Agenda packet — Carpinteria City Council, May 8, 2023 (part 2 of 2)

system improvements from Caltrans to the City. As part of this process, the City would accept title to related properties upon relinquishment by Caltrans. Caltrans is still in process with the relinquishment documents. The City continues to work with Caltrans in order to ensure appropriate documentation pursuant said agreements.

In March 2022, the City filed a claim with CJPIA under its property insurance program (Claim #23066530). The insurance deductible is $250,000. As a part of the CJPIA claim process for payment authorization to third-parties, the City would first pay the third party (i.e. Caltrans) up front. Then, CJPIA would send a reimbursement payment to the City in the amount of Caltrans' invoice ($334,481.84). In turn, the City would send payment of the deductible to CJPIA.

POLICY CONSISTENCY
The recommendation is consistent with the City's Mission Statement, in part:

Government shall make judicious use of the City's limited resources to promote the highest possible quality of life for all of Carpinteria's residents. This includes providing services consistent with community needs as well as protecting the social and physical environment.

The recommendation is also consistent with the Emergency Operations Plan in the protection of life, property, and environment.

FINANCIAL CONSIDERATIONS
Budget appropriation in the amount of $335,000 in 301-403-5780 - Major Capital Projects offset by a transfer from General Reserves - Special Projects - 102-999-5911 - To Capital Improvements 301. General Reserves - Special Projects has sufficient Fund Balance.

LEGAL AND RISK MANAGEMENT CONSIDERATIONS
Staff has been working closely with CJPIA.

OPTIONS

1. Approve a budget appropriation of $335,000 to the Capital Improvement Projects Fund from the General Reserves - Special Projects and the associated transfer for the City's portion of emergency repair costs of the Highway 101 Fire Incident Emergency Repair. (Staff recommendation)

2. The City Council could choose to not approve the recommendation and direct staff as determined appropriate.

PRINCIPAL PARTIES EXPECTED AT MEETING
There are no principal parties expected at the meeting.

Approval of Budget Appropriation for the Highway 101 Fire Incident Emergency Repair May 8, 2023
Page4
Staff contact:

Licette Maldonado, Administrative Services Director
(805) 755-4448; [email protected]
Reviewed by:

John L. Ilasin, Public Works Director
(805) 880-3402; [email protected]
Reviewed by:

Michael Ramirez, Assistant City Manager
(805) 755-4450; [email protected]
Reviewed by:

Dave Durflinger, City Manager
(805) 755-4400; [email protected]
~
Signature
City of Carpinteria

COUNCIL AGENDA STAFF REPORT
May 8, 2023

ITEM FOR COUNCIL CONSIDERATION
A report describing measures taken to alleviate need for Moratorium on Formula Businesses and approval and adoption of Ordinance No. 766, extending Ordinance No. 755, a temporary moratorium on the issuance of certificates of occupancy and/or business licenses or any other entitlement for the establishment of formula businesses within the City of Carpinteria, with the exception of Casitas Plaza and Shepard Place Shops, for one additional year.

STAFF RECOMMENDATION
Approve and issue the Government Code 65858(d) Report describing the measures taken, to date, to alleviate the conditions that led to the adoption of the Moratorium; and Approve and adopt Ordinance No. 766 (Attachment A), extending a temporary moratorium on the issuance of certificates of occupancy and/or business licenses or any other entitlement for the establishment of formula businesses within the City of Carpinteria, with the exception of Casitas Plaza and Shepard Place Shops, for one additional year or until the effective date of Ordinance No. 760, whichever occurs first.

Sample Motion 1: I move to approve and issue the May 8, 2023 report describing the measures taken to alleviate the need for a moratorium on formula businesses for the purposes of meeting the requirements of Government Code section 65858(d) concerning moratorium extensions.

Sample Motion 2: I move to approve and adopt Ordinance No. 766, as read by title only, to extend the Moratorium for an additional one year from June 26, 2023 or until the effective date of Ordinance No. 760, whichever occurs first.

This motion requires, at minimum, a 415
th vote for approval by the legislative body to
pass.

BACKGROUND
At its meeting of February 14, 2022, the Carpinteria City Council ("City Council") requested that staff prepare a report on how cities regulate chain stores and Formula Business Temporary Moratorium Extension
May 8, 2023

Page 2 ends

restaurants, also known as "formula businesses," that have standardized services, decor, methods of operation, and other features that make them virtually identical to businesses elsewhere.

During its meeting on May 9, 2022, the City Council received information that a proliferation of formula businesses can have deleterious impacts on a community's health, safety, and welfare.
1 For example:

Cities have found it common for formula businesses to arrive in an area en masse, squeezing out independent businesses and causing a speculative run-up in rents that results in the wholesale transformation of a business district almost overnight.2 The loss of independently owned/operated stores can also have long-term economic consequences for communities. One study of independent business in San Francisco found that an increase of 10% in independent businesses' market share would yield an increase of nearly $200 million in economic activity and nearly 1,300 new jobs, while a 10% decrease in market share would cause declines in economic activity and jobs by the same amount.3 In addition to causing downtown or neighborhood business districts to lose their distinctive appeal, formula businesses often drive up rents where they locate.

Higher rents can have the effect of pushing out independent entrepreneurs and low-margin/service businesses that meet the basic needs of surrounding neighborhoods (such as grocers and beauty/barber shops). 4 Local economies dominated by formula businesses also tend to be solely profit based and uninterested in meeting community needs over time, as opposed to a business model that fills a local niche and/or is complementary to existing businesses in similar categories.
5 Perhaps of greatest concern, formula
businesses often invest locally generated profits outside of the community, and disappear quickly when the economy contracts or their corporate strategy shifts, leaving behind building vacancies with higher rent expectations. 6 After receiving the staff report, the City Council heard from staff and a member of the public regarding the impacts that the proliferation of formula businesses could have on the City of Carpinteria's ("City") commercial areas and directed staff to return with an urgency ordinance to establish a temporary moratorium on the establishment of formula 1 See https://carpinteria.granicus.com/MetaViewer.php?view id=2&clip id=1028&meta id=69910. See a/so Alexander, Christopher, A Pattern Language, page 432, Individually Owned Shops, Oxford University press, 1977.
2 S. Mitchell, Formula Business Restrictions, Institute for Local Self-Reliance ("ILSR") https://ilsr.org/rule/formula-business-restrictions/ (as of May 17, 2022). 3 Civic Economics, The San Francisco Retail Diversity Study https://community-wealth.org/content/sanfrancisco-retail-diversity-study-report-prepared-san-francisco-locally-owned-merchants ( as of May 17, 2022).
4 S. Mitchell, supra fn. 3.
5 Id.
6 Id.

N:\Project Files\2022 (2139- )\2151 Formula Business Ordinance\Moratorium\2nd Extension 05-08-2023\CC Staff Report re Formula Businesses Moratorium 2nd Extension 2023-05-08 (24451432.4).docx Formula Business Temporary Moratorium Extension
May 8, 2023

Page 3 ends

businesses throughout the City while City staff and the City Council study and consider permanent regulations on formula businesses. The staff report for this meeting can be accessed on the City's website and is hereby incorporated by reference. 7 As directed by the City Council, staff returned to the next meeting on May 23 rd with
options for a temporary moratorium on the establishment of any new formula businesses. The staff report and draft moratorium were crafted in a manner to offer the City Council a menu of options to choose from related to the geographic scope of the moratorium, the types of formula businesses to be regulated, how to define formula businesses, and considerations for whether to allow for any exceptions for the replacement and/or relocation of existing formula businesses. Because only three Councilmembers were present during this item (which requires a four-fifth (4/5) vote for approval), the City Council could not take action on the item and continued its consideration to a date when at least four of the Councilmembers could be present. The staff report for this meeting is available online and is hereby incorporated by reference. 8 On June 27, 2022, the City Council approved Ordinance No. 755 (Attachment B), an urgency ordinance establishing a temporary moratorium on the establishment of formula businesses in the City of Carpinteria, as modified by the City Council. At this meeting, the City Council considered additional public testimony and examples of language from other municipalities' formula business regulations (e.g., geographic scope, types of businesses to be regulated, definition of formula business, and exceptions) before adopting the moratorium. The Council cited, among other reasons, the City's character as a classic California beach town; with the City's desire to foster businesses that serve both the needs of City residents and visitors and thereby ensure the community's quality of life; the resiliency of the City's vibrant, small-scale, diversified commercial character; and the City's ongoing economic vitality all require that the City maintain and encourage the establishment of diverse business types and sizes, including smaller and mid-sized businesses
Following the Council's discussion, the Council voted to apply a temporary moratorium citywide, with the exception of the Casitas Plaza and Shepard Place Shops. The temporary moratorium applies to any commercial business operating as a retail sales, restaurant/food service, and/or hotel or motel establishment, and which (a) has more than seven (7) locations anywhere in the United States of America; and (b) has two or more of the following features common to all or substantially all of its locations:
standardized array of services or products for sale, facade, architecture, decor or color scheme, uniform or other employee apparel, signage, or trademark/servicemark.

The Council also determined that the following business types, in the context of the moratorium, not be treated as formula businesses: office space, professional services, banks or credit unions, grocery stores, nonprofit businesses, pharmacies, gas stations, or theaters/performing arts spaces. The temporary moratorium does not prohibit the 7 See https://carpinteria.granicus.com/MetaViewer.php?view id=2&clip id=1028&meta id=69910 8 See https://carpinteria.granicus.com/MetaViewer.php?view_id=2&clip_id=1036&meta_id=70334 N:\Project Files\2022 (2139- )\2151 Formula Business Ordinance\Moratorium\2nd Extension 05-08-2023\CC Staff Report re Formula Businesses Moratorium 2nd Extension 2023-05-08 (24451432.4).docx Formula Business Temporary Moratorium Extension
May 8, 2023

Page 4 ends

relocation of an existing formula business in operation at a location within the City of Carpinteria upon the effective date of this Ordinance to another location within the City.

The staff report for the June 27, 2022 meeting is available online and is hereby incorporated by reference.
9 The temporary moratorium took effect on June 27, 2022 and remained in effect for an initial period of 45 days, subject to a maximum of two extensions by the City Council, which may extend the temporary moratorium for a total period not to exceed two years from the date of the initial adoption of the Ordinance. On July 25, 2022, the City Council considered and adopted Ordinance No. 757, granting a first extension of the temporary moratorium for an additional 10 months and 15 days. This granting of the first extension to Ordinance No. 755 moved the expiration of the temporary moratorium out to June 26, 2023.

The purpose of this agenda matter is to allow the City Council an opportunity to review and approve a report describing the measures taken, to date, to alleviate the conditions that led to the adoption of the Moratorium, and to extend the temporary moratorium a second (and final) time for an additional one (1) year or until the City's proposed Ordinance No. 760 establishing permanent formula business regulations takes effect, whichever occurs first. If extended, Ordinance No. 755 would then expire on June 26, 2024.

DISCUSSION
Regarding the extension, Government Code section 65858(d) requires the City Council to issue a written report describing the measures taken to alleviate the conditions that led to the adoption of the temporary urgency ordinance ten days prior to any extension or the termination of the urgency ordinance. Accordingly, the City Council must consider, approve, and issue the required report pursuant to Government Code section 65858(d) (Attachment C) describing the measures taken, to date, to alleviate the conditions that led to the adoption of Ordinance No. 755 prior to taking any actions to further extend the temporary moratorium beyond its current expiration. The Report concludes that although the City has made progress toward enacting comprehensive formula business regulations, the conditions that led to the adoption of Ordinance No. 755 remain ongoing, and therefore a second (and final) extension of the moratorium is warranted.

While the temporary moratorium remains in place, the City Council will continue working towards the adoption of (permanent) regulations for the establishment of formula businesses within the City. The permanent regulations were initiated by the City Council on July 11, 2022. The staff report initiating preparation of the permanent regulations is available online and hereby incorporated by reference. 10 The draft
permanent regulations were presented to the Planning Commission for consideration 9 See https://carpinteria.granicus.com/MetaViewer.php?view_id=2&clip_id=1064&meta_id=71473 10 See https://carpinteria.granicus.com/MetaViewer. php?view_id=2&clip _id= 1070&meta_id=71814 N:\Project Files\2022 (2139- )\2151 Formula Business Ordinance\Moratorium\2nd Extension 05-08-2023\CC Staff Report re Formula Businesses Moratorium 2nd Extension 2023-05-08 (24451432.4).docx Formula Business Temporary Moratorium Extension
May 8, 2023

Page 5 ends

and a recommendation for adoption to the City Council at their December 5, 2022 meeting. The staff report from the Planning Commission's consideration of the draft permanent regulations is available online and hereby incorporated by reference. 11 Following the Planning Commission's recommendation for adoption, the City Council considered the draft permanent regulations on a first reading at their February 13, 2023 meeting wherein the Council adopted Ordinance No. 760 with minor revisions. The Council also adopted Resolution No. 6192 authorizing staff to submit the draft proposed ordinance to the California Coastal Commission ("Coastal Commission") as an amendment to the City's certified Local Coastal Program ("LCPA"). The February 13 th
City Council staff report is also available online and hereby incorporated by reference. 12 Subsequent to the Council's adoption upon a first reading of Ordinance No. 760 and Resolution No. 6192, staff submitted the LCPA materials to Coastal Commission staff on April 19, 2023. The subject LCPA materials are currently under review by Coastal Commission staff. Based on initial discussions with Coastal Commission staff, it is anticipated that the proposed permanent formula business regulations would qualify for a streamlined review and certification by the Coastal Commission. Upon certification by the Coastal Commission, the proposed permanent regulations would return to the City Council for acknowledgement of the Coastal Commission's certification action(s), and final adoption of Ordinance No. 760 upon a second reading, followed by effectuation of the permanent regulations.

Staff anticipates that the extension of the temporary moratorium by one additional year to June 26, 2024 would allow for more than enough time to complete the remaining steps outlined above for adoption and effectuation of the permanent formula business regulations. On the date of effectuation of the permanent regulations, the temporary moratorium regulations will expire and be supplanted by the permanent formula business regulations.

POLICY CONSIDERATIONS
As discussed in the other staff reports concerning Ordinance No. 755, numerous policies speak to providing for a range of business activities that are compatible with the City of Carpinteria's small beach town character. In particular, General Plan/Local Coastal Plan Objective LU-3, and Policies LU-3d and LU-3g, and the City's Sustainable Community Policy (Resolution No. 5500) may be found consistent with an interest in temporarily limiting establishment of new formula businesses in Carpinteria.

FINANCIAL CONSIDERATIONS
The proliferation of formula businesses can have long-term economic consequences for a community. Low-margin businesses that meet the basic needs of surrounding neighborhoods, such as grocers and pharmacies, may be pushed out as rents rise and the area attracts more formula restaurants and stores. Perhaps of greatest concern, 11 See https://carpinteria.granicus.com/MetaViewer.php?view_id=2&clip_id=1151 &meta_id=75608 12 See https://carpinteria.granicus.com/MetaViewer.php?view_id=2&clip_id=1189&meta_id=77715 N:\Project Files\2022 (2139- )\2151 Formula Business Ordinance\Moratorium\2nd Extension 05-08-2023\CC Staff Report re Formula Businesses Moratorium 2nd Extension 2023-05-08 (24451432.4).docx Formula Business Temporary Moratorium Extension
May 8, 2023

Page 6 ends

formula businesses tend to be fair-weather friends and can disappear quickly when the economy contracts or their corporate strategy shifts. The risk of formula businesses resulting in a downtown or neighborhood business district losing its distinctive appeal and no longer offering opportunities for independent entrepreneurs could result in loss of customers, fewer business opportunities, and a decline in locally generated tax revenue.

An extension of the moratorium on new formula businesses could temporarily impact potential City revenues generated from sources, including but not limited to: sales taxes, property taxes (related to new development/tenant improvements), transient occupancy taxes (for hotel/motel uses), business license taxes, and permit fees. The extent to which such revenues would be impacted is dependent upon the degree to which the moratorium continues to limit or reduce the establishment of new businesses in the City.

Costs associated with staff time for the preparation and implementation of a moratorium (or extension thereof) and on the ongoing development and adoption of the permanent regulations limiting formula businesses would be paid for from General Fund sources.

LEGAL AND RISK MANAGEMENT CONSIDERATIONS
California has a well-established history with formula business restrictions at a city and county level. In addition to prominent "big box" store regulations, many cities of varying size across the state have enacted prohibitions against formula businesses. California courts largely have upheld these restrictions against legal challenges under the dormant commerce and equal protection clauses of the U.S. Constitution.

It is also a well-established legal principle that a public agency's police power has broad application to protect the public health, safety, and welfare of its residents which has been interpreted to include regulating formula businesses. Additionally, section 65858 of the Government Code authorizes cities to adopt a temporary moratorium without following the typical procedures that it would use to amend its municipal code. A temporary moratorium barring issuance of additional entitlements may be adopted under Government Code section 65858 where the City Council finds that issuance of such entitlements would result in a current and immediate threat to public health, safety, or welfare.

Prior to extension of such a temporary moratorium, section 65858(d) of the Government Code requires that, ten days prior to an extension, the City Council must "issue a written report describing he measures taken to alleviate the condition which led to the adoption of the ordinance." The report attached as Attachment C satisfies these requirements.

California law requires that an urgency ordinance (and any extensions thereto) be approved by a four-fifths vote of the local legislative body. The initial adoption of Ordinance No. 755 on June 27, 2022 for a period of 45 days, the subsequent adoption of Ordinance No. 757 granting the first time extension for an additional 10 months and 15 days, and now, if adopted, Ordinance No. 766 to grant an extension of one additional year, would meet the statutory limit on the maximum allowed duration of an urgency N:\Project Files\2022 (2139- )\2151 Formula Business Ordinance\Moratorium\2nd Extension 05-08-2023\CC Staff Report re Formula Businesses Moratorium 2nd Extension 2023-05-08 (24451432.4).docx Formula Business Temporary Moratorium Extension
May 8, 2023

Page 7 ends

ordinance. Accordingly, no further extension(s) of the temporary moratorium on formula businesses would be available following the adoption of Ordinance No. 766.

OPTIONS

1. Issue the Government Code section 65858(d) report; and Approve and adopt Ordinance No. 766, thereby extending the temporary moratorium concerning formula businesses for one additional year from June 26, 2023 (staff recommendation).

2. Decline to enact an extension of the urgency ordinance No. 755. Such action would result in the expiration of urgency ordinance No. 755 on June 26, 2023.

PRINCIPAL PARTIES EXPECTED AT MEETINGS
Carpinteria business owners
Commercial property owners/managers
Commercial property developers

ATTACHMENTS
Attachment A
Attachment B
Attachment C
Ordinance No. 766 Second Extension of Urgency Ordinance Ordinance No. 755 Urgency Ordinance
Government Code section 65858(d) Report
Staff Contact: Steve Goggia, Community Development Director (805) 755-4414 I [email protected] ~@~
Signature
Reviewed by: Dave Durflinger, City Manager
(805) 755-4400, [email protected]
Reviewed by: Jena Shoaf Acos,
on behalf of Brownstein Hyatt Farber Schreck, LLP
acting as City Attorney for the City of Carpinteria
N:\Project Files\2022 (2139- )\2151 Formula Business Ordinance\Moratorium\2nd Extension 05-08-2023\CC Staff Report re Formula Businesses Moratorium 2nd Extension 2023-05-08 (24451432.4).docx Attachment A
Ordinance No. 766
Second Extension of Urgency Ordinance
Formula Business Temporary Moratorium Extension
Project 22-2151-ORD/LCPA
May 8, 2023 City Council Hearing
ORDINANCE NO. 766

EXTENSION OF AN URGENCY ORDINANCE OF THE CITY COUNCIL OF THE

CITY OF CARPINTERIA, CALIFORNIA ESTABLISHING A MORATORIUM ON THE

ISSUANCE OF CERTIFICATES OF OCCUPANCY OR ANY OTHER

ENTITLEMENTS FOR THE OPERATION OF FORMULA BUSINESSES WITHIN THE

CITY OF CARPINTERIA, WITH THE EXCEPTION OF THE CASITAS PLAZA AND

THE SHEPARD PLACE SHOPS
WHEREAS, pursuant to the City of Carpinteria's ("City") police power, as granted broadly under Article XI, Section 7 of the California Constitution, the City Council of the City ("City Council") has the authority to enact and enforce ordinances and regulations for public health, safety, and welfare; and
WHEREAS, section 65850 of the Government Code also provides the City Council with the authority to, among other things, adopt ordinances regulating the use of buildings within its jurisdiction; and
WHEREAS, the City's Zoning Ordinance currently allows operation of formula businesses within the City, provided that such businesses meet all applicable legal requirements and have obtained a Certificate of Occupancy and other necessary entitlements from the City; and WHEREAS, the City adopted its General Plan/Local Coastal Plan as a comprehensive, long-term plan for the City's development and many of the City's General Plan/Local Coastal Plan policies and zoning regulations were enacted to limit commercial development that would impair the City's distinctive small beach town charm and character. Among others, those land use objectives and policies include the following:
• Land Use Element Objective LU-3: Preserve the small beach town character of the built environment of Carpinteria, encouraging compatible revitalization and avoiding spawl development at the City's edge; and
• Policy LU-3d: Establish a commercial sector that balances the retail and service needs of citizens and tourists; and
• Policy LU-3g: Provide for a range of business activities that bring vitality, revenue, and employment to Carpinteria and are compatible with its small town character.

WHEREAS, the City has adopted Resolution No. 5500, a Sustainable Community Policy, in part, as a basis for creating strategies that allow it to adapt to ever-changing environmental, economic, social, and physical stressors. Among the directives of the City's Sustainable Community Policy are the following:
• Promote a diversified and resilient local economy that reflects the unique attributes of the region and provides necessary and desirable products and services for both residents and visitors; and
• Attract and retain downtown retailers, hotels, corporate headquarters and Research and Development uses that can be successful in and complimentary to the community; and 25561041.1
Ordinance No. 766
Page2
• Establish support for small business development; and • Maintain and enhance the unique identity of the community and built environment to sustain a strong sense of place and community.

WHEREAS, the City's character as a classic California beach town; the City's desire to foster businesses that serve both the needs of City residents and visitors and thereby ensure the community's quality of life; the resiliency of the City's vibrant, small-scale, diversified commercial character; and the City's ongoing economic vitality all require that the City maintain and encourage establishment of diverse business types and sizes, including smaller and mid-sized businesses; and
WHEREAS, formula businesses are, by their very nature, standardized (including their architecture, decor, color schemes, and signage) and not unique, and therefore do not enhance the unique small town character that the City Council finds necessary to maintain a viable visitor industry in the City; and
WHEREAS, as City staff noted in a May 9, 2022 Staff Report, many formula businesses are increasingly locating in downtowns and neighborhood business districts en masse, squeezing out independent businesses and causing a speculative run-up in rents that results in the wholesale transformation of a business district. In addition to causing such downtowns and business districts to lose their distinctive appeal, the rent increases caused by an influx of formula businesses can force independent entrepreneurs and low margin/service businesses that serve the surrounding neighborhood's basic needs to close or move out of the area; and WHEREAS, as further noted by City staff in the May 9, 2022 Staff Report, local economies dominated by formula businesses tend to be solely profit-based and therefore disinterested in meeting the community's needs, rather than filling a local niche or complementing existing businesses in similar categories. Formula businesses also often invest locally generated profits outside of the community, disappearing quickly when economic conditions shift or corporate strategy changes, and leaving behind vacancies with higher rent expectations; and WHEREAS, this ordinance is not premised on maintaining local ownership of businesses, or protecting existing businesses, or preventing formula businesses from doing business in the City. The purpose of this ordinance is to maintain the City's unique, special character, the diversity and vitality of the City's commercial districts, and the quality of life of City residents; and WHEREAS, the impacts described above may result in existing small businesses losing customers and having fewer business opportunities, and may further lead to long-term urban decay and increased vacancies in commercial real estate, both of which could lead to a decline in tax revenue for the City; and
WHEREAS, further, the COVID-19 pandemic and government regulations pertaining to social distancing had devastating impacts on businesses-with acute impacts on small businesses-including those doing business within the City; and WHEREAS, the City Council finds that the unregulated proliferation of formula businesses could lead to a lack of diversity in City businesses, which would substantially harm the 25561041.1
Ordinance No. 766

Page 3 ends

important City interests listed above and create substantial public health, safety and welfare problems for the City, its residents, and its businesses; and WHEREAS, on May 9, 2022, the City Council directed City staff to prepare a proposal to adopt regulations governing the establishment of formula businesses within the City; and WHEREAS, City staff is currently studying and drafting comprehensive regulations governing formula businesses pursuant to the City Council's direction; and WHEREAS, in the meantime, a temporary moratorium is necessary to allow City staff time to study possible revisions to the City's zoning ordinance and other regulations to address the matters set forth above, which regulations when completed will be brought back for City Council consideration within a reasonable time; and
WHEREAS, on May 23, 2022, the City Council heard City staffs report and received public comment on the proposed moratorium but could not take action on the moratorium because only three Councilmembers were present, which would not have met the four-fifths (4/5) vote requirement in Government Code section 65858; and
WHEREAS, California Government Code section 65858 provides that for the purpose of protecting the public safety, health, and welfare and without following the procedures otherwise required prior to adoption of a zoning ordinance, the City Council may adopt, as an urgency measure, an urgency ordinance prohibiting any uses which may be in conflict with "a contemplated general plan, specific plan, or zoning proposal that the [City Council], planning commission or the planning department is considering studying or intends to study within a reasonable time;" and WHEREAS, the City currently has approximately 15 vacant commercial spaces, in addition to an anticipated 17 to 20 new commercial spaces that are associated with pending development projects, which could be occupied by a formula business without any further discretionary review or approval by the City; and
WHEREAS, the City's Municipal Code provides that a Certificate of Occupancy and business license, both of which are necessary to operate a business in the City, are ministerial entitlements not subject to discretionary review by the City; and WHEREAS, if and when a new formula business applies for such entitlements, any such application could be granted before the City could consider and enact an urgency ordinance under Government Code section 65858 regulating establishment of such a new formula business, thereby frustrating the City's ability to enact lawful regulations on the establishment of new formula businesses; and
WHEREAS, the City finds that, as a result of these conditions, the City cannot wait until a new application for establishment of a formula business is submitted in order to enact restrictions on formula businesses; and
WHEREAS, if additional formula businesses were allowed to be instituted in the City, prior to the City's consideration and adoption of final regulations governing formula businesses, 25561041.1
Ordinance No. 766

Page 4 ends

such uses could (1) conflict with and/or defeat the purpose of the proposal to adopt regulations regulating formula businesses, (2) conflict with the requirements of the General Plan/Local Coastal Plan, (3) be inconsistent with surrounding uses, and/or (4) be immediately detrimental to the public health, safety, and welfare; and
WHEREAS, in the absence of an urgency moratorium, the City's ability to effectively address in a timely manner the negative impacts caused by the proliferation of formula businesses on the public health, safety, and welfare will be seriously compromised; and WHEREAS, the City Council finds that the above conditions create a current and immediate threat to the public health, safety, and welfare of the City, its residents, and its businesses, within the meaning of Government Code section 65858, as the public health, safety, and welfare depend on the continued economic and cultural vitality of a connected, engaged, and diverse business community, and excessive formula businesses degrade the community's smalltown feel and eliminate opportunities for smaller and independently-owned businesses to thrive, especially those business providing vital services to local residents that do not normally pay high rents; and
WHEREAS, on June 27, 2022 for the reasons included in the record, the City Council has determined that, as of the Effective Date of Ordinance No. 755, there is no urgency to regulate formula businesses within the Casitas Plaza or the Shepard Place Shops; and WHEREAS, on June 27, 2022 the City Council determined, by at least a four-fifths (4/5) vote, that Ordinance No. 755 satisfies the requirements of Government Code section 65858, is a matter of City-wide importance, is a reasonable and necessary measure designed for immediate preservation and protection of the public health, safety, and welfare of the community, and is in accord with the public purposes and provisions of applicable State and local laws and regulations; and
WHEREAS, the provisions of Government Code section 65858 provide that the City Council may extend the interim ordinance for an initial period of ten (10) months and fifteen (15) days, and for a second period of one year, upon notice pursuant to Government Code section 65090 and a public hearing at which the City Council adopts the extension by at least a four-fifth ( 4/5) vote; and
WHEREAS, on July 25, 2022, the City Council adopted a report pursuant to Government Code section 65858(d) and also adopted Ordinance No. 757, extending the interim ordinance for a period of ten months and fifteen days; and
WHEREAS, on February 13, 2023, the City Council approved Ordinance No. 760, at a first reading, which would amend the City's zoning regulations and Local Coastal Program to include permanent regulations governing establishment of formula businesses in the City; and WHEREAS, on April 19, 2023, the City transmitted to the California Coastal Commission the materials necessary for the Commission to consider Ordinance No. 760's proposed amendment to the City's Local Coastal Program; and
25561041.1
Ordinance No. 766

Page 5 ends

WHEREAS, the California Coastal Commission has not yet acted on Ordinance No. 760; and
WHEREAS, although the City has made progress (as outlined in a report prepared and adopted by the City Council pursuant to Government Code section 65858(d)), the City has not completed the process of amending the City's zoning ordinance and Local Coastal Program to address regulation of formula businesses, and meanwhile the conditions creating an immediate threat to the public health, safety, and welfare (as described above and in Ordinance Nos. 755 and 757) persist; and
WHEREAS, pursuant to the requirements of Government Code sections 65858 and 65090, a notice of public hearing about the proposed extension of this Ordinance, originally enacted on June 27, 2022 and extended on July 25, 2022, has been placed in a newspaper of general circulation within the City at least 10 days prior to the City Council meeting scheduled for May 8, 2023; and WHEREAS, pursuant to the requirements of Government Code section 65858, the City Council has determined, by at least four-fifth ( 4/5) votes, to extend this Ordinance for the immediate preservation and protection of the public health, safety and welfare of the community.

NOW, THEREFORE, THE CITY COUNCIL HEREBY ORDAINS AS FOLLOWS:

SECTION 1. Recitals Incorporated.

The above recitals are incorporated herein and are each relied upon independently by the City Council in its adoption of this Ordinance.

SECTION 2. Declaration of Urgency.

The City Council hereby finds and declares that, for the reasons set forth in the above recitals, there is a need to extend the urgency ordinance establishing a moratorium on the issuance of any and all Certificates of Occupancy and/or any other entitlements for the operation of formula businesses (as defined in Section 6 of this Ordinance) within the City, with the exception of the Casitas Plaza and the Shepard Place Shops (collectively, "City Limits"), subject to the findings and conditions contained in this Ordinance. To clarify, the Casitas Plaza and the Shepard Place Shops shall not be subject to this Ordinance. Prior to the issuance of further entitlements for formula businesses within the City, City staff needs time to ensure that the proposed changes to the City's zoning regulations and Local Coastal Program are in full force and effect.

SECTION 3. Moratorium.

During the term of this Ordinance, only those entitlements for which the right to proceed with the associated development, facility, or activity has vested pursuant to the provisions of State law prior 25561041.1
Ordinance No. 766

Page 6 ends

to the effective date of this Ordinance, shall proceed in violation of the provisions of this Ordinance.

SECTION 4. Immediate Threat.

Based on the findings herein, this Ordinance is adopted pursuant to California Government Code section 65858. Adoption of this Ordinance is required in order to address the current and immediate threat identified by the City Council to the public health, safety, and welfare of residents and businesses that would result from the grant of new Certificates of Occupancy and/or other entitlements for the operation of formula businesses within the City Limits.

SECTION 5. Hardship Exception/Waiver.

The City, on a case-by-case basis, shall have the authority, upon a showing of good cause by an applicant or other individual with standing, to waive the interim prohibition/moratorium imposed by this Ordinance and allow for the granting of a Certificate of Occupancy and/or other City-issued entitlement to said applicant or other individual with standing. "Good cause" shall mean a factual and evidentiary showing by the applicant that the interim prohibition/moratorium, if not waived, will (1) deprive the applicant of substantially all reasonable economic use of its property or (2) result in a violation of an applicable California or federal law. All such applications for waiver shall be filed with the City Community Development Department.

SECTION 6. Definition of Formula Business.

For the purposes of this Ordinance, "formula business" is defined as any commercial business operating as a retail sales, restaurant/food service, and/or hotel or motel establishment, and which (a) has more than seven (7) locations anywhere in the United States of America, and (b) has two or more of the following features common to all or substantially all of its locations:
standardized array of services or products for sale, facade, architecture, decor or color scheme, uniform or other employee apparel, signage, or trademark/servicemark. Notwithstanding any other provision of this Section, the following types of businesses are not formula businesses: office space, professional services, banks or credit unions, grocery stores, nonprofit businesses, pharmacies, gas stations, or theaters/performing arts spaces.

SECTION 7. Exception for Relocation of Existing Formula Businesses.

In the event that a formula business, in operation at a location within the City Limits on the Effective Date of this Ordinance, seeks to relocate to another location within the City, this Ordinance shall not apply to bar such relocation.

SECTION 8. Effective Date.

This Ordinance becomes effective immediately following the expiration of Ordinance No. 757, i.e., June 26, 2023 and will extend for a period of one (1) year, i.e., June 26, 2024 or until City Ordinance No. 760 takes effect, whichever occurs first. 25561041.1
Ordinance No. 766

Page 7 ends

SECTION 9. Amendment of Ordinance.

Pursuant to the process set forth in Government Code section 65858, the City Council, by the affirmative vote of at least four-fifths (4/5), may modify, amend, delete, or add to this Ordinance upon a finding that such action will implement and enforce the goals, policies, and purposes of this Ordinance.

SECTION 10. Severability.

If any section, subsection, sentence, clause, phrase, or word of this Ordinance is for any reason held to be invalid by a court of competent jurisdiction, such decisions shall not affect the validity of the remaining portions of this Ordinance. The City Council hereby declares that it would have passed and adopted this Ordinance, and each and all provisions hereof, irrespective of the fact that one or more provisions may be declared invalid.

SECTION 11. CEQA Exemption.

The City Council finds that this Ordinance is not subject to the California Environmental Quality Act ("CEQA") pursuant to Title 14 of the California Code of Regulations, CEQA Guidelines sections 15060( c )(2) (the activity will not result in a direct or reasonably foreseeable indirect physical change in the environment) and 15060(c)(3) (the activity is not a "project" as defined in section 153 78). The Ordinance prevents changes in the environment pending completion of the contemplated CMC review and thus has no potential for resulting in physical change to the environment, either directly or indirectly.

PASSED, APPROVED, AND ADOPTED this 8th day of May, 2023, by the following called vote:

AYES: COUNCILMEMBERS:

NOES: COUNCILMEMBERS:

ABSENT: COUNCILMEMBERS:

Mayor of the City of Carpinteria
ATTEST:

City Clerk, City of Carpinteria
25561041.1
Ordinance No. 7 66

Page 8 ends

I hereby certify that the foregoing Ordinance was duly and regularly introduced and adopted at a regular meeting of the City Council of the City of Carpinteria held this 8th day of May, 2023.

City Clerk, City of Carpinteria
APPROVED AS TO FORM:

Mackenzie Carlson, on behalf of Brownstein
Hyatt Farber Schreck, LLP, acting as
City Attorney of the City of Carpinteria
25561041.1
Attachment B
Ordinance No. 755
Formula Businesses Moratorium Urgency Ordinance
Formula Business Temporary Moratorium Extension
Project 22-2151-ORD/LCPA
May 8, 2023 City Council Hearing
ORDINANCE NO. 755

AN URGENCY ORDINANCE OF THE CITY COUNCIL OF THE CITY OF

CARPINTERIA, CALIFORNIA ESTABLISHING A MORATORIUM ON THE

ISSUANCE OF CERTIFICATES OF OCCUPANCY OR ANY OTHER

ENTITLEMENTS FOR THE OPERATION OF FORMULA BUSINESSES WITHIN THE

CITY OF CARPINTERIA, WITH THE EXCEPTION OF THE CASIT AS PLAZA AND

THE SHEP ARD PLACE SHOPS
WHEREAS, pursuant to the City of Carpinteria's ("City") police power, as granted broadly under Article XI, Section 7 of the California Constitution, the City Council of the City ("City Council") has the authority to enact and enforce ordinances and regulations for public health, safety, and welfare;
WHEREAS, section 65850 of the Government Code also provides the City Council with the authority to, among other things, adopt ordinances regulating the use of buildings within its jurisdiction;
WHEREAS, the City's Zoning Ordinance currently allows operation of formula businesses within the City, provided that such businesses meet all applicable legal requirements and have obtained a Certificate of Occupancy and other necessary entitlements from the City; and WHEREAS, the City adopted its General Plan/Local Coastal Plan as a comprehensive, long-term plan for the City's development and many of the City's General Plan/Local Coastal Plan policies and zoning regulations were enacted to limit commercial development that would impair the City's distinctive small beach town charm and character. Among others, those land use objectives and policies include the following:
• Land Use Element Objective LU-3: Preserve the small beach town character of the built environment of Carpinteria, encouraging compatible revitalization and avoiding spawl development at the City's edge
• Policy LU-3d: Establish a commercial sector that balances the retail and service needs of citizens and tourists
• Policy LU-3g: Provide for a range of business activities that bring vitality, revenue, and employment to Carpinteria and are compatible with its small town character; WHEREAS, the City has adopted Resolution No. 5500, a Sustainable Community Policy, in part, as a basis for creating strategies that allow it to adapt to ever-changing environmental, economic, social and physical stressors. Among the directives of the City's Sustainable Community Policy are the following:
• Promote a diversified and resilient local economy that reflects the unique attributes of the region and provides necessary and desirable products and services for both residents and visitors;
• Attract and retain downtown retailers, hotels, corporate headquarters and Research and Development uses that can be successful in and complimentary to the community; Ordinance No. 755

Page 2 ends

• Establish support for small business development;
• Maintain and enhance the unique identity of the community and built environment to sustain a strong sense of place and community;
WHEREAS, the City's character as a classic California beach town; the City's desire to foster businesses that serve both the needs of City residents and visitors and thereby ensure the community's quality of life; the resiliency of the City's vibrant, small-scale, diversified commercial character; and the City's ongoing economic vitality all require that the City maintain and encourage establishment of diverse business types and sizes, including smaller and mid-sized businesses;
WHEREAS, formula businesses are, by their very nature, standardized (including their architecture, decor, color schemes, and signage) and not unique, and therefore do not enhance the unique small town character that the City Council finds necessary to maintain a viable visitor industry in the City;
WHEREAS, as City staff noted in a May 9, 2022 Staff Report, many formula businesses are increasingly locating in downtowns and neighborhood business districts en masse, squeezing out independent businesses and causing a speculative run-up in rents that results in the wholesale transformation of a business district. In addition to causing such downtowns and business districts to lose their distinctive appeal, the rent increases caused by an influx of formula businesses can force independent entrepreneurs and low margin/service businesses that serve the surrounding neighborhood's basic needs to close or move out of the area; WHEREAS, as further noted by City staff in the May 9, 2022 Staff Report, local economies dominated by formula businesses tend to be solely profit-based and therefore disinterested in meeting the community's needs, rather than filling a local niche or complementing existing businesses in similar categories. Formula businesses also often invest locally generated profits outside of the community, disappearing quickly when economic conditions shift or corporate strategy changes, and leaving behind vacancies with higher rent expectations; WHEREAS, this ordinance is not premised on maintaining local ownership of businesses, or protecting existing businesses, or preventing formula businesses from doing business in the City. The purpose of this ordinance is to maintain the City's unique, special character, the diversity and vitality of the City's commercial districts, and the quality of life of City residents; WHEREAS, the impacts described above may result in existing small businesses losing customers and having fewer business opportunities, and may further lead to long-term urban decay and increased vacancies in commercial real estate, both of which could lead to a decline in tax revenue for the City;
WHEREAS, further, the COVID-19 pandemic and government regulations pertaining to social distancing had devastating impacts on businesses-with acute impacts on small businesses-including those doing business within the City; WHEREAS, the City Council finds that the unregulated proliferation of formula businesses could lead to a lack of diversity in City businesses, which would substantially harm the Ordinance No. 755

Page 3 ends

important City interests listed above and create substantial public health, safety and welfare problems for the City, its residents, and its businesses; WHEREAS, on May 9, 2022, the City Council directed City staff to prepare a proposal to adopt regulations governing the establishment of formula businesses within the City; WHEREAS, City staff is in the process of initiating an amendment to its Local Coastal Plan for the City Council's consideration at a future meeting in order to study and draft comprehensive regulations governing formula businesses pursuant to the City Council's direction; WHEREAS, in the meantime, a temporary moratorium is necessary to allow City staff time to study possible revisions to the City's zoning ordinance and other regulations to address the matters set forth above, which regulations when completed will be brought back for City Council consideration within a reasonable time;
WHEREAS, on May 23, 2022, the City Council heard City staff's report and received public comment on the proposed moratorium but could not take action on the moratorium because only three Councilmembers were present, which would not have met the four-fifths (4/5) vote requirement in Government Code section 65858;
WHEREAS, California Government Code section 65858 provides that for the purpose of protecting the public safety, health, and welfare and without following the procedures otherwise required prior to adoption of a zoning ordinance, the City Council may adopt, as an urgency measure, an urgency ordinance prohibiting any uses which may be in conflict with "a contemplated general plan, specific plan, or zoning proposal that the [City Council], planning commission or the planning department is considering studying or intends to study within a reasonable time;" WHEREAS, the City currently has approximately 15 vacant commercial spaces, in addition to an anticipated 17 to 20 new commercial spaces that are associated with pending development projects, which could be occupied by a formula business without any further discretionary review or approval by the City;
WHEREAS, the City's Municipal Code provides that a Certificate of Occupancy and business license, both of which are necessary to operate a business in the City, are ministerial entitlements not subject to discretionary review by the City; WHEREAS, if and when a new formula business applies for such entitlements, any such application could be granted before the City could consider and enact an urgency ordinance under Government Code section 65 85 8 regulating establishment of such a new formula business, thereby frustrating the City's ability to enact lawful regulations on the establishment of new formula businesses;
WHEREAS, the City finds that, as a result of these conditions, the City cannot wait until a new application for establishment of a formula business is submitted in order to enact restrictions on formula businesses;
Ordinance No. 755

Page 4 ends

WHEREAS, if additional formula businesses were allowed to be instituted in the City, prior to the City's consideration and adoption of final regulations governing formula businesses, such uses could (1) conflict with and/or defeat the purpose of the proposal to adopt regulations regulating formula businesses, (2) conflict with the requirements of the General Plan/Local Coastal Plan, (3) be inconsistent with surrounding uses, and/or (4) be immediately detrimental to the public health, safety, and welfare;
WHEREAS, in the absence of an urgency moratorium, the City's ability to effectively address in a timely manner the negative impacts caused by the proliferation of formula businesses on the public health, safety, and welfare will be seriously compromised; and WHEREAS, the City Council finds that the above conditions create a current and immediate threat to the public health, safety, and welfare of the City, its residents, and its businesses, within the meaning of Government Code section 65858, as the public health, safety, and welfare depend on the continued economic and cultural vitality of a connected, engaged, and diverse business community, and excessive formula businesses degrade the community's smalltown feel and eliminate opportunities for smaller and independently-owned businesses to thrive, especially those business providing vital services to local residents that do not normally pay high rents;
WHEREAS, for the reasons included in the record, the City Council has determined that, as of the Effective Date (as this term is defined in Section 8 below) of Ordinance No. 755 ("Ordinance"), there is no urgency to regulate formula businesses within the Casitas Plaza or the Shepard Place Shops;
WHEREAS, the City Council has determined, by at least a four-fifths (4/5) vote, that this Ordinance satisfies the requirements of Government Code section 65858, is a matter of City-wide importance, is a reasonable and necessary measure designed for immediate preservation and protection of the public health, safety, and welfare of the community, and is in accord with the public purposes and provisions of applicable State and local laws and regulations.

NOW, THEREFORE, THE CITY COUNCIL HEREBY ORDAINS AS FOLLOWS:

SECTION 1. Recitals Incorporated.

The above recitals are incorporated herein and are each relied upon independently by the City Council in its adoption of this Ordinance.

SECTION 2. Declaration of Urgency.

The City Council hereby finds and declares that, for the reasons set forth in the above recitals, there is a need to enact an urgency ordinance establishing a moratorium on the issuance of any and all Certificates of Occupancy and/or any other entitlements for the operation of formula businesses (as defined in Section 6 of this Ordinance) within the City, with the exception of the Casitas Plaza and the Shepard Place Shops (collectively, "City Limits"), subject to the findings and conditions contained in this Ordinance. To clarify, the Casitas Plaza and the Shepard Place Shops shall not be subject to this Ordinance. Prior to the issuance of further entitlements for Ordinance No. 755

Page 5 ends

formula businesses within the City, City staff needs time to study the Carpinteria Municipal Code ("CMC"), including the City's zoning regulations, and other regulations to ensure that the provisions of the City's zoning regulations and other regulations applicable to formula businesses are compatible with and support the City's General Plan/Local Coastal Plan; ensure consistency with surrounding land uses; ensure compliance with evolving state and federal law; and ensure that the effects of such land use on the public health, safety, and welfare of the residents and businesses of the City are adequately addressed.

SECTION 3. Moratorium.

Notwithstanding any other provisions of the CMC or any other ordinances or regulations of the City to the contrary, no Certificate of Occupancy or any other entitlement which has as its result the approval or allowance of the operation of a formula business within the City Limits shall be issued, granted or approved by any employee, department, or commission of the City for a period of forty-five (45) days immediately succeeding the effective date of this Ordinance (and as it shall be extended pursuant to the requirements on Government Code section 65858). During the term of this Ordinance, only those entitlements for which the right to proceed with the associated development, facility, or activity has vested pursuant to the provisions of State law prior to the effective date of this Ordinance, shall proceed in violation of the provisions of this Ordinance.

SECTION 4. Immediate Threat.

SECTION 5. Hardship Exception/Waiver.

SECTION 6. Definition of Formula Business.

Page 6 ends

other provision of this Section, the following types of businesses are not formula businesses: office space, professional services, banks or credit unions, grocery stores, nonprofit businesses, pharmacies, gas stations, or theaters/performing arts spaces.

SECTION 7. Exception for Relocation of Existing Formula Businesses.

SECTION 8. Effective Date.

This Ordinance shall be in effect for a period of forty-five (45) days immediately following the date of adoption; provided, however, that after notice pursuant to California Government Code section 65090 and a public hearing, by the affirmative vote of at least four-fifths (4/5) the City Council may extend this Ordinance for an initial period of time up to 10 months and 15 days pursuant to California Government Code section 65858. Thereafter, upon a four-fifth (4/5) vote, a further extension of one (1) year is also permitted.

SECTION 9. Amendment of Ordinance.

SECTION 10. Severability.

SECTION 11. CEQA Exemption.

The City Council finds that this Ordinance is not subject to the California Environmental Quality Act ("CEQA") pursuant to Title 14 of the California Code of Regulations, CEQA Guidelines sections 15060( c )(2) (the activity will not result in a direct or reasonably foreseeable indirect physical change in the environment) and 15060( c )(3) (the activity is not a "project" as defined in section 15378). The Ordinance prevents changes in the environment pending completion of the contemplated CMC review and thus has no potential for resulting in physical change to the environment, either directly or indirectly.

PASSED, APPROVED, AND ADOPTED this 27th day of June, 2022, by the following called vote:

AYES: COUNCILMEMBERS: Alarcon, Carty, Clark, Nomura
Ordinance No. 755
Page7
NOES: COUNCILMEMBERS: None
ABSENT: COUNCILMEMBERS: Lee ( recused)
Mayor of the City of Carpinteria
ATTEST:
~
City of Carpinter
~
ia
I hereby certify that the foregoing Ordinance was duly and regularly introduced and adopted at a regular meeting of the City Council of the City of Carpinteria held this 27th day of June, 2022. ~BrianC.BaniIf:. tt, e'M~
C, City Clerk
City of Carpinteria
APPROVED AS TO FORM:

Attachment C
Government Code §65858(d) Report
Formula Business Temporary Moratorium Extension
Project 22-2151-ORD/LCPA
May 8, 2023 City Council Hearing
Gov. Code§ 65858(d) Report
Date: May 8, 2023
From: City Council
Subject: Report Describing Measures Taken to Alleviate
Need for Moratorium on Formula Businesses
This report ("Report") describes the measures taken by the City of Carpinteria ("City") to alleviate the conditions that led to the adoption of Ordinance No. 755 ("Ordinance), which enacted a moratorium on the issuance of Certificates of Occupancy, business licenses, or other necessary entitlements to establish a formula business within the City limits, with the exception of the Casitas Plaza and Shepard Place Shops.

Background
Many communities across the state and country are experiencing a growth in the number of chain stores and restaurants being established, with associated impacts on the local community and economy. Also known as formula businesses, these establishments have been shown to have negative impacts on the public health, safety, and welfare, including uncontrolled increases in commercial rent, degrading the character of distinctive or historic areas, reducing local tax revenue, and driving out smaller, independent businesses on which the community depends. These concerns are more thoroughly described in the staff reports presented to the City Council for its deliberations on the Ordinance, the contents of which are hereby incorporated by reference.
1 On June 27, 2022, the City Council adopted the Ordinance, imposing a moratorium on the City's issuance of entitlements to operate new formula businesses in the City, with the exception of the Casitas Plaza and Shepard Place Shops. The purpose of the Ordinance is to prevent the establishment of new formula businesses within these areas while the City develops and approves comprehensive, permanent regulations governing formula businesses.

Work To Date
At its February 13, 2023 meeting, the City Council adopted Ordinance No. 760, which amends the City's zoning regulations and Local Coastal Program to include permanent regulations governing establishment of formula businesses in the City. On April 19, 2023, the City transmitted to the California Coastal Commission the materials necessary 1 These staff reports are available on line at the following links:
https://carpinteria.granicus.com/MetaViewer.php?view id=2&clip id=1028&meta id=69910 (May 9, 2022 Staff Report); https://carpinteria.granicus.com/MetaViewer.php?view id=2&clip id=1036&meta id=70334 (May 23, 2022 Staff Report); https://carpinteria.granicus.com/MetaViewer.php?view id=2&clip id=1064& meta id=71473 (June 27, 2022 Staff Report).
25561202.1
Formula Business Regulations Status Report
May 8, 2023

Page 2 ends

for the Commission to consider Ordinance No. 760's proposed amendment to the City's Local Coastal Program, but the Commission has not yet acted on that submission.

Therefore, although the City has made significant progress towards enacting comprehensive formula business regulations, the conditions that led to the adoption of the Ordinance are ongoing. Extension of the urgency ordinance is therefore warranted to allow the City the additional time needed to complete adoption and effectuation of comprehensive formula business regulations.
25561202.1
City of Carpinteria

COUNCIL AGENDA STAFF REPORT
May 8, 2023

ITEM FOR COUNCIL CONSIDERATION
Adoption of Resolution No. 6234, initiating proposed amendments to the City's Local Coastal Program and Carpinteria Municipal Code Title 14: Zoning to address State law consistency and implement the 2023-2031 Housing Element.

STAFF RECOMMENDATION
Adopt Resolution No. 6234 (Attachment A), initiating amendments to the Carpinteria Local Coastal Program, and Carpinteria Municipal Code Title 14: Zoning to address State law consistency and implement the 2023-2031 Housing Element.

Sample Motion: I move to approve and adopt Resolution No. 6234, initiating amendments to the Carpinteria Local Coastal Program, and Carpinteria Municipal Code Title 14: Zoning to address State law consistency and implement the 2023-2031 Housing Element.

BACKGROUND
The City Council adopted the City's 6
th Cycle Housing Element 2023-2031 ("Housing
Element")on April 10, 2023 and subsequently sent to the State Housing & Community Development (HCD) on April 12
th for certification. The Housing Element includes a
number of programs in order to provide adequate properties to accommodate the City's Regional Housing Needs Allocation (RHNA) of 901 additional housing units for the 2023-2031 period. The new 901-unit allocation includes 286 units for very low income households, 132 units for low income households, 135 units for moderate income households, and 348 units for above moderate income households.

As described in Appendix B of the Housing Element, the land use and zoning designations in the City's current General Plan do not provide adequate capacity to fully accommodate the City's RHNA allocation. To address this shortfall, the Housing Element requires that the City process amendments to the General Plan and Zoning Code to accommodate at least 100 percent of the RHNA shortfall plus a reasonable buffer to create sufficient capacity for lower-income affordable housing.

Per the Housing Element, the rezone amendments will include a minimum of 11.4 Housing Element Zone Code Amendment Initiation
May 8, 2023

Page 2 ends

acres allowing densities of 20 to 25 units per acre (with a minimum density of 20 units per acre) to accommodate lower-income housing with appropriate development standards, including, but not limited to allowances for 3-story buildings and affordability requirements, to encourage maximum allowable densities and to ensure lower-income housing projects are feasible.

The Housing Element presents that the City intends to utilize the Residential Overlay District ("R Overlay District") to expand the potential sites that can accommodate residential uses, thereby addressing the RHNA shortfall. The purpose of the R Overlay District is to provide the opportunity for stand-alone residential development in zone districts which would otherwise not permit such use. To complete the Housing Element, the City has performed a preliminary evaluation of housing development opportunities and has identified certain non-residential sites, identified in Appendix B, Table B-6 of the Technical Report, that may be qualified for inclusion in the R Overlay District. The Housing Element further acknowledges that more detailed site analysis and California Environmental Quality Act (CEQA) review during the implementation of this program could identify new opportunity sites while other sites may be deemed unsuitable or densities may be modified based on new information.

The Housing Element, as part of the rezoning program, commits the City to a review of all residential development standards in consultation with local architects and developers and to amend standards as necessary to ensure that allowable densities can be achieved. Such amended standards include, for example, allowance for 3-story development in multi-family zones, reduced required parking standards, and changes necessary to ensure that standards do not pose unreasonable constraints on the cost and supply of housing.

In addition to the required rezones, the Housing Element proposes other amendments to Carpinteria Municipal Code Title 14: Zoning and the City's Local Coastal Program (LCP) to (i) address potential inconsistencies with State law, (ii) implement other Programs in the Housing Element, and (iii) clarify certain provisions. The City Council has already initiated some of the proposed amendments specified in the Housing Element, such as clarifications to the City's Density Bonus regulations (Carpinteria Municipal Code Chapter 14.77) in order to implement these regulations consistent with the Coastal Act. Other amendments to the City's LCP and Carpinteria Municipal Code Title 14: Zoning that still must be initiated by the City Council to implement the Housing Element include changes for:
• Emergency Shelters
• Low Barrier Navigation Centers
• Transitional and Supportive Housing
• Single Room Occupancy (SRO) Housing
• Residential Care Facilities
• SB 9 duplexes and lot splits
• Accessory Dwelling Units and Junior Accessory Dwelling Units (update) N:\Project Files\2023 (2196- )\Initiation of Zoning HE LCPA\May 8 2023 lnitiation\CC Staff Report Initiation HE Zoning Amendments 4.8.2023.docx
Housing Element Zone Code Amendment Initiation
May 8, 2023

Page 3 ends

These proposed amendments to the City's LCP and Carpinteria Municipal Code Title 14: Zoning are described in Programs 7, 8, 11 and 17 and summarized in Table H-2 of the Housing Element.

DISCUSSION
The purpose of this agenda item is to initiate changes to the City's LCP and Carpinteria Municipal Code Title 14: Zoning to implement the 2023-2031 Housing Element and, if determined necessary, to address State law consistency. If adopted as staff recommends, Resolution No. 6234 would formally initiate these amendments.

Ordinance Adoption Process
Once initiated, staff will work to prepare the more detailed site analysis and CEQA review through public workshops/hearings and prepare a draft ordinance. Upon completion of the draft ordinance, it first will be considered at a public hearing by the Planning Commission. The Planning Commission will provide recommendations on the draft ordinance to the City Council at a noticed public hearing. The Council will then hold a public hearing to receive the Planning Commission's recommendation(s) and to consider adoption of the draft ordinance upon a first reading. The Council would have the opportunity to modify or amend the draft ordinance. If the draft ordinance is significantly modified, the City will need to provide six weeks' notice to the public before the City Council returns to hold a final vote adopting the ordinance upon a first reading.

Upon adoption, the Council would also authorize staff to submit the draft ordinance to the California Coastal Commission (CCC) as a Local Coastal Program amendment (LCPA). The CCC review is a requisite part of the LCPA process and together with the City's review/approval, ensures that the Zoning Code amendment is consistent with the policies of the California Coastal Act and the City's certified LCP. Upon certification of the LCPA by the CCC, the draft ordinance would be returned to the City Council for: 1) acceptance of any modifications required by the CCC and 2) adoption of the ordinance upon a second reading.

If the CCC certifies the ordinance without any suggested modifications, the certification is effective immediately, and the ordinance will go into effect thirty (30) days following the City Council's second reading of the ordinance. If the CCC suggests modifications, then certification does not become effective until 1) the CCC Executive Director receives notification of the City's acceptance and implementation of those modifications, 2) the Executive Director determines in writing that the City's action and notification procedures are legally adequate to satisfy the CCC's certification order, and 3) the Executive Director reports this determination to the CCC at its next regularly scheduled meeting.

N:\Project Files\2023 (2196- )\Initiation of Zoning HE LCPA\May 8 2023 lnitiation\CC Staff Report Initiation HE Zoning Amendments 4.8.2023.docx
Housing Element Zone Code Amendment Initiation
May 8, 2023
Page4
Depending upon the extent and manner in which the CCC completes the review and certification of the City's LCPA, the entire ordinance adoption process could take approximately 9 to 14 months.

POLICY CONSISTENCY
A number of policies within the existing Land Use and Housing Elements of the General Plan/Local Coastal Land Use Plan address the expansion of housing opportunities in the City to address the ongoing and increasing housing needs for affordable and market rate households, while ensuring that the amendment is consistent with the City's LCP. A few key policies that the amendment process will address are identified below.

LAND USE ELEMENT
Objective LU-1: Establish the basis for orderly, well planned urban development while protecting coastal resources and providing for greater access and recreational opportunities for the public.

Policy LU-1 c: Where policies in the Land Use Element overlap, the policy that is most protective of resources (e.g., land, water, air, etc.) shall take precedence.

HOUSING ELEMENT
The City's adopted Sixth Cycle, 2023- 2031 Housing Element has been sent to the State Housing & Community Development (HCD) on April 12th for certification.

Goals and policies of the 2023 - 2031 Housing Element are listed below:

Goals
• Maintain an adequate supply of appropriately zoned land and take all necessary actions to support the production of at least 901 housing units in the City to accommodate the RHNA allocation for the 2023-2031 period. • Maintain a jobs-housing balance or ratio within the 0.75 to 1.25 range suggested by the Santa Barbara County Association of Governments.

Policies
• Adequate Sites: Provide sufficient sites in the General Plan and Zoning Code and associated Land Use and Zoning Maps to accommodate the housing needs allocated to the City in the Regional Housing Needs Allocation (RHNA) Plan. • Housing Types: In the General Plan and implementing ordinances, provide for a mix of housing types consistent with the City's needs, including single-family detached and multi-family housing.

Page 5 ends

• Accessory Dwelling Units: Promote the development of ADUs consistent with State law and City regulations.
• Public Services and Facilities: Ensure that public services and facilities have the capacity to support the need for the new residential development allocated to the City by the RHNA Plan.

Programs

1. Adequate Sites to Accommodate Regional Housing Needs The final RHNA allocation for the City for the 2023-2031 period is 901 additional housing units, including 286 units for very low income households, 132 units for low income households, 135 units for moderate income households, and 348 units for above moderate income households.

As described in Appendix B, the land use and zoning designations in the City's current General Plan do not provide adequate capacity to fully accommodate the City's RHNA allocation in the lower-income levels for the 2023-2031 period. The City's current inventory of sites and pending projects has an estimated realistic capacity of only 190 of the 418 lower-income RHNA unitsi.e., a shortfall of 228 potential housing units. To address this shortfall, the City will process amendments to the General Plan and Zoning Code to accommodate at least 100 percent of the RHNA shortfall plus a reasonable buffer to create sufficient capacity for lower-income affordable housing even if the City does not achieve the conservative assumptions for development in the site inventory during the planning period. The rezone amendments will include a minimum of 11.4 acres allowing densities of 20 to 25 units per acre (with a minimum density of 20 units per acre) to accommodate lower-income housing with appropriate development standards, including, but not limited to allowances for 3-story buildings and affordability requirements, to encourage maximum allowable densities and to ensure lowerincome housing projects are feasible.

The City intends to utilize the Residential Overlay District ("R Overlay District") to expand the potential sites that can accommodate residential uses, thereby addressing the RHNA shortfall for lower income units and increasing the City's capacity for moderate income units as well.

The purpose of the R Overlay District is to provide the opportunity for stand-alone residential development in zone districts which would otherwise not permit such use. The City has performed a preliminary evaluation of housing development opportunities and has identified certain non- residential sites, identified in Appendix B, Table B-6 of the Technical Report, that may be qualified for inclusion in the R Overlay District. However, it is expected that more detailed site analysis and California Environmental Quality Act (CEQA) review during the implementation of this program could identify new opportunity sites while other sites may be deemed unsuitable or densities may be modified based on new information.

When selecting sites for rezoning, the City will give priority consideration to sites with access to transit and services to further fair housing access for lower- income and special needs populations. The City may implement modified zoning strategies provided the total unmet RHNA need by income category is accommodated consistent with state- defined criteria. If future zoning strategies deviate from the targets expressed in this Housing Element but still meet the requirement to identify adequate sites to accommodate the unmet RHNA need, no amendment to the Housing Element would be required and deviations of any magnitude may be considered subject to public review and City Council approval.

N:\Project Files\2023 (2196- }\Initiation of Zoning HE LCPA\May 8 2023 lnitiation\CC Staff Report Initiation HE Zoning Amendments 4.8.2023.docx
Housing Element Zone Code Amendment Initiation
May 8, 2023

Page 6 ends

As part of the rezoning program, the City will also review residential development standards in consultation with local architects and developers and amend standards as necessary to ensure that allowable densities can be achieved, including 3-story development in multi-family zones, reduced required parking standards, and that standards do not pose unreasonable constraints on the cost and supply of housing.

Sites rezoned to accommodate the shortfall of sites for lower-income housing will be consistent with Government Code Section 65583.2(h) and state law:
• Permit owner-occupied and rental multifamily uses by right for developments in which 20 percent or more of the units are affordable to lower-income households.

By right means local government review must not require a conditional use permit, planned unit development permit, or other discretionary review or approval; • Permit the development of at least 16 units per site; • Require a minimum density of 20 units per acre on sufficient sites to accommodate the City's lower-income RHNA allocation; and
• Ensure a) at least 50 percent of the shortfall of low- and very low-income regional housing need can be accommodated on sites designated for exclusively residential uses, or b) if accommodating more than 50 percent of the low- and very low-income regional housing need on sites designated for mixed-uses, all sites designated for mixed-uses must allow 100 percent residential use and require residential use to occupy at least 50 percent of the floor area in a mixeduse project.

The Zoning Code update will also include streamlined review procedures and objective standards to minimize constraints on housing supply and affordability, and all zoning regulations, development standards and fees will continue to be posted on the City website and updated continuously in compliance with transparency requirements. The City will continually review and amend development review process and criteria to improve development certainty and objectivity consistent with the Coastal Act wherever possible.

The City shall continue to comply with the No Net Loss provisions of Government Code § 65863 through ongoing project-by-project evaluation to ensure that adequate sites are available to accommodate the City's RHNA share throughout the planning period. The City shall not reduce the allowable density of any site in its residential land inventory, nor approve a development project at a lower density than assumed in the Housing Element sites inventory, unless both of the following findings are made:
a) The reduction is consistent with the adopted General Plan, including the Housing Element; and
b) The remaining sites identified in the Housing Element are adequate to accommodate the City's remaining share of regional housing need pursuant to Government Code
§ 65584.

If a reduction in residential density for any parcel would result in the remaining sites in the Housing Element land inventory not being adequate to accommodate the City's share of the regional housing need pursuant to §65584, the City may reduce the density on that parcel if N:\Project Files\2023 (2196- )\Initiation of Zoning HE LCPA\May 8 2023 lnitiation\CC Staff Report Initiation HE Zoning Amendments 4.8.2023.docx
Housing Element Zone Code Amendment Initiation
May 8, 2023

Page 7 ends

findings are made identifying sufficient additional, adequate and available sites with an equal or greater residential density so that there is no net loss of residential unit capacity.

Development on any site listed in Appendix B that proposes to demolish existing housing units shall be subject to a policy requiring the replacement of affordable units as a condition of any development on the site pursuant to Government Code §65583.2(9)(3). Replacement requirements shall be consistent with those set forth in §65915(c)(3) and § 65590-65590.1 (the Mello Act).

State law requires water and sewer service providers to establish specific procedures to grant priority water and sewer service to developments with units affordable to lower-income households. (Gov. Code, § 65589.7) The City will immediately deliver the adopted housing element to water and sewer service providers with a cover memo describing the City's housing element, including the City's housing needs and regional housing need.

Responsible Agency: Community Development Department
Funding Sources: General Fund; Housing Trust Fund; other governmental agencies; grant funds
Objectives & Timeframe: Process General Plan and Zoning Code amendments to provide adequate sites to accommodate the RHNA, including amendments to development standards and implementation of affordability requirements, by February 2026 or sooner in accordance with state Housing Element Law deadlines; When selecting sites for rezoning to accommodate regional housing needs for lower-income units, give priority consideration to sites with close access to public transit and services; Adopt streamlined review procedures and objective standards for residential development by December 2024; Post and update all zoning regulations and fees on the City website annually throughout the planning period; Continue to review and amend development review process and criteria to improve development certainty and objectivity consistent with the Coastal Act and take additional actions to improve certainty and objectivity by the midpoint in the planning period (2027), when review identifies potential improvements; Continue to comply with No Net Loss requirements on a project-by-project basis throughout the planning period; Enforce replacement requirements consistent with State law throughout the planning period; Notify water and sewer providers immediately upon adoption of the Housing Element.

7. Density Bonus
Under state law, developments that provide affordable housing may be entitled to a density bonus above the maximum allowed under City regulations. A density bonus is also allowed in exchange for land donation or provision of a child care facility. State density bonus law has been amended from time to time, and an amendment to the Zoning Code was initiated in 2022 to ensure that City density bonus regulations are consistent with State law. The City will also promote the use of density bonus to facilitate production of affordable housing by posting and annually updating density bonus regulations on the City website.

Responsible agency: Community Development Department
Funding Sources: General Fund; Affordable Housing Trust Fund N:\Project Files\2023 (2196- )\Initiation of Zoning HE LCPA\May 8 2023 lnitiation\CC Staff Report Initiation HE Zoning Amendments 4.8.2023.docx
Housing Element Zone Code Amendment Initiation
May 8, 2023

Page 8 ends

Objective & Timeframe: Update City density bonus regulations by April 2024 in conformance with current state law; Post and annually update density bonus regulations on the City website; Update density bonus requlations in response to additional changes in state law and/or by the mid-point in the planning period (2027) if housing production is not meeting objectives.

8. Facilitate Lot Consolidation or Subdivision
The consolidation of small parcels into a single building site can enhance the feasibility of affordable housing through economies of scale and also by improved competitiveness for grant funding. It is also possible that larger parcels more than 10 acres in size require subdivision to create suitably sized affordable housing sites. The City will continue to play an active role in facilitating lot consolidation and subdivision, particularly as it relates to parcels listed in the sites inventory. For example, the City will work with nonprofit developers and/or private landowners of small or large sites to consolidate or subdivide parcels to facilitate the development of housing affordable to lower-income households. These opportunities will be discussed with developers during the preliminary or conceptual review process. Lot consolidation or subdivision requests will be processed concurrently with other development approvals ministerially to the extent allowed by law. Incentives for lot consolidation will include allowing for higher densities, flexibility in development standards and expedited processing when small parcels are consolidated to facilitate projects that include affordable units. The City will also ensure that regulations continue to comply with State requirements regarding urban lot splits pursuant to SB 9 (2021) and promote lot splits through posting information on the City website and assisting interested property owners in preparing applications. In coordination with research being conducted at the State level, evaluate and pursue opportunities to incentivize and provide funding assistance for homeowners to provide affordable units under SB 9.

Responsible agency: Community Development Department
Funding Sources: General Fund
Objective & Timeframe: Encourage consolidation of small lots and subdivision of large lots on a project-by-project basis throughout the planning period through incentives and discussions with housing developers during preliminary project reviews; Amend the zoning code and local coastal program to implement SB 9 (2021) by December 2024; Facilitate urban lot splits pursuant to SB 9 (2021) throughout the planning period; In coordination with research being conducted at the State level, evaluate and pursue opportunities to incentivize and provide funding assistance for homeowners to provide affordable units under SB 9. ·

11. Special Needs Housing
Certain segments of the population may have more difficulty in finding suitable, affordable housing due to their special needs. Special circumstances may be related to one's employment and income, family characteristics, disability and household characteristics, among other factors.

Pursuant to State law, the Housing Element must address the following special needs groups:
elderly, persons with disabilities (including those with developmental disabilities), large households, single-parent households (particularly, female-headed households), farmworkers, and the homeless. A discussion of the particularized needs of each special needs group listed and the policies and procedures the City will implement to meet those needs is included in Section I.E of the Technical Report. New laws adopted in recent years by the State Legislature revised N:\Project Files\2023 (2196- )\Initiation of Zoning HE LCPA\May 8 2023 lnitiation\CC Staff Report Initiation HE Zoning Amendments 4.8.2023.docx
Housing Element Zone Code Amendment Initiation
May 8, 2023

Page 9 ends

some requirements for special needs housing. In 2018, AB 2162 amended State law to require that supportive housing be a use by-right in zones where multi-family and mixed uses are permitted, including non-residential zones permitting multi-family uses, if the proposed housing development meets specified criteria. AB 139 (2019) modified parking standards for emergency shelters and AB 101 (2019) established requirements to allow low barrier navigation centers in certain locations. In 2022, AB 2339 added specificity on how cities plan for emergency shelters.

To ensure consistency with these new laws, a zoning amendment will be processed by April 2024 to update City regulations for these types of facilities. In addition, the City will revise regulations to remove the CUP requirement for SRO housing, and amend existing procedures for approving reasonable accommodation requests and permit requirements and necessary findings for residential care facilities serving seven or more persons to ensure that they are consistent with State law and fair housing requirements.

Responsible Agency: Community Development Department
Funding Sources: General Fund; grant funds (if available) Objectives & Timeframe: Specific objectives and timeframes for actions to support special needs housing are as follows
• Emergency Shelters: Amend regulations for emergency shelter parking standards consistent with AB 139 (2019) by April 2024; continue to provide services to people experiencing homelessness in collaboration with the County of Santa Barbara, non- government organizations providing homeless services in the region, and local community-based volunteers and organizations, and continuously evaluate information to determine trends and issues related to homeless services as well as to evaluate the effectiveness and efficiency of those services. (See also Section I.E.6 of the Technical Report.) • Low Barrier Navigation Centers: Adopt regulations for low barrier navigation centers consistent with AB 101 (2019) by April 2024.
• Transitional and Supportive Housing: Amend regulations for supportive housing consistent with AB 2162 (2018) by April 2024; continue to facilitate the production of transitional and supportive :housing to serve the needs of persons with disabilities on a project-by-project basis throughout the planning period. (See also Programs 4, 5, 9 and 17.)
• SRO Housing: Amend regulations to remove the Conditional Use Permit requirement for SROs by April 2024; continue to facilitate the production of SRO housing to serve the needs of lower-income persons on a project-by-project basis throughout the planning period. (See also Programs 4, 5, 9 and 17.) N:\Project Files\2023 (2196- )\Initiation of Zoning HE LCPA\May 8 2023 lnitiation\CC Staff Report Initiation HE Zoning Amendments 4.8.2023.docx
Housing Element Zone Code Amendment Initiation
May 8, 2023

Page 1 ends

• Reasonable Accommodation: Support reasonable accommodation for persons with disabilities by amending regulations to remove subjective findings for approval related to potential impacts on surrounding uses by April 2024. • Residential Care Facilities: Amend permitting requirements and necessary findings for residential care facilities for 7 or more persons to ensure that they are consistent with state law and fair housing requirements by April 2024. • Elderly: In addition to the accessibility requirements of the building code, the housing needs of seniors can be addressed through smaller units, accessory dwelling units on lots with existing homes, shared living arrangements, congregate housing and housing assistance programs. The City will continue to actively engage the community through the City Council Ad Hoc Senior Services Planning Committee. The committee conducted and presented the results of a Community Needs Assessment Survey as well as data-supported recommendations for the creation of a senior services program to the City Council in November 2022. Based on the recommendations, the Council extended the term of the committee and revised its roles and responsibilities, tasking it with exploring and providing feedback on potential interim and long-term service models and partnerships for active adult/senior services in order to develop an actionable plan, or plans, for implementation by December 2023.
• Large Households: The City will continue to implement programs designed to address housing affordability and accessibility that could benefit large households. (See Programs 1, 4, 8, 5, 6, 7, 9, 17, and 18.) The City will also continue to work with non-profit housing organizations to facilitate affordable housing to benefit large households and others struggling with housing affordability. For example, in recent years Carpinteria has been successful in facilitating affordable family housing developments with 3-bedroom units such as Dahlia Court and Casas de las Flores, both developed and managed by Peoples' Self-Help Housing Corporation.
• Female-Headed Households: The City will continue to implement programs designed to address housing affordability and accessibility that could benefit female-headed households. (See Programs 1, 4, 8, 5, 6, 7, 9, 17, and 18.) • Farm Workers: The City of Carpinteria will continue to support farmworker housing through programs to facilitate affordable housing development and rental assistance. (See Programs 4, 5, and 9.) Two affordable housing projects in Carpinteria, Dahlia Court and Chapel Court, are specifically targeted to farmworkers and their families. The City also supports farmworker housing through regulations in conformance with the Employee Housing Act.

Page 11 ends

• 17. Affirmatively Furthering Fair Housing "Affirmatively furthering fair housing" (AFFH) means taking meaningful actions, in addition to combating discrimination, that overcome patterns of segregation and foster inclusive communities free from barriers that restrict access to opportunity based on protected characteristics.

Specifically, affirmatively furthering fair housing means taking meaningful actions that, taken together, address significant disparities in housing needs and in access to opportunity, replacing segregated living patterns with truly integrated and balanced living patterns, transforming racially and ethnically concentrated areas of poverty into areas of opportunity, and fostering and maintaining compliance with civil rights and fair housing laws. The duty to affirmatively further fair housing extends to all of a public agency's activities and programs relating to housing and community development. (Gov. Code§ 8899.50(a)(1 ).)
The most significant impediments to fair housing identified in Carpinteria are 1) Housing affordability; 2) Homelessness; and 3) Fair housing education. During the 2023-2031 planning period the City will pursue the following actions to address these issues.

FINANCIAL CONSIDERATIONS
Cost associated with the subject work will include staffing requirements and legal services charges in the hundreds of thousands of dollars range.

The City is in the process of establishing an advanced planning division (two positions) in order to ·effectively and efficiently address this work. The related total employee total compensation costs to be considered as a part of the Fiscal Year 2023-24 budget will be approximately $309,500. Staff positions required to prepare and implement these Zoning Code Amendments are expected to be paid for from Measure X and possibly supplemented by state grants, should grants become available during the processing of these amendments.

Legal services costs in support of City legislation and other special projects is projected at approximately $450,000 for Fiscal Year 2023-24, of which a portion of that spending would include the subject work.

LEGAL AND RISK MANAGEMENT CONSIDERATIONS
The City Attorney's Office will coordinate with the Community Development Department to complete these LCP and Carpinteria Municipal Code Title 14: Zoning amendments consistent with the City's certified Housing Element and in accordance with state law, including the California Coastal Act. Timely initiation of these amendments is necessary to meet the deadlines specified in state law and included in the Housing Element.

Page 12 ends

OPTIONS
The Council may choose to:

1. Initiate amendments to the Local Coastal Program and Carpinteria Municipal Code Title 14: Zoning to address State law consistency and implement the 2023- 2031 Housing Element.

2. Take no action, or elect not to initiate the amendments as proposed herein.

3. Request staff to return to a future Council meeting with additional information prior to deciding whether to initiate the amendments.

PRINCIPAL PARTIES EXPECTED AT MEETING
Interested citizens

ATTACHMENTS
Attachment A Draft Resolution No. 6234
Staff Contact: Steve Goggia, Director
Community Development Department
(805) 755-4414 / [email protected]
Reviewed by: Licette Maldonado, Director
Administrative Services
(805) 755-4448, [email protected]
Reviewed by: Dave Durflinger, City Manager
(805) 755-4400, [email protected]
Reviewed by: Jena Shoaf Acos,
on behalf of Brownstein Hyatt Farber Schreck, LLP
acting as City Attorney for the City of Carpinteria /::[7-£ J-e~~ &o/ Signature
N:\Project Files\2023 (2196- )\Initiation of Zoning HE LCPA\May 8 2023 lnitiation\CC Staff Report Initiation HE Zoning Amendments 4.8.2023.docx
Attachment A
Draft Resolution No. 6234
RESOLUTION NO. 6234

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

CARPINTERIA INITIATING AMENDMENTS TO THE
CARPINTERIA LOCAL COASTAL PROGRAM AND TITLE 14,

ZONING, OF THE CARPINTERIA MUNICIPAL CODE, TO

ADDRESS STATE LAW CONSISTENCY AND IMPLEMENT
THE 2023-2031 HOUSING ELEMENT.

WHEREAS, pursuant to the City of Carpinteria's ("City") police power, as granted broadly under Article XI, Section 7 of the California Constitution, the City Council of the City ("City Council") has the authority to enact and enforce ordinances and regulations for public health, safety, and welfare; and
WHEREAS, on January 1980, by Resolution No. 1019, the City Council adopted the Coastal Plan that was developed pursuant to The California Coastal Act of 1976 (Public Resources Code 30000 et seq.) ("Coastal Act"), which includes the entirety of the City's jurisdiction; and
WHEREAS, on October 12, 1981, by Ordinance No. 315, the City Council adopted Title 14 of the Carpinteria Municipal Code, in compliance with the State of California planning and zoning laws; and
WHEREAS, on April 10, 2023, by Resolution No. 4670, the City Council adopted the City's 6th Cycle Housing Element 2023-2031, and subsequently sent to the State Housing & Community Development (HCD) on April 12th for certification; and WHEREAS, the City's 6th Cycle 2023-2031 Housing Element ("Housing Element") includes a number of programs in order to provide adequate properties to accommodate the City's Regional Housing Needs Allocation (RHNA) of 901 additional housing units for the 2023-2031 period. The new 901-unit allocation includes 286 units for very low income households, 132 units for low income households, 135 units for moderate income households, and 348 units for above moderate income households; and WHEREAS, the Housing Element presents that the City intends to utilize the Residential Overlay District ("R Overlay District") to expand the potential sites that can accommodate residential uses. Per the Housing Element, the rezone amendments will include a minimum of 11.4 acres allowing densities of 20 to 25 units per acre (with a minimum density of 20 units per acre) to accommodate lower-income housing with appropriate development standards, including, but not limited to allowances for 3-story buildings and affordability requirements, to encourage maximum allowable densities and to ensure lower-income housing projects are feasible; and - 1 -
Resolution No. 6234
WHEREAS, the Housing Element proposes other amendments to Carpinteria Municipal Code Title 14: Zoning and the City's Local Coastal Program (LCP) for (1) Emergency Shelters; (2) Low Barrier Navigation Centers; (3) Transitional and Supportive Housing; (4) Single Room Occupancy (SRO) Housing; (5) Residential Care Facilities; (6) SB 9 duplexes and lot splits; and (6) Accessory Dwelling Units and Junior Accessory Dwelling Units; and
WHEREAS, the City Council desires to initiate amendments to the City's Local Coastal Program and Carpinteria Municipal Code Title 14: Zoning in order to implement the City's Housing Element, address potential inconsistencies with State law, and facilitate the development of lower income housing.

NOW, THEREFORE, BE IT RESOLVED as follows:

SECTION 1. The above recitals are true and correct, and incorporated herein by reference.

SECTION 2. The City Council hereby initiates amendments to the Carpinteria Local Coastal Program, including, but not limited to, Title 14, Zoning, of the Carpinteria Municipal Code to address state law consistency and implement the 2023-2031 Housing Element.

PASSED, APPROVED AND ADOPTED on May 8, 2023, by the following vote:

AYES: COUNCILMEMBER(S):

NOES: COUNCILMEMBER(S):

ABSENT: COUNCILMEMBER(S):

ABSTAIN: COUNCILMEMBER(S):

Mayor, City of Carpinteria
ATTEST:

Brian C. Barrett, CMC, CPMC
City Clerk, City of Carpinteria
- 2 -
Resolution No. 6234
I hereby certify that the foregoing resolution was adopted at a regular meeting of the City Council of the City of Carpinteria held on May 8, 2023.

Brian C. Barrett, CMC, CPMC
City Clerk, City of Carpinteria
APPROVED AS TO FORM:

Jena Shoaf Acos, on behalf of Brownstein
Hyatt Farber Schreck, LLP acting as
City Attorney of the City of Carpinteria
- 3 -
Resolution No. 6234
City of Carpinteria
Cour,rcr- Aceruoa Srnrr Reponr
May 8,2023

ITEM FOR COUNCIL CONSIDERATION
Amendments to the Carpinteria Municipal Code to add or modify anti-displacement regulations protective of tenants and adoption of Resolution No. 6235, initiating proposed amendment(s) to the City's Local Coastal Program and Carpinteria Municipal Code, as appropriate, for said regulations.

STAFF RECOMMENDATION
Adopt Resolution No. 6235 (Attachment A), initiating amendments to the City's Local Coastal Program and Carpinteria Municipal Code ('CMC'), as appropriate, for antidisplacement regulations; and articulate order of priorities for development of said regulations.

Sample Motion: I move to approve and adopt Resolution No. 6235, initiating amendments to the City's Local Coastal Program and Carpinteria Municipal Code relating to:
. Housingaffordability;
o Just cause eviction ordinance, including "renovictions"; o A vacant parcel tax;
. Regulation of fractional ownership timeshares;
o Amending the City's existing inclusionary housing requirements (CMC Chapter 14.75); and/or
o Amending the City's existing short term rental regulations to allow for imposition of increased fines for certain violations (CMC Chapter 14.47); and directing staff to prioritize the drafting of the regulations as determined by the City Council.
25544063.7
Anti-Displacement Regulations lnitiation
May 8, 2023

Page 2 ends

BACKGROUND
Californians spend a larger share of their income on rent than households in the rest of the nation. While this impacts residents at every income level it impacts low income renters most significantlyl. Further, a lack of available housing contributes significanfly to long home/work commute times that negatively impacts businesses (e.g., emptoyel recruitmenUretention), infrastructure (e.g., wear and tear on roads and highways), the environment (e.9., increased vehicle emissions), and exacerbates health and workfamily conflict2. ln recent years, State and local governments have responded to high home prices, low housing inventory and rising rents by enacting laws that aim to stimulate housing production, promote affordability, and strengthen tenant protections. A number of local governments across the State have enacted so-called "anti-displacement" policies and regulations that aim to protect residents, preserve existing affordable housing, and produce new affordable housing.

The purpose of this agenda item is to summ arize a few of these policies and regulations as options to potentially incorporate in the Carpinteria Municipal Code ("CMC') lnd/or obtain direction from the City Council on further work efforts with respect to each. The City Council also may want to prioritize certain measures and provide direction to staff as appropriate. The anti-displacement measures that are proposed for consideration include:
o Housingaffordability;
o Just cause eviction ordinance (includes addressing "renovictions"); o A vacant parcel tax;
. Regulation of fractional ownership timeshares;
o Amending the City's existing inclusionary housing requirements (CMC Chapter

14.75); and
o Amending the City's existing short term rental regulations to allow for imposition of increased fines for certain violations (cMc chapter 14.47) The City already implements numerous related anti-displacement measures.

For example, the City, along with the Cities of Goleta and Santa Barbara, participates in the Rental Housing Mediation Program, which is operated through the City of Santa Barbara to provide landlord-tenant dispute resolution services to those cities' residents.3 1 The 2_022-23 Budget: The Governor's Housing Plan, Legislative Analyst's Office, February 2022 2 Bai, B., Gopalan, N.,.Be,trtell, N 9f af lmpact otnOsotut6 and Relative Commute Time on Work-Family Conflict: Work Schedule Control, Child Care Hours, and Life Satisfaction . J Fam Econ /ss 42, 5g6-600 (2021). https: //doi. oro/ 1 0. 1 007/s 1 0834-02 1 -09752-w 3 The 2023-2031 Housing Element identifies only one complaint filed with the Rental Housing Mediation Program between 2015 and 2019. However, the 2023-2031Housing Element also identifies that many City resident are not aware of City resources, like the Rental Housirig Mediation program. As a result, 2023-2031 Housing Element further identifies fair housing education as part of Progiam 17 to ensure that City residents are aware of City housing resources.
25544063.7
Anti-Displacement Regulations lnitiation
May 8,2023

Page 3 ends

The County, through United Way, operates an Emergency RentalAssistance Program for all County residents, providing rental and utility grants to eligible individuals. Such resources, however, are not regulations that directly impact tenant or resident rights.

The City's most recent regulation in this space was in 2021with the amendment to CMC Chapter 14.74, relating to Ownership Conversions Affecting Apartments; Conversion Permits. CMC Chapter 14.74limits the conversions of rental apartments into condominium to preserve the City's rental housing stock. prscussroN
The following section provides additional background and information on potential antidisplacement measures that the City Council could choose to initiate and prioritize. lncluded as Attachment B is a summary table to assist the City Council with its evaluation of the proposed anti-displacement measures. The table contains the proposed anti-displacement measure, a brief summary, potential implementation considerations, estimates of the level of work involved, and a space for Council feedback on prioritization.

A. Affordable Housing
ln recent years, California has seen a dramatic increase in home prices and the rental rates due to a variety of factors. To address the immediate needs of local residents, the state and local agencies have pursued regulations, like rent control or rent stabilization, or financial assistance programs to support tenants and homeowners remain in their residences.

1. Rent Stabilization
Since 1995, local agency regulation of rent stabilization or rent control has been restricted by the Costa-Hawkins Rental Housing Act (Civil Code SS1954.50-1954.535), which limits the ability of local governments to enact rent control measures by generally exempting single family homes and post-1995 construction from rent control. This means that cities can only impose rent control on buildings built before 1995. Any property constructed and approved for occupancy after 1995 is not subject to local agency rent control regulations.

Separately, but relatedly, in 2019, the California Legislature passed Assembly Bill1482, which is commonly known as the California Tenant Protection Act. A copy is included as Attachment C. This legislation, codified in Civil Code sections 1946.2 and 1947.12, provides protections to tenants throughout the State of California, including through limiting rent increases and preventing evictions without cause (discussed below), among other things. Regarding rent increases, the California Tenant Protection Act limits rent increases over the course of any 12-month period to (i) 5% plus the annual inflation rate (e.9., the Consumer Price lndex or "CPl") or (ii) 10%, whichever is lower.

The California Tenant Protection Act exempts from rent stabilization: (i) units constructed within the last 15 years; (ii) units restricted by deed, regulatory restriction or 25544063.7
Anti-Displacement Regulations lnitiation
May 8,2023

Page 4 ends

other document limiting the affordability to low or moderate income households; (iii) certain dormitories;.(iy) two unit properties where the second unit was occupied by'the property owner; and (v) single family homes and condominiums when (a) the unit is not owned by a real estate trust, corporation or LLC, and (b) the landlord piovided notice of potent rent increases under the law. lmportantly, the California Tenani protection Act also does not apply to properties covered by a local agency's rent control ordinance.

Taking the Costa-Hawkins Rental Housing Act and the California Tenant Protection Act together, a local agency may generally impose rent stabilization regulations (including regulations that are stricter than those in the California Tenant Protection nci; on mriiifamily buildings built before 1995. For buildings built after 1ggb, a local agency cannot impose rent stabilization regulations on such buildings; rather, rent stabilization for lhose buildings is governed by the California TenaniProtection Act. Because the C1y - like all others in South Santa Barbara County - does not currently impose rent stabilization outside of mobilehomes, rent caps are governed by btat! law. As of February 2023, the local annual change in CPI was 5.4%,4 whiih would result in the current rent cap being the state-established maximum of 10o/o for tenants in covered units.

Several local agencies impose additional rent controls on top of the statewide limits.

For example, in March of this year, the Ojai City Council approved a tenant protection ordinance that included a rent control aspect. Specifically, tne ordinance - which took effect on April 28, 2023 - caps annual increases at 4% for apartments. ln light of the interplay between the Costa-Hawkins Rental Housing Act and the California Tenant Protection Act, this means that Ojai's 4o/o cap will generally apply to multi-family buildings constructed before 1995, while other buiidings witt be governed by th6 b% plus 10o/o or cPl cap set forth in the california Tenant protection Act.

The City may consider whether to amend the CMC to include rent stabilization regulations that apply to multi-family housing built before 1995. Establishing additional rent stabilization regulations could help protect against rent increases, limit displacement, and promote community by keeping established tenants in their existing housing.

There are some criticisms about rent control, rent stabilization or rental caps.

Specifically, critics allege that these measures lead to a decrease in available rental housing over time because rent control disincentivizes developers from building new housing and incentivizes current tenants to stay, thereby causing the rental malket to stagnate. ln addition, rent control reduces profitability for landlords, which in turn may mean that maintenance is not a priority thereby leading to lower quality rental housing ln some places, rent control could also encourage sale of the propertyto a California Department of lndustrial Relations, Consumer Price lndex - California, All Urban Consumers https://www.d ir. ca. gov/OPRL/Cpl/presentCCplchanqe. pDF 25544063.7
Anti-Displacement Regulations lnitiation
May 8,2023

Page 5 ends

homeownership or conversion to other uses, further reducing the availability of lower income housing.5

2. Housinq Subsidies
Housing subsidies are another strategy that cities employ to maintain affordable rental rates and preserve the ability of homeowners to remain in their residences.

The City in coordination with other local agencies currently has a variety of financial assistance programs available to provide rental and homeowner assistance. The City coordinates with the City of Santa Barbara Housing Authority and County of Santa Barbara Housing Authority for Section 8 rental assistance vouchers. As of October 2021, 177 Carpinteria residents received assistance through Section 8 vouchers to pay up to 7oo/o of their rent.

The City also receives Community Development Block Grant and HOME lnvestment Partnership Programs from the County. These funds are used to support a wide range of affordable housing activities, including building, buying and/or rehabilitating affordable housing for rent or homeownership, or providing direct rental assistance to low income households.

Historically, the City also has facilitated the use of United States Department of Agriculture (USDA) funds for loans to very-low income homeowners to repair, improve or modernize their homes. Further, USDA grant funds are available for homeowners who are 62 years of age or older that cannot repay a loan.

The 2023-2031 Housing Element provides more details on these funding sources, and others, available to subsidize existing affordable housing. Specifically, Program 4 (Section 8 RentalAssistance), Program 5 (Affordable Rental Housing Development Assistance), Program 15 (Single-Family Housing Rehabilitation), Program 16 (MultiFamily Housing Rehabilitation and Preservation) and Program 18 (Workforce Homebuyer Down Payment Loans) describe various funding opportunities and the City's commitment to expanding these programs over the next eight years. However, the 2023-2031 Housing Element also identifies that the lack of knowledge about these programs within the City has diminished their efficacy since residents may not be aware of these opportunities.

The City Council could direct staff to explore additional funding sources and establish more robust communication and engagement strategies to enable more City residents to participate in these programs immediately.
s Rosen Consulting Group, Housing Affordability in the South Coast: lmpacts of Past Policies and Potential Pathways for the Future, p9.21 (May 2022); Jeffrey Harding, Rent Control \A/ill Harm the Poor, Santa Barbara lndependent (August 31,2022); Economic Forecast Project, Rent Control is Not the Answer: Never has Been, Never Will Be (March 2,2022).
25544063.7
Anti-Displacement Regulations lnitiation
May 8, 2023

Page 6 ends

B. Just Gause Eviction and ,,Renoviction,'
ln addition, California Tenant Protection Act also imposes eviction protections for tenants in covered units.6 The law generally requires landlords to lrave a'Just cause" reason to terminate a residential tenancy of at least 12 months. The law is a floor, and does not apply if there is a parallel local ordinance adopted or amended after September 1, 2019 that is more protective than state law. State law supersedes local ordinances that are less protective than state law, unless the parallel local ordinance was adopted on or before September 1,2019.7 State law, which will sunset on January 1, 2030 absent an extension, currently applies in the City since there is no on-point loial law. Both the City of Santa Barbara and County of Santa Barbara have chosen to enact more stringent local requirements, which are discussed below.

1. State Law
State law defines 'Just cause" for terminating a residential tenancy as either "at-fault just cause" or "no-fault just cause." "At fault just cause" includes, among other things, a tenant's defaulting on rent, subletting without permission, or maintaining a nuislnce on the property. "No fault just cause" includes an intent by the owner or hiJ/her family to occupy the property; withdrawal of the property from the rental market; complianie with an order or ordinance that necessitates vacating the property; and an intent to demolish or to substantially remodel the property.
"At fault just cause" requires providing the tenant with notice of the violation and three 9"yt' opportunity to cure it (excluding Saturday, Sunday and judicial holidays). "No fault just cause" requires the owner to notify tenant of the right to either paymeni of relocation assistance comprising of one months' rent (in effect at the time of the notice) or a waiver of the final month's rent. State law requires notification to tenants about the iaw, either as an addendum to the lease or separate written notice signed by the tenant. As discussed above, the law does not apply to most single-family reiidences, provided that the owner is not a real estate investment trust, corporation, oi limited liability company, and certain statutory language is included in the lease. Nor does it apply to a rental property that was issued a certificate of occupancy in the last 15 years.

2. Local Laws
Both the City of Santa Barbara and Santa Barbara County have adopted their own more protective local laws, which supersede state law. Like state law, both ordinances 6 Further, pending legislation, Senate Bill 567, seeks to expand eviction protections under the California Tenant Protection Act. (See SB 567, available at
!!tp!:/4gginfo.legislature.ca.qovffaces/billTextOlient.xhtml?bill id=202320240S8567 (accessed on Apr. 28,2023).)
7 The City coordinates with the Santa Barbara Rental Housing Mediation program (SBRHMp) to assist residents with landlord{t91ant, fair housing and other eviction issues. ln the talst yedr or so, SBRHMp reports approximately 33% of the requests from City residents involve termination of tenancy issues. 25544063.7
Anti-Displacement Regulations lnitiation
May 8, 2023

Page 7 ends

generally apply to multi-family residential (duplexes and larger) and require 'Just cause" for terminating tenancy, with at fault and no fault just cause defined the same as in state law. Tenants qualified for relocation assistance must have occupied their rental units for at least twelve months.s
The City of Santa Barbara's Ordinance No. 5979, adopted on December 9, 2020, added Chapter 26.50 to their municipal code ("Just Cause for Residential Evictions"). Santa Barbara County urgency Ordinance No. 5175, adopted on April 6,2023, added Article lV (Just Cause for Residential Evictions) to Chapter 44 (Residential Property Landlord Tenant Rights) of the County's Code. Both are more stringent than state law in that tenants evicted for no fault just cause are entitled to an amount equal to three months' rent. For City of Santa Barbara, rent refers to the rent in effect at the time the owner issued the notice to terminate tenancy. For County of Santa Barbara, rent is the fair market rent for the area as determined by the Department of Housing and Urban Development (HUD) or seven thousand dollars, whichever is greater. Unlike State law, the City's relocation assistance must be paid either within 15 calendar days of issuance of the notice to terminate, or half of the relocation assistance may be paid in this time frame, with the balance due no later than the time the tenant vacates the premises. The County generally requires relocation assistance payments be made within 20 days of notice of tenancy termination. Both ordinances require relocation assistance to be paid to each qualified tenant, rather than in a lump sum.

Regarding so-called "renovictions," whereby the landlord evicts tenants in order to complete renovations, both the City and County of Santa Barbara require the landlord to provide copies of the necessary permits to the tenants along with an explanation of the scope of work to be performed and why the work requires the tenant to vacate concurrent with the notice to vacate. Copies of the tenant communications must then be filed with the Community Development Department.

Both local ordinances make the landlord's failure to adhere to the applicable ordinance's requirements a defense in an unlaMul detainer action. The City of Santa Barbara requires the City Administrator and City Attorney to present an annual status report on the effects of AB 1482 rent control on the local rental market, with focus on the growth of differentials between contract rents and market rents.

G. Vacancy Tax
Vacant Parcel Taxes ("VPT') are taxes placed upon unused and/or under-used properties. Generally, VPTs are intended to motivate property owners to develop vacant parcels and to either sell or rent unoccupied units to ensure all available housing is used. Other benefits include addressing blight and code compliance issues associated with vacant parcels, and revenue generation.
8 tne City of Santa Barbara requires all tenants be offered a lease with a minimum one year tenancy, which in effect provides them with the option of a lease subject to the California Tenant Protection Act (see Municipal Code Chapter 26.40).
25544063.7
Anti-Displacement Regulations lnitiation
May 8,2023

Page 8 ends

A VPT is a parcel tax and must be placed on the ballot either by council or by citizen initiative. Council placement on the ballot requires 66.7o/o of the electorate's vote to pass; citizen initiatives require only a simple majority vote (>50%). ln order to implement a VPT, the city must draft an ordinance that identifies which parcels will qualify as "vacant", the appropriate tax rate, owners that will be exempt from the tax, what the proceeds will be used for, and how the tax will be enforced.

For example, in the City of Oakland, one of the first to successfully adopt a VpT at the November 2018 general election, a parcel is considered "vacant' if it is in use less than 50 days during a calendar year. The current maximum VPT rates include an annual tax rate of $6,000 per parcel for residential parcels and $3,000 per vacant residential unit in a condominium, duplex, or townhouse unit under separate ownership. In the City of Berkeley, starting in 2024, a $3,000 tax will be imposed on residential units in duplexes, condominiums, single-family homes and townhouses that are vacant for more than 182 days of a year for the first year and a tax of $6,000 is imposed for any subsequent year a unit is vacant. City and County of San Francisco's VPT also will commence'next year and deflnes a property "vacant" if it is unoccupied, uninhabited, or unused, for more than 182 days, whether consecutive or nonconsecutive, in a tax year. For properties less than 1,000 sq. ft. the tax is $10,000 per residential unit; for Iroperties.1,0b0 to 2,000 sq. ft. the tax is $14,000 per residential unit; and for units greater than 2,000 sq. ft. the tax is $20,000 per residential unit.

VPTs are usually collected annually via property tax, and the proceeds are typically used to fund homeless and affordable housing programs. There are a number of administrative burdens associated with enforcing the tax that will require staff or consultant time, such as making both an initial and ongoing determination of what properties are vacant, allowing owners to contest the vacancy determination, and allocating proceeds to appropriate programs.

Nationally, few local governments impose VPTs, and VPTs have only recenfly gained traction in California. A number of California cities have begun to explore VpiJas a way to address the need for affordable housing, but have not yet taken concrete steps to put the issue on the ballot. They include the Cities of: Santa Barbara, Simi Valley, Los Angeles, San Diego, Half Moon Bay, Capitola, and Richmond. The City of Santa Cruz's citizen-sponsored VPT initiative failed in November 2022.

Because the VPT is relatively new and few jurisdictions actually impose it, its longterm impacts and efficacy remain undetermined. As has been the case with monitoring short term rentals and other similar programs, there will be associated time and monetary costs with establishing and maintaining a City VPT. For example, the City of Oakland has delegated implementation and monitoring of their VPT program to Sbl Consulting Group and formed a nine-member commission to advise the City on expenditure of the tax revenue.
25544063.7
Anti-Displacement Regulations lnitiation
May 8, 2023

Page 9 ends

D. Regulating Fractional Ownership Timeshares
Pacaso, lnc. ("Pacaso") launched in 2020 as the principal proponent of an emerging trend in which prospective second-home buyers purchase shares in a limited liability company (LLC) as a vehicle for holding title to a home. Each shareholder has a fractional ownership interest in the home that is used as a vacation stay for a certain amount of time each year.

Pacaso has been controversial in those cities where Pacaso has a presence, since the public looks to the city to regulate the perceived or actual impacts these homes create, including high-turnover of occupants, noise, increased traffic, loss of privacy, loss of community buy-in, reduction in available housing stock, and decline in property values.

The City currently has no Pacaso homes.

The Cities of St. Helena, South Lake Tahoe, Carmel-by-the-Sea, Palm Springs, and Monterey County have all issued cease and desist letters to Pacaso, under the theory that Pacaso fractional ownership homes are "timeshares" and are therefore subject to their respective timeshare ordinances. Pacaso is in ongoing litigation with St. Helena, alleging that St. Helena's timeshare ordinance is unconstitutionally vague and the city unlawfully and selectively enforced the ordinance against Pacaso. Trial is scheduled for January 8,2024. Since the start of litigation, St. Helena has amended its timeshare ordinance in response to Pacaso's business model. Beverly Hills and City of Sonoma adopted urgency ordinances banning Pacaso-style fractional ownership timeshares until they could draft more comprehensive regulations.e Beverly Hills' urgency ordinance is still in effect and is set to expire on or around July 1 6,2023. On June 15,2022, City of Sonoma adopted an ordinance banning all timeshare uses in the city, including Pacasostyle fractional ownership homes.

The CMC currently defines terms relating to timeshares, but is otherwise silent on the subject. There are no express prohibitions against timeshares anywhere in the City.

Staff reviewed several other jurisdictions' ordinances regulating timeshares. A common theme is the regulation of timeshares by qualifying them as commercial uses restricted to commercially zoned areas. Alternatively, some jurisdictions have completely prohibited timeshare uses within their boundaries. The City Council may consider adopting an interim urgency ordinance prohibiting timeshares, including Pacaso-style fractional ownership homes to provide the City with time to gather the information necessary to understand the impacts of Pacaso-style fractional ownership homes.

Options for regulating include the following:
e ln response to claims that Pacaso diminishes the local housing stock, Pacaso has argued that its fractional ownership model results in the conversion of fewer residences into second-homes or vacation rentals by only taking one residence off the market instead of multiple residences. However, this assertion has not been confirmed.
25544063.7
Anti-Displacement Regulations lnitiation
May 8, 2023

Page 10 ends

1. Establish a geographically limited zone where timeshare uses would be permitted, subject to a discretionary permitting process; 2- Adopt a policy where timeshare uses are permitted in all residential zones subject to a license procedure;

3. Adopt a ban on alltimeshare uses city-wide; or 4. Do nothing and allow fractional ownership timeshares to be unregulated. lf the City chooses the regulate timeshares, the City may consider amending the existing definitions of the terms "timeshare" and "timeshare project" to encompass fractional ownership vacation homes.

The City Council, however, should be aware that there are a number of emerging Pacaso competitors that advertise themselves as anti-fractionat ownership, such as Equity Estates, Summer, and reAlpha.lo Given the evolving nature of these businesses and ownership models, any regulations may need to be revised to address potential business and ownership models that gain traction in the future.

E. Updating lnclusionary Housing Requirements
lnclusionary housing ordinances are intended to encourage developers who are creating marketrate housing to set aside a percentage of the housing to be sold or rented at below-market rates. Where adding on-site inclusionary houiing is infeasible, some jurisdictions allow payment of an "in-lieu fee" set by the local ageniy.

On June 14,2004, the City Council adopted the Inclusionary Housing Ordinance, which included an "in-lieu fee" alternative, codified at CMC Chapter 14.75.ltre City Council may desire to evaluate its lnclusionary Housing Ordinance and in-lieu fee toconfirm that is the ordinance furthers the City's policy goals. The following provides an overview of the City's existing lnclusionary Housing Ordinance and in-lieu fee and describes other neighboring jurisdictions approaches.

1. City lnclusionary Housing Ordinance
The City's lnclusionary Housing Ordinance requires all residential ownership projects of five or more units to provide onsite affordable housing for above-moderate income households.ll The inclusionary housing requirementts 12o/o of the total number of net new market rate units with sale prices set for households earning 121% to 200o/o of area median income (AMl) set by the federal government. For example, The Cottages Carpinteria project, a five-unit development at the Faith Lutheran Church propLrty, constructed one deed restricted, affordable unit which the City offered for sale to10 For example, Equity Estates apparently purchases luxury homes worldwide and allows members to use any of them for a set number of days a year, periodically liquidates holdings and provides investors with return plus profits. Preliminary review of this model suggests it could be c6vered by appropriately drafted timeshare regu lations.
11 The City's lnclusionary Housing Ordinance does not apply to rental housing projects. 25544063.7
Anti-Displacement Regulations lnitiation
May 8,2023

Page 11 ends

qualifying above-moderate income households through a lottery. The sale price of the four bedroom, two bath, 2,210 square foot home was $674,100.

The City Council also adopted an in-lieu housing fee associated with the lnclusionary Housing Ordinance. This fee may be paid only when a finding is made that providing onsite inclusionary housing is infeasible. The ordinance does not allow affordable housing to be provided off-site. ln-lieu fees are deposited into the Affordable Housing Trust Fund. The fund is used for the provision of affordable housing and for reasonable costs associated with the development, maintenance and oversight of affordable housing and housing programs, such as Rental Housing Mediation, in the City.

The existing ordinance provides a methodology for calculating in-lieu fees for single family units and condominium units. The in-lieu fee is based on a formula used by the City of Santa Barbara that includes the median sales price of condominiums and single family dwellings for the prior year, the median household income for the County of Santa Barbara and current mortgage interest rates. The in-lieu fee is applied as a traditional land use or zoning regulation rather than as an exaction or development impact fee. The ordinance specifies that the City Council adopt the amount of the in-lieu fee by resolution and that the Council may annually review and adjust the amount of the in-lieu fee. On July 1 1,2022, the City Council adopted the City's current in-lieu fees of $735,400 for single family dwellings and $214,200 for condominium.l2 In the City, payment of an in-lieu fee is rare.

2. Other Local lnclusionarv Housinq Ordinances
Other nearby agencies have similar inclusionary housing ordinances, but vary widely in their approach to inclusionary housing and in-lieu fees. The City of Santa Barbara's inclusionary housing ordinance requires projects with ten or more units (excluding any density bonus units) to provide at least 15 percent of the total units as inclusionary units offered for sale at prices affordable to middle-income (up to 160% AMI) or, in the case of residential lot subdivisions, for the construction of single unit homes for upper-middle income households (up to 200 percent AMI). For projects of two to nine units developer can pay in-lieu fees or provide one unit as an owner-occupied middle-income restricted unit.

The City of Goleta has an inclusionary housing program requiring inclusion of 20o/o affordable units within new residential development. On-site affordable units are strongly preferred; however, an in-lieu payment option is available to small residential projects with two to four units and to projects with five or more units with a finding by the City Council that providing affordable units on-site is infeasible. Projects qualifying for a 2oo/o affordability level must provide:
12 For detailed description of calculation see Exhibit 1 to Resolution No.6147, CouncilAgenda Staff Report, July 1 1 ,2022, available at https://carpinteria.granicus.com/ MetaViewer.php?view id=2&clip id=1070&meta id=71823.
25544063.7
Anti-Displacement Regulations lnitiation
May 8,2023

Page 12 ends

o 2.5o/o of the total number of units at prices affordable to extremely low-income households;
o 2.5o/o affordable to very low-income households.
o 5o/o affordable to low-income households; '
. SYo affordable to moderate-income households; and
. 5o/o affordable to above moderate-income households earning 120 to 2OO% AMl. lf unable to provide the required affordable housing on-site, off-site, or through a land dedication, the developer may propose paying an in-lieu fee subject to city oT Goleta's approval. ln-lieu fees rates are set based on a per square foot amount coiresponding to each different income category.

Santa Barbara County's. inclusionary housing ordinance requires residential projects creating five or more units or subdivisions creating five or more lots to constiuciup to 15o/o of affordable housing units on the site or pay fees in-lieu of constructing the affordable dwellings.
ln 2021, a City of Goleta Planning Commission staff report studied inclusionary requirements and in-lieu fees in eight nearby jurisdictions including cities of Santa Barbara, Carpinteria, Ventura, San Luis Obispo ("SLO"), Oxnard, Arroyo Grande, pismo Beach, and unincorporated areas of Santa Barbara County.13 The study highlighied the following variables between the in-lieu fee programs:
o Proiecfs SubT'ecf to lnclusionary Requirements- i.e., whether a particular number of residential units triggers to the requirement to provide inclusionary housing;,0 c Proiects Allowed to Pay Fees, - i.e., whether projects allowed "by right" or with a smaller number of units could pay an in-lieu fee;
o Amount of For-Sale Project ln-Lieu Fees - i.e., the amount of an in-lieu fee evaluated on a per square foot basis;15
c lnclusion Requirements on Rental Projects - i.e., whether new rental housing projects had to reserve a percent of the units available for rent at certain affordabi I ity req u irements ;
o Rental ln-Lieu Fees - i.e., the amount of an in-lieu fee for rental projects on a per square foot basis;
ln summary, the scope of an inclusionary housing ordinance and in-lieu fees are a policy decision. lnclusionary housing ordinances seek to require new development to 13 The staff report is available here:
!tF!4qo:letq.leqistar.com/LegislationDetail.aspx?lD=5128403&cUtD=80EA28CF-Db77-45B9-A639- ACA19F8A24F1 1a As noted above, the City's lnclusionary Housing Ordinance applies to projects of 5 or more units. The City of Santa Barbara's requirements apply to projects 10 or more units with requirements to pay in-lieu fees applying to smaller projects (2-9 unit prolects).
]. J!" study highlighted that in-tieu fees ranged from $7-glsq. ft. in San Luis Obispo County jurisdictions to $34-46/sq. ft, in Santa Barbara County jurisdictions. Accoiding to the Goleta StuOy, Carpinteria is on the higher end of the pricing spectrum with rates that equate to $tz-zzlsq. rt. 25544063.7
Anti-Displacement Regulations lnitiation
May 8, 2023

Page 13 ends

provide different types of affordable units, such as very low and low income housing and/or moderate or above-moderate income housing, to reflect the needs of each jurisdiction. However, stringent inclusionary housing ordinances are often viewed by developers and State agencies as a creating a constraint on new residential development.l6
Further, inclusionary housing ordinance fees also have numerous policy considerations.

Setting high in-lieu fees and only allowing in-lieu payment under limited circumstances signal a policy decision to encourage on-site construction of affordable housing. On the other hand, lower in-lieu fees and "by-right" options to pay an in-lieu fee, might reflect a policy goal of encouraging in-lieu payments as a tool to generate flexible revenue for construction of affordable housing when on-site construction is not feasible. However, a formula that results in fees that are too high or too low can distort the market, affect developers' decisions, and ultimately affect where and how much affordable housing is built.

Considering that the City's lnclusionary Housing Ordinance was adopted in 2004, the City Council may want consider to analyzing the lnclusionary Housing Ordinance requirements and in-lieu fee program to ensure that the ordinance is effectively furthering the City's policy goals. This analysis may involve having a consultant review the in-lieu fee calculation method and propose amendment, if necessary.

F. Short Term Rentals
ln 2021, the California Legislature passed Senate Bill 60, which amended sections 25132 and 36900 of the Government Code related to permissible fines that cities may impose on persons violating city ordinances. Specifically, these amendments increased the fines that cities can assess for a violation of an ordinance pertaining to a short-term rental that poses a threat to health and safety. As amended, Government Code sections 25132 and 36900 permit the following fines for such violations:
o Fine for a first violation of a short-term rental ordinance is $1,500. o Fine for a second violation of a short-term rental ordinance is $3,000. o Fine for each additional violation of the same ordinance within the same year are $5,000.

Senate Bill 60 also requires cities to include a process by which a responsible party can apply for a hardship waiver for the imposed fines for violation of a short-term rental ordinance.
16 For example, the California Department of Housing and Community Development (HCD) recently requested that the City of Goleta provide an analysis of whether its inclusionary housing ordinance is a potential constraint on the development of new housing in Goleta. (See HCD, City of Goleta's 6th Cycle 2023-2031Adopted Housing Element Letter. p. 3 (March 20,2023) https://www.ci$ofgoleta.org/home/ showpu blisheddocumen V27 97 0 16381 49237 394100000.
25544063.7
Anti-Displacement Regulations lnitiation
May 8,2023

Page 14 ends

Some local agencies near the City have amended their ordinances to reflect the increased fines permitted under Senate Bill 60. For example, the County of Santa Barbara broadly authorizes the imposition of fines up to the maximum amounts set forth in Section 25132 of the Government Code. (County of Santa Barbara Municipal Code section 24A04.) Thus, the County's Municipal Code incorporates the increased fines from Senate Bill 60 by reference.

Currently, the CMC does not authorize imposition of the increased fines made permissible by Senate Bill 60. Rather, CMC 1.06.050 allows the City to impose fines set by resolution of the City Council, which may not exceed the penilty for infractions that is set by State law. lnfractions are fined as follows: up to $tbO for a first violation; up to $200 for a second violation with a year of the first violation; and up to $500 for each additional violation within that year. These amounts are significanily lower than what the new state law permits.
ln light of the foregoing, the City should consider whether to amend the CMC to allow for the imposition of increased fines where the same is permissible under Government Code sections 25132 and 36900. This would allow the City to impose increased fines on public health and safety violations at short-term rentals The City Council also may want to consider further refinements to the short-term rental ordinance to clarify certain provisions, to improve enforceability, and to maintain the City's current balance of short-term rentals and traditional rentll housing.

SUMMARY
The following provides a brief summary of the above items The City currently operates under state law for rent control and just cause eviction, but has the option to adopt more stringent regulations which would supersede state law. Areas of regulation for just cause eviction include increasing the amount of relocation assistance, the time for payment of such assistance, and making failure to adhere to the ordinance,s iequirements a defense in an unlaMul detainer action.
o
a
I
The City may choose to put a vacancy parcel tax measure on the ballot as a means to stimulate use of underused properties in the City.

The city may regulate fractional ownership timeshares by adopting comprehensive timeshare regulations. ln the interim, the City mayionsider adopting an urgency ordinance doing the same, to allow the-City more time to understand the pertinent issues of such regulation.

The City may consider re-evaluating its lnclusionary Housing Ordinance and inlieu fee. 25544063.7
Anti-Displacement Regulations lnitiation
May 8,2023

Page 15 ends

The City may consider amending its regulations related to short term rentals to allow for the imposition of increased fines for certain violations as permitted by law and additional changes to improve enforcement.

POLICY CONSIDERATIONS
These tenant protective measure are in line with the City's General Plan Policies that support affordable housing. The following programs are from the City's recently adopted Housing Element:

Program 1 (Adequate Sites to Accommodate Regional Housing Needs), Program 2 (Accessory Dwelling Units),
Program 4 (Section 8 Rental Assistance),
Program 5 (Affordable Rental Housing Development Assistance), Program 6 (lnclusionary Housing),
Program 7 (Density Bonus),
Program 9 (Regulatory Concessions and lncentives for Affordable Housing), Program 11 (Special Needs Housing),
Program 12 (Conservation of Mobile Home Parks and Rent Stabilization), Program 1 3 (Condominium Conversion Ordinance),
Program 14 (Housing Code Compliance),
Program 1 5 (Single-Family Housing Rehabilitation),
Program 16 (Multi-Family Housing Rehabilitation and Preservation), Program 17 (Affirmatively Furthering Fair Housing); and Program 18 (Workforce Homebuyer Down Payment Loans)
This work can also be found consistent with the Legislative & Policy program of the 2023 Work Plan, which specifically identifies many of the initiatives discussed in this Staff Report.

FI NANCIAL CONSI DERATIONS
Drafting each anti-displacement regulations will require staff and City Attorney time, and may necessitate involving consultants (e.9., inclusionary housing in-lieu fee). lnitial estimates of the amount of staff and attorney time are included in Attachment B Monitoring these programs, in particular, vacancy tax and LLC ownership of second homes, will require staff time and may even necessitate expanding staff or hiring consultants.

LEGAL AND RISK MANAGEMENT CONSIDERATIONS
It is also a well-established legal principle that a public agency's police power has broad application to protect the public health, safety, and welfare of its residents which has been interpreted to include regulations similar to those outlined in this report. The City Attorney has reviewed this Staff Report and will be available to answer questions at the meeting.
a
25544063,7
ln addition, Attachment B provides a brief overview of potential strategies to implement the potential regulations described in this report. For some regulationl, the City Council may want to consider adoption of an urgency ordinance pursuant to Government Code section 65858 to establish a temporary moratorium to protect against current and immediate threats to public health, safety or welfare that may occur during the City's development of permanent reg ulations.

OPTIONS
1' lnitiate amendments to the Local Coastal Program and Carpinteria Municipal Code, as appropriate, for "anti-displacement" regulations and articulate priorities. 2' Request staff to return to a future Council meeting with additional information prior to deciding whether to initiate the "anti-displacement" regulations. 3' Direct staff to defer "anti-displacement" regulations either indefinitely or for a time certain.

Anti-Displacement Regulations lnitiation
May 8,2023

Page 16 ends

PRINCIPAL PARTIES DAT ETING
lnterested members of the public

ATTACHMENTS
Attachment A:

Attachment B:

Attachment C:

Staff contact: Steve Goggia, Director
Community Development
(805) 7 55-441 4 / [email protected]
Reviewed by: Licette Maldonado, Director
Administrative Services
(805) 7 55-4448, licettem@ca rpi nteriaca. qov
Resolution No.6235
Anti-Displacement Measures Summary Table
California Tenant Protection Act
Signature
Reviewed by: Dave Durflinger, City Manager
(805) 7 55-4400 / [email protected]
25544063.7

ATTACHMENT A
RESOLUTION NO.6235

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

CARPINTERIA INITIATING AMENDMENTS TO THE

CARPINTERIA LOCAL GOASTAL PROGRAM AND THE

CARPINTERIA MUNICIPAL CODE TO PRESERVE AND

PROMOTE AFFORDABLE HOUSING
WHEREAS, pursuant to the City of Carpinteria's ("City") police power, as granted broadly under Article Xl, Section 7 of the California Constitution, the City Council of the City ("City Council") has the authority to enact and enforce ordinances and regulations for public health, safety, and welfare; and
WHEREAS, on January 1980, by Resolution No. 1019, the City Council adopted the Coastal Plan that was developed pursuant to The California Coastal Act of 1976 (Public Resources Code 30000 et seq.) ("CoastalAct"), which includes the entirety of the City's jurisdiction; and
WHEREAS, on October 12,1981, by Ordinance No. 315, the City Counciladopted Title 14 of the Carpinteria Municipal Code, in compliance with the State of California planning and zoning laws; and
WHEREAS, on April 10,2023, by Resolution No. 4670, the City Council adopted the City's 6th Cycle 2023 -2031Housing Element ("Housing Element"), and subsequently sent it to the State Housing & Community Development (HCD) on April 12th lor certification; and
WHEREAS, the Housing Element includes a number of programs in order to promote the development, affordability and maintenance of the City's housing supplies, including but not limited to Program 1 (Adequate Sites to Accommodate Regional Housing Needs), Program 2 (Accessory Dwelling Units), Program 4 (Section 8 Rental Assistance), Program 5 (Affordable Rental Housing Development Assistance), Program 6 (lnclusionary Housing), Program 7 (Density Bonus), Program I (Regulatory Concessions and lncentives for Affordable Housing), Program 11 (Special Needs Housing), Program 12 (Conservation of Mobile Home Parks and Rent Stabilization), Program 13 (Condominium Conversion Ordinance), Program 14 (Housing Code Compliance), Program 15 (Single-Family Housing Rehabilitation), Program 16 (MultiFamily Housing Rehabilitation and Preservation), Program 17 (Affirmatively Furthering Fair Housing) and Program 18 (Workforce Homebuyer Down Payment Loans); and WHEREAS, the protection of the City's housing stock for long-term residency is important to maintain local workforce housing supporting the City's economy, including its tourism hospitality, and agricultural industries; and WHEREAS, the City is experiencing a housing affordability shortage that threatens the public health, safety and welfare of its citizenry; and Resolution No. 6234
WHEREAS, as reported in the 2021 Carpinteria Valley Economic Profib, the existing for-sale housing market offers few properties for sale per year and 2021 was the most limited on record; and
WHEREAS, as reported in the 2021 Carpinteria Valley Economic Profile, the median selling value of a home in Carpinteria during calendar year 2021was $1,680,000, an increase of 35 percent over the median selling value of all homes sold in 2020; and WHEREAS, as reported in the 2021 Carpinteria Valley Economic Profile, apartments and mobile homes represent 53 percent of the City's total housing stock and finds there are very few apartments available for rent within the City; and WHEREAS, the loss of affordable residential units, eviction of tenants without just cause, and underutilization of residential buildings decreases the supply of affordable housing, increases the costs of housing, and often displaces residences, especially for the elderly, families and those with special needs, whom cannot find comparable housing within the City; and
WHEREAS, regulations to preserve existing affordable residential units, protect residential tenants, increase the supply of residential units, and decrease the conversion of long-term residential units to other uses, help protect the public health, safety and welfare of City residents and affirmatively further fair housing within the City; and WHEREAS, the City Council desires to initiate amendments to the City's Local Coastal Program and Carpinteria Municipal Code in order to preserve and promote affordable housing within the City.

NOW, THEREFORE, BE lT RESOLVED as foilows
SECTION 1. The above recitals are true and correct, and incorporated herein by reference
SECTION 2. The City Council hereby initiates amendments to the Carpinteria Local Coastal Program, including, but not limited to, Title 14, Zoning, of the Carpinteria Municipal Code to preserve and promote affordable housing. 2 Resolution No. 6234
PASSED, APPROVED AND ADOPTED on May 8,2023, by the following vote:

AYES coUNcTLMEMBER(S):
coUNcTLMEMBER(S):
coUNcTLMEMBER(S):
couNcTLMEMBER(S):

NOES
ABSENT

ABSTAIN
Mayor, City of Carpinteria
ATTEST
Brian C. Barrett, CMC, CPMC
City Clerk, City of Carpinteria
I hereby certify that the foregoing resolution was adopted at a regular meeting of the City Council of the City of Carpinteria held on May 8,2023.

Brian C. Barrett, CMC, CPMC
City Clerk, City of Carpinteria

APPROVED AS TO FORM
Jena Shoaf Acos, on behalf of Brownstein
Hyatt Farber Schreck, LLP acting as
City Attorney of the City of Carpinteria
--tResolution No. 6234

ATTACHMENT B
AruI-DTSpLAcEMENT Melsunes Suunmnv
Estimated Level of Work Gouncil Priority
(Staff/Attorney Time)
50 - 90 Hours;
30 - 50 Hours
20 - 40 Hours /
60 - 80 Hours
80 - 160 Hours; plus election
costs
30 - 40 Hours /80 - 160 Hours
60 - 100 Hours; plus
consultant time
20 - 40 Hours
lmplementation
Considerations
Rent
Stabilization
Ordinance;
and/or
Staff Support
Urgency
Ordinance /
Permanent
Ordinance
November 2024
Ballot or special
election
Urgency
Ordinance /
Permanent
Ordinance
Amendment to
Existing
Ordinance
Amendment to
Existing
Ordinance
Summary
Establish more stringent rent
stabilization regulations on certain
types of units than provided for in
State Law; and/or
Additional rental and housing
support (e.9., Section 8)
Establish more stringent tenant
protections, such as relocation
assistance and notice requirements,
the provided for in State Law
Proposed a vacant parcel tax for the
ballot to promote the use of vacant
property
Establish regulations for fractional
ownership timeshares and similar
models
Evaluate scope/applicability of the
ordinance and the amount of in lieu
fees for new projects
Establish more stringent penalties
for violations and additional
changes to improve enforcement
Measure
Housing
Affordability
Just Cause
Eviction
Ordinance
(including
Renovictions)
Vacant Parcel Tax
Fractional
Ownership
Timeshares
Ordinance
Amendment to
lnclusionary
Housing
Ordinance
Amendment to
Short-Term Rental
Ordinance

ATTACHMENT C
tdh I
[j]ll/ t,.r,r,,r. .rrr',orr,'
. , AUTHENTICATED
Ett(leotrra r Fcll MArFerar
Assembly Bilt No. 1482
CHAPTER 597
An act to add and repeal Sections 1946.2, 1947 .12, and 1947.13 of the Civil Code, relating to tenancy.
[Approved by Governor October 8, 2019. Filed with Secretary of State October 8,2019.1

LEGISLATIVE COUNSEL'S DIGEST
AB 1482, Chiu. Tenant ProtectionAct of 2019: tenancy: rent caps.

Existing law specifies that a hiring ofresidential real property, for a term not specified by the parties, is deemed to be renewed at the end of the term implied by law unless one of the parties gives written notice to the other of that party's intention to terminate. Existing law requires an owner of a residential dwelling to give notice at least 60 days prior to the proposed date of termination, or at least 30 days prior to the proposed date of termination ifany tenant or resident has resided in the dwelling for less than one year, as specified. Existing law requires any notice given by an owner to be given in a prescribed manner, to contain certain information, and to be formatted, as specified.

This bill would, with certain exceptions, prohibit an owner, as defined, of residential real property from terminating a tenancy without just cause, as defined, which the bill would require to be stated in the written notice to terminate tenancy when the tenant has continuously and lawfully occupied the residential real property for 12 months, except as provided. The bill would require, for certain just cause terminations that are curable, that the owner give a notice of violation and an opportunity to cure the violation prior to issuing the notice of termination. The bill, if the violation is not cured within the time period set forth in the notice, would authorize a3-day notice to quit without an opportunity to cure to be served to terminate the tenancy. The bill woirld require, for no-fault just cause terminations, as specified, that the owner, at the owner's option, either assist certain tenants to relocate, regardless of the tenant's income, by providing a direct payment of one month's rent to the tenant, as specified, or waive in writing the payment of rent for the final month ofthe tenancy, priorto the rent becoming due. The bill would require the actual amount of relocation assistance or rent waiver provided to a tenant that fails to vacate after the expiration of the notice to terminate the tenancy to be recoverable as damages in an action to recover possession. The bill would provide that if the owner does not provide relocation assistance, the notice of termination is void. The bill would except certain properties and circumstances from the application of its provisions. The bill would require an owner of residential property to provide prescribed notice to a tenant of the tenant's rights under these 9l
ch.597 _r_
provisions. The bill would not apply to residential real property subject to a local ordinance requiring just cause for termination aaoptia on or -before
September 1,2019, or to residential real property subject to a local ordinance requiring just cause for termination adopted or amended after September l, 2019, that is more protective than these provisions, as defined. The bili would void any waiver of the rights under these provisions. The bill would repeal these provisions as ofJanuary 1,2030.
.Existing law govems thehiring of residential dwelling units and requires a larrdlord to provide specified notice to tenants prior to an increase in rent.

Existing law, the costa-Hawkins Rental Housing Act, prescribes statewide limits on the application of local rent control with iegardio certain properties.

That agtr.a1no_ngother things, authorizes an owner oiresidential reil pioperty to establish the initial and.all subsequent rental rates for a dwelling oi unit that meets specified criteria, subject to certain limitations.

This bill would, until January 1,2030, prohibit an owner of residential real property from, over the. course of any l2-month period, increasing the gross rental rate for a dwelling or unit more than 5% plus the percenlage change in the cost of living, as defined, or ljyo, whichever is lower, of tfre lowest gross rental rate charged for the immediately preceding l2 months, subject to specified conditions. The bill would prohibit an owier of a unit ofresidential real property from increasing the gross rental rate for the unit in more than 2 increments over a l2-month period, after the tenant remains in occupancy of the unit over a l2-month period. The bill would exempt certain properties from--these provisions. The bill would require the Legislative Analyst's Office to submit a report, on or before January l, 2030, tolhe Legislature regarding the effectiveness ofthese provisions. The bill would provide that these provisions apply to all rent incriases occurring on or after March 15, 2019 . The bill would provide that in the event that an owner increased the rent by more than the amount specified above between \a1rch 15,2019, and January 1,2020, the applicable rent on January l, 2020, shall be the rent as of March 75,2019,plus the maximum permissible increase, and the owner shall not be liable to the tenant for any corresponding rent overpayment. The bill would authorize an owner who increised the rent by less than the amount specified above between March 15,2019, and {11qury 7,2020, to increase the rent twice within 12 months of March 15, 2019, but not by more than the amount specified above. The bill would void any waiver of the rights under these provisions.
-
The Planning and Zoning Law requires the owner of an assisted housing development in which there will be an expiration of rental restrictions to, among,otherthings, provide notice of the proposed change to each affected tenant household residing in the assisted housing development subject to specified procedures and requirements, and to also provideipecified entities notice and an opportunity to submit an offer to purchase tire development prior to the expiration ofthe rental restrictions.

This bill would authorize an owner of an assisted housing development, who demonstrates, under penalty of perjury, compliance witfi the provisions described above with regard to the expiration of rental restrictions, to 9l
-3- ch.597
establish the initial unassisted rental rate for units without regard to the cap on rent increases discussed above, but would require the owner to comply with the above cap on rent increases for subsequent rent increases in the development. The bill would authorize an owner of a deed-restricted affordable housing unit or an affordable housing unit subject to a regulatory restriction contained in an agreement with a govemment agency limiting rental rates that is not within an assisted housing development to establish the initial rental rate for the unit upon the expiration ofthe restriction, but would require the owner to comply with the above cap on rent increases for subsequent rent increases for the unit. The bill would repeal these provisions on January l, 2030. The bill would void any waiver of the rights under these provisions. By requiring an owner of an assisted housing development to demonstrate compliance with specified provisions under penalty of perjury this bill would expand the existing crime of perjury and thus would impose a state-mandated local program.

The Califomia Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

This bill would provide that no reimbursement is required by this act for a specified reason.

The people of the State of Califurnia do enact asfollows:

SECTION 1. This act shall be known, and may be cited, as the Tenant Protection Act of 2019.

SEC. 2. Section 1946.2 is added to the Civil Code, to read:
1946.2. (a) Not'withstanding any other law, after a tenant has continuously and lawfully occupied a residential real property for 12 months, the owner of the residential real property shall not terminate the tenancy without just cause, which shall be stated in the written notice to terminate tenancy. If any additional adult tenants are added to the lease before an existing tenant has continuously and lawfully occupied the residehtial real property for 24 months, then this subdivision shall only apply if either of the following are satisfied:
(l) All of the tenants have continuously and lawfully occupied the residential real property for l2 months or more.
(2) One or more tenants have continuously and lawfully occupied the residential real property for 24 months or more.
(b) For purposes of this section, 'Just cause" includes either of the following:
(1) At-fault just cause, which is any of the following:
(A) Default in the payment of rent.
(B) A breach of a material term of the lease, as described in paragraph (3) of Section 1161 of the Code of Civil Procedure, including, but not limited to, violation of a provision of the lease after being issued a written notice to correct the violation.
9l
ch.597 -4-
(C) Maintaining, committing, or permitting the maintenance or commission of a nuisance as described in paragraph (4) of section l 16l of the Code of Civil Procedure.
_
(!) Committing waste as described in paragraph (4) of Section I 16l of the Code of Civil Procedure.
(E) The tenant had a written lease that terminated on or after January l, 2020, and after a written request or demand from the owner, the tenantias refused to execute a written extension or renewal of the lease for an additional term of similar duration with similar provisions, provided that those terms do not violate this section or any other provisionbf hw. .
(F).Criminal activity by the tenant on the reiidential real property, inc^luding any common areas, or any criminal activity or criminal thteat, us defined in subdivision (a) ofSection 422 ofthe penal code, on or offihe residentia-lreatqropgrty, that is directed at any owner or agent of the owner ofthe residential real property.
(G) Assigning or subletting the premises in violation ofthe tenant's lease, as described in paragraph (4) of Section I 16l ofthe code of civil procedure. (H) The tenant's refusal to allow the owner to enter the residential real property as authorized by Sections 1101.5 and 1954 ofthis code, and Sections l3ll3.7 and 17926.1of the Health and Safety Code. . .(I)^Using the premises for al unJawful purpose as deicribed in paragraph (4) of Section I 16l of the Code of Civil Proiedure.
(J) The employee, agent, or licensee's failure to vacate after their !:{mt:Ttiol as _a1-9mR19Veq agent, or a licensee as described in paragraph (l) of Section I l6l of the Code of Civil procedure. (K) when the tenant fails to deliver possession of the residential real gpp_ery after providing the owner written notice as provided in Section 1946 of the tenant's intention to terminate the hiring of the real property, or makes a written offer to surrender that is accepied in writing uy ttie landlord, but fails to deliver possession at the time specified in thaiwiitten notice as described in paragraph (5) ofSection l16r ofthe code ofcivil Procedure.
(?l \g-prtt just cause, which includes any of the following:
-
(A) (D Intent to occupy the residential real property by dre owner or their- spouse, domestic partner, children, grindchildren, parents, or grandparents.
(ii) Ior leases entered into on.or after July 1,2020,clause (i) shall apply only if the.tenant agrees, in writing, to the t-ermination, or if i frovision of the lease allows the owner to terminate the lease if the owner, or their spouse, domestic__ pa_rtngl, children, grandchildren, parents, oi grandparents, unilaterally_decides to occupy the residential rial property. Addition or a provision allowing the owner to terminate the leaie is discribed in this clause to a new or renewed rental agreement or fixed-term lease constitutes a similar provision for the purposes of subparagraph (E) ofparagraph (l). (B) Withdrawal of the residential real pioperry from ttre ienta] maGt. (C) (D The owner complying with any of the'following:
9l
ch.597
(I) An order issued by a govemment agency or court relating to habitability that necessitates vacating the residential real property. (II) An order issued by a govemment agency or court to vacate the residential real property.
(III) A local ordinance that necessitates vacating the residential real property.
(ii) If it is determined by any government agency or court that the tenant is at fault for the condition or conditions triggering the order or need to vacate under clause (i), the tenant shall not be entitled to relocation assistance as outlined in paragraph (3) ofsubdivision (d).
(D) (D Intent to demolish or to substantially remodel the residential real property.
(ii) For purposes of this subparagraph, "substantially remodel" means the replacement or substantial modification of any structural, electrical, plumbing, or mechanical system that requires a permit from a governmental agency, or the abatement of hazardous materials, including lead-based paint, mold, or asbestos, in accordance with applicable federal, state, and local laws, that cannot be reasonably accomplished in a safe manner with the tenant in place and that requires the tenant to vacate the residential real property for at least 30 days. Cosmetic improvements alone, including painting, decorating, and minor repairs, or other work that can be performed safely without having the residential real property vacated, do not qualiff as substantial rehabilitation.
(c) Before an owner of residential real property issues a notice to terminate a tenancy for just cause that is a curable lease violation, the owner shall first give notice of the violation to the tenant with an opportunity to cure the violation pursuant to paragraph (3) of Section I I 6 I of the Code of Civil Procedure. If the violation is not cured within the time period set forth in the notice, a three-day notice to quit without an opportunity to cure may thereafter be served to terminate the tenancy.
(d) (l) For a tenancy for which just cause is required to terminate the tenancy under subdivision (a), ifan owner ofresidential real property issues a termination notice based on a no-faultjust cause described in paragraph (2) of subdivision (b), the owner shall, regardless of the tenant's income, at the owner's option, do one of the following:
(A) Assist the tenant to relocate by providing a direct payment to the tenant as described in paragraph (3).
(B) Waive in writing the payment of rent for the final month of the tenancy, prior to the rent becoming due.
(2) If an owner issues a notice to terminate a tenancy for no-fault just cause, the owner shall notiSr the tenant ofthe tenant's right to relocation assistance or rent waiver pursuant to this section. If the owner elects to waive the rent for the final month ofthe tenancy as provided in subparagraph (B) of paragraph (1), the notice shall state the amount of rent waived and that no rent is due for the final month of the tenancy. (3) (A) The amount of relocation assistance or rent waiver shall be equal to one month of the tenant's rent that was in effect when the owner issued 9l
-5-
ch. s97 -6-
the notice to terminate the tenancy. Any relocation assistance shall be provided within 15 calendar days of service of the notice. (B) If a tenant fails to vacate afterthe expiration of the notice to terminate the tenancy, the actual amount of any relocation assistance or rent waiver prwided pursuant to this subdivision shall be recoverable as damages in an action to recover possession.
(c) The relocation assistance or rent waiver required by this subdivision shall be credited against any other relocation asiistance required by any other law.
(a) An owner's failure to strictly comply with this subdivision shall render the notice of termination void.
(e) This section shall not apply to the following types of residentiar real properties or residential circumstances:
-(1) Transient and tourist hotel occupancy as defined in subdivision (b) ofSection 1940.
(2) .Housing accommodatiols in a nonprofit hospital, religious facility, e.xlendgq care facility, licensed residential care facility for tle elderly as defined in Section 1569.2 of the Health and Safety Code, or an adult residential facility, as defined in chapter 6 of Division 6 of Title 22 of the Manual of Policies and Procedures published by the State Department of Social Services.
(3) Dormitories owned and operated by an institution of higher education or a kindergarten and grades I to 12, inciusive, school. (4) Housing accommodations in which the tenant shares bathroom or kitchen facilities with the owner who maintains their principal residence at the residential real property.
.(5) Single-family owner-occupied residences, including a residence in which the owner-occupant renti or leases no more thaln two units or bedrooms, including, but not limited to, an accessory dwelling unit or a junior accessory dwelling unit.
(6) A duplex in which the owner occupied one of the units as the owner,s principal place ofresidence at the beginning ofthe tenancy, so long as the owner continues in occupancy.
(7) Housing that has been issued a certificate of occupancy within the previous l5 years.
(8) Residential real property that is alienable separate from the titre to any.other dwelling unit, provided that both of the following apply: (A) The owner is not any of the following:
(i) A real estate investment trust, as defined in section 856 of the Internal Revenue Code.
(ii) A corporation.
(iii) A limited liability company in which at least one member is a corporation.
(B) (D The tenants have been provided written notice that the residential property is exempt from this section using the following statement:
9t
-
t- ch. s97
"This property is not subject to the rent limits imposed by Section 1947.12 of the Civil Code and is not subject to the just cause requirements of Section 1946.2 of the Civil Code. This property meets the requirements of Sections 1947.12 (d)(5) and 1946.2 (e)(8) of the Civil Code andthe owner is not any of the following: (l) a real estate investment trust, as defined by Section 856 of the Intemal Revenue Code; (2) a corporation; or (3) a limited liability company in which at least one member is a corporation." (ii) For a tenancy existing before July I ,2020, the notice required under clause (i) may, but is not required to, be provided in the rental agreement. (iii) For any tenancy commenced or renewed on or after July 1,2020, the notice required under clause (i) must be provided in the rental agreement. (iv) Addition of a provision containing the notice required under clause (i) to any new or renewed rental agreement or fixed-term lease constitutes a similar provision for the purposes ofsubparagraph (E) ofparagraph (l) of subdivision (b).
(9) Housing restricted by deed, regulatory restriction contained in an agreement with a govemment agency, or other recorded document as affordable housing for persons and families of very low, low, or moderate income, as defined in Section 50093 of the Health and Safety Code, or subject to an agreement that provides housing subsidies for affordable housing for persons and families of very low, low, or moderate income, as defined in Section 50093 of the Health and Safety Code or comparable federal statutes.
(0 An owner of residential real property subject to this section shall provide notice to the tenant as follows:
(l) For any tenancy commenced or renewed on or after July l, 2020, as an addendum to the lease or rental agreement, or as a written notice signed by the tenant, with a copy provided to the tenant.
(2) For a tenancy existing prior to July 1, 2020,by written notice to the tenant no later than August l, 2020, or as an addendum to the lease or rental agreement.
(3) The notification or lease provision shall be in no less than l2-point type, and shall include the following:
"California law limits the amount your rent can be increased. See Section 1947 .12 of the Civil Code for more information. Califomia law also provides that after all of the tenants have continuously and lawfully occupied the properly for 12 months or more or at least one ofthe tenants has continuously and lawfully occupied the property for 24 months or more, a landlord must provide a statement of cause in any notice to terminate a tenancy. See Section 1946.2 of the Civil Code for more information."
The provision ofthe notice shall be subject to Section 1632. (e) (t) This section does not apply to the following residential real property:
9l
ch.597 -8-
(A) Residential real.prope-rty gqbject to a local ordinance requiring just cause for termination of a residential tenancy adopted on or before'septeilber 1 , 2019, in which case the local ordinance shalf apply (B) Residential real p^roperty_subject to a locai ordinance requiring just cause for termination of a residential tenancy adopted ot u-ended-ufte.

September 1,2079, that is more protective than thiisection, in which case the local ordinance shall apply. For purposes of this subparagraph, an ot9FT:" is "more protective" if it meets alt of the following criieri'a: ' (i) The just cause for termination of a residentiar tenancy rinder the local ordinance is consistent with this section.
(ii) The ordinance further limits the reasons for termination of a residential tenancy, provides for higher relocation assistance amounts, or provides additional tenant protections that are not prohibited by any other provision of law.
(iii) The_local govemment has made a binding finding within their local ordinance that the ordinance is more protectiveihan thJprovisions of this section.
(2) A residential real property shall not be subject to both a local ordinance requiring just cause for termination of a reiidential tenancy and this section.
(3) A local ordinance adopted after September 1,2019, that is less protective than this section shall not be enforced unless this section is repealed.

G) any waiver of the rights under this section shall be void as contrary to public policy.
(i) F.o^r the pypoles of this section, the following definitions shall apply:
-
(1) "Owner" and "residential real propertli', have the same meaning as those terms are defined in Section 1954.il. -
(2) ' Tenancy" means the lawful occupation of residential real property and includes a lease or sublease.

O This section shall remain in effect only until January l, 2030, and as ofthat date is repealed.

SEC. 3. Section 1947.12 is added to the Civil Code, to read:
1947 '12. (a) (l) Subject to subdivision (b), an owner ofresidential real property shall not, over the course of any l2-month period, increase the gross rental rate for a dwelling .or a unit more than- 5 percent plus the percentage change in the cost of living, or l0 percent, whichever is lower, of the lowest gross rental rate charged for that dwelling or unit at any time during the 12 months prior to the effective date 6f the increase. In determining the lowest gross rental amount pursuant to this section, any rent discounts, incentives, concessions, or credits offered by the owner of such unit of residential real property and accepted by the ienant shall be excluded. The gross per-month rentai rate and any owner-offered discounts, incentives, concessions, or credits shall be sepaiately risted and identified in the lease or rental agreement or any amendhentr io an existing lease or rental agreement.
9l
-9- ch. s97
(2) If the same tenant remains in occupancy of a unit of residential real property over any l2-month period, the gross rental rate for the unit of residential real property shall not be increased in more than two increments over that l2-month period, subject to the other restrictions of this subdivision goveming gross rental rate increase.
(b) For a new tenancy in which no tenant from the prior tenancy remains in lawful possession of the residential real property, the owner may establish the initial rental rate not subject to subdivision (a). Subdivision (a) is only applicable to subsequent increases after that initial rental rate has been established.
(c) A tenant ofresidential real property subject to this section shall not enter into a sublease that results in a total rent for the premises that exceeds the allowable rental rate authorized by subdivision (a). Nothing in this subdivision authorizes a tenant to sublet or assign the tenant's interest where otherwise prohibited.
(d) This section shall not apply to the following residential real properties:
(l) Housing restricted by deed, regulatory restriction contained in an agreement with a government agency, or other recorded document as affordable housing for persons and families of very low, low, or moderate income, as defined in Section 50093 of the Health and Safety Code, or subject to an agreement that provides housing subsidies for affordable housing for persons and families of very low, low, or moderate income, as defined in Section 50093 of the Health and Safety Code or comparable federal statutes.
(2) Dormitories constructed and maintained in connection with any higher education institution within the state for use and occupancy by students in attendance at the institution.
(3) Housing subject to rent or price control through a public entity's valid exercise of its police power consistent with Chapter 2.7 (commencing with Section 1954.50) that restricts annual increases in the rental rate to an amount less than that provided in subdivision (a).
(4) Housing that has been issued a certificate of occupancy within the previous l5 years.
(5) Residential real property that is alienable separate from the title to any other dwelling unit, provided that both of the following apply:
(A) The owner is not any of the following:
(i) A real estate investment trust, as defined in Section 856 of the Internal Revenue Code.
(ii) A corporation.
(iii) A limited liability company in which at least one member is a coqporation.
(B) (D The tenants have been provided written notice that the residential real property is exempt from this section using the following statement:
"This property is not subject to the rent limits imposedby Section 1947.12 of the Civil Code and is not subject to the just cause requirements of Section 1946.2 of the Civil Code. This property meets the requirements of Sections 9l
ch. s97 -10-
l24J ,l? (c)(5) and 1946.2 (e)(7) of the Civil Code and the owner is not any of the following:_Q) a real estate investment trust, as defined by Section 856 of the Intemal Revenue code; (2) a corporation; or (3) a limited liabiliry company in which at least one member is a corporation.'! .
(ii) F.or a tenancy existing before July l,202},the notice required under "luy.tg Q may, but is not required to, be provided in the rental agreement. (iii) Fora tenancy commenced or renewed on or after luly tlZ0ZO, the notice required under clause (i) must be provided in the rental agreement. _..
(iv) Addition of a provision containing the notice required urider clause (i) to any new or renewed rental agreement or fixed-term lease constitutes a similar provision for the purposes of subparagraph (B) ofparagraph (l) of subdivision (b) of Section1946.2.
(6) A duplex in which the owner occupied one of the units as the owner,s principal place ofresidence at the beginning ofthe tenancy, so long as the owner continues in occupancy.
(e) An owner shall provide notice of any increase in the rental rate, pursuant to subdivision (a), to each tenant in accordance with Section g27. _
(f) (l) On or before January 1,2030, the Legislative Analyst's Office shall report to the Legislature regarding the effectiveness ofthijsection and Section 1947.13. The report shall include, but not be limited to, the impact of the rental rate cap pursuant to subdivision (a) on the houiing market within the state.
.(2) The rep^ort required by paragraph ( I ) shall be submitted in compliance with Section 9795 of the Govemment Code.

Q) f9r the n-urnoses ofthis section, the following definitions shall apply: (1) "Owner" and "residential real property" shall have the same ,n"anirrg as those terms are defined in Section 1954.51.
^ (2) .'?ercentage change in the cost of living" means the percentage change from April*l of the prior year to April I of fhe current year in thJregionil consumer Price Index for the region where the residential real prop6rty is located, as published by the united States Bureau of Labor staiistics. if a regional index is not available, the california consumer price Index forAll Urban Consumers for all items, as determined by the Department of Industrial Relations, shall apply.
(3) ' Tenancy" means the lawful occupation of residential real property and includes a lease or sublease.
(h) (l) This section shall apply to all rent increases subject to subdivision (a) occuning_o_n or after March I 5, 20 19. This section shalibecome operative January 7,2020.
(2) In the event that an owner has increased the rent by more than the amount permissible under subdivision (a) between March 15,2019, and Ja1uary 1,2020, both of the following shall apply:
(A) The applicable rent on January 1,20\0,itritt Ue the rent as of March 15,.2019, plus the maximum permissible increase under subdivision (a). (B) An owner shall not be liable to the tenant for any corresponding ient overpayment.
9l
-
11- ch.597
(3) An owner of residential real property subject to subdivision (a) who increased the rental rate on that residential real propefty on or after March 15,2019, but prior to January 1,2020, by an amount less than the rental rate increase permitted by subdivision (a) shall be allowed to increase the rental rate twice, as provided in paragraph (2) of subdivision (a), within 12 months of March 15,2019, but in no event shall that rental rate increase exceed the maximum rental rate increase permitted by subdivision (a). (i) Any waiver of the rights under this section shall be void as contrary to public policy.
(j) This section shall remain in effect until January 1,2030, and as of that date is repealed.
(k) (l) The Legislature finds and declares that the unique circumstances ofthe current housing crisis require a statewide response to address rent gouging by establishing statewide limitations on gross rental rate increases. (2) It is the intent ofthe Legislature that this section should apply only for the limited time needed to address the current statewide housing crisis, as described in paragraph ( I ). This section is not intended to expand or limit the authority of local govemments to establish local policies regulating rents consistent with Chapter 2.7 (commencing with Section 1954.50), nor is it a statement regarding the appropriate, allowable rental rate increase when a local govemment adopts a policy regulating rent that is otherwise consistent with Chapter 2.7 (commencing with Section 1954.50).
(3) Nothing in this section authorizes a local government to establish limitations on any rental rate increases not otherwise permissible under Chapter 2.7 (commencing with Section 1954.50), or affects the existing authority of a local government to adopt or maintain rent controls or price controls consistent with that chapter.

SEC. 4. Section 1947.13 is added to the Civil Code, to read:
1947.13. (a) Notrvithstanding Sectior/ 1947.12, upon the expiration of rental restrictions, the following shall apply:
(l) The owner of an assisted housing development who demonstrates, under penalty of perjury compliance with all applicable provisions of Sections 65863.10, 65863.1l, and 65863.13 of the Govemment Code and any other applicable law or regulation intended to promote the preservation of assisted housing, may establish the initial unassisted rental rate for units in the applicable housing development. Any subsequent rent increase in the development shall be subject to Section 1947.12.
(2) The owner of a deed-restricted affordable housing unit or an affordable housing unit subject to a regulatory restriction contained in an agreement with a govemment agency limiting rental rates that is not within an assisted housing development may establish the initial rental rate for the unit upon the expiration ofthe restriction. Any subsequent rent increase for the unit shall be subject to Section 1947.12.
(b) Forpurposes ofthis section:
(1) 'Assisted housing development" has the same meaning as defined in paragraph (3) of subdivision (a) of Section 65863.10 of the Government Code.
9l
ch.597 -12-
o
.
(2) "Expiration of rental restrictions" has the same meaning as defined in paragraph (5) of subdivision (a) of Section 65863.10 of the 6ovemment Code.
(c) This section shall remain in effect until January l, ZO30, and as of that date is repealed.
(d)- lny waiver of the rights under this section shall be void as contrary to public policy.

SEC. 5. No reimbursement is required by this act pursuant to Section 6 ofArticle XIIIB of the califomia constitution because the only costs that may be incuned by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changgs_ the penalty for a crime or infraction, within the meaning oi' section 17556 ofthe Govemment code, or changes the definition of a cime within the meaning of Section 6 of Article-xIIIB of the califomia Constitution.
9l
City of Carpinteria
Councu Acenoe Srerr Reponr
May 8,2023

ITEM FOR COUNCIL CONSIDERATION
lnitiation of an amended lease between the City of Carpinteria and Friends of the Carpinteria Community Library for its use and occupancy of the Seaside Building, 5103 Carpinteria Avenue.

STAFF RECOMMENDATION
Direct Staff to open lease negotiations in response to the request received from the Friends of the Carpinteria Community Library.

Sample Motion: I move to direct staff to ope,n lease negotiations in response to the request received from the Friends of the Carpinteria Community Library.

BACKGROUND
The City acquired and refurbished the Seaside building in 2009. The Building is named after the Seaside Oil Company that used it as an administrative office in 1930's. The Seaside Oil Company logo can still be seen in the gable end of the building today.

After the Building renovation was completed, the City considered various occupants for the building. After City Council review and approval, the City leased the building to the Friends of the Carpinteria Community Library (Friends). Attachment A to this Report is the current lease.

The Friends is a non-profit organization that has a sole purpose dedicated to the direct support of library operations serving Carpinteria. The organization operates a used book store to generate revenue to support library services. The used book store has proven to be a reliable revenue generator as the Friends contributions to Carpinteria Library operations has been significant.

The City leased the Building with terms that included the City providing all building utilities and services including janitorial, maintenance and landscaping. The initial monthly rent was calculated to cover only the City's direct expenses for the Building Seaside Building Lease
05t8t2023

Page 2 ends

Currently, the monthly rental is $1,321.37. The lease amount did not include costs for non-routine maintenance for the Building.
ln July of 2023, the City assumed responsibility for the operation of the Carpinteria library, including staffing and all other expenses.

On February 14,2023, the Friends sent a letter to the Carpinteria City Council requesting that the lease for the Building be renegotiated. The basis ior the request is a part of the letter included herein as Attachment B, and includes that the monthly rental be reduced to $1 per year as well as a commitment to a minimum annual contribution of $50,000 to the Carpinteria Library.

The proposal was considered by the City Council Public Facility Site Acquisition / Development committee at its meeting of March 23,2029. The commitiee recommended that the matter be fonrvarded to the City Council to consider initiation of the amendment as requested.

The purpose of this agenda matter is to afford the Council an opportunity to respond to the Friends' request, including the possibility of initiating the process to establish an amended lease.
prscusstoN
Should the Council elect to initiate the process to establish an amended lease between the City and Friends for its operation of a used bookstore at the Seaside Building, staff, including support frgm the City Attorney's Office, would conduct negotiations with representative(s) of the Friends to develop the amended lease document.

There are three key amendments requested by Friends: a five year term, a $1/year lease rate, and a funding commitment to the Library. Council should provide stif witn any specific direction concerning desired lease terms. Once negotiations are concluded, and if successful, the draft lease would be brought to the Council for its consideration.

POLICY CONSISTENCY
The City and Friends have successfulty partnered to support the operation of the Carpinteria Community Library. lnitiating a process in response to the Friends request, can be found to be consistent with the City's interest in maintaining this successful partnership.

FI NANCIAL CONSIDERATIONS
The City collects an annual rent of almost $16,000 from the tenant of the Seaside Building and uses that money to fund the cost of utilities and maintain the property.

While the City has not conduced an appraisal, staff is confident this is well beiow market G/MatU Staff Report Seaside Building Lease 2023
Seaside Building Lease
05t8t2023
Page2
rental rates for similar buildings. Funds generated by the lease are only used to operate the building.

The proposal from the Friends to effectively pay no rent would eliminate revenue to the City to maintain the building. lf made part of an amended lease, the City would need to provide additional discretionary revenue to operate the Seaside Building. The proposal from the Friends to commit to $50,000 in annual funding for the Library would help to ensure funding adequate to maintain and operated the Library to meet the needs and desires of the community.

LEGAL AND RISK MANAGEMENT CONSIDERATIONS
Should the Council initiate the lease negotiation process, City Attorney's Office would assist with the form of the lease.

OPTIONS

1. Direct staff to negotiate new terms for the Seaside Building Lease with the Friends.

Decline to initiate the amended lease process
Provide other direction to Staff
Members of the Friends of the Carpinteria Community Library

ATTACHMENTS
Current Lease
Letterfrom the Friends, February 14,2023
Staff contact: Matt Roberts, Parks & Recreation Director (805) 755-4449 [email protected]
Signature
M,D
2 3

PRINCIPAL PARTIES EXPECTED AT MEETING
A
B
6 Reviewed by: Dave Durflinger, City Manager
(805) 7 55-4400, d [email protected]
G/MatU Staff Report Seaside Building Lease 2023
Signature
av t7
Attachment A

BUILDING LEASE BY AND BETWEEN

THE CITY OF CARPINTERIA
AND

FRIENDS OF THE CARPINTERIA PUBLIC LIBRARY
This BUILDING LEASE ("Lease") is made and entered into as of this I day of ,\r,,- ,2016, by and between the City of Carpinteria, a municipal corporation located in the County of Santa Barbara, State of California ("Landlord" and sometimes "City"), and Friends of the Carpinteria Public Library, a non-profit California corporation ("Tenant") with reference to the following facts and intentions:

RECITALS:

WHEREAS, Landlord is the owner of record of the real property and improvements located at 5103 Carpinteria Avenue, Carpinteria California 93013 and identified as APN # 004-047-001 ("the Property"); and
WHEREAS, Tenant is in need of a place to conduct its business operations within the City of Carpinteria; and
WHEREAS, on an interirn basis Landlord desires to lease to Tenant and Tenant desires to lease frorn the Landlord a portion of the Property ("the Premises"), as hereinafter more fully described, on the terms and conditions in this Lease; and WHEREAS, Landlord and Tenant have entered into previous leases of the Premises and now desire to enter into a new lease agreement and further intend that this Lease shall supersede and replace all prior lease agreements.

NOW, THEREFORE, rN CONSTDERATION OF THE TERMS, COVENANTS AND CONDITIONS

CONTAINED HEREIN, AND OTHER GOOD AND VALUABLE CONSIDERATION, THE RECEIPT

AND SUFFICIENCY OF WHICII ARE IIEREBY ACKNOWLEDGED, LANDLORD AND TENANT HEREBY AGREE AS FOLLOWS:

SUBJECT OF LEASE
l.l The Premisgg. Landlord hereby leases, transfers and demises to Tenant and Tenant hereby leases and takes from Landlord the Premises, which constitute approxinrately one thousand eighty seven (1,087) square feet of inside rentable space, or approximately ninety-four (94%) of the total square fbotage of inside rentable space in the Property, as shown on the floor plan of the Property attached as Exhibit "A", on the terms and upon the agreements, covenants and conditions set forth in this Lease.

L2 Common Areas. In addition to Tenant's rights to use and occupy the Premises as specified herein, Tenant shall lrave non-exclusive rights to occupy Common Areas (as hereinafter defined), but shall not lrave any rights to the roof or exterior walls of the building(s) on the Property, subject to the tenns and upon the agreements, covenants and conditions set forth in this Lease.

1.2.1 Common Areas - Definition. T'he term "Common Areas" is defined as all areas and facilities outside the Premises and within the exterior boundary line ol'the Property that are provided and designated by the Landlord from time to time for the general nonexclusive use of Landlord, Tenant and other tenants of the Property and their respective A
B
C
D
I
Page I of 19

1.3 employees, suppliers, shippers, custonrers, contractors and invitees, including restroom facilities, parking areas, Ioading and unloading areas, trash areas, walkways,-driveways and landscaped areas. The Common Areas include, but are not limited to, the interior restroom of approxirnately seventy-two (72) square feet and storage space in the Janitor's CJoset within the Prenrises.

1.2.2 Coinmon Arcas - Tcnan,tns RieFts. Landlord grants to Tenant, for the benefit of Tenant and its enrployees, suppliers, shippers, contractors, customers and invitees, during the term of this Lease, the non-exclusive right to use, in comrron with others entitled toiuch use, the Common Areas as they exist from time to tirne, subject to any rights, powers, and privileges reserved by Landlord under the terms hereof or under the tenns of any rules and regulations or restrictions governing the use of the Project. Tenant shall obtain prior written consent from Landlord to store any property, temporarily or permanently, in the Common Areas. In the event that any unauthorized storage shall occur then Landlord shall have the right, in addition to such other rights and remedies that it may have, to remove the property and charge the cost to Tenant, which cost shall be payabte upon demand by Landlord.
1'2.3 I,tules and Resulations. Landlord shall have the exclusive control and management of the Common Areas and shall have the right, from time to time, to establish, modify, amend and enforce reasonable rules and regulations ("Rules and Regulations") fbr the lxanagement, safety, care, and cleanliness of the grounds, the parking and unloading of vehicles and the preservation of good order, as well as for the convenience of other occupants or tenants of the Premises and the Property and their invitees. Tenant agrees to abide by and confonn to all such Rules and Regulations, and shall use its best efforts to cause its employees, suppliers, shippers, cnstomers, contractors and invitees to so abide and conforrn, Landlord shall not be responsible to Tenant for the non-compliance with said Rules and Regulations by other tenants of the property.

1.2.4 Common Areas - Changes. Landlord shall have the right, in Landlord's sole discretion, from time to time: (a) to make changes to the Common Areas, including, without limitation, changes in the location, size, shape and number of drivewayi, entrances, parking spaces, parking areas, loading and unloading areas, ingress, egress, direction of traffic, landscaped areas, walkways and utility iace*uys; 1Oy to ilos" temporarily any of the Common Areas for maintenance purposes so long as reasonable access to the Prenrises remains available; (c) to add additional buildings and improvements to the Common Areas; (d) to use the Common Areas while engaged irr rnaking additional improvements, repairs or alterations to the Project, or any portion thereof; and (f; to do and perfonn such other acts and make such other chang.i in, to o. with respect to the Common Areas and Project as Landlord nray, in the exercise of sound business judgment, deerr to be appropriate,
Parties to the Lease.

1.3.1 Landlortl. Landlord is the City of Carpinteria, a municipal corporation located in the County of Santa Barbara, Califor.nia.

1.3.2 Tenant. Tenant is Friends ol'the Carpinteria Public Library, a non-profit Califbrnia corporation located in the county of santa Barbara, california.

Page 2 ends

2, POSSESSION OF THE PREMISES

2.1 As-Is Condition. -l'he Premises will be delivered to Tenant in its "as is" condition on the date of Tenant's Acceptance as defined in paragraph 2.2 below.

2.2 Acceptance of the Premises. Except as may be otherwise provided herein, Tenant shall, by entering into and occupying the Premises or using any portion of the Premises, be deerned to have accepted the Prenrises and to have acknowledged that the same is then in the condition called for by this Lease.

2.3 Ouiet Eniovment. Except as expressly provided under this Lease, Tenant, upon performing and cornplying with all covenants, agreements, warranties, terms and conditions of this Lease to be performed, or complied with by Tenant, shall lawfully and quietly hold, ocoupy and enjoy the exclusive use of the Premises during the Term (as defined in Article 3) of this Lease.

Surrcnder of thc Premises. Upon the expiration or termination of the Tenn of this Lease, Tenant shall peaceably and quietly leave and surender the Premises to Landlord, broom clean and in good order, condition and repair, reasonable wear and tear excepted,

3. TERM

3.1 Duration and Commencement. The initial term ("Initial Term") of this Lease shall comrnence orr July 1,2A16 and continue through June 30, 2021.

3.2 Request for Extension.

3.2.1 Landlord and Tenant agree that Tenant may request an extension of the Initial Tenn of this Lease subject to all the provisions herein contained for consecutive one (l) year periods (the "Extended Term") following the expiration of the Initial Terrn, provided Tenant shall give written notice of said request to Landlord not less than three (3) months prior to the expiration of the Tenn, and provided further that Landlord may agree to such Extended Term in its sole discretion.

3.2.2 Tenant expressly acknowledges and agrees that Landlord is renting the Premises to Tenant on an interim basis while Landlord determines a long term use for the Property and that Landlord rnay deny a request for extension under this Section 3.2 if , among other reasons, Landlord elects to use the Premises and/or the Property for itself or any of the public bodies and agencies related to the City. Tenant further agrees to cooperate with Landlord to the fullest extent possible, in Landlord's efforts to secure a long ternr use for the Ploperty.

3.2.3 Tenant's right to request an extension is subject to the following conditions precedent:
(i) The Lease shall be in effect at thetime notice of exercise is given and on the last day of the Ternr; and
(ii) T'enant shall not be in default of any of the tenns, conditions, covenants, warranties, agreements or restrictions provided under this Lease or any other discretionary Landlord approvals at the time notice of exercise is given or on the last day oIthe Tenn; and

2.4 Page3 ofl9
4 (iii) The Premises shall be in good operating condition with no material deferred internal or external maintenance other than normal wear and tear and subject to nonnal and customary replacelnents and repairs; and (iv) Tenant shall not be in violation of any ordinance or regulation of the City at tirne the notice of exercise is given or on the last day of the Term.

RENT
Tenant shall pay, without demand or delay, abatement, deduction, or offset, the Rent in such amounts as provided herein.

4.1 Securitv Deoosif. Concurrently with the execution of this Lease, Tenant shall deposit with Landlord a Security Deposit in the amount of one thousand four hundred dollars 1$ I ,+00.00), and thereafter, durirrg the continuance of this Lease, shall maintain the Security Deposit with Landlord. The Security Deposit shall be security for the fult, prompt and faithful performance by Tenant of all of its obligations hereunder, Landlord shall have the right, but not th-e obligation, to apply the Security Deposit or any part thereof toward the cost and expense (including l,andlord's attorneys' and other professional fees, if any) of curing any default on the palt of Tenant; in which event, Tenant shall restore the Security Deposit to its original amount within thirfy (30) days after receipt of Landlord's written request to do so. A failure to restore the Security Deposit shall be amaterial breach of this Lease. Upon expiration ortermination of this I-ease and vacation of the Premises in the manner required by this Lease, the Security Deposit, or portion thereof remaining unapplied afterthe curing of every defautt by Tenant shatl be returned to Tenant. No interest shall be payable to Tenant on account of the Security Deposit. 4'2 Monthlv Rent. Tenant shall pay to Landlord as rental for the use and occupancy of the premises, one thousand sixty eight dollars ($1,068.00) permonth duringthe Initial Term, in lawfirl money of the United States ("Monthly Rent"). The rent shall be due on the first day of each calendar month.

If Landlord agrees to any one year Extended Terms, then upon the expiration of the lnitial Term and upon expiration of each Extended Term, the rental rate of one thousand sixty eight dollars ($1'068.00) per month shall be adjusted according to any increase in the Consumer Price Index of the United States Department of Labor, Bureau of Labor Statistics forAll Urban Consumers, All Items ("CPI") for LA-Riverside-Orange County, California Series Id: CUURA42ISA0 (not seasonally adjusted).

The Beginning lndex for computing the adjustrnent for the Extencied Term is the March 2016 CPI - 247.873. Fol'any agreed to extension, the monthly rent for the following year until the next rcnt adjustnrent will be set by rnultiplying $1,068.00 by a fraction, the numerator of which is the most recently published March Index and the denorninator of which is the Beginning Index (247.873)' Provided, however, that in no event shall any adjusted rent be less than the rent for the month imrnediately preceding the adjustment. If the CPI is no longer published, then the adjustrnerrt to Base Rent shall be based on an alternate index that most cloiely reflects the Cpl.

Pavment. All paynrents required to be made by T'enant under this l,ease shall be made without any setoff, deduction or counterclaim whatsoever and shall be rnade by check, payable to the "City of Carpinteria" ancl delivered to the City at5775 Calpinteria Ave., Carpinteria, California 93013 Attn: city Manager or any other location as the city rnay designate.

4.3

Page 4 ends

4.4 Lrto Charscsl Leose Termination. Any Rent not paid to Landlord within ten (10) days of the due date under this Lease shall be subject to a late fee of ten percent (10%) of the amount then owing. The pafties understand and agree that the late fee is a fair and reasonable estimate of the cost of the late payment to Landlord.

Notwithstanding the above, the parties also understand and agree that persistent and chronic late payrnents are disruptive and costly to Landlord, requiring Landlord to devote additional time, money, rssources and energy to tlre administration of this Lease, all of which can not be sufficiently reimbursed to Landlord by way of Tenant's payment of the late fee. Therefore, Tenant's failure to pay any Rent for three (3) consecutive periods, or four (4) periods duling any twelve (12) month period, shall be deemed a material and incurable default under this Lease, giving rise to Landlord's right, in its sole discretion, to terminate this Lease upon thirty (30) days notice. Landlord's decision not to exercise this remedy aL any time during the Term of this Lease shall not act to waive Landlord's right to exercise such remedy at a future date during the Tenn.

4.5 Utilitv nnd Services. Tenant shall contract and pay for all telephone and cable services to the Premises which shall all be billed directly to Tenant. Landlord shall contract and pay for electric, water, sanitary, trash, janitorial and gas services to the Premises which shall all be directly billed to and paid by Landlord.

4.6 lfaxes. Assessments and Chsrges. Tenant covenants to pay when due, its pro rata share of all applicable taxes, assessments (including, without limitation, all assessments for public improvements or benefits, whether or not commenced or completed prior to the date hereof and whether or not to be completed within the term hereof), rates and charges, excises, levies, license lbes, permit fees, inspection fees and other authorization fbes and other charges, in each case, whether general or special, ordinary or extraordinary, foreseen or unforeseen, of every type of character (including all interest and penalties thereon), which at any time during or in respect of the term hereof rnay be assessed, levied, confirmed or imposed on, or in respect of, or be measured by, or become a lien upon Landlord, the Ploperty, this Lease or any part thereof, or any estate, or right or interest therein.

4.7 Notice of Possessorv Interest: Payment ol'. ln accordance with California Revenue and Taxation Code Section 107.6(a) this Lease may create a possessory interest that is subject to taxation. If such interest is created, Tenant may be subject to the payment of propefty taxes levied on said possessory interest. Tenant agrees to pay these amounts as Additional Rent in the same rnanner and on the same schedule as the Monthly Rent.

5. USE OF THN PREMISES

5.1 Permitted Use. The Premises shall be used orrly for the purpose of corrducting Tenant's business of selling used and new books and the operation of Tenant's related business and nonprofit activities. Tenant shall operate the business and conduct activities therein in a prudent and businesslike manner and in full cornpliance with all terms and conditions of this Lease.

Prohibited Uses. Tenant shall not use, or allow use of, the Premises for any activity other than as set furtlr in paragraph 5.1 without the prior written conset'rt of Landlord. Tenant's uncured breach of the above shall be deerned a material default under the tenns of this Lease giving rise to Landlord's right. in its sole discretion, to tenninate this Lease.

5.2 Page5ofl9

5.3 Co4oliance with Rul€.s and Rosulationq. Tenant agrees to comply with all rules and regulations of City that are at any time posted on the Prerniies or delivered to Tenant. esupligngJ with Laws. Tenant shall not occupy or use the Premises, or pennit the premises to be used or occupied, nor do or permit anything to be done in or on the Primises, in whole or in part, for other than legal purposes, or for a purpose or in a rnanner liable to create a public or private nuisance or to cause structural injury to the Prcmises or any part thereof, or which rnay nrake it difficult, impossible or cost prohibitive to obtain fire or other insurance thereon required to be furnished by Tenant hereunder, or in violation of any certificate of occupancy or evidence of cornpliance issued by any governlnental agency covering or affecting the uie of th. property, or in violation of any ordinance or regulation of the City. Tenant's uncured breach of the above shall be deemed a material default under the terms of this Lease giving rise to Landlord,s right, in its sole discretion, to terminate this Lease.

Alterationsl Imorovcmcnts. Tenant shall not, without the Landlord's prior written consel.lt, mal<e any alterations, inrprovements or additions in or about the Premises. As a condition to giving any such consent, the Landlord may require the Tenant to remove any such alterations, improvements, ol'additions at the expiration of the term and to restore the premises to their prior condition by giving Tenant forty-five (45) days written notice prior to the ixpiration of the term.

Unless the Landlord requires their removal as set forth above, all alteratioris, improvements or additions which are made on the Premises by the Tenant shall becorne the pioperty of the Landlord and remain upon and be surendered with the Premises at the expiration of the term.

Any darnage to the Premises caused by said removal shall be repaired at Tenant's sole cost.

5.4 5.5
6, LIENS

6.1 Lien Indemnification. Tenant shall at all times indemnify, save and hold Landlord, the premises and the Property, free, clear and harmless from any clairns, liens, demands, charges, encumbrances or litigation arising directly or indirectly out of any use, occupancy or activity of Tenant, or out of any work performed, material furnished, or obligations incurred by Tenant, in, upon, about or otherwise in connection with the Premises and shall pay or cause to be paid fbr all workperformed and material furnished to the Premises which will ormay result in a lien on the Property, and will keep the Property free and olear of all mechanic's liens and materialmen's liens (including the posting of an appropriate bond which shall release the lien).

INDEMNIFICATION, BUSINESS INTERRUPTION AND INSURANCE

7.1 Gencral Intlernnification. Tenant hereby indernnifies, holds hanrless and agrees to defend Landlord fi'olr and against all clairns, danrages, expenses (including, without ligritation, reasonable attorneys' fees and reasonable investigative ancl discovery costs), liabilities and judgrnents on account of injury to persons, loss of lifb, or darnage to pioperty occurring on the Premises and Propel'ty and caused by the alleged active or passive .n"giig"1,..
oi willful
tnisconduct of Tenant, its agents. servants ol' employees. fenant's obligations with respect to indernnification hereunder shall retnain effective, notwithstanding the expiration or termination of this Lease, as to clailns arising or accruing prior to the expiration or ternrinatiori of this Lease.

Pusiness Interruption. Tenant agrees that no claims fbr damages, loss of business, or loss of income either direct or indirect shall be nracle against Landlord aJa result of irrprovements to the Prenrises or Conrrnorr Areas.
7 7.2

Page 6 ends

7.3 7.4
Liabilitv lnsurnnce Covcragc and Limits. Throughout the Term ol' this Lease, and the Extended Ternr, if applicable, Tenant agrces to rnaintain, andlor cause to be nraintained, at no cost to Landlord, liability insurance insuring its interests against claims for personal injury, bodily injury, death and property damage occuring on, in or about the Premises and the ways immediately adjoining the Premises, with a "Combined Single Limit" (covering personal injury liability, bodily injury liability and property damage liability) of not less than One Million Dollals ($1,000,000.00). Landlord and its officials, employees and agents shall be covered and narned as additional insureds with respect to liability arising from activities performed by or on behalf of Tenant. The insurance lirnits in this section shall be subject to increase from tirne to tirne by such amounts as Landlord and Tenant may reasonably agree is necessary or desirable, as may be evidenced by the practice of similarly situated properties. Tenant shall provide Landlord with written evidence that such insurance is in force prior to the comnrencement date of this lease.

Property Casualtv Insurance. Througlrout the 'Ierm of the Lease, and the Extended Term, if applicable, Landlord shall cause the Premises to be insured against loss or darnage by fire and the pelils commonly covered under the standard extended coverage endorsement.

7.5 PcrsonRl Propcrty Insurlnce. Tenant shall obtain and maintain insurance coverage on all of Tenant's personal property, along with any trade fixtures, and Tenant-owned alterations. Such insurance shall be full replacernent cost coverage with a deductible of not to exceed $1,000 per occurrence. The proceeds from any such insurance shall be used by Tenant for the replacernent of personal property, trade fixtures, and Tenant-owned alterations. Landlord shallbe named as arr additional insured. 'fenant shall provide Landlord with written evidence that such insurance is in force prior to the commencetnent date of this lease.
7,6 Damases for Failure to Provide Insurance. This Section is applicable only in tlre event that Tenant is not in compliance with the requirements to maintain insurance as set forth in this Artiole 7. Landlord shall not be lirnited in the proof of any damages which Landlord nray claim against Tenant arising out of or by reason of Tenant's failure to provide and keep in force insurance as aforesaid, to the alnount of the insurance premium or premiums not paid or incurred by Tenant and which would have been payable upon such insurance, but Landlord shall also be entitled to recover as damages for such breach the uninsured amount of any loss (to the extent of any deficiency in the insurance required by the provisions of this Lease), damages, costs and expenses of suit, including attorneys' fees, suffered or incurred by reason of damage to, or destruction of, the Prernises or Property, occurring during any period in which Tenant shall have failed orneglected to provide insurance as aforesaid. Tenant'suncured breach of the above shall be deemed a material default underthe terms of this Lease giving rise to Landlord's right, in its sole discretion, to terminate this Lease.

7.7 Landlord I) n to Insure. Landlord, in its sole discretion, throughout the Terrn of this Lease, shall have the right to obtain a cornmercial conrprehensive general liability insurance policy on the Property or alternatively, rnay self-insure the Property.

8. DAMAGE OR DESTRUCTION

8.1 Reconstruction and/or Removal. If, by rro fault of Tenant, Premises are totally or partially datriaged or destroyed by fire, earthqual<e, accident or other casualty, Landlord shall have tlre light to restore the Premises by repair or rebuilding. lf Landlord elects to repair or rebuild, and is able to complete such restoration within ninety (90) days from the date of damage, sub.iect tothe Page7ol19
terms of this paragraph, this Lease shall rernain in full force and effect. If Landlord is unable to restore the Premises within this time, or if Landlord elects not to restore, then either Landlord or Tenant may tenninate this Lease by giving the other written notice. Rent shall be abated as of the date of damage. The abated amount shall be the current Rent prorated on a thirty (30) day basis. If this Lease is not terminated, and the damage is not repaired, the Rent shall be reduced based on the extent to which tlre damage interferes with Tenant's reasonable use of premises. If damage occurs as a result of an act of Tenant or Tenant's guest, only Landlord shall have the right of termination, and no reduction in Rent shall be made. 9, ASSIGNMENT AND SUBLETTING

9.1 Prior Written Consent. Tenant may not assign or sublet all or any portion of its interest in this Lease without Landlord's prior written consent, which may not be unreasonably withheld by Landlord.

9.2 A$siSnment of Landlortls Interest in Lease or the Leased Premises. Larrdlord may convey, transfer, sell, assign or otherwise transfbr the Propetty, this [,ease, all or a portion of its interest thereunder, and/or all or a portion of the payments that are payable to it by Tenant pursuant to this Lease. Tenant hereby consents and agrees to any such transfer which Landlord considers necessary or proper, regardless of the reason or reasons for which Landtord makes such transfer and regardless of the entity that is the Transferee thereunder.

IO. PERFORMANCE OF TENANT'S COVENANTS
l0.l Right of Performance. If Tenant shall at any tirne fail to pay any tax, assessment, fee or other charge in accordance with this Lease, within the time peliod therein permitted or shall fail to pay for or rnaintain any of the insurance policies provided for in this Lease, within the time therein permitted, or fail to make any other payment or perform any other act on its part to be made or perfonned hereunder, within the time perrnitted by this Lease, then Landlord, ifter ten (10) days' written notice as to payments of Rent with other charges and thirty (30) days' written notice as to other breaches, given to Tenant (or, in case of an emergency, on such notice, or without notice, as may be reasonable under the circumstances) and without waiving or releasing Tenant from any obligation of Tenant hereunder, may (but shall not be rrequired to):

10.1.1 Pay such tax, assessment, fbe or other charge payabre by Tenant, or la.l.2 Pay for and maintain such insurance policies provided for, or 10'1.3 Make such other payment or perfonn such otlrer act on Tenant's part to be made or perforrned as in this Lease provided.

10.2 Reimbursemen and Damases. All sums so paid by Landlord and all costs and expenses incurred by Landlord in connection with the performance of any such act, together with interest thereon, shall constitute an obligation payable by Tenant under this Lease and shall be paid by Tenant to Landlord on demand. A failure by Tenant to make suclr a payment shall be a material breach of this Lease. Landlord shall not be lirnited in the proof of any danrages which Landtord tnay claim against Tenant arising out of or by reason of Tenant's failure to provide and lceep in force insurance as aforesaid, to the amourlt of the insurance premiunr or prerniums not paii or incurred by Tenant and which would have been payable upon such insurance, but Landlord shall also be entitled to recover as damages for such breach, tlre uninsured anrount of any loss (to the

Page 8 of 19 ends

extent of any deficiency in the insurance required by the provisions of this Lease), damages, costs and expenses of suit, includingattorneys'fees, suffered or incurred by reason of damageto, or destruction of, the Prernises, occurring during any period in which Tenant shall have failed or neglected to provide insurance as aforesaid.

I I. HAZARDOUS MATERIALS
I l.l Landtortlrs Renrescntutions nnd Warranties. Except as identified by Landlord in writing to Tenant as known environmental conditions prior to the execution of this Lease, Landlord makes no l'epresentation or warranty regarding the condition of the Premises or Property.

11.2 No Use of Hazardous Materials on the Prcnrises. Tenant covenants and agrees that it shall not, and that it shall not permit any licensee to, treat, use, store, dispose, release, handle or otherwise manage Hazardous Materials on the Premises except in connection with any construction, operation, maintenance or repair of the Premises or in the ordinary course of its business, and that such conduct shall be done in compliance with all applicable federal, state and local laws. Tenant's violation of the foregoing prohibition shall constitute a material breach hereunder and Tenant shall indemnify, hold harmless and defend the Landlord for such violation as provided below.

I I .3 Notice and Remediation bv Tcnant. Tenant shall, within five (5) days of such occul'rence or imrnediately in cases ol' imminent threat of injury to life or property, notify Landlord ol'any significant release of any Hazardous Materials, and/or any notices, demands, claims or orders received by Tenant f'rom any governmental agency pertaining to Llazardous Materials which may affect the Property. Tenant's breach of the above shall be deemed a material default undel the terms of this Lease giving rise to Landlord's right, in its sole discretion, to terminate this Lease.

11.4 Environmcntal Indemnitv bv Tenant. Tenant hereby agrees to hold hamless, defend and indemnify Landlord and its employees, members and officials from and against all liability, loss, damage, costs, penalties, fines and/or expenses (including attorney's fees and court costs) arising out of or in any way connected with (a) Tenant's breach or violation of any covenant, prohibition or waranty in this Lease concerning Hazardous Materials, or (b) the activities, acts or omissions of Tenant, its employees, contractors or agents on or affecting the Premises f'rom and after the Possession Date, including but not limited to the release of any I{azardous Materials or other kinds of contamination or pollutants of any kind into the air, soil, groundwater or surface water on, in, ttnder or frorn the Premises whether such condition, liability, loss, damage, cost, penalty, fine and/or expense shall accrue or be discovered before or after the ternrination ol'this Lease.

This indernnificatiorr supplements and in no way linrits the scope of the indernnification set fofth in Afticle 7.
ll.5 Release by Tenant, Tenant waives, releases, acquits and forever discharges Landlord and its employees, metnbers and officials or any other person acting on behalf of Landlord, of and from any and all clailrs, actions, causes of action, demands, rights, danrages, costs, expenses, or contpensation (collectively "Clainrs") whatsoever including, but not linrited to, all Clairns at conlnon law, whether direct or indirect, known or unknown, foreseen or unforeseen, whioh Tenant has as of the Possession Date on aocount of or in any way growing out of or in connection with any Hazardous Materials or other conditions o11, in, under, from, or aff-ecting tlre Prenrises, or any law or regulation applicable thereto. Tenant is hereby sublogated to any and all rights possessed by Landlord against third parties with respect to said Clainrs.

Page9ofl9

12. 11.6 Onvironmcntal Indemnitv by Landlord. Landlord hereby agrees to hold harmless, defend and indemnify Tenant and its employees, members, officers, directors, and agents from and against all liability, loss, damage, costs, penalties, fines and/or expenses (including attorney's feei and court costs) arising out of or in any way connected with the activities, acts or omissions of persons or entities other than Tenant, its employees, contractors or agents on or affecting the Premises, including but not limited to the release of any Hazardous Materials or other kinds of contamination or pollutants of any kind into the air, soil, groundwater or surface water on, in, under or from the Premises whether such condition, liability, loss, darnage, cost, penalty, fine and/or expense shall accrue or be discovered before or after the termination of this Lease.

11.7 Release bv Landlorrl. Landlold waives, releases, acquits and forever discharges Tenant and its employees, members, officers, directors, agents, or any other person acting on behalf of Tenant, of and from any and all Claims whatsoever including, but not limited to, all Claims at colnmon law, whether direct or indirect, known or unknown, foreseen or unforeseen, which Landlord has as of the Possession Date on account of or in any way growing out of or in connection with any Hazardous Materials or other conditions on, in, under, from, or affecting the Premises, or any law or regulation applicable thereto.

I1.8 Termination. The agreements and obligations of the Parties under this Article l1 with regard to indemnification of Landlord or Tenant shall survive the scheduled termination or ioon.. expiration of the Term for any reason, for five (5) years and all claims relatirrg thereto must be delivered in writing to Landlord or Tenant, as tlre case may be, within such period.

REPRESENTATIONS AND WARRANTIES

12.1 Landlordts Representations and Warranties. Landlord represents and warrants to Tenant that:
12'1,1 Landlord has full right and authority to grant the estate and the other rights demised herein and to execute and perform all of the terms and corrditions of this Lease. 12,1.2 Tenant, upon performing and cornplying with all covenants, agreements, terms and conditions of this Lease to be perfonned or cornplied with by it, shall peaceably and quietly have, hold and enjoy the full possession and use of the Premises and the easements, rights-of-way, rights, privileges, benefits and appur.tenances belonging thereto throughout the Term.
12,1.3 Landlord has the power and authority to enter into this Lease and perforrn all the obligations of Landlord hereunder.

12.2 Tenant's Representations and Warranties. Tenant represents and warrants to Landlord that:

12.2'1 Tenant has exatnined the Premises and accepts the Premises in its "as is" condition.

12.2.2 Tenant acknowledges that Landlord has not made any representations or warranties regarding the condition of the Premises, or its suitability for the use of the Premises conternplated by this Lease.

12.2.3 -lenant has the right, power arrd authority to enler into ttris Lease and to perform all the obligations of Tenant hereunder.

Page l0 ol' 19
I3. EVDNTS OF DEFAULT; REMEDIES
l3.l [vents of Default. Any one or all of the following events after thirty (30) days written notice to Tenant, unless a shorter period is specified, shall constitute an Event of Default hereunder:
l3.l.l The default in the payment of any Monthly Rent or Additional Rent or other charges by Tenant when and as the same becomes due and payable and such default continues for more than ten (10) days after Landlord gives written notice thereof to Tenant; or

13.l .2 The abandonment or vacation of the Premises by Tenant; or

13.1 .3 The entry of any decree or order for relief by any court with respect to Tenant, or any assignee or transferee of Tenant (hereinafter "Assignee"), in any involuntary case under the Federal Bankruptcy Code or any other applicable federal or state law; or the appointment of or taking possession by any receiver, liquidator, assignee, trustee, sequestrator or other similar official of Tenant or any Assignee, or of any substantial part of the Premises of Tenant or such Assignee, or the ordering or wirrding up or liquidating of the affairs of Tenant or any Assignee and the continuance of such decree or order unstayed and in effect for a period of sixty (60) days or more (whether or not consecutive); or the commencernent by Tenant of any such Assignee of a voluntary proceeding under the Federal Bankruptcy Code or any other applicable state or federal law or consent by 'Ienant or any such Assignee to the entry of any order for relief in an involuntary case under any such law, or consent by Tenant or any such Assignee to the appointment of or taking of possession by a receiver, liquidator, assignee, trustee, sequestrator or other similar official of Tenant or any such Assignee, or of any substantial property of any of the foregoing, or the making by Tenant or any such Assignee of any general assignnrent for the benefit of creditors; or Tenant or any such Assignee takes any other voluntary action related to the business of Tenant or any such Assignee or the winding up of the affairs of any of the foregoing; or

13.1,4 The default in Tenant's performance of or compliance with any other material term, covenant or condition of this Lease where Tenant fails to cure such default within thiny (30) days or Tenant fails to use reasonable diligence in curing a default where it is of such character as to require nrore than thirty (30) days to cure.

13.2 Remedies.

13.2.1 If an Event of Default shall occurand continue as afbresaid, then in addition to any other remedies available to [,andlord at law or in equity, Landlord shall have the inrmediate option to terminate this Lease and bring suit against Tenant and recover as an award in sLrch suit the following:
(i) the worth at the tinre of award of the unpaid Rent and all other sunrs due hereunder which had been earned at the time of terrnination; (ii) the worlh at the time of award of the arnount by which the unpaid Rent and all other surns due hereunder which would have been earned after termination until the tirne of award exceeds the amount of such rental loss tlrat Tenant proves could lrave been reasonably avoided;
Page ll of19
(ii i)
(iv)
the worth at the tirne of award of the amount by which the unpaid Rent and all other sums due hereunder for the balance of the Tenn after termination exceeds the amount of such rental loss that Tenant proves could be reasonably avoided; any other amount necessary to compensate Landlord for all the detriment proximately caused by Tenant's failure to perfonn its obligations under this Lease or which in the ordinary course of things could be likely to result therefrorn; and such amounts in addition to or in lieu of the foregoing as may be permitted from time to time by applicable California law.
(v)
1 3.3

13.2'2 If an Event of Default occurs, Landlord shall also have the right, with or without terminating this Lease, to reenter the Premises and remove all persons and property fronr the Prenrises; property nray be removed and stored in a public warehouse or elsewhere at the cost ofand for the account ofTenant.

13.2.3 If an Event of Default occurs, Landlord shatl also have the right, with or without terminating this Lease, to relet the Premises. If Landlord so elects to exercise its right to relet the Premises without terminating this [,ease, then rentals received by Landlord from such reletting shall be applied: First, to the payment of any indebtednessother than Rent due hereunder frorn Tenant to Landlord; Second, to the payment of any cost of such reletting; Third, to the payment of the cost of any alterations and repairs to the premises; Fourth, to the payment of Rent due and unpaid hereunder; and Fifth, the residue, if any, shall be held by Landlord and applied in payment of future Rent as the same may beconre due and payable hereunder. Should the amount of rental received from such reletting during any month which is applied to the payment of Rent hereunder be less tlran that agreed to be paid during that month by Tenant hereunder, then Tenant shall pay such deficiency to Landlord immediately upon demand therefor by Landlord. Such dificiency shall be calculated and paid rrronthly. Tenant shall also pay to Landlord, as soon as ascertained, any costs and expenses incurred by Landlord in such reletting or in making alterations and repairs not covered by the rentals received from such reletting.

13.2.4 No reentry or taking possession of the Premises by Landlord pursuant to this l,ease shall be construed as an election to terminate this Lease unlesi a written notice of such intention is given to Tenant or unless the termination thereof is decreed by a court of competent jurisdiction. Notwithstanding any reletting without termination by Tenant because of any default by Tenant, Landlord may at any time after such reletting eleot to terminate this Lease for any such delbult.

Beceint of Rent' No Waiver of Default. The receipt by Landlord of the Rents or any other charges due to Landlord, with knowledge of any breach of this Lease by Tenant or of any clefault on the part of Tenant in the observance or performance of any of the conditions or covenants of this Lease, shall not be deemed to be a waiver ol'any provisions of this Lease. No acceptance by Landlord of a lesser sLtm than the Rents or any other charges then due shall be deemed to be other than on account of the earliest installment of the Rents or other charges due, nor shall any endorsement or statetnent on any check or any letter accompanying any check or payrnent of Rent or charges due be deerned an accord and satisfaction, and Landlord may accept such check or payment without prejudice to Landlord's right to recover the balance of such installment or pursue any other remedy provided in this Lease. The receipt by Landlord of any Rent or any other suln of money or any other consideration paid by Tenant after the tennination of this Lease, or after giving by Landlord of any lrotice hereunder to effect such tennination, shall not, Page l2of19
except as otherwise expressly set fofth in this Lease, reinstate, continue, or extend the Tenn of this Lease, or destroy, or in any manner inrpair the efficacy of any such notice of tennination as may have been given hereunder by Landlord to Tenant prior to the receipt of any such sum of tnoney or other consideration, unless so agreed to in writing and signed by Landlord. Neither acceptance of the keys nor any other act or thing done by Landlord or by its agents or ernployees during the Term shall be deemed to be an acceptance of a surrender of the Premises, excepting only an agreement in writing signed by Landlord accepting or agreeing to accept such a surrender.

13.4 Effect on Indemnification. Notwithstanding the foregoing, nothing contained in this Article shall be construed to limit Landlord's right to indemnification as otherwise provided in this Lease.

13.5 Notice of Landlord's Dcfault; Tenant's Waiver. Landlord shall not be considered to be in default under this Lease unless (a) Tenant has given notice specifying the default and (b) Landlord has failed for thirty (30) days to cure the default, if it is culable, or to institute and diligently pursue reasonable corrective or ameliorative acts for noncurable def'aults.

14. ENTRY BY LANDLORD

14.1 Rieht of Entrv. Landlord and its respective authorized representatives shall have the right to enter the Premises at all reasonable times and upon reasonable notice for the purpose of inspecting the same and to take all such action thereon as may be necessary or appropriate for any such purpose provided for under this Lease or any other lawful purpose including protecting the Prernises or showing the Property to prospective purchasers or tenants (but nothing contained in this Lease shall create or imply any duty on the part of l-andlord to make any such inspection or to do any such work). No such entry shall constitute an eviction of Tenant.

15. PARKING AND STORAGE OF PERSONAL PROPERTY
l5.l Parkine. Tenant and its invited guests and licensees shall be entitled to use the Property's vehicular parking spaces upon which the Property is located on a shared basis with the general public. There are no parking spaces reserved for the exclusive use of Tenant.

15.2 Storage of Personal Pronertv. Tenant shall store on the Premises only personal property that Tenant owns and shall not store any irnproperly packaged food or perishable goods, flammable materials, explosives, or other dangerous or hazardous material.

15.3 $igns. Tenant may place on the Prenrises ordinary business signs consistent with applicable law, provided that Tenant and Landlord shall jointly process approvals for such signs and provided furlher that [,andlord shall pay or waive the applicable City fees associated with such signage perrnit.

I6. SUBMISSION OF ANNUAL FINANCIAL STATEMENTS.
l6.l Financial Statement. Tenant agrees to subrnit annually to Larrdlord an annual financial staternent of the Friends of the Carpinteria Public Library, a non-profit California corporation.

Pagel3ofl9

17. l8

19. 18.3

18.4 REPAIRS AND MAINTENANCE

17.l Responsibiliti$. Landlord shall professionally maintain the Premises including janitorial service, heating, air conditioning, electrical, plumbing and water systems, if any, and keep glass, windows and doors in operable and safe condition. Landlord shall rnaintain the rool fogndation, exterior walls and common areas. All danrage or injury done to the Pr.emises or property by the Tenant or by any person who may be in or upon the Premises or Property wjth tire ienant,s consent or invitation or by the Tenant's failure to properly secure the Pr.emises or property shall be paid for by the Tenant.

DEFINITIONS

18.1 "Extended Term" shall mean the one yeartime period commencing on the date of expiration of the Term and resulting frorn Landlord's acceptance of Tenant's request to extend thb Terrn of this Lease,

18.2 "Hazardous Materials" shall mean any substance or material defined as or included in the definition of "hazardous sttbstances", "hazardorrs wastes", "hazardous materials,', "extremely hazardous waste", "acutely hazardous waste", "restricted hazardous wastet', "toxic substances" or "known to cause cancer or reproductive toxicity" (or words of similar irnport), petroleum products (including crude oil or any fi'action thereof) or any chemical substance or material which is prohibited, linrited or regulated under any federal, state or local lawo ordinance, regulation, order, permit, license, decree, cotnmon law or treaty regulating, relating to or imposing liability ol standards concerning materials or substances known or suspected to be toxic or hazardous to health and safety, the environment or natural resources,. "lnitialTerm" is agreed to be July 1,2016 until and including June 30, 2021. "Landlord's Interest" shall mean its fee interest in the Property and its interest in this Lease, or any part thereof.
"Possession Date" is agreed to be July l,2016,
"Rent" refers to the Monthly Rent and Additional Rent and any other amounts due the Landlord under this Lease unless the context clearly manifests a different intent.

18.7 "Term" shall mean the Initial Term and each of the Extended Terms described in Article 3 unless otherwise specifically provided herein.

GENERAL PROVISIONS

19.1 Notices. All notices and other conrnrunications hereunder shall be in writing, shall be sent by first class registered orcertified United States mail, postage prepaid, and shall bedeenred to have been given two (2) days after the day of mailing, addressed: (a) if to Landlord:5775 Carpinteria Ave, Carpinteria, CA 93013, Attn: City Manager or at such other addresses as Landlord shall have furnished to 'l'enant; and (b) if to Tenant: 5103 Carpinteria Avenue, Carpinteria, CA g30l 3, Attn: Chair of lrriends of the Library, or at such other addresses as Tenant shall have furnished Landlord in writing.

19.2 Successors. All of the riglrts and obligations of the Parties unclert|is Lease shall bind an<J inure to the benefit ofthe respective lreirs, personat representatives, successors, grantees and assigns oI Pagel4of19

18.5 18.6
the Parties and the restrictions, covenants and obligations pertaining to the Prernises shall run with the land and shall continue until this Lease is tenninated or expires. 19,3 Mediation and Arbitration.

19.3.1 Mediation. Except as otherwise provided herein, any controversy, claim, or dispute arising out of or related to this Lease or the interpretation, performance, or alleged breach of this Lease (a "Dispute") shall be resolved according to the procedures set forth in this paragraph, which shall constitute the sole dispute resolution mechanism under this Lease.

In the event that the Parties are unable to resolve any Dispute after meeting and atternpting in good faith to reach a negotiated resolution, such Dispute(s) shall first be mediated by a retired judge or justice of a court or by a trained and qualified rnediator mutually agreeable to the Parties. If the Parties are unable to alree upon a mediator, either party may apply to a licensed mediation service for the appointment of a mediator from a panel of retired judges or justices or other trained and qualified mediators. Upon the appointment of a mediator, the Parties thereafter shall submit their Dispute to mediation and engage in the mediation process fully and in good fhith.

19.3.2 Arbitration. Except as otherwise provided herein, if the Parties are unable to resolve one or more Dispute(s) by mediation, then either Party may initiate arbitration of such Dispute(s). The arbitration shall be initiated and conducted according to the Commercial Arbitration Rules of a reputable and qualified arbitration service, including rules that allow an Appeal (the "Arbitration Rules"). The arbitration shall be conducted at a mutually agreeable location before a single neutral arbitrator appointed in accordance with the Arbitration Rules, except that the Parties shall be entitled to undertake discovery in the arbitration in acoordance with the statutory provisions and rules applicable, as of the date of the first Arbitration Notice, to discovery in civil actions before a Court with jurisdiction over the Parties and the subject matter. The arbitrator shall have the authority to hear and rule upon all discovery motions and, in connection therewith, to award sanctions as appropriate in accordance with the then-prevailing law. Any appeal shall be heard and decided by a panel of three neutral arbitrators. The neutral arbitrator and the members of any Appeal Panel shall be retired judges or justices of any state or federal court. In all their substantive (as opposed to procedural or discovery-related) rulings, the arbitrator and Appeal Panel shall apply the law specified in the choice of law provision of this Agreement. If either party refuses to perfonn any or all of its obligations underthe final arbitration award (following appeal, if applicable) within thirty (30) days of such award being rendered, then the other party rnay enforce the final award in any court of cornpetent ju risd iction.

19.3.3 Exclusions from Mediation and Arbitration. The following matters are excluded frorn mediation and arbitration hereunder: (i) a judicial or non-judicial foreclosure or other action or proceeding to enforce a deed of tlust, moftgage, or installment land sale contract as defined in Civil Code $2985; (ii) an unlawful detainer action, (iii) the filing or enforcement of a rnechanic's lien; and (iv) any matter that is within the jurisdiction of a probate, small clairns, or bankruptcy court. The filing of a court action to enable the recording of a notice of pending action, for order of attachrnent, receivership, irrjunction or other provisional remedies, shall not constitute a violation of the rnediatiorr and arbitration prov ision s.

Page l5 of 19
19'4 Attorney's Fees. In any action for any relief, declaratory or otherwise, to enforce the terms hereof or to declale rights hereunder (collectively, an 'oAction"), each party shall bear its own attorney's fees.

19.5 Integration. This Lease, and the exhibits attached hereto, constitute the entire agreernent between and final expression of the parties, and there are no agreernents or reprer"ntations between the parties except as expressed herein or therein. All prior negotiations ani agreelnents between Landlord and Tenant with respect to the subject matter hereof are superseOeA Uy ttris Lease. Except as otherwise provided herein, no subsequent change or addition to this Lease shall be binding unless in writing and signed by the parlies hereto. 19'6 No Waiver By Landlord. To the extent permitted by applicable law, no failure by Landlord to insist upon the strict perfornrance of any term hereof or to exercise any right, power or remedy consequent upon a default under this Lease, and no acceptance ofRent during the continuance of any such default, shall constitute a waiver of any such default or of any such term. No waiver of any default shall affect or alter this Lease, which shall continue in full force and effect, or the rights of l,andlord with respect to any other then existing or subsequent default.

19.7 Amendment. This Lease can be modified, supplemented, amended or rescinded only by a writing expressly referring to this Lease and signed by Landlord and Tenant.

19.8 Severabilityl Consent. tf any term of this Lease or any application thereof shall be invalid or unenforceable, the remainder of this Lease and any other application of such terrn shall lot be affected thereby. Unless otherwise expressly provided herein, any approval or consent of Landlord required hereunder shall not be unreasonably withheld or delayed. This Lease shall be binding upon and inure to the benefit of and be enforceable by the respective successors of the parties hereto' The headings in this Lease are for purposes of reference only and shall not Iimit or define the nreaning hereof. This Lease may be executed in any number of counterparts, each of which shall be an original, but all of which shall together constitr.rte one and the same instrument.

19.9 Accessibility Disclosure Pursuant to California Civil Code Section 1938. The Prenrises and Comnron Areas have been inspected by a Certified Access Specialist (CASp) and clo not currently meet all accessibility standards.
19'9 Holding Over - Consensual. In the event Tenant shall holdover orremain in possession of the Premises with the written consent of Landlord after the expimtion of the Term of this Lease, suclr htllding over or continued possession shall create a tenancy for month to montlr only, upon the same terms and conditions as are herein set fbrth and in effect the tast ntonth prioi to the expiration of the Terrn of this Lease.

19.10 Holding Over - Non-Consensual. If Tenant remains in possession of the prenrises or any part thereof after the expilation of Tenant's term heleof without the express written consent of Landlord, suclt occttpancy shall be a tenancy frorn month to month at a rnonthly rental in twice the anrount of the total of all the last month Rent paid or due, plus all other charges payable hereunder, and upon all the terms hereof applicable to a month-to-nronth tenancy. l9'll Warranty Against Payment of Consideration. Tenant warrants that it has not ;raid or given, arrci will not pay or give, any third party any n'roney or other consideration for obtaining this Lease.

Page 16 ends

19.12 Non-liability of Landlord Officials and Employees; Non-liability of Members. No member, official or employee of Landlord shall be personally liable to Tenant, or any successor in interest, in the event of any default or breach by Landlord or for any amount which may become due to Tenant or its successor or on any obligations under the terms of this Lease.

19.13 Remedies Cumulative, The various rights, options, elections and remedies of Landlord contained in this Lease shall be cumulative and no one of them shall be construed as exclusive of any other, or of any right, priority or remedy allowed or provided for by law and not expressly waived in this Lease.

19.14 Time of the Essence. Time is of the essence of this Lease and all of the terms, provisiotts, covenants and conditions hereof.

19.15 Controlling and Venue Law. The validity of this Agreement and any of its terms or provisions, as well as the rights and duties of tlre parties under this Agreement, shall be construed pursuant to and in accordance with California law. All proceedings involving disputes over the tenns, provisions, covenants or conditions contained in this Agreement and all proceedings involving any enforcement action related to this Agreement shall be initiated and conducted in the applicable couft or forunr in Santa Barbara County, California.

19.16 Covenants. Whenever in this Lease any words of obligation or duty are used in connection with either party, such words shall have the same force and effect as though framed in the forrn of express covenants on the part of the party obligated.

19.17 Joint and Several Liability. ln the event either party hereto now or hereafter shall consist of more than one person, finn or corporation, then and in such event all such persons, firms or corporations shall be jointly and severally liable as parties hereunder.

19.18 Recitals. The Recitals are true and correct as of the date hereof and are incorporated into the terms and conditions of this Lease.

19.19 Attachments. All attachrnents and exhibits refered to in this Lease are attached to and incorporated herein by reference.

Page l7 of19
IN WITNESS WIIEREOF, the parties hereto have caused this Lease to be executed as of the dates written below.

Landlord: THa crrY oF CARPTNTERIA, a california municipal corporation
B
Its
Tenant: x'riends of the Library, a nonprorit california corporation By
Its: t o
APPROVED AS TO FORM:

City of Carpinteria
Peter on of
Brownstein Hyatt Farber Schreck, LLp
Acting as City Attonrey of the City of Carpinteria
Attachments: Exhibit A: Premises
prusl &n ForPage l8 of 19
ttarubla rp.c.

Exhibit "A"

PREMISES
llo, O.iftrrad.trr!{.

C$phta'r!e, gf,
Drervlng la not tc lodo
Jnnllot's
Closrt
88r 0n "Premlses" lnclude all lnterlor space
except rcstoom space and Janltors Closet
Res troorn an d .l anitors clo set sp ace rls " Comrlton'AteaD Page l9 of 19
Attachment B

TO THE CARPINTERIA CITY COUNCIL

FROM THE BOARD OF DIRECTORS OF

THE FRIENDS OF THE CARPINTERIA COMMUNITY LIBRARY
FEBRUARY 14,2023
The Friends of the Carpinteria Community Library Board has always been grateful for the generous, below-market rate charged to us for the bookstore building, with its ideal charm and location. Since 2009, when we first rented just the front of the building for $700/month, the bookstore has become a much loved gathering place in our town. Under the able management of volunteers Susan Williams and April Ueoka, with the help of 60 volunteers, each working a 2-hour shift every week, the bookstore has generated for the last decade (excluding the worst Covid years) a net annual revenue of at least $60,000.

The Friends Board respectfully requests that the City consider a change in our rental agreement for the bookstore building. Since the Friends' annual funding no longer goes to the Santa Barbara Public Library for the operating budget, but will be paid directly to the City of Carpinteria, it seems to us that the rental contract is redundant. lnstead of the prospect of an increasing monthly rent for the bookstore, the Friends would like the Council to consider accepting our guarantee of a minimum of $50,000 as an annual donation in lieu of rent.

A rising annual rent creates a perception on the part of the Friends board of rising annual costs and the need for an adjustment to our book prices. A fixed annual minimum contribution to the City from the Friends guarantees the City far and above what can be expected by a rental contract, as well as dispelling future Board concerns about rising rental costs.

This fiscal year (2022-2023), the Friends have pledged $50,000 for books and materials, in addition to the $175,000 gift of La Centra-Summerland Foundation for the renovation of the library. We propose a change in our rental agreement to a nominal $1 per year for building rental, as we confidently pledge to the City that our minimum annual donation will far exceed our current annual rental fee of $15,852. We'd also like to request a longer lease agreement rather than an annual review.

Thank you for considering this request. We look fonryard to partnering with the City in supporting the library's wonderful potential in serving the needs of our community.

Gaby Edwards and Jean Bailard
(for the FOL board)
City of Carpinteria

COUNCIL AGENDA STAFF REPORT
May 8, 2023

ITEM FOR COUNCIL CONSIDERATION
Authorization for the City Manager to execute an Agreement with Encompass Consultant Group, Inc. to provide consulting design services for the 2023 Pavement Maintenance and Rehabilitation Project (includes the whole or segments of Aragon Drive, Arbol Verde Street, Calle Rey Mar, Carnation Place, Concha Loma Drive, Eleanor Drive, Holly Avenue, La Quinta Drive, Malibu Drive, Sawyer Avenue, Vallecito Court, Vallecito Place, Vallecito Road, and Verano Drive).

STAFF RECOMMENDATION
Authorize the City Manager to execute an Agreement with Encompass Consultant Group, Inc. to provide consulting design services in an amount not-to-exceed $330,730 for the 2023 Pavement Maintenance and Rehabilitation Project.

Sample Motion: I move to authorize the City Manager to execute an Agreement with Encompass Consultant Group, Inc. to provide consulting design services in an amount notto-exceed $330,730 for the 2023 Pavement Maintenance and Rehabilitation Project. (The motion requires a roll call vote.)

BACKGROUND
On March 23, 2023, staff presented two (2) street selection lists to the Public Facility Site Acquisition/Development Committee (Committee)- one for Pavement Maintenance and another for Pavement Rehabilitation, as shown as follows:

Street Selection List- Pavement Maintenance
Street Name Block Begin Limit End Limit
Aragon Drive 4500 Chaney Avenue Santa Ynez
Intersection Avenue
Aragon Drive 4600to Azalea Drive Chaney Avenue
4700 Intersection Intersection
Arbol Verde 400 to Calle Pacific Fiesta Drive
Street 500 Intersection
Agreement with Encompass Consultant Group, Inc. for the 2023 Pavement Maintenance & Rehabilitation Project May 8, 2023

Page 2 ends

Arbol Verde 600 to Fiesta Drive Concha Loma
Street 800 Intersection Drive
Bailard Avenue 1000 Via Real Pandanus Street
Intersection Intersection
Carnation Place 1400 End Aragon Drive
Delta Avenue 1300 Eleanor Drive South End
Eleanor Drive 4600to Sterling Avenue Chaney Avenue
4700
La Brea Lane 1200 East End West End
La Pala Lane 1200 East End Cameo Road
La Quinta Drive 4300 East End Santa Monica
Road
Seventh Street - Carpinteria Avenue Reynolds Avenue
Intersection
Seventh Street 4600 Reynolds Avenue Ash Avenue
Intersection I nte rsectio n
Seventh Street 4700 Ash Avenue Holly Avenue
Intersection Intersection
Seventh Street 4800 Holly Avenue Elm Avenue
Intersection Intersection
Seventh Street 4900 Elm Avenue Linden Avenue
Intersection
Seventh Street 5000 Linden Avenue Maple Avenue
Seventh Street 5100 Maple Avenue Walnut Avenue
Sixth Street 5000 Linden Avenue Maple Avenue
Verano Drive 4300 North End Santa Monica
Road
Willow Place 5300 Olive Avenue Palm Avenue
The general scope of work of pavement maintenance consists of crack treatment, asphalt concrete pavement replacements, and the application of microsurfacing. (Those street names labeled with the word, "intersection," means the limit of the pavement work includes the entire street intersection.) The existing asphalt concrete pavement surface would be rejuvenated and preserved for at least five years until pavement rehabilitation. This approach allows the costs for more expensive pavement rehabilitation work, which involves the complete rebuilding of the pavement structural section, to be spread out over a period of time that is manageable while also maintaining adequate road condition, given the available annual budget. The order of magnitude estimate for this set of streets would be about $1.3M which includes design, construction, construction management, inspection, and materials testing.

Street Selection List- Pavement Rehabilitation
Street Name Block Begin Limit End Limit
Calle Rey Mar 700 Arbol Verde Street End
Concha Loma 800 Arbol Verde Street Calle Ocha
Drive
Agreement with Encompass Consultant Group, Inc. for the 2023 Pavement Maintenance & Rehabilitation Project May 8, 2023

Page 3 ends

Holly Avenue 1000 Sawyer Avenue Carpinteria Avenue
Linden Avenue 200 to 300 Railroad Tracks South End
Malibu Drive 4700 Sterling Avenue West End
Malibu Drive 4800to Linden Avenue Sterling Avenue
4900
Sawyer Avenue 4800to Linden Avenue Holly Avenue
4900
Vallecito Court 5200 Vallecito Place West End
Vallecito Place 1300 Vallecito Road Ogan Road
Vallecito Road 1300 Vallecito Place Ogan Road
Vallecito Road 1200 Ogan Road Via Real
The general scope of work of pavement rehabilitation consists of using technologies and material recycling techniques that lower greenhouse gas emissions and reduce the cost of pavement maintenance through material choice and construction methods. As with the City's last two completed pavement rehabilitation projects as well as the 2022 Pavement Rehabilitation Project that is in currently in design, accessibility upgrades are also a part of the scope of work in order to conform with Americans with Disabilities Act (ADA) standards. The order of magnitude estimate for this set of streets would be about $5.4M which includes design, construction, construction management, inspection, and materials testing.

In general, the Committee concurred with the aforementioned street selection lists.

However, the Committee expressed concern about funding a total cost of $6. 7M for both pavement projects ($1.3M pavement maintenance plus $5.4M pavement rehabilitation) and recommended for staff to reevaluate the street selection lists in order to reduce the costs.

Staff provides findings of the reevaluation in the discussion below and recommends for a combined project of maintenance and rehabilitation as the 2023 Pavement Maintenance and Rehabilitation Project. The purpose of this agenda matter is for the City Council to authorize the City Manager to execute an agreement with Encompass Consultant Group, Inc. to provide consulting design services for the 2023 Pavement Maintenance and Rehabilitation Project.

DISCUSSION
Staff Reevaluation
Street selection lists for both pavement maintenance and rehabilitation are determined based on the City's pavement management system and the City Council's direction of including all pavement management zones in each project. The City's pavement management system established six (6) pavement management zones. Pursuant to the Committee's recommendation at its meeting on March 23, 2023, staff reevaluated the initial street selection lists. In addition to considering each street's Pavement Condition Agreement with Encompass Consultant Group, Inc. for the 2023 Pavement Maintenance & Rehabilitation Project May 8, 2023

Page 4 ends

Index (PCl)
1 , staff determined the following criteria as the logic for reevaluating the street lists:

1. Failed condition- PCI between 30 and 0

2. Poor condition- Middle to lower range PCI (between 40.5 and 31)

3. Fair condition- Lower range PCI close to or on the verge of decreasing into poor condition

4. Drainage deficiencies

5. Street Tree Special Conditions
2 - Local streets (i.e. no arterial, collector, and
commercial streets)

6. Number of streets per pavement management zone

7. Relative proximity of streets
Based on the aforementioned criteria, staff determined the following modified street selection lists:

Modified Street Selection List- Pavement Maintenance
Street Name Block Begin Limit End Limit PCI Zone
Aragon Drive 4500 Chaney Avenue Santa Ynez 39 5
Intersection Avenue
Aragon Drive 4600 to Azalea Drive Chaney Avenue 38 5
4700 Intersection Intersection
Arbol Verde 400 to Calle Pacific Fiesta Drive 54 2
Street 500 I nte rsectio n
Arbol Verde 600 to Fiesta Drive Concha Loma 44 2
Street 800 Intersection Drive
QailaFs 1Ai¥€U:Ha1e 4000 Via Real PaF1sai;ua1s Sti;eet @4 G I Fite FseetiErn I F1teFSeeti0F1
Carnation Place 1400 End Aragon Drive 53 5
Qelta 1Ai1a1eF11:1e ~ ~leaF10F Qi;i¥e S01:1ti.t ~FIS 40 i Eleanor Drive 4600to Sterling Avenue Chaney Avenue 53 5 4700
ba Qi;ea baF1e ~ ~ast ~FIS ¼fest ~Fis Ga 4
ba Pala baFle ~ ~ast ~Fis Games Reas iG 4
La Quinta Drive 4300 East End Santa Monica 59 5
Road
Se¥eF1tR Strnet - GaF~iF1teFia AveF11:1e ReyF10lss A¥eF11:1e i9 a I F1tei;seeti0F1
SeveFltR Strnet 4GOO ReyF10lss A¥eF11:1e AsR AveRl;je M a IF1teFS8eti0F1 IF1teFSeeti0F1
1 Excellent Condition 100-91, Good Condition 90-71, Fair Condition 70-51, Poor Condition 50-31, and Failed Condition 30-0. Source: Pavement Management Program Report Update. Pavement Engineering, Inc.

August 2018
2 Special Conditions Street Tree Management Plan. West Coasts Arborists. 12 July 2021 Agreement with Encompass Consultant Group, Inc. for the 2023 Pavement Maintenance & Rehabilitation Project May 8, 2023

Page 5 ends

Sevc:mU~ StFOet 4700 i01SR Ala!QFll:IO l,,lelly Aia10F11:10 ~ a IAtOFSO@tieA IAtOFSOGtieA
SeveAtR StFOet 4200 i,,lelly iO,ia10A1:10 ~Im AveA1:10 @S a I AtOFSO@tieA IAtOFSOGtieA
SeveAtR Sti;eet 4900 ~Im Aia10A1:10 biFISOFI ,0i¥OFll:IO @S a I AtOFSO@tieA
Se¥eAtR Sti;eet eOOQ biF1€IOF1 A¥0Fll:IO lA--1~ /I •-- ~ ·-·.- - - -- - 47 a
SeveAtR StFOet &WG lA--1- /I -
- - -- - \AJalA1:1t A¥0A1:10 47 a
Si~EtR Sti;eet eOOQ biA€IOFI Ala!QFll:IO lA~-1~ /1, -
-·r - - - ~ a
Verano Drive 4300 North End Santa Monica 60 5
Road
Will@tN ~laee ~ Qli!J(3 A¥€U~'38 ~aim AveA1:10 @S a
Street Name Block Begin Limit End Limit PCI Zone
Calle Rey Mar 700 Arbol Verde Street End 34 2
Concha Loma 800 Arbol Verde Street Calle Ocha 32 2
Drive
Holly Avenue 1000 Sawyer Avenue Carpinteria Avenue 37 3 biA€IOFI Aia!OFll:IO ~QQ te ~QQ Railma€1 :i:i;a@l~s Se1:1tR ~A€1 ~ 4 Malibu Drive 4700 Sterling Avenue West End 26 5
Malibu Drive 4800to Linden Avenue Sterling Avenue 30 5
4900
Sawyer Avenue 4800to Linden Avenue Holly Avenue 34 3
4900
Vallecito Court 5200 Vallecito Place West End 22 4
Vallecito Place 1300 Vallecito Road Ogan Road 47 4
Vallecito Road 1300 Vallecito Place Ogan Road 24 4
Vallecito Road 1200 Ogan Road Via Real 35 4
Modified Street Selection List- Pavement Rehabilitation Based on these modified street selection lists, staff determined a modified project that could combine both separate maintenance and rehabilitation projects into one and yield a reduced total cost. The order of magnitude estimate for this combined project would be about $4.5M which includes design, construction, construction management, inspection, and materials testing. This amount is about $2.2M less than having two separate projects that total $6.7M. However, this combined project would also defer seven (7) streets from pavement maintenance and one (1) street from pavement rehabilitation, as shown as strike-throughs in the modified street selection lists. Although, any or all of the deferred streets from pavement maintenance may be added to the project as extra work should the City receive a low construction bid that could afford more. The reason is because the mobilization of pavement maintenance work is a relatively minor expense as compared to pavement rehabilitation work.

Agreement with Encompass Consultant Group, Inc. for the 2023 Pavement Maintenance & Rehabilitation Project May 8, 2023

Page 6 ends

As with a separate pavement rehabilitation project, a combined project would still include accessibility upgrades such as curb ramps and acute areas of damaged sidewalks in order to conform with ADA standards.

Consulting Agreement
As a best practice, staff typically conducts a qualifications-based selection (QBS) process as the basis of procuring professional or consulting services. QBS is a competitive, contract procurement process whereby consulting firms initially submit a proposal of its qualifications and the proposed scope of work and schedule to a procuring entity (e.g. City) who evaluates and selects the most qualified firm, and then negotiates the consultant fee.

The QBS process is consistent with California Government Code Section 4525 et al. for procuring professional or consulting services of private architectural, landscape architectural, professional engineering, environmental, land surveying, and construction project management firms.

In July 2022, staff issued a request for proposal (RFP) to provide consulting design services for another project- 2022 Pavement Rehabilitation Project. Encompass Consultant Group, Inc. submitted a proposal for this project, but it was not selected.

However, staff considered the list of proposers from the RFP of that project as a prequalification list for similar future projects, and the 2023 Pavement Maintenance Project is an example of such.

In February 2023, staff requested for a proposal from Encompass Consultant Group, Inc. to provide consulting design services for the project. Staff determined the proposed scope of work and project schedule meet the City's needs including the time frame to deliver the design for construction. Further, staff determined the proposed fee be fair and reasonable.

A summary of the proposed tasks is as follows:

1. Project management

2. Preliminary design

3. Final design

4. Engineering support services during construction
A copy of the proposed Agreement with Encompass Consultant Group, Inc. including details of the proposed tasks is shown as Attachment A.

The estimated project schedule is as follows:

Design
Advertise for Bids
Open Bids
Award Contract
Construction
June 2023 to October 2023
November 2023
December 2023
January 2023
February 2024 to June 2024
Agreement with Encompass Consultant Group, Inc. for the 2023 Pavement Maintenance & Rehabilitation Project May 8, 2023

Page 7 ends

POLICY CONSISTENCY
The project is consistent with the policy of establishing a program that monitors and effectuate improvements on roadways in accordance with the Circulation Element of the City General Plan and Local Coastal Plan.

FINANCIAL CONSIDERATIONS
On March 13, 2023, the City Council's mid-year review of the Fiscal Year 2022/23 Budget appropriated funds towards procurement of the design services. The construction budget will be presented to the City Council at a future date.

LEGAL AND RISK MANAGEMENT CONSIDERATIONS
The recommendation is consistent with the California Government Code Section 4525 et al. for procuring professional or consulting services.

OPTIONS

1. Authorize the execute an Agreement with Encompass Consultant Group, Inc. to provide consulting design services in an amount not-to-exceed $330,730 for the 2023 Pavement Maintenance and Rehabilitation Project. (Staff recommendation)

2. The City Council could choose to not approve the recommendation and direct staff as determined appropriate; however, non-action would delay the project.

PRINCIPAL PARTIES EXPECTED AT MEETING
There are no principal parties expected at the meeting.

ATTACHMENTS
Attachment A: Agreement
Staff contact:

John L. Ilasin, Public Works Director ~ .VL,. '
(805) 880-3402; [email protected] ~gnature
Reviewed by: A /14 / / /
Licette Maldonado, Administrative Services Director -~-~--+-~~~----- (805) 755-4448; [email protected] Signature
Reviewed by:

Dave Durflinger, City Manager
(805) 755-4400; [email protected]

ATTACHMENT A
Agreement

AGREEMENT FOR CONSULTANT SERVICES
DesignServicesforthe2023PavementMaintenance&RehabilitationProjectNos. 15133/15134 THIS AGREEMENT FOR CONSULTANT SERVICES ("Agreement") is made and effective as of the 8th day of May ,2023 by and between the City of Carpinteria, a municipal corporation ("City"), and Encompass Consultant Group, Inc. ("Consultant") (collectively, the "Parties") at Carpinteria, Califomia, with reference to the following facts:

City has determined that it is necessary and appropriate to engage a design professional to carry out the services described herein; and
Consultant has represented itself as being fully qualified and available to perform the consultant services necessary to complete the work in a timely manner; and City desires to contract with Consultant and Consultant is willing to perform the consultant services, subject to the terms and conditions of this Agreement.

NOW, THEREFORE, in consideration of the mutual covenants and conditions set forth herein, the sufficiency of which is hereby acknowledged, the parties agree as follows:

SERVICES.

1.1 Basic Services. City hereby retains Consultant to perform the services described and set forth in the attached Exhibit A ("Basic Services"), which is incorporated by this reference as though set forth in full. Consultant hereby agrees to perform said services within the designated time frames and accepts this retention. Consultant shall complete the Basic Services according to a schedule of performance which is also set forth in Exhibit A. The Parties agree and acknowledge that time is of the essence in performance of this Agreement.

1.2 Additional Services. In addition to the Basic Services, City may elect to have Consultant perform additional services that are beyond the current scope of the Basic Services, but within the expertise of Consultant ("Additional Services"). Such Additional Services shall be mutually agreed to in advance and specified in a writing, which shall also specif, the basis for the Consultant's fee for such additional services. Basic Services and Additional Services are referenced collectively as "Services."

2. PERFORMANCE.

2.1 Standard of Performance. Consultant shall faithfully, competently and diligently perform the obligations and responsibilities required by this Agreement, applying best management practices and the same standards of care utilized by persons commonly engaged in providing similar services as are required of Consultant hereunder in meeting its obligations under this Agreement. Consultant shall not engage the assistance of subcontractors for performance of the Services unless previously agreed to in writing by the City.

2.2 Labor and Materials. Consultant shall fumish, at its own expense, all labor, materials, equipment, tools, transportation and services necessary for the successful completion of the Services. Consultant shall give its attention and supervision to the fulfillment of the provisions of this Agreement by its employees and subcontractors and shall be responsible for the timely performance of the Services required by this Agreement.

2.3 Review of Service. Consultant shall furnish City with reasonable opportunities from time to time to ascertain whether the Services of Consultant are being performed in accordance with this Agreement. All work done and materials fumished shall be subject to final review and approval by City; Consultant is not providing final approval or review, which is solely City's function and role. City review and approval of such work and Services shall not, however, relieve Consultant of any of its obligations under this Agreement.

2.4 Contract Administration. The City Manager or his/her designee shall represent the City in all matters relating to the administration ofthis Agreement. The City Manager or his/her designee shall have the authority to act on the City's behalf to review and approve all products submitted by Consultant and may execute all necessary documents to authorize Consultant to perform Additional Services as provided for herein.

2.5 Representations and Warranties. Consultant represents and warrants to City that: (i) its fulfillment of its obligations and, as applicable, performance the Services under this Agreement, will not violate any applicable or breach any contracts with third parties and (ii) it has the right, power and authority to fulfill its obligations, and, as applicable perform the Services, and enter into this Agreement; (iii) the Services contemplated hereunder will be performed by adequately trained, competent personnel, in a professional manner, with such personnel having the requisite skill and expertise necessary to perform and complete the Services in accordance with industry standards and in accordance with the terms and conditions of this Agreement; and (iv) the Services and all deliverables provided hereunder will conform to the specifications agreed-to by the parties.

TERM. This Agreement shall be effective as of the date first above written and shall continue until all Services to be provided by Consultant are completed to the satisfaction of the City, but in no event later than the 30th day ofJune, 2024; unless terminated earlier as provided for herein.

4. COMPENSATION.

4.1 Basic Services. For Basic Services, City shall pay Consultant on a time and materials basis, not to exceed amount of Three Hundred Thirty Thousand Seven Hundred Thirty Dollars ($330,730.00) as full compensation for all labor, materials, equipment, tools, transportation, and Services. This compensation shall be paid in accordance with the payment rates and schedule as set forth in Exhibit B, attached hereto and incorporated herein by this reference as though set forth in full, based on the actual time spent on the tasks and the actual price of the necessary materials.

4.2 Additional Services. Consultant shall not be compensated for any services rendered in connection with its performance of this Agreement which are in addition to the Basic Services, unless such Additional Services are authorized in advance and in writing in the J.
2 method provided for herein. Consultant will submit fee estimates for such Additional Services upon request of City.

4.3 Invoices. Each and every payment by City shall be subject to City's receipt of an invoice outlining the items for which payment is requested. Payment to Consultant as to any undisputed fees shall be made, after verification of Consultant's performance, within 30 (thiny) days of receipt of invoice. If City disputes any of Consultant's fees, it shall give written notice to Consultant within 30 (thirty) days of receipt of an invoice of such disputed fees.

4.4 Withholdine. City reserves the right to withhold future payment to Consultant if any aspect of the Consultant's work is found to be substantially inadequate. City shall notiff Consultant in writing of deficiencies believed to be substantially inadequate within thirty (30) days after receipt ofproduct.

4.5 Taxes/Insurance/Licenses. Consultant shall be solely responsible for the payment of any federal, state, or local income tax, social security tax, workers' compensation insurance, state disability insurance, and any other taxes or insurance which Consultant is responsible for paying as an independent contractor under federal, state or local law. At all times during the term of this Agreement, Consultant and any approved subcontractors performing Services under this Agreement shall have in full force and effect all licenses necessary for the performance of Services hereunder, including without limitation, business licensing from City, all at the sole cost of Consultant.

5. RECORDS.

5.1 Financial Records. Consultant shall maintain complete and accurate records with respect to sales, costs, expenses, receipts and other such information required by City that relate to the performance of Services under this Agreement. Consultant shall also maintain adequate records of Services provided in sufficient detail to permit an evaluation of Services. All such records shall be maintained in accordance with generally accepted accounting principles and shall be clearly identified and readily accessible.

5.2 Access to Records. Consultant shall provide free access to the representatives of City or its designees at reasonable times to books and records as set forth in section 5.1; shall give City the right to examine and audit said books and records; shall permit City to make transcripts therefrom as necessary; and shall allow inspection of all work, data, documents, proceedings and activities related to this Agreement. Such records, together with supporting documents, shall be maintained for a period of four (4) years after receipt of final payment.

5.3 Original Records. Upon completion of, or in the event of termination or suspension of this Agreement, all completed and incomplete original agreements, data, documents, designs, drawings, exhibits, maps, models, computer files, reports, studies, surveys, notes, and other work, materials or documents prepared or used to prepare Consultant's work product in the course of providing the Services pursuant to this Agreement ("Consultant Work Product") shall become the sole property of City once the Consultant has received 3 payment. City may duplicate, disclose, disseminate, use, reuse or otherwise dispose of Consultant Work Product in whole or in part in any manner it deems appropriate, without the permission of Consultant. With respect to computer files, Consultant shall make available to the City, at Consultant's office and upon reasonable written request by City, the necessary computer software and hardware for purposes of accessing, compiling, transferring and printing computer files. Consultant may retain copies of such Consultant Work Product as a part of its record of professional activity.

6. TERMINATION.

6.1 Termination Without Cause. This Agreement may be terminated by either party for any reason upon ten (10) days prior written notice by the terminating party to the other party.

In the event of a termination, the date oftermination shall be deemed to be the first business day occurring after the expiration of the notice period. Upon receipt of said notice, Consultant shall immediately cease all work under this Agreement, unless the notice provides otherwise.

6.2 Termination With Cause. Either party may terminate this Agreement with cause, effective immediately upon written notice of such termination to the other party and failure of the breaching party to correct within five (5) days of receiving such notice, based upon the occurrence of any of the following events:
. Material breach of this Agreement;
. Cessation of Consultant to be licensed, as required;
. Failure to substantially comply with any applicable federal, state or local law or regulation;
. Filing by or against Consultant of any petition under any law for the relief of debtors; and,
' Filing of a criminal complaint against Consultant for any crime, other than minor traffic offenses.

6.3 Performance Upon Termination. In the event this Agreement is terminated pursuant to this Section, City shall pay Consultant for the outstanding balance owed for work performed up to the time of termination. Upon termination of the Agreement, Consultant shall submit an invoice to City as provided for herein and shall submit to the City all of its files for any billable or non-billable matters in which the Consultant is involved under the scope of this Agreement.

6.4 Termination Upon Mutual Consent. This agreement may also be terminated by mutual consent of the parties and in accordance with the terms and conditions of any plan of termination established by the parties. In the event of a termination by mutual consent, the date of termination shall be such date as is agreed upon by the parties. The parties may agree to suspend or terminate a portion of this Agreement and such suspension or termination shall not make void or invalidate the remainder of this Agreement.

DISPUTE RESOLUTION. Except as explicitly provided in Exhibit E relating to claims by Consultant, if any dispute, claim or disagreement shall arise relative to the interpretation or 7 4
8 enforcement of this Agreement, the parties shall use commercially reasonable efforts to settle the dispute, claim or disagreement. To this end, they shall consult and negotiate with each other in good faith and, recognizing their mutual interests, attempt to reach a just and equitable solution satisfactory to both parties. If they do not reach such a solution within a period of thirty (30) days, then, upon notice by either party to the other, the dispute, claim or disagreement shall be submitted to final, binding arbitration administered by the American Arbitration Association in accordance with its Commercial Arbitration Rules. The arbitrator shall have the authority to assess arbitration costs and expenses against either or both parties. The decision in the arbitration shall be binding on all parties, and judgment on any arbitration award may be entered in any court of competent jurisdiction.

INSURANCE. Consultant shall maintain prior to the beginning of and for the duration of this Agreement insurance coverage as specified in the attached Exhibit C, which is incorporated by this reference as though set forth in full.

9. INDEMNIFICATION
Indemnification for Professional Liabilitv. To the fullest extent permitted by law, Consultant shall indemniff, protect, defend and hold harmless City and any of its officials, directors, employees and agents ("Indemnified Parties") from and against any and all losses, liabilities, damages, costs, and expenses, including attorneys' fees and costs of defense (collectively, "Claims") to the extent such Claims arise out of, pertain to, or relate to the negligence, recklessness or willful misconduct of Consultant and its agents, employees, subcontractors, consultants or assigns.

10. RELEASE OF INFORMATION.
l0.l Confidentialitv. All information gained by Consultant in performance of this Agreement shall be considered confidential and shall not be released except to the City, directly or indirectly, by Consultant without City's prior written authorization. Consultant, its officers, employees, subcontractors or sub-consultants shall not voluntarily provide declarations, letters of support, testimony at depositions, response to interrogatories or other information concerning the Services performed under this Agreement unless requested by the City Attomey or authorized in writing by the City Manager. Response to a subpoena or court order shall not be considered "voluntary" provided that Consultant shall give City prompt written notice of any such court order or subpoena. The provisions of this Paragraph shall survive the termination of this Agreement.

10.2 Notice and Cooperation. Consultant shall promptly notify the City Manager and City Attomey in writing if Consultanq its officers, employees, agents, subcontractors or subconsultants are served with any summons, complaint, subpoen4 notice of deposition, request for documents, intenogatories, request for admissions or other discovery request, court order or subpoena from any person or party related to this Agreement and/or Consultant's related Services. City has no obligation to, but may exercise discretion to represent Consultant and/or be present at any deposition, hearing or similar proceeding. Consultant agrees to cooperate fully with City and to provide the City an opportunity to review any response to 5 discovery requests provided by Consultant. However, City's right to review any such response does not grant or imply a right of City to control, direct, dictate or rewrite said response.

I 1. RELATIONSHIP TO CITY.

I 1.1 Independent Contractor. Consultant is and shall at all times remain as to the City a wholly independent contractor. The personnel performing the services under this Agreement on behalf of Consultant shall at all times be under Consultant's exclusive direction and control. Neither City nor any of its officers, employees or agents shall have control over the conduct of Consultant or any of Consultant's officers, employees or agents, except as set forth in this Agreement. Consultant shall not at any time or in any manner represent that it or any of its officers, employees or agents are in any manner officers, employees or agents of City. Consultant shall not incur or have the power to incur any debt, obligation or liability whatever against City, or bind City in any manner.

11.2 No Emplovee Privileses. No City employee benefits shall be available to Consultant in connection with the performance of this Agreement. Except for the fees paid to Consultant as provided in the Agreement, City shall not pay salaries, wages or other compensation to Consultant for performing Services hereunder for City. City shall not be liable for compensation or indemnification to Consultant for injury or sickness arising out of performing Services hereunder.

11.3 Consultant Dutv to Citv. Consultant understands and agrees that its responsibility to provide complete and accurate Services is owed solely to City and that its accountability under this contract shall likewise be solely to City and not to any City applicants or any other third person or entity.

11.4 Interest of Consultant. Consultant represents and warrants to City that it presently has no interests, and covenants that it shall not acquire any interests, direct or indirect, financial or otherwise, which would conflict with the performance of the services to be provided by Consultant under this Agreement. Consultant further covenants that, in the performance of this Agreement, no subcontractor or employee having such an interest shall be employed by Consultant. Consultant certifies that no one who has or will have any financial interest under this Agreement is: (a) an officer or employee of City, or (b). an officer or employee of the applicant and any of its consultants. Consultant agrees to comply with any applicable conflict of interest code.

I1.5 Undue Influence. Consultant declares and warrants that no undue influence or pressure is used against or in concert with any officer or employee of City in connection with the award, terms or implementation of this Agreement, including any method of coercion, confidential financial affangement or financial inducement. No officer or employee of City will receive compensation, directly or indirectly, from Consultant or any officer, employee or agent of Consultant, in connection with the award of this Agreement or any work to be conducted as a result of this Agreement. Violation of this Section shall be a material breach of this Agreement entitling City to any and all remedies at law or in equity. 1 1.6 Third Partv Beneficiaries. This Agreement is entered into solely for the benefit of the 6 City and the Consultant and will not confer any rights upon any person not expressly a party to this Agreement.

12. GENERAL PROVISIONS.
l2.l Assignment of Rights. Contractor agrees to assign City all rights, title, and interest in and to all causes of action it may have under Section 4 of the Clayton Act or under the Cartwright Act arising from purchases of goods, services, or materials pursuant to this Agreement.

12.2 FurtherAssurances. City and Consultant each agree to cooperate with one another, to use their best efforts, to act in good faith, and to promptly perform such acts and execute such documents or instruments as are reasonably necessary and proper to consummate the transactions contemplated by this Agreement.

12.3 Notices. All notices, requests, demands and other communications under this Agreement shall be in writing and shall be deemed to have been duly given on the date of service if personally served or on the second day after mailing if mailed by first-class mail, registered or certified, return receipt requested, postage prepaid and properly addressed as follows:

To City:

Dave Durflinger, City Manager
City of Carpinteria
57 7 5 Carpirfteria Avenue
Carpinteria, CA 9301 3-2698
P: (80s) 684-5405
F: (80s) 684-5304
To Consultant:

Sal Contreras, P.E., Principal Engineer
Encompass Consultant Group, Inc.
333 North Lantana Street, Suite 287
Camarillo, CA 93010
P:(80s) 322-4443
F:N/A
Any party may change their address for the purpose of this paragraph by giving the other party written notice of the new address in the above manner.

12.4 Legal Responsibilities. Consultant shall keep itself informed of state, federal and laws and regulations which in any manner affect those employed by it or in any way affect the performance of its Service pursuant to this Agreement. The Consultant shall reasonably observe and comply with such laws and regulations. The City and its officers and employees shall not be liable at law or in equity occasioned by failure of the Consultant to comply with this Section.

12.5 Licenses. At all times during the term of this Agreement, Consultant shall have in full force and effect, all licenses required by law for the performance of services described in this Agreement.

12.6 Labor Conditions. City is a public entity in the state of Califomia, and therefore, City and Consultant are subject to the provisions of the Govemment Code and the Labor Code of the state of Califomia. All provisions of law applicable to public contracts and/or this Agreement are incorporated herein by this reference and are made a part of this Agreement 7 to the same extent as if they were fully stated in the Agreement and shall be complied with by Consultant.

12.7 Labor Requirements. Consultant shall abide by all federal and Califomia laws and regulations regarding wages, including, without limitation, the Fair Labor Standards Act and the California Labor Code, which, in part, mandate that 8 hours' labor constitutes a legal days' work, and require Consultant to pay the general prevailing wage rates. The Califomia statutory provisions for penalties for failure to pay prevailing wages will be enforced and the statutory provisions for penalties for failure to comply with Califomia's wage and hour laws will be enforced. In addition, Consultant is required to comply with the statutory requirements relating to employment of apprentices. Consultant also must secure the payment of workers' compensation to its employees as provided by California law. Consult acknowledges its obligation to secure payment of Workers' Compensation before beginning work as set forth in the attached Exhibit D ("Acknowledgement of Workers' Compensation Obligation") which is incorporated by this reference as through set forth in full. Additionally, Consultant is required to comply with all statutory requirements relating to certified payroll records, including the maintenance of the records, their certification, and their availability for inspection.

12.8 Discrimination. No person shall be excluded from employment in the performance ofthis Agreement on the grounds of race, creed, color, sex, age, marital status, sexual orientation or place of national origin. Consultant shall comply with all local, state, and federal laws relating to equal employment opportunity rights.

12.9 Assignment. Consultant shall not assign the performance of this Agreement, nor any part thereof, nor any monies due hereunder, without prior written consent of City, which shall have the sole discretion to consent to any proposed assignment. Because ofthe personal nature of the Services to be rendered pursuant to this Agreement, only Consultant shall perform the services described in this Agreement.

12.10 Waiver. No waiverof aprovisionofthis Agreementshall constitute awaiverof any other provision, whether or not similar. No waiver shall constitute a continuing waiver. No waiver shall be binding unless executed in writing by the party making the waiver.

12.11 Force Maieure. Neither Consultant nor City shall be liable for any delays resulting from circumstances or causes beyond its reasonable control, including, without limitation, fire or other casualty, act of God, strike or labor dispute, war or other violence, or any law, order or requirement of any governmental agency or authority.

12.12 Construction of Terms. All parts of this Agreement shall in all cases be construed according to their plain meaning and shall not be construed in favor or against either of the parties. If any term, provision, covenant or condition of this Agreement is held by a court of competent jurisdiction to be invalid, void or unenforceable, in whole or in part, the remainder of this Agreement shall remain in full force and effect and shall not be affected, impaired or invalidated thereby. In the event of any provision shall be adjudged invalid, void or unenforceable, the parties hereto agree to enter into a supplemental agreement to effectuate the intent of the parties and the purposes of this Agreement. 8 12.13 Controlline Law. The City and Consultant understand and agree that the laws of the State of California shall govern the rights, obligations, duties and liabilities of the parties to this Agreement and also govem the interpretation of this Agreement, with venue proper only in the County of Santa Barban, State of Califomia.

12.14 Authorization. All officers and individuals executing this and other documents on behalf ofthe respective parties hereby certifu and warrant that they have the capacity and have been duly authorized to execute said documents on behalf of the entities indicated.

12.15 Entire Asreement. This Agreement, along with its attached exhibits, which are incorporated herein by this reference, constitutes the entire Agreement between the parties and supersedes all prior and contemporaneous agreements, representations and understandings of the parties. This Agreement may be altered, amended or modified only by a supplemental writing executed by the parties to this Agreement and by no other means.

Each party waives any future right to claim, contest, or assert that this Agreement was modified, canceled, superseded, or changed by any oral agreement, course of conduct, waiver or estoppel.

12.16 Counterparts. This Agreement may be executed in counterparts, each of which shall remain in full force and effect as to each party.

12.17 Severabilitv. In the event that any term or provision of this Agreement shall be held to be invalid, void or unenforceable, then the remainder of this Agreement shall not be affected, impaired or invalidated, and each such term and provision of this Agreement shall be valid and enforceable to the fullest extent permitted by law.

IN WITNESS WHEREOF, the parties have executed this Agreement at the place and as of the date first written above.
''CITY''
City of Carpinteria
By
David Durflinger, City Manager

APPROVED AS TO FORM
City of Carpinteria
By
Jena ShoafAcos, on behalfof
Brownstein Hyatt Farber Schreck, LLP
Acting as City Attorney of the City of Carpinteria
''CONSULTANT''
Encompass Consultant Group, Inc.

By:

Sal Contreras, P.E., Principal Engineer
ATTEST:

City of Carpinteria
By
Brian C. Barrett, CMC, CPMC, City Clerk
9 EXHIBIT A

TASKS TO BE PERFORMED
l0
333 North Lantana St.

Suite 287
Camarillo, CA 93010
(805) 322-4443
25115 Ave. Stanford
Suite 4320
Santa Clarita, CA 91355
(661) 600-9367
Civil Engineering
Land Surveying
Land Planning
c0mtlaSE fonsullan: 6r0ug
April 17,2023
w.o.0852.00
John L. llasin, P.E.

City of Carpinteria - Public Works Department
5775 Carpinteria Ave.

Carpinteria, CA 93013
Subject: 2023 Paving Maintenance Project
Dear John
ln response to your request, Encompass Consultant Group, lnc. (ECG) is pleased to submit this proposalto provide civil engineering and surveying services.

PROJECT UNDERSTANDING
It is our understanding that the City of Carpinteria would like to continuing with their annual street maintenance program for 2023. The City is interested in paving the streets identified below. The streets have been identified as either micro surfacing or full depth rehabilitation. Arbol Verde St is the only street with extensive damage to the sidewalks, curb, gutter and street caused by overgrown tree roots that have migrated into these areas.

Microsurrfacing
Shdtilqln lii thi l.€rqil{fl lbtrn Erp
bfgALn
Ery
|lk=troin
BLilEff}tkrp
Ed.cin
Arilql Ll. &dea Lt sartE YrEflre, I.itttS t u d
tubd thrde Crartgra Ae Clel4rr6c 2{Xil} 7
LJrltmH, L:LldE6ac ArsmLl 36 U $
ljljtlnEl Ur. trEgl ETE tglGt r{gtE t{dl I:D t u U
ItErtr l.l. LhrErtAle SDrtno Ade. l l It 4 U b
vgem L,t F&rth trrn 5trrtrlukllE i5 .ltt I
Full Depth Rehabilitation
Shrlrg;n Li- lii l-rEil{q tbffn Erp
EEEI'I-A krp knubr
EiirEIInkry
Ed.dan
TVIEIHJ LNE U'ItenA'tg SEiltr(AJE. I.t t, u s
M*hr Drp 9glrroAe Culdg:clUrbq fu:l 3ffi
ViledtrLslrt \tll€clto H. Uuldsaca$ihct hrdl 'ftb u 2 u Valetiu R. Ooan Rd. vdlslot&,: rlu l 1 $
VJlEitoRed MaRed VJEito&rt 1{p$
sEffiAffirF Lr*lAE tldv Are, sI.l $ I I
ilily /r,r,e. Sawrrel Are. LEDmtslEArE Jib I I
{rEnclE L.glrE tnl|t AH Ysr.le:t uile{rcho 6rt I t, {,
L.ils t{st Mir l'lEI'r/€rrF:t Lt'd€#E dl I U u
All streets will be evaluated areas were dig outs are required will be identified. AIIADA ramps will be field evaluated for streets identified for both full depth rehabilitation and micropsurfacing.

These evaluations are to be performed by visual and field inspection. We are proposing a full topo An Employee Owned Company
KCG Page2of11
2023 Paving Maintenance Project
on Arbol Verde and will be providing an optionalfee for surveying ADA ramps for street identified as full dept rehabilitation.

We assume field survey will not be necessary for the street plans. The basemap will be prepared based on available aerial imagery. Topographical mapping willonly be performed on ArbolVerde and, as an optional cost, handicap ramps on street designated as FDR listed above.

Based on our understanding of the project requirements, we propose the following scope of services:

SCOPE OF WORK
This proposal includes the services as indicated in the RFP and will perform continuous project management and in-house quality control as discussed in this proposal. The following services described below are provided to clarify and customize the tasks indicated in the RFP for this project's unique nuances. The tasks include but not limited to, the following:

Task 1: Project Management
A. Project Administration
a. Team coordination.
b. Quality control and quality assurance.
c. Provide project schedule and updates. ECG will develop a project schedule utilizing MS project. Prepare a formal schedule for design completion, including delivery dates for design review submittals to the City.
d. Monitor budgets and report project status on a monthly basis. e. Prepare and provide monthly progress project reports.

B. Progress Meetings
a. Organizing team progress and coordination meetings. ECG will provide meeting agenda and distribute meeting minutes. ECG shall set meeting at or near milestones.

Assume 30o/o,60o/o and 90% milestone progress meetings with the City b. Organize the project design kick-off meeting with City staff to review project scope and expectations, finalize a schedule of deliverables, and mutually agree upon a project approach. Criteria for pavement repair work, City priorities and constraints, and standardization of pavement and improvements evaluation will also be discussed.

Task I Deliverables:

1. Project files in PDF and the original format.

2. Monthly progress reports

3. Progress meeting agenda and minutes
An Employee Owned Company
qcG Page3of11
2023 Paving Maintenance Project
Task 2: Preliminaru Design (307o. 607o and 907o)
A. Topographical Mapping (Arbol Verde)
a. Perform field surveys along ArbolVerde Street and at 25 additional ramp locations. The survey limits for Arbol Verde Street will be within the approximate right of way and the survey limits for the ramp locations shall be from beginning of curve to end of curve at each of the right of way corners and will extend to the approximate right of way behind curb and into the adjacent roadway approximately 10 feet. Field surveys will locate pavement, curbs, drives, walks, building footprints, fences, walls, planters, and visible surface utilities, together with topographic features such as tops, toes, flow lines, grade breaks, etc. within the areas described above. Pavement and surface materials will also be identified. Trees larger than 4" in diameter will be located and shown on the map. b. Field surveys will be processed and compiled with data obtained from the aerial imagery provided by the City. A construction control line will be determined for use during design and construction. Note, the construction control line may not be an established right of way centerline, as it is not known at this time what centerline and/or right of way monumentation exists.
c. ECG will compile the record right of way locations as they are depicted in the latest assessor maps. Records will be georeferenced to the site base map with available monuments in the project areas recovered during the topographic surveys. Resolving disputed locations or title research is not proposed herein. lf right of way analysis or acquisition is required, we will require title reports for the property(ies) in question to support the additionalwork (not included herein).
d. Research available records to prepare a monument inventory in the work areas.

Potential andlor located monuments will be shown on improvement plans for monument preservation per Business and Professions Code section 8771 and Green book section 400-2. (Monument preservation to be performed under separate contract) B. Field investigation and Data Collection
a. Develop a project basemap based on the City provided GIS aerial and the topographic survey and supplemental field survey performed, as well as any additional information provided by the City. The basemap shall be on state plane coordinates and will be used in the initialfield evaluation. Survey markers in ADA ramps will be located and noted to be protected in-place. ECG will contact City Surveyor for list of known survey monuments. Basemap will include the record existing utility information obtained from utility companies and the City.
b. With the basemap completed project basemap, ECG will perform an initial field walk.

ECG will walk the entire City and will invite City staff to attend. The walk will record and document existing conditions to be used to refine the project scope, limits of work, basemap and design approach. Finding will be documented and provided to the City. c. Perform field evaluation work that shall include physical inspection, marking of streets, and entering roadway repair work into AutoCAD. The following will be identified during the field evaluation, as applicable, for the pavement preparation:
1, Failed pavement areas to be removed and replaced (dig-outs);

2. Confirm existing street p\pavement conditions are adequate for Micro Paving An Employee Owned Company
KCG Page4of11
2023 Paving Maintenance Project

3. Utility structures to be adjusted to grade (i.e., vaults, manholes, valve boxes, etc.);

4. Concrete improvement replacements including sidewalks, ADA ramps, curbs & gutters;

5. Traffic detector loops, if any, to be replaced due to conflicts with roadway repair work;

6. Existing striping layouts; and document existing signage.

7. Additional areas of special concern or treatments required including coordination with City arborist regarding ongoing root damage for sidewalks and AC paved areas.
d. Review any available Pavement Management data and reports related to the proposed street prior to the field evaluation.
e. Based on the field review and assembled project information, summarize recommendations, street rehabilitation methods and proposed street segments that fit into the City's proposed construction budget constraints and maximize construction value. A comparison of proposed repair methods, their respective costs and anticipated service life will be provided.
f. Coordinate with the City to present the treatment recommendations and potential construction costs.
g. Develop CAD sheets showing street location, limits of work, roadway configuration, affected utility infrastructure, and summary of repair work. h. ldentify areas during the field evaluation that exist or are potential drainage issues.

During an overlay, existing drainage problems can become more problematic after construction, and new drainage problems can be created by oversights during design.

ECG will identify these areas of concern to bring to the attention of the City. i. Perform existing ADA ramp evaluations per the list provided above. Evaluations shall be performed based on the Caltrans Permanent Pedestrian Facilities ADA Compliance Handbook and the American with Disabilities Act Accessibility Guidelines (ADAAG). Each ramp shall be evaluated for compliance. Deficiencies will be noted and documented in a report. The findings will be presented to the City for approval. lf the City determines ADA ramp design are required, ECG willthen provide an estimate for surveying and engineering for the new ramp design selected. j. Soils investigation shallbe provided by Earth Systems. Scope and description of work is attached to this proposal. Earth Systems is familiarwith the project and has reviewed the scope of services outlined in the RFP and City provided project documents. Coring shall be performed for the streets designated for full depth rehabilitation. A report shall be prepared with conclusion and findings. Core locations will be indicated on the project plans.

C. Utility Company Coordination
a. Conduct existing utility research. Obtain utility owner contact information by utilizing USA Dig Alert database.
b. Prepare utility record drawing request notifications. Letter shall include a map of each street indicating the project limits. Letters shall be either mail or emailed directly to the utility company.

An Employee Owned Company
KCG Page5of11
2023 Paving Maintenance Project
c. Prepare and maintain a utility notification log noting dates when notices were sent, received and noting comments from the utility company.
d. Prepare an existing utility basemap and overlay the map onto the project basemap.

The plan will identify utilities that are in conflict with the proposed design. ECG will look for alternatives to the designs to avoid relocations where possible. Minor relocations such as utility box and valve adjustments to grade will be noted on the construction plans. Major utility relocations are not anticipated. lf a major relocation is encountered such as a fire hydrant relocation, then ECG will contact the utility company to coordinate the relocation on the construction documents to resolve the relocation successfully. e. ECG shall support the City with facility relocation claims by providing exhibits, preliminary and final plans. ECG will be available to assist in the coordination and communication with the affected utility company
D. Utility Facility Positive Location
ECG does not anticipate utility conflicts due to the nature of the project. We do not anticipate grading to be greater than 24 inches and the proposed design elements to be deep enough to require positive utility locations.
a. ln the event that utility such as a fire hydrant utility box will need to be relocated due to the proposed design elements, ECG will allocate a total of one (1) day for positive utility locations. This service will be provided by Spearhead Locators. lf potholing is necessary, ECG will allocate one (1)full day of potholing services from Travis Ag. b. lf these services are utilized then ECG will prepare a potholing report including photographs, descriptions, depth, material and size of the exposed utility.

E. Preliminary Plans, Specifications, Estimates (60% and 90%) a. Prepare 30% preliminary design drawings per City of Carpinteria standards and Standard Plans for Public Works Construction (Greenbook). Plans shall include details and typical sections corresponding to the preliminary design. 30% design shall identify dig out areas, limits of ADA improvements, rolled curb and gutters, cross gutters and provide initial coring data.
b. Update pavementrehabilitation recommendations.
c. ldentify design constraints, utilities conflicts and provide resolution report. d. Prepare a construction cost estimate for the preliminary design. e. Provide a 60% submittal of construction drawings and cost estimates to the City for review and comment. This submittal shall include the following information:

1. A title sheet for the set of drawings;

2. A vicinity map;

3. Paving rehabilitation drawings;

4. 60% striping and signage plans

5. ACA ramp details with proposed configurations.

6. Preliminary cost and quantity estimates for the project construction; and An Employee Owned Company
KCG Page6of11
2023 Paving Maintenance Project

7. Details and typical sections corresponding to the design.

8. Prepare preliminary outline technical specifications for pavement repair work utilizing City provided electronic boilerplate contract documents f. Meet with the City to discuss the 60% submittal and incorporate City 600/o review comments into construction drawings and specifications. g. Perform any additional field evaluation checks as needed to complete construction drawings for the 90% submittal to the City. Provide the 90% submittal to include of construction drawings, contract specifications, and cost estimates to the City for review and comment. This submittal shall include the following information:

1. A title sheet;

2. A vicinity map;

3. 90% rehabilitation drawings including striping and signage plans.

4. 90% cost and quantity estimates for the project construction;

5. 90% specifications;

6. ADA ramp details and typical sections corresponding to the design; h. Attend 90% milestone progress meeting. Discuss comments and provide clarifications. i. ECG does not anticipate permits during the design phase of this project. lf an encroachment permit is required then ECG will obtain and provide a copy of the permit to the City as necessary.
j. Work with the City to prepare memo identifying the street that will fall under the street maintenance category.

Task2 Deliverables:

1. Pavement evaluation report

2. Topographical mapping and right of way survey, PDF

3. Record of Survey or Corner Records (to be performed under separate contract)

4. Field investigation and Data Collection findings

5. Utility conflicts and resolutions report

6. Utility coordination meetings

7. Positive location and underground Utility Facility Record

8. Preliminary, 60% and 90% PS&E

9. Street maintenance memo

10. ADA ramp evaluation report

11. Preliminary soils report including core data in PDF Task 3: Final Design
A. Bid Documents- Final Plans, Specifications, Strom Water Prevention Plan (100%) a. Obtain City independent contractibility review comments and incorporate into final construction documents.
b. lncorporate the City 90o/o review comments into the construction drawings. Assemble final construction contract documents for the project.

An Employee Owned Company
g(G Page7of11
2023 Paving Maintenance Project
c. Perform a final job walk with the final construction contract documents for the final quality assurance check before submitting final construction contract documents and cost estimates to the City for approval and bidding.
d. Prepare and submit final PS&E
B. FinalEstimate
Task 3 Deliverables:

1. Bid Documents. Plans, Specifications

2. FinalEstimate
Task 4: Engineering Suoport Services During Gonstruction A. Bidding Support
a. Provide support to the City as needed.
b. Attend pre-bid meeting.
c. Address contractor questions and provide clarifications as necessary d. Provide assistance is bid evaluations if necessary
B. Conformed Plans and Specifications
a. Provide conformed construction documents based on bid phase addenda.

C. Construction Observations
a. Attend construction kick off meeting
b. Review project shop drawings and submittals and maintain project submittal logs c. Address Contractor RFI's and necessary
d. Prepare plan revisions to provide clarifications.
e. Provide periodic site observations and determined by the City. Observations reports shall be included documenting the construction activity observed while on site. Report shall include photographs with descriptions and documenting conversations held during the site visit. Reports shall be submitted to the City the same day observed. For the purposes of this proposal, we assume a 6 month construction duration and will include one (1) site observation every 2 weeks for 2 hours/ visit. Assume 12 observations total.

D. Record Drawings
a. Prepare record drawings based on contractor mark ups. b. Submit signed record drawings in PDF and Mylar is requested Task4 Deliverables:

1. Bidderclarifications

2. Addenda

3. Conformed Plans and Specifications

4. Submittal Reviews

5. Responses to RFI's

6. Revised designs

7. Periodic Observation Reports
An Employee Owned Company
KCG Page8of11
2023 Paving Maintenance Project

8. Record Drawings
Task 5: OPTIONAL Topographical Survey -Full Depth Rehabilitation (FDR) As an optionalfee, ECG will perform topographical surveying at ADA ramp locations for the street identified as FDR. We assume a total of twenty-eight (28) ramps total will require survey to meet ADA standards. ln additions, ECG will perform a boundary suruey to determine and conflicts with the proposed ADA ramp design.

TaskS Delivenbles

1. Topographical survey in CAD and PDF

2. Boundary survey in CAD and PDF

SERVICES NOT INCLUDED
The following services and all other services not specifically listed herein are excluded:

1. 2.

3. 4.

5. 6.

7. 8.

L
Governmental and public agency fees, cost of bonds, and taxes.

Title company reports, services, and fees.

Services by consultants other than ECG except for the subconsultants listed in the scope of work.

Pavement core and pavement design
Storm Water Pollution Prevention Plan
Environmental permitting, reports, general plan or zoning changes, or processing.

ALTA, boundary establishment/resolution surveys, construction staking orfiling records with the County Surveyor.

Record of Survey or Corner Records (to be prepared under separate contract).

Legal Descriptions and exhibits for the purpose of right of way acquisition and temporary construction easements (to be prepared under separate contract, if needed).

Planning and processing services.

Construction management services
Traffic studies or traffic control plans.

Dry utilities design (naturalgas, electrical, communication, etc.).

Services beyond those specifically listed in the Scope of Work above.

10. 11.

12. 13.

14. CLIENT TO PROVIDE
Client or co-consultant at Client's direction shall provide the following items to ECG:

1. GIS Aerial survey

2. Street Record Drawings.

ASSUMPTIONS

1. Client will provide and coordinate access to and around site as required to perform work.

An Employee Owned Company
KCG
Service
Project Management
Preliminary Design (30%, 600/o and 90%)
Final Design
Engineering Support Services During Construction
OPTIONAL- Topographical Mapping and boundary
(FDR Streets)
OPTIONAL- ADA Ramp Design (FDR Street)

SUBCONSULTANTS
Earth Systems
Totalwithout options
Totalwith options
Page9of11
2023 Paving Maintenance Project
Fee
$15,175
$193,700
$19,720
$20.820
$27,540
$25,440
$28.105
$277,520
$330,730

2. Sufficient boundary monuments of record remain in place in the immediate site vicinity to allow for adequate boundary compilation and orientation. lf insufficient monuments exist in the immediate area, additionaltime and charges may be required.

3. Project limits of work are within City right of way and land acquisition will not be necessary.

4. GIS Aerial survey has adequate resolution for base mapping purposes.

PROPOSED FEE AND METHOD OF PAYMENT
Our proposed services will be performed on a time and materials, not to exceed basis and shall be billed monthly at the rates then in effect. Charges for "time" include professional, technical and clerical support services provided by ECG. "Materials" include all reimbursable expenses, such as photocopies, postage, shipping/delivery, plots, prints, maps/documents, and outside consultant fees.

Based on our understanding of your requirements and our experience with similar projects, we estimate that the fee required for our services, including reimbursable expenses, will cost approximately as follows:

Task
1 2
3 4
5 We reserve the right to reallocate budgets between the tasks listed above for actual work performed, but we will not exceed the totalfee without written approval.

We have estimated the cost of our services based on our understanding at this time of the scope and complexity of the work. However, please note that our services will be performed on a time and materials basis, and it is possible that our actual charges could exceed the amount we have estimated. During the per{ormance of our services, the need for additional or expanded services may be determined. We will make every reasonable etfort to keep you informed of our progress and costs incurred.

An Employee Owned Company
KCG Page 10 of 11
2023 Paving Maintenance Project

ADDITIONAL SERVICES
Services performed outside the scope of this agreement require written approval prior to performance of the work. Significant design changes after th'e start of work shall be considered additional services. Any work request that is outside the scope of this agreement will be identified by ECG as such, and a fixed fee or not-to-exceed amount will be agreed upon prior to the start of the additional work. Compensation for additional services shall be in accordance with the rates then in effect.

TIME OF PERFORMANCE
Based on our current workload, we estimate that we can begin work upon receipt of your written authorization to proceed. We will make every effort to keep you informed of our progress in accordance with a mutually acceptable schedule which will be arranged with you.

AUTHORIZATION
Should you require any additional information, or wish to discuss this proposal further, please contact me at (805) 416-8704, or via email at [email protected]. lf this proposal is satisfactory, please contact us regarding the necessary agreement forms to begin work. Please note that this proposal is valid for a period of 30 calendar days.

Thank you for your consideration of ECG for this project.

Sincerely,
ENCOMPASS CONSULTANT GROUP, INC.

SalContreras, No.66720, CA Travis J. Maag, 83406, CA
Principal Engineer
Phone: (805) 416-8704
Sal. Contreras@ECGcivi L com
Senior Engineer I
Phone: (805) 465-9095
Travis. [email protected]
Enclosures: ECG's Current Billing Rate Schedule
n:\projer:ls\0B52\ad min\02-proposals\0852_city of carpinteria ,2023 paving maintenance _r2. docx An Employee Owned Company
KCG Page 11 of 11
2023 Paving Maintenance Project
SURVEY LTMTTS EXHTBTT (ARBOL VERpE)
An Employee Owned Company
K.gg
&E:

N:
4t1 I t202:t
MJN
PBwiting Wdg@ (YN) v
m23 RATES CiUolcapb@b243 h*rC MW wotu 08a
Fsmlm ffil $fu[ *l
BE O.dotrl 1& 2{atr k Clqlod
tdlt
Hourly Ratr 230 210 1m 175 t8() 135 1m rs5 85 r85 280 120 8n

40.0 s7 230.00
b. QAQC

2.0 16.0 s3 260.00

6.0 $15 230.00
B. Field lnv6slioationsand Dala colladion
a. O€veloo Proiecl BasemaD
40 BO $3 rao 00

4.0 24.O 320 $a 960.00
d. ReviewEavemenl dala reDods
e. PreDare Davemenl recohhehdalions reDon
L P.esenlpavement recommendalions and updsle 10

2.0 2.D 16 0 s2 730 00
i. PedromADAramofddevzlualions(2Sloelionsl
J. Cmrdination Gth EadhSyslFes 20
b. P.eoare ulil w.6ouesl leners
d. Preoare exislino uullybase map 80 s7 160 n0

2.O 2.O s590.00
O, UrlN FacillyPosilive Localon
a. Manaoeand coordinale !tililylftalion and oolholin!

2.O 4n $1 400 no
a. P.€oare 30% Prelminao Plans
b. Updale @vemenl recommendalions o

2.O a0

4.0 s2 820.00
t- 60% Milestone meelino (lhcluded in Task 1 Bial l
40 6n0 4nn 1rn n 931 220 00
$0.00
fa*ffidhon
A. Bid Doclments- Final Plans, PS&E

4.0 4,0 s1.8S0.00
b [email protected] cn/ fr% cmnents
c. Pedom nnal valk to cohrm dlEal lens 10

1.0 a0 $1n 900 nn
a. Provide Ciry Suppon 20 a0 sl i6n 00
s580.00
c. Add.ess contacror {Lesliohs
d P.oUdc hid cvailalidn esqirr:h.c
B. Conlorn Plans and Specilrcdrons
8,0 s1 860.00
a. Attend Consltu.tion Kck Of Meelinq
b. ReviewShop Drawinqs and Submillals 10

4.0 s1 630.00
a. ProFare rocord Drawinas
40 s930 00
ToDoqraohical Ma!Dino (FORI 10
ADARampdesiqn {FDR) 28 Rmaps 8 400 100 0 $25 440 00
Srhdel F- hv sd Cer.rd

70.0 525.0 176.0 142,0 851.0 0.0 0.0 0.0 88.0 0.0 16.0
Gd.h i rbd
Eadh Syslems
10v" $0.00
Earth Systems
115 West Canon Perdido Street I Santa Barbara, CA 93101 | (805) 642-6727 | www.earthsystems.com April L4,2023 Proposal No.: S84-23-04-004
Attention: Sal Contreras
Encompass Consultant Group
333 N. Lantana Street, Suite 287
Camarillo, CA 93010
Project: Carpinteria Pavement Maintenance2O23
Various Streets
Carpinteria, Californ ia
Subject: Proposal to Provide Geotechnical lnformation for Proposed Full Depth Reclamation lntroduction
Earth Systems Pacific (Earth Systems) is pleased to provide a proposal to provide geotechnical engineering services to provide information pertinent to full depth reclamation plans for various streets in the City of Carpinteria. Streets involved in the program will include approximately L,050 lineal feet of Arbol Verde Street, 360 lineal feet of Holly Avenue, L,28O lineal feet of Malibu Drive, 870 lineal feet of Sawyer Avenue, 870 lineal feet of Vallecito Court, and L,260lineal feet of Vallecito Road.

The scope of services would include measuring the existing structural paving section thicknesses, sampling subgrade soils, performing laboratory testing on those soils, analyzing the field and laboratory data, and providing a written report with recommendations for full depth reclamation structural sections.

The project will require advancing borings at 15 locations scattered throughout the subject streets. The intent is to sample about every 300 lineal feet. lt is anticipated that traffic control plans will be required to obtain encroachment permits, and traffic control will be required during our field exploration. The cost associated with preparation of the traffic plan and preparation of the encroachment permit applications has been included in our estimated costs.

However, Earth Systems has assumed that the encroachment permit fees from the City of Carpinteria will be waived.

Scope of Services and Estimated Fees
Task l-. Drilline/Samplins and Thickness Determinations o Mark 15 points of exploration, notify Underground Service Alert, and post "No Parking" signs 72 hours prior to work start date (S1,380.00)
o Drill Rig and Operator for two days (S10,560.00)
o Staff Professional for Logging (L6 hours) (Sz,00O.OO1 o Field Equipment/ Asphalt Patching (5450.00)

BERMUDA
DUNES
FREMONT HOLLI5TER PATMDATE PAsADENA P€RRIS SAIINAS sAN tuts oBtsPo
SANTA

BARBARA
SANTA
MARIA

VENTURA
April14,2O23 Proposal No.: S84-23-04-004
Task 2. Traffic Control
o Obtain Traffic Control Plan Sheets (4)to be submitted to the City of Carpinteria (SS0O.OO1 o Two Person Traffic Control Crew with Equipment for Single Lane Closures. (Based on two 8-hou r weekday shifts) (S f,a6O.OO1
Task 3. Proiect Management and Report Preparation
o Project Management (5695.00)
. Report Preparation (Sf,SSO.OO1
Task 4. Laboratorv Tests
. Tests of subgrade soils to include:
. 15 - Moisture & Density (ASTM 29371. (S0ZS.OO;
r S - R- Value (ASTM D 2844, CT 301). (S3,OOO.OO;
o Q, - Maximum Density and Optimum Moisture (ASTM D 1557). (51,300.00) 2 Total Estimate S25,550.00
It is assumed that the terms for services will be negotiated at a later date This proposal may be considered valid for a period of 90 days, at which time if it is not fully executed, we reserve the right to modify our proposal in both scope and fee.

Upon acceptance of this proposal, please sign and date a copy and return it to Earth Systems Pacific, 5917 Olivas Park Drive, Suite F, Ventura, California 93003.

EARTH SYSTEMS PACIFIC
fua:,+ / ekAL
Patrick V. Boales
Engineering Geologist/Vice-President

AGREED TO AND ACCEPTED
Client Signature and Title
Client Name (in print)
Date
Copies 1 - Sal Contreras at ECG (via email)
1 - Proposal File

EARTH SYSTEMS PACIFIC

EXHIBIT B

PAYMENT SCHEDULE
(See Exhibit A)
1l

EXHIBIT C

INSURANCE REOUIREMENTS
Prior to the beginning of and throughout the duration of the Work, Consultant will maintain insurance in codormancewiththerequirementssetforthbelow. Consultantwilluseexistingcoveragetocomplywiththese requirements. If that existing coverage does not meet the requirements set forth here, Consultant agrees to amend, supplement or endorse the existing coverage to do so. Consultant aclmowledges that the insurance coverage and policy limits setforth in this section constitute the minimum amount of coverage required. Any insurance proceeds available to City in excess of the limits and coverage required in this agreement andwhich is applicable to a given loss, will be available to City.

Consultant shall provide thefollowing types and amounts of insurance:

Commercial General Liability Insurance using Insurance Services Office "Commercial General Liability" policy form CG 00 0l or the exact equivalent. Defense costs must be paid in addition to limits. There shall be no cross liability exclusion for claims or suits by one insured against another. Limits are subject to review but in no event less than $1,000,000 per occurrence.

Business Auto Coverage on ISO Business Auto Coverage form CA 00 01 including symbol 1 (Any Auto) or the exact equivalent. Limits are subject to review, but in no event to be less than $1,000,000 per accident. If Consultant owns no vehicles, this requirement may be satisfied by a non-owned auto endorsement to the general liability policy described above. If Consultant or Consultant's employees will use personal autos in any way on this project, Consultant shall provide evidence ofpersonal auto liability coverage for each such person.

Workers Compensation on a state-approved policy form providing statutory benefits as required by law with employer's liability limits no less than $ 1 ,000,000 per accident or disease.

Excess or Umbrella Liability Insurance (Over Primary) if used to meet limit requirements, shall provide coverage at least as broad as specified for the underlying coverages. Any such coverage provided under an umbrella liability policy shall include a drop down provision providing primary coverage above a maximum $25,000 self-insured retention for liability not covered by primary but covered by the umbrella. Coverage shall be provided on a "pay on behalfl' basis, with defense costs payable in addition to policy limits. Policy shall contain a provision obligating insurer at the time insured's liability is determined, not requiring actual payment by the insured first. There shall be no cross liability exclusion precluding coverage for claims or suits by one insured against another. Coverage shall be applicable to City for injury to employees of Consultant, subconsultants or others involved in the Work. The scope of coverage provided is subject to approval of City following receipt of proof of insurance as required herein. Limits are subject to review but in no event less than $1,000,000 per occurence.

Professional Liability or Errors and Omissions Insurance as appropriate shall be written on a policy form coverage specifically designed to protect against acts, errors or omissions of the consultant and 'oCovered Professional Services" as designated in the policy must specifically include work performed under this agrcement. The policy limit shall be no less than $1,000,000 per claim and in the aggregate. The policy must "pay on behalf of' the insured and must include a provision establishing the insurer's duty to defend. The policy retroactive date shall be on or before the effective date of this agreement. 12 Insurance procured pursuant to these requirements shall be written by insurers that are admitted carriers in the state of Califurnia and with an A.M. Bests rating of A- or better and a minimumfinancial size VII.

General conditions pertaining to provision of insurance coverage by Consultant. Consultant and City agree to the following with respect to insurance provided by Consultant:

Consultant agrees to have its insurer endorse the third party general liability coverage required herein to include as additional insureds City, its officials, employees, volunteers and agents, using standard ISO endorsement No. CG 2010-0413. Consultant also agrees to require all contractors and subcontractors to do likewise.

2. No liability insurance coverage provided to comply with this Agreement shall prohibit Consultant, or Consultant's employees or agents, from waiving the right of subrogation prior to a loss. Consultant agrees to waive subrogation rights against City regardless ofthe applicability of any insurance proceeds, and to require all contractors and subcontractors to do likewise.

3. All insurance coverage and limits provided by Contractor and available or applicable to this agreement are intended to apply to the full extent ofthe policies. Nothing contained in this Agreement or any other agreement relating to the City or its operations limig the application of such insurance coverage.

4. None of the coverages required herein will be in compliance with these requirements if they include any limiting endorsement of any kind that has not been first submitted to City and approved of in writing.

5. No liability policy shall contain any provision or definition that would serve to eliminate so-called "third party action over" claims, including any exclusion for bodily injury to an employee ofthe insured or of any contractor or subcontractor.

6. All coverage types and limits required are subject to approval, modification and additional requirements by the City, as the need arises. Consultant shall not make any reductions in scope of coverage (e.g., elimination of contractual liability or reduction of discovery period) that may affect City's protection without City's prior written consent.

7. Proof of compliance with these insurance requirements, consisting of certificates of insurance evidencing all of the coverages required and an additional insured endorsement to Consultant's general liability policy, shall be delivered to City at or prior to the execution of this Agreement. In the event such proofofany insurance is not delivered as required, or in the event such insurance is canceled at any time and no replacement coverage is provided, City has the right, but not the duty, to obtain any insurance it deems necessary to protect its interests under this or any other agreement and to pay the premium. Any premium so paid by City shall be charged to and promptly paid by Consultant or deducted from sums due Consultant, at City option.

8. Certificate(s) are to reflect that the insurer will provide 30 (thirty) days notice to City of any cancellation ofcoverage. Consultant agrces to require its insurer to modiff such certificates to delete any exculpatory wording stating that failure of the insurer to mail written notice of cancellation imposes no obligation, orthat any party will "endeavor" (as opposed to being required) to comply with the requirements of the certificate.
l3

9. It is acknowledged by the parties of this agreement that all insurance coverage required to be provided by Consultant or any subcontractor, is intended to apply first and on a primary, non-contributing basis in relation to any other insurance or self insurance available to City.

10. Consultant agrees to ensure that subcontractors, and any other party involved with the project who is brought onto or involved in the project by Consultant, provide the same minimum insurance coverage required of Consultant. Consultant agrees to monitor and review all such coverage and assumes all responsibility for ensuring that such coverage is provided in conformity with the requirements of this section. Consultant agrees that upon request, all agreements with subcontractors and others engaged in the project will be submitted to City for review.

I 1. Consultant agrees not to self-insure or to use any self-insured retentions or deductibles on any portion of the insurance required herein and further agrees that it will not allow any contractor, subcontractor, Architect, Engineer or other entity or person in any way involved in the performance of work on the project contemplated by this agreement to self-insure its obligations to City. If Consultant's existing coverage includes a deductible or self-insured retention, the deductible or self-insured retention must be declared to the City. At that time the City shall review options with the Consultant, which may include reduction or elimination of the deductible or self-insured retention, substitution of other coverage, or other solutions.

12. The City reserves the right at any time during the term of the contract to change the amounts and types of insurance required by giving the Consultant ninety (90) days advance written notice of such change.

If such change results in substantial additional cost to the Consultant, the City will negotiate additional compensation proportional to the increased benefit to City.

13. For purposes of applying insurance coverage only, this Agreement will be deemed to have been executed immediately upon any parly hereto taking any steps that can be deemed to be in furtherance of or towards performance ofthis Agreement.

14. Consultant acknowledges and agrees that any actual or alleged failure on the part of City to inform Consultant of non-compliance with any insurance requirement in no way imposes any additional obligations on City nor does it waive any rights hereunder in this or any other regard.

15. Consultant will renew the required coverage annually as long as City or its employees or agents face an exposure from operations of any type pursuant to this Agreement. This obligation applies whether or not the Agreement is canceled or terminated for any reason. Termination of this obligation is not effective until City executes a written statement to that effect.

16. Consultant shall provide proof that policies of insurance required herein expiring during the term ofthis Agreement have been renewed or replaced with other policies providing at least the same coverage.

Proof that such coverage has been ordered shall be submitted prior to expiration. A coverage binder or letter from Consultant's insurance agent to this effect is acceptable. A certificate of insurance and/or additional insured endorsement as required in these specifications applicable to the renewing or new coverage must be provided to City within five days ofthe expiration ofthe coverages.

17. The provisions of any workers' compensation or similar act will not limit the obligations of Consultant under this Agreement. Consultant expressly agrees not to use any statutory immunity defenses under such laws with respect to City, its employees, officials and agents. 14 18. Requirements of specific coverage features or limits contained in this section are not intended as limitations on coverage, limits or other requirements nor as a waiver of any coverage normally provided by any given policy. Specific reference to a given coverage feature is for purposes ofclarification only as it pertains to a given issue and is not intended by any parly or insured to be limiting or all-inclusive.

19. These insurance requirements are intended to be separate and distinct from any other provision in this agreement and are intended by the parties here to be interpreted as such.

20. The requirements in this Section supersede all other sections and provisions of this Agreement to the extent that any other section or provision conflicts with or impairs the provisions ofthis Section. 2l. Consultant agrees to be responsible for ensuring that no contract used by any parly involved in any way with the project reserves the right to charge City or Consultant for the cost of additional insurance coverage required by this agrcement. Any such provisions are to be deleted with reference to City. It is not the intent of City to reimburse any third party for the cost of complying with these requirements.

There shall be no recourse against City for payment of premiums or other amounts with respect thereto.

22. The City's failure to comply with reporting requirements should not affect coverage required under the Agreement.

23. The consultant's insurance is primary to that of any insurance claimed by the City.

Consultant agrees to provide immediate notice to City of any claim or loss against Consultant arising out of the work performed under this agreement. City assumes no obligation or liability by such notice, but has the right (but not the duty) to monitor the handling of any such claim or claims if they are likely to involve City.
l5

EXHIBITI)

WORKERS' COMPENSATION REOUIREMENTS
The Consultant is required to sign and /ile a statement aclmowledging its obligation to secare payment of Worlrers' Compensation before beginning worh
16 ACKNOWLEDGEMENT OF' WORKERS' COMPENSATION OBLIGATION I, Sal Contreras, hereby acknowledge my obligation to secure payment of Workers' Compensation before beginning work.

Encompass Consultant Group, Inc.

By:

Sal Contreras, P.E., Principal Engineer
T)nfed'
l7
1 2

EXHIBIT E

RESOLUTION OF CONSTRUCTION CLAIMS
The following pertains to Public Contract Code Sections 20104 through 20104.6 (Resolution of Construction Claims)
This article applies to all public works claims of three hundred seventy-five thousand dollars ($375,000) or less which arise between a contractor and a local agency.

This article shall not apply to any claims resulting from a contract between a contractor and a public agency when the public agency has elected to resolve any disputes pursuant to Article

7.1 (commencing with Section 10240) of Chapter I of Parl2. "Public rvork" means "public works contract" as defined in Section I l0l but does not include any work or improvement contracted for by the state or the Regents of the University of California.
"Claim" means a separate demand by the contractor for (a) a time extension, (b) payment of money or damages arising from work done by, or on behalf oi the contractor pursuant to the contract for a public work and payment of which is not otherwise expressly provided for or the claimant is not otherwise entitled to, or (c) an amount the payment of which is disputed by the local agency.

The provisions of this article or a summary thereof shall be set forth in the plans or specifications for any work which may give rise to a claim under this article.

6. This article applies only to contracts entered into on or after January l, 1991

7. For any claim subject to this Agreement, the following requirements apply a. The claim shall be in writing and include the documents necessary to substantiate the claim. Claims must be filed on or before the date of final payment. Nothing in this subdivision is intended to extend the time limit or supersede notice requirements otherwise provided by contract for the filing of claims. ( I ) For claims of less than fifty thousand dollars ($50,000), the City shall respond in writing to any written claim within 45 days of receipt of the claim, or may request, in writing, within 30 days of receipt of the claim, any additional documentation supporting the claim or relating to defenses to the claim the City may have against the claimant.
(2) If additional information is thereafter required, it shall be requested and provided pursuant to this subdivision, upon mutual agreement of the City and the claimant.

J
4 5
b
18 (3) The Cit1,''s written response to the claim, as further documented, shall be submitted to the claimant within l5 days after receipt of the further documentation or within a period of time no greater than that taken by the claimant in producing the additional information, whichever is greater.
(1) For claims of over fifty thousand dollars ($50,000) and less than or equal to three hundred seventy-five thousand dollars ($375,000), the City shall respond in writing to all written claims within 60 days of receipt of the claim, or may request, in writing, within 30 days of receipt of the claim, any additional documentation supporting the claim or relating to defenses to the claim the City may have against the claimant. (2) If additional information is thereafter required, it shall be requested and provided pursuant to this subdivision, upon mutual agreement of the City and the claimant. (3) The Ciry"'s written response to the claim, as further documented, shall be submitted to the claimant within 30 days after receipt of the further documentation, or within a period of time no greater than that taken by the claimant in producing the additional information or requested documentation, whichever is greater.

If the claimant disputes the City's written response, or the City fails to respond within the time prescribed, the claimant may so notify the City, in writing, either within 15 days of receipt of the City's response or within l5 days of the City's failure to respond within the time prescribed, respectively, and demand an informal conference to meet and confer for settlement of the issues in dispute. Upon a demand, the City shall schedule a meet and confer conference within 30 days for settlement of the dispute.

Following the meet and confer conference, if the claim or any portion remains in dispute, the claimant may file a claim as provided in Chapter 1 (commencing with Section 900) and Chapter 2 (commencing with Section 910) of Part 3 of Division 3.6 of Title 1 of the Government Code. For purposes of those provisions, the running of the period of time within which a claim must be filed shall be tolled from the time the claimant submits his or her written claim pursuant to subdivision (a) until the time that claim is denied as a result of the meet and confer process, including any period of time utilized by the meet and confer process.

This article does not apply to tort claims and nothing in this arlicle is intended nor shall be construed to change the time periods for filing tort claims or actions specified by Chapter 1 (commencing with Section 900) and Chapter 2 (commencing with Section 910) of Part 3 of Division 3.6 of Title I of the Government Code.

The following procedures are established for all civil actions filed to resolve claims subject to this article:

Within 60 days, but no earlier than 30 days, following the filing or responsive pleadings, the court shall submit the matter to nonbinding mediation unless waived by mutual stipulation of both parties. The mediation process shall provide for the selection within l5 days by both d.
e
f.

8. t9
9 parties of a disinterested third person as mediator, shall be commenced within 30 days of the submittal, and shall be concluded within l5 days from the commencement of the mediation unless a time requirement is extended upon a good cause showing to the court or by stipulation of both parties. If the parties fail to select a mediator within the 1 5-day period, any party may petition the court to appoint the mediator.
(a) If the matter remains in dispute, the case shall be submitted to judicial arbitration pursuant to Chapter 2.5 (commencing with Section I l4l.l0) of Title 3 of Part 3 of the Code of Civil Procedure, notwithstanding Section I 141.1 I of that code. The Civil Discovery Act (Title 4 (commencing with Section 2016.010) of Part 4 of the Code of Civil Procedure) shall apply to any proceeding brought under this subdivision consistent with the rules pertaining to judicial arbitration.
(b) Notwithstanding any other provision of law, upon stipulation of the parties, arbitrators appointed for purposes of this article shall be experienced in construction law, and, upon stipulation of the parties, mediators and arbitrators shall be paid necessary and reasonable hourly rates ofpay not to exceed their customary rate, and such fees and expenses shall be paid equally by the parties, except in the case of arbitration where the arbitrator, for good cause, determines a different division. In no event shall these fees or expenses be paid by state or county funds.
(c) In addition to Chapter 2.5 (commencing with Section I141.10) of Title 3 of Part 3 of the Code of Civil Procedure, any parly who after receiving an arbitration award requests a trial de novo but does not obtain a more favorable judgment shall, in addition to payment of costs and fees under that chapter, pay the attorney's fees ofthe other party arising out ofthe trial de novo.

10. The court may, upon request by any party, order any witnesses to participate in the mediation or arbitration process.
ll The City shall not fail to pay money as to any portion of a claim which is undisputed except as otherwise provided in the contract.

In any suit filed under Section2}l}4.4,the City shall pay interest at the legal rate on any arbitration award or judgment. The interest shall begin to accrue on the date the suit is filed in a court of law.

Pursuant to Califomia Public Contract Code Section7207, the City may not retain greater than five (5%) percent of contract price.

12. l3
20 Cal Cities' advocacy efforts are strongest when joined by the voices of city leaders. Below is a list of current legislative proposals that local officials should act on to support cities' top legislative priorities, along with sample support or opposition letters.

Proposed Advanced Clean Fleet Regulations
The California Air Resource Board’s (CARB) proposed Advanced Clean Fleet regulation has unclear, exploitable provisions and unattainable timelines. The proposed regulation would require all new class 2b-8 vehicle purchases, such as garbage trucks, to become zero-emission by 2027.

With a few exceptions, most government agencies in California would be impacted by this change. Voice your concerns to CARB’s proposed Advanced Clean Fleet regulation by submitting a letter TODAY. For information about how the measure could impact your community, contact your local public affairs manager.

AB 1708 (Muratsuchi) Proposition 47 Reform
Proposition 47 made promises of safe neighborhoods, but the unintended consequences that followed have undermined that promise. AB 1708 (Muratsuchi) would increase accountability for repeat theft offenders and offer pathways for pre-plea diversion programming.

If passed, the bill would send the issue to the voters for approval at the next statewide general election. Voice your SUPPORT by submitting a letter to the Assembly Public Safety Committee. If your assembly member is on the committee, it is important to submit a letter and call them to express your support!
2023-24 State Budget Priorities for Cities
Cal Cities is calling on the state and Legislature to invest $3 billion in ongoing funding for cities to increase the supply of affordable housing and reduce homelessness, invest $1 billion to reimburse cities for unfunded mandates, and lay off any action that would reduce or eliminate funding for cities or divert essential local revenue sources.

Take action today by sending a letter to Budget Committee chairs and vice chairs requesting investments in the 2023-24 state budget that bolster local government efforts to support our most vulnerable residents and ensure cities can thrive!
State Ballot Measure Restricting Voters’ Input and Local Taxing Authority
The anti-local control California Business Roundtable measure has qualified for the November 2024 ballot. This anti-local control measure will decimate vital local and state services to the benefit of the largest and wealthiest corporations in California. Cal Cities, along with a broad coalition of local governments, labor, public safety, education, and infrastructure advocates, strongly oppose this initiative.

Make sure your city’s voice is heard by adopting a resolution opposing the harmful measure. Adopted city resolutions can be sent to [email protected]. For information about how the measure could impact your community, contact your local public affairs manager.

Carpinteria City CouncilMay 8, 2023

Carpinteria City Council
May 8, 2023