Santa Cruz Mid-County Groundwater Agency (MGA or Agency) was formed under SGMA to develop this Groundwater Sustainability Plan (GSP or Plan) for the Santa Cruz Mid-County Groundwater Basin (Basin). The Basin is classified by the California Department of Water Resources (DWR) as a high priority basin in a state of critical overdraft because of seawater intrusion. Based on this critical overdraft designation, the MGA is required to submit its Board adopted GSP to DWR by January 31, 2020. The MGA initiated development of this GSP in 2017 to guide ongoing management of the Basin with a goal to achieve and maintain groundwater sustainability over a 50-year planning and implementation horizon.

While the SGMA would revolutionize groundwater management in California, MGA member agencies began studying groundwater and managing the Basin long before SGMA was passed into law. The City of Santa Cruz Water Department and Soquel Creek Water District acquired interests in groundwater pumping in the Basin, and together with Santa Cruz County commissioned the first hydrogeologic study of the Basin in the mid-1960s (USGS, 1968).

Seawater intrusion identified in the Basin in the 1980s required water managers to develop an extensive monitoring network of wells to monitor the Basin’s groundwater and to help improve understanding of the Basin, and to implement water conservation and groundwater management strategies to balance groundwater demand with the Basin’s groundwater budget.

A Groundwater Sustainability Plan (GSP) was prepared for the Santa Cruz Mid-County Groundwater Basin, and was approved by the California Department of Water Resources in June 2021. The GSP presents detailed 2 Water Quality Control Plan for the Central Coastal Basin (ca.gov), accessed August 16, 2023 3 Santa Cruz Mid-County Groundwater Sustainability Plan , https://sgma.water.ca.gov/portal/service/gspdocument/download/3166, accessed August 16, 2023
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information to understand the occurrence of groundwater in the Basin and provides solutions to achieve the Basin’s sustainability goals. The GSP and Executive Summary are organized following DWR’s guidance documents (DWR, 2016):
▪ Executive Summary
▪ Section 1: Introduction to the MGA
▪ Section 2: Plan and Basin Setting
▪ Section 3: Sustainable Management Criteria
▪ Section 4: Projects and Management Actions to Achieve Sustainability ▪ Section 5: Plan Implementation, Budget and Schedule
▪ Section 6: References and Technical Studies used to Develop the GSP Projected Future Basin Conditions, Land Use and Water Use The GSP includes projects and management actions to stop the advancement of seawater intrusion and to maintain sustainability under future Basin conditions that will be impacted by changes in land use, water use, and climate. The projected climate change effects include 2.3 feet of sea level rise by 2070 and a warmer and drier climate that has an average temperature increase of 2.4°F, a decrease in precipitation of up to 3.1 inches per year, and a 6% increase in evapotranspiration. Land use patterns are assumed to be unchanged while accommodating projected regional population growth of 4.2% pre-2035 and 2.1% post-2035. Projected nonmunicipal groundwater demand for domestic use assumes pre-drought (2012 – 2015) water demand of 0.35 acre-feet per year per household. Groundwater demand for larger institutions such as camps, retreats, and schools, and agricultural irrigation are assumed to remain the same as historical demands.

Future development projects associated with implementation of the proposed project would be subject to applicable requirements from the GSP and Santa Cruz Mid-County Groundwater Agency. The proposed project involves policy-level documents, and as such, does not include any site-specific development designs or proposals.

The proposed project would not conflict with or obstruct implementation of a water quality control plan or a sustainable groundwater management plan. Thus, adoption and implementation of the proposed project ensures impacts remain as less than significant impacts.

Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard. 289
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4.11 LAND USE AND PLANNING
Would the project:

New
Potentially
Significant
Impact
New Impact
Requiring New
Mitigation
No New
Impact/
No Impact
Reduced
Impact
A. Physically divide an established community? ✓
B. Cause a significant environmental impact due to a conflict with any land use plan, policy, or regulation adopted for the purpose of avoiding or mitigating an environmental effect?
✓

PRIOR ENVIRONMENTAL FINDINGS
General Plan Update EIR
The table below summarizes the land use and planning impacts and mitigation measures, if applicable.

LAND USE – SUMMARY OF IMPACTS AND MITIGATION MEASURES
Impact Significance Before
Mitigation Mitigation Measures Significance With Mitigation LAND-1: The proposed Plan would not physically divide an established community. Less Than Significant Not Applicable LAND-2: The proposed Plan would not conflict with an
applicable land use plan, policy, or regulation adopted for the purpose of avoiding or mitigating an environmental
effect.

Less Than Significant Not Applicable
LAND-3: The proposed Plan would not conflict with the
Monterey Bay National Marine Sanctuary Management
Plan.

Less Than Significant Not Applicable
LAND-4: The proposed Plan, in combination with past,
present, and reasonably foreseeable development in the
surrounding area, would result in less than significant cumulative impacts with respect to land use and planning.

Less Than Significant Not Applicable
Source: Capitola General Plan Update Environmental Impact Report (June 2014), Table 1-1, Summary of Impacts and Mitigation Measures

IMPACT ANALYSIS
The 2023-2031 Housing Element includes policies and programs that are applicable City-wide and are designed to facilitate the construction of housing units to meet the City’s share of the regional housing need. The 2023-2031 Housing Element Chapter 4, Housing Need and Opportunities identifies potential residential sites and densities, inclusive of recyclable residential land, religious facility sites and State land housing, vacant and non-vacant land, and the Capitola Mall site. The 2023-2031 Housing Element Chapter 5, Housing Plan identifies the Goals, Policies, and Programs and Quantified Objectives that are based upon expected availability of resources to address the City’s housing needs, expectations regarding future housing development, as well as prior objectives established in earlier housing plans.
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The 2023-2031 Housing Element is a policy document that would not change land use designations or in and of themselves authorize any development within the City. While the City is required by State law to facilitate development commensurate with its allocated share of regional housing needs, no change in the location or nature of allowable development would be authorized by the 2023-2031 Housing Element.

A. WOULD THE PROJECT PHYSICALLY DIVIDE AN ESTABLISHED COMMUNITY? The GPU EIR concluded that implementation of the General Plan would result in less than significant impacts.

The City of Capitola has been urbanized for many years with established development throughout the City.

The proposed project involves policy-level documents, and as such, does not include any site-specific development designs or proposals nor provide for new land use uses that would physically divide or disrupt established neighborhoods or create physical barriersin Capitola. Thus, adoption and implementation of the proposed project ensures impacts remain as less than significant impacts.

Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard.

B. WOULD THE PROJECT CAUSE A SIGNIFICANT ENVIRONMENTAL IMPACT DUE TO A CONFLICT

WITH ANY APPLICABLE LAND USE PLAN, POLICY, OR REGULATION ADOPTED FOR THE PURPOSE OF AVOIDING OR MITIGATING AN ENVIRONMENTAL EFFECT?
The General Plan includes policies relative to conflicts with an applicable land use plan, policy, or regulation adopted for the purpose of avoiding or mitigating an environmental effect: Policy LU-1.1 Community Character, Policy LU-2.1 Historic Structures, Policy LU-3.3 Infill Development, Policy LU-3.4 Transit and Pedestrian Access, Policy LU-3.7 Regional Outlook, Policy LU-13.4 New Brighton State Beach, Policy LU-13.6 Beach Management, Policy LU-13.7 Beach Structures, and Action LU-14.3 Coastal Recreation. The GPU EIR concluded less than significant impacts with implementation of General Plan policies and actions.

The City is required by State law to facilitate development commensurate with its allocated share of regional housing needs; however, no change in the location or nature of allowable development would be authorized by the 2023-2031 Housing Element. The 2023-2031 Housing Element enhances the General Plan goals and policies calling for additional housing types and expanding the supply of housing.

The adoption and implementation of the proposed project further enhances the goals, policies, and actions in the General Plan, would not conflict with goals or objectives contained within regional plans, or cause a significant environmental impact due to a conflict with any applicable land use plan, policy, or regulation adopted for the purpose of avoiding or mitigating an environmental effect.

The proposed project involves policy-level documents, and as such, does not include any site-specific development designs or proposals. Future development proposals associated with implementation of the proposed project would be required to comply with all applicable regulations and development standards, along with projectspecific conditions and mitigation measures to reduce potential impacts required as part of the development review and environmental impact processes. Thus, adoption and implementation of the proposed project ensures impacts remain as less than significant impacts.
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Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard. 293
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4.12 MINERAL RESOURCES
Would the project:

New
Potentially
Significant
Impact
New Impact
Requiring New
Mitigation
No New
Impact/
No Impact
Reduced
Impact
A. Result in the loss of availability of a known mineral resource that would be of value to the region and the residents of the state? ✓
B. Result in the loss of availability of a locally-important mineral resource recovery site delineated on a local general plan, specific plan, or other land use plan? ✓

PRIOR ENVIRONMENTAL FINDINGS
General Plan Update EIR
CEQA Guidelines Section 15128 allows environmental issues for which there is no likelihood of significant impact to be “scoped out” and not analyzed further in the EIR. It was determined that the General Plan would not result in significant impacts with respect to Mineral Resources, and as such were not analyzed in the GPU EIR.

IMPACT ANALYSIS
The 2023-2031 Housing Element includes policies and programs that are applicable City-wide and are designed to facilitate the construction of housing units to meet the City’s share of the regional housing need. The 2023-2031 Housing Element Chapter 4, Housing Need and Opportunities identifies potential residential sites and densities, inclusive of recyclable residential land, religious facility sites and State land housing, vacant and non-vacant land, and the Capitola Mall site. The 2023-2031 Housing Element Chapter 5, Housing Plan identifies the Goals, Policies, and Programs and Quantified Objectives that are based upon expected availability of resources to address the City’s housing needs, expectations regarding future housing development, as well as prior objectives established in earlier housing plans.

The 2023-2031 Housing Element is a policy document that would not change land use designations or in and of themselves authorize any development within the City. While the City is required by State law to facilitate development commensurate with its allocated share of regional housing needs, no change in the location or nature of allowable development would be authorized by the 2023-2031 Housing Element.

A. WOULD THE PROJECT RESULT IN THE LOSS OF AVAILABILITY OF A KNOWN MINERAL RESOURCE THAT WOULD BE OF VALUE TO THE REGION AND THE RESIDENTS OF THE STATE? The proposed project involves policy-level documents, and as such, does not include any site-specific development designs or proposals. Within the City, there are no known mineral resource of value to the region and the residents of the State. Thus, adoption and implementation of the proposed project ensures impacts remain as no impacts. 295
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Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard.

B. WOULD THE PROJECT RESULT IN THE LOSS OF AVAILABILITY OF A LOCALLY-IMPORTANT

MINERAL RESOURCE RECOVERY SITE DELINEATED ON A LOCAL GENERAL PLAN, SPECIFIC PLAN, OR OTHER LAND USE PLAN?
The proposed project involves policy-level documents, and as such, does not include any site-specific development designs or proposals. There are no known locally important mineral resource recovery sites in the City. Thus, adoption and implementation of the proposed project ensures impacts remain as no impacts.

Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard. 296
Item 7 D.

Addendum to the Capitola General Plan Update EIR
For the 2023-2031 Housing Element
Draft | November 2023 4-69

4.13 NOISE
Would the project result in:

New
Potentially
Significant
Impact
New Impact
Requiring
New
Mitigation
No New
Impact/
No Impact
Reduced
Impact
A. Generation of a substantial temporary or permanent increase in ambient noise levels in the vicinity of the project in excess of standards established in the local general plan or noise ordinance, or applicable standards of other agencies? ✓
B. Generation of excessive groundborne vibration or groundborne noise levels? ✓ C. For a project located within the vicinity of a private airstrip or an airport land use plan or, where such a plan has not been adopted, within two miles of a public airport or public use airport, would the project expose people residing or working in the project area to excessive noise levels?
✓

PRIOR ENVIRONMENTAL FINDINGS
General Plan Update EIR
The table below summarizes the noise impacts and mitigation measures, if applicable.

NOISE – SUMMARY OF IMPACTS AND MITIGATION MEASURES
Impact Significance Before
Mitigation Mitigation Measures Significance With Mitigation NOISE-1: Construction-related activities resulting from implementation of the proposed Plan would not result in the generation of noise levels in excess of established standards.

Less Than Significant Not Applicable
NOISE-2: Construction-related activities resulting from implementation of the proposed Plan could generate or
expose persons or structures to excessive ground-borne
vibration.

Significant Noise 2a
Noise-2b Less Than Significant
NOISE-3: Future noise levels associated with
implementation of the proposed Plan could contribute to an exceedance of the City’s noise standards resulting in
potential noise impacts to sensitive receptors.

Less Than Significant Not Applicable
NOISE-4: The Plan, in combination with past, present, and reasonably foreseeable projects, would result in less than significant cumulative impacts with respect to noise.

Less Than Significant Not Applicable
Source: Capitola General Plan Update Environmental Impact Report (June 2014), Table 1-1, Summary of Impacts and Mitigation Measures

IMPACT ANALYSIS
The 2023-2031 Housing Element includes policies and programs that are applicable City-wide and are designed to facilitate the construction of housing units to meet the City’s share of the regional housing need. The 2023-2031 Housing Element Chapter 4, Housing Need and Opportunities identifies potential residential sites and densities, inclusive of recyclable residential land, religious facility sites and State land housing, vacant and non-vacant land, 297
Item 7 D.

Addendum to the Capitola General Plan Update EIR
For the 2023-2031 Housing Element
Draft | November 2023 4-70
and the Capitola Mall site. The 2023-2031 Housing Element Chapter 5, Housing Plan identifies the Goals, Policies, and Programs and Quantified Objectives that are based upon expected availability of resources to address the City’s housing needs, expectations regarding future housing development, as well as prior objectives established in earlier housing plans.

The 2023-2031 Housing Element is a policy document that would not change land use designations or in and of themselves authorize any development within the City. While the City is required by State law to facilitate development commensurate with its allocated share of regional housing needs, no change in the location or nature of allowable development would be authorized by the 2023-2031 Housing Element.

A. WOULD THE PROJECT RESULT IN GENERATION OF A SUBSTANTIAL TEMPORARY OR

PERMANENT INCREASE IN AMBIENT NOISE LEVELS IN THE VICINITY OF THE PROJECT IN EXCESS

OF STANDARDS ESTABLISHED IN THE LOCAL GENERAL PLAN OR NOISE ORDINANCE, OR APPLICABLE STANDARDS OF OTHER AGENCIES?
B. WOULD THE PROJECT RESULT IN GENERATION OF EXCESSIVE GROUNDBORNE VIBRATION OR GROUNDBORNE NOISE LEVELS?
The General Plan includes policies and actions relative to noise levels, and groundborne vibration and groundborne noise levels: Policy SN-7.1 Noise Sensitive Land Uses, Policy SN-7.2 Noise Level Standards, Policy SN7.3 Noise Control Ordinance, Policy SN-7.4 Acoustical Analyses, Policy SN-7.5 Rail Service, and Action SN-7.1 Noise Ordinance Effectiveness. The GPU EIR concluded less than significant impacts and less than significant impacts with mitigation incorporated with implementation of General Plan policies and actions.

Increase in Ambient Noise Levels in Excess of Standards Established in the General Plan, Noise Ordinance, or Applicable Standards. The GPU EIR concluded that construction-related activities resulting from implementation of the General Plan would not result in the generation of noise levels in excess of established standards.

While adoption and implementation of the proposed project would not directly result in the construction of housing, implementation of Housing Element policy would facilitate the construction of future development proposals associated with implementation of the proposed project consistent with adopted land use policy.

Typically, residential uses do not generate high noise levels. However, individual residential development projects may result in the exposure of persons to noise levels in excess of standards established in the General Plan or Noise Ordinance. Without identifying the location of future development proposals associated with implementation of the proposed project, it is not possible to determine if they would be placed near land uses that would generate noise levels or groundborne vibrations that would exceed acceptable standards.

Future development proposals would be required to comply with all applicable regulations and development standards, along with project-specific conditions and mitigation measures to reduce potential impacts required as part of the development review and environmental impact processes. This can include, but is not limited to, Municipal Code requirements; General Plan goals, policies, and implementation programs, including those identified in the proposed project, and mitigation measures. Thus, adoption and implementation of the proposed project ensures impacts remain as less than significant impacts. 298
Item 7 D.

Addendum to the Capitola General Plan Update EIR
For the 2023-2031 Housing Element
Draft | November 2023 4-71
Ground-Borne Construction Vibration Noise. The GPU EIR concluded that with the imposition of regulatory requirements and Mitigation Measures Noise-2a and Noise-2b, ground-borne construction vibration noise impacts are less than significant.

While adoption and implementation of the proposed project would not directly result in the construction of housing, implementation of Housing Element policy would facilitate the construction of future development proposals associated with implementation of the proposed project consistent with adopted land use policy.

However, individual residential development projects may result in the exposure of persons to ground-borne construction vibration noise levels in excess of standards established in the General Plan or Noise Ordinance.

Without identifying the location of future development proposals associated with implementation of the proposed project, it is not possible to determine if they would be placed near land uses that would generate noise levels or groundborne vibrations that would exceed acceptable standards.

Future development proposals would be required to comply with all applicable regulations and development standards, along with project-specific conditions and mitigation measures to reduce potential impacts required as part of the development review and environmental impact processes. This can include, but is not limited to, Municipal Code requirements; General Plan goals, policies, and implementation programs, including those identified in the proposed project, and mitigation measures. Thus, adoption and implementation of the proposed project ensures impacts remain as less than significant with mitigation incorporated.

Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard.

C. FOR A PROJECT LOCATED WITHIN THE VICINITY OF A PRIVATE AIRSTRIP OR AN AIRPORT LAND

USE PLAN OR, WHERE SUCH A PLAN HAS NOT BEEN ADOPTED, WITHIN TWO MILES OF A PUBLIC

AIRPORT OR PUBLIC USE AIRPORT, WOULD THE PROJECT EXPOSE PEOPLE RESIDING OR WORKING IN THE PROJECT AREA TO EXCESSIVE NOISE LEVELS?
There are no airports in Capitola. The closest airport is the Watsonville Municipal Airport, a public airport in Watsonville located approximately 8 miles to the southeast of Capitola. Any aircraft overflights do not contribute significantly to the ambient noise environment in the City.

The proposed project involves policy-level documents, and as such, does not include any site-specific development designs or proposals. Adoption and implementation of the proposed project would not expose future residents or workers in the City to substantial sources of airport or heliport of noise in the City. Thus, adoption and implementation of the proposed project ensures impacts remain as less than significant impacts.

Conclusion: No New Impact. The changes associated with the proposed project would not result in any new impacts or increase the severity of impacts in this regard. 299
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For the 2023-2031 Housing Element
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300
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Draft | November 2023 4-73

4.14 POPULATION AND HOUSING
Would the project:

New
Potentially
Significant
Impact
New Impact
Requiring
New
Mitigation
No New
Impact/
No Impact
Reduced
Impact
a. Induce substantial unplanned population growth in an area, either directly (for example, by proposing new homes and businesses) or indirectly (for example, through extension of roads or other infrastructure)?
✓
b. Displace substantial numbers of existing people or housing, necessitating the construction of replacement housing elsewhere? ✓

PRIOR ENVIRONMENTAL FINDINGS
General Plan Update EIR
The table below summarizes the population and housing impacts and mitigation measures, if applicable.

POPULATION AND HOUSING – SUMMARY OF IMPACTS AND MITIGATION MEASURES Impact Significance Before
Mitigation Mitigation Measures Significance With Mitigation POP-1: The Plan would not induce substantial unexpected population growth, or growth for which inadequate planning has occurred, either directly or indirectly.

Less Than Significant Not Applicable
POP-2: The Plan would not displace substantial numbers
of existing housing units, necessitating the construction of replacement housing elsewhere.

Less Than Significant Not Applicable
POP-3: The proposed Plan would not displace substantial numbers of people, necessitating the construction of
replacement housing elsewhere.

Less Than Significant Not Applicable
POP-4: The proposed Plan, in combination with past,
present, and reasonably foreseeable projects, would result in less than significant cumulative impacts with respect to population and housing.

Less Than Significant Not Applicable
Source: Capitola General Plan Update Environmental Impact Report (June 2014), Table 1-1, Summary of Impacts and Mitigation Measures

IMPACT ANALYSIS
The 2023-2031 Housing Element includes policies and programs that are applicable City-wide and are designed to facilitate the construction of housing units to meet the City’s share of the regional housing need. The 2023-2031 Housing Element Chapter 4, Housing Need and Opportunities identifies potential residential sites and densities, inclusive of recyclable residential land, religious facility sites and State land housing, vacant and non-vacant land, and the Capitola Mall site. The 2023-2031 Housing Element Chapter 5, Housing Plan identifies the Goals, Policies, and Programs and Quantified Objectives that are based upon expected availability of resources to address the City’s housing needs, expectations regarding future housing development, as well as prior objectives established in earlier housing plans.
301
Item 7 D.

Addendum to the Capitola General Plan Update EIR
For the 2023-2031 Housing Element
Draft | November 2023 4-74
The 2023-2031 Housing Element is a policy document that would not change land use designations or in and of themselves authorize any development within the City. While the City is required by State law to facilitate development commensurate with its allocated share of regional housing needs, no change in the location or nature of allowable development would be authorized by the 2023-2031 Housing Element.

A. WOULD THE PROJECT INDUCE SUBSTANTIAL UNPLANNED POPULATION GROWTH IN AN AREA,

EITHER DIRECTLY (FOR EXAMPLE, BY PROPOSING NEW HOMES AND BUSINESSES) OR INDIRECTLY (FOR EXAMPLE, THROUGH EXTENSION OF ROADS OR OTHER INFRASTRUCTURE)? The General Plan includes policies relative to local and regional population growth: Policy LU-1.3 Compatible Development, Policy LU-1.6 Balanced Community, Policy LU-3.3 Infill Development, Policy LU-5.1 Neighborhood Characteristics, Policy LU- 5.2 Development Impacts, and Policy LU-3.7 Regional Outlook. The GPU EIR concluded less than significant impacts with implementation of General Plan policies.

The City of Capitola has been urbanized for many years with established development throughout the City.

The Association of Monterey Bay Area Governments (AMBAG) is the responsible agency for developing and adopting regional housing and population forecasts for the Counties and Cities of Monterey, San Benito and Santa Cruz, and provides population projection estimates in five-year increments.

AMBAG developed the 2045 Metropolitan Transportation Plan/Sustainable Communities Strategy (2045 MTP/SCS). Federal and state law requires that AMBAG prepare a long-range transportation plan every four years.

The draft 2045 MTP/SCS was released for public review and comment on November 22, 2021. On June 15, 2022, the AMBAG Board of Directors certified the Final Environmental Impact Report (EIR) prepared for the 2045 Metropolitan Transportation/Sustainable Communities Strategy; adopted CEQA Findings of Fact, Statement of Overriding Considerations, and Mitigation Monitoring and Reporting Program; made a finding that the SCS achieves the greenhouse gas reduction targets established by the California Air Resources Board; adopted the Final 2022 Regional Growth Forecast; and adopted the Final 2045 MTP/SCS.

AMBAG’s Regional Housing Needs Assessment (RHNA) for the Capitola 2023-2031 housing element period is 1,336 housing units.
4 As of 2020, the City of Capitola included a population of 10,108 and 5,554 households. The 2045 MTP/SCS projects a 2040 population of 11,049 and 6,017 households for the City of Capitola. Refer to Table 4.14-1, 2020 and 2040 Population and Household Projections.
4 AMBAG, 2022 Regional Growth Forecasts, Appendix A_2022 RGF (ambag.org) 302
Item 7 D.

Addendum to the Capitola General Plan Update EIR
For the 2023-2031 Housing Element
Draft | November 2023 4-75
TABLE 4.14-1
2020 AND 2040 POPULATION AND HOUSEHOLD PROJECTIONS
2020 2040 Change
2020 - 2040
Population 10,108 11,049 941
Households 5,554 6,017 463
Sources:

AMBAG, 2045 Metropolitan Transportation Plan/Sustainable Communities Strategy (MTP/SCS) As previously noted, the 2023-2031 Housing Element projects 1,336 housing units during the eight-year period.