Agenda packet — Cotati City Council, September 27, 2022

AGENDA

JOINT MEETING OF THE COTATI CITY COUNCIL AND THE SUCCESSOR

AGENCY TO THE FORMER COTATI COMMUNITY REDEVELOPMENT AGENCY Tuesday September 27, 2022
6:00 PM REGULAR MEETING
Pursuant to AB 361 (2021), Teleconference Restrictions of the Brown Act Have Been Suspended, as Well as the Requirement to Provide a Physical Location for Members of the Public to Participate in the Meeting.

Cotati City Council and Planning Commission Meetings will be conducted virtually through Zoom Online video conferencing, and will still be available to watch or listen in the following ways:

1. Using the following online livestream meeting portal link: http://cotaticityca.iqm2.com/citizens/default.aspx;

2. Cable T.V. Broadcast, local channel 28
Members of the public can participate in the meeting online by selecting “Join a Meeting” at zoom.us. The credentials for joining the meeting are provided below:

Webinar ID: 882 0875 9408
Passcode: 428917
If you do not have the ability to join online, but would like to participate in the meeting, you can call into the meeting using your telephone, by dialing one of the following numbers and entering the meeting credentials:
+1 (669) 900-6833 or +1 (346) 248-7799 or +1 (253) 215-8782 or +1 (301) 715-8592 or +1 (312) 626-6799 or +1 (929) 436-2866
Attendees may join the meeting any time after 5:45pm. Attendees will be muted until they are called upon for Public Comment. To make a public comment, use the “raise hand” icon on your smart device or desktop computer, or dial *9 if you are using just your telephone. Please listen carefully for the Mayor or City Clerk to address you by name (or phone number) and for the audible Zoom notification that you have been unmuted. Once you begin your public comment, your three minutes will begin.

If you would prefer to submit your public comment in writing, please email your comments to [email protected]. If you are commenting on a specific agenda item or items, please state the agenda item number(s) in the subject line of the email. All comments received via email will be provided to the City Council or Planning Commission in writing and included as part of the record of the meeting. ###
The Cotati City Council welcomes you to its meetings that are generally scheduled for the 2nd and 4th Tuesday of every month. Your interest and participation are encouraged and appreciated.

City Council meeting agendas, minutes, and recordings are posted on the City’s Meeting Portal at www.cotaticity.org.

For questions about the agenda of to receive the City Council agenda by email, contact the Deputy City Clerk at [email protected] or (707) 665-3622.

Notice is hereby given that Council may discuss and/or take action on any or all of the items listed on this agenda.

Cotati City Council Agenda September 27, 2022

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Any writings or documents provided to a majority of the Cotati City Council regarding any item on this agenda will be made available for inspection in the online Meeting Portal at www.cotaticity.org and in the City Manager’s office located at 201 West Sierra Ave, Cotati, CA during the City’s posted business hours.

Disabled Accommodations: Upon request, this agenda will be made available in appropriate formats to persons with disabilities as required by Section 202 of the Americans with Disabilities Act of 1990. Any person with a disability who requires a modification or accommodation in order to participate in a meeting should contact the Deputy City Clerk at [email protected], or (707) 665-3622, at least 48 hours in advance of the meeting.

Public Comment (Action Items): Public comment on any one agenda item where the City Council will be taking some action is limited to no more than three (3) minutes per person. Action items are typically designated on the agenda title.

Public Comment (Non-Action Items): Public comment on non-action agenda items shall be received during the designated portion of the agenda. Comments shall be limited to no more than three (3) minutes for all non-action agenda items.

Waiver Warning: If you challenge decisions/direction of the City Council of the City of Cotati in court, you may be limited to raising only those issues you or someone else raised at public hearing(s) described in this agenda, or in written correspondence delivered to the City of Cotati at, or prior to, the public hearing(s).

City Council meetings are conducted according to City Council Policy 2021-01: City Council Rules. This policy is available for inspection in the online Meeting Portal at www.cotaticity.org and in the City Manager’s office located at 201 West Sierra Ave, Cotati, CA, during the City’s posted business hours.

Persons wishing to address the Council are not required to identify themselves or complete a speaker card; (Gov’t Code § 54953.3); however, this information assists the Mayor by ensuring that all persons wishing to address the Council are recognized and it assists the Deputy City Clerk in preparing the City Council meeting minutes.

1. CALL TO ORDER

2. ROLL CALL

3. PLEDGE OF ALLEGIANCE

4. APPROVAL OF MINUTES AND NOTICE OF WAIVING OF READING OF ALL

RESOLUTIONS AND ORDINANCES INTRODUCED AND/OR ADOPTED

UNDER THIS AGENDA (ACTION)
A. COTATI CITY COUNCIL - REGULAR MEETING - SEP 13, 2022 6:00 PM

5. ANNOUNCEMENTS
A. Meeting Orientation for New Attendees/Viewers. In conformance with the Brown Act and the adopted City Council Rules, the meeting agenda includes items labeled as Action Items, where the City Council will consider the item and citizens are afforded the opportunity to provide comments relevant to the item being discussed. The meeting agenda also includes a Citizens Business item, which is the designated place on the agenda where citizens have the right to say whatever they wish.

The City Council may, or may not, choose to respond to comments, as the Government Code allows. However, if the City Council declines to respond, it should not be perceived as giving credence to or agreeing with any statements that the City Council or its members believe are incorrect, misinformed or purposefully biased.

Cotati City Council Agenda September 27, 2022

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B. Measure S supports police services, a variety of recreation programs for all ages, and the maintenance of our streets, parks, and public buildings. See details on the web at cotaticity.org
C. Citizens interested in receiving City of Cotati community alerts via text or email are encouraged to sign up with Nixle by downloading the Everbridge app from the IOS or Android app store or by texting your zip code (94931) to 888777.

D. Like always, we love to hear from you, so please feel free to contact the City at 707- 792-4600 or [email protected]. If you have a non-emergency issue after normal business hours, you can contact us at 707-792-4611 and of course if you have an emergency, please contact 9-1-1. Continue to look for updates on the City's website and social media channels available on Facebook, Instagram, Nixle, and Nextdoor.

6. APPROVAL OF FINAL AGENDA (ACTION)

7. CITIZEN BUSINESS AND PUBLIC COMMENT FOR CONSENT CALENDAR ITEMS
Any member of the public wishing to speak to the Council on any item(s) listed on the Consent Calendar or any matter(s) not listed on the agenda that are within the subject matter jurisdiction of the Council may do so at this time. Pursuant to the Brown Act, the Council is not allowed to consider issues or take action on any item not listed on the agenda during this period. Pursuant to City Council Policy 2021-01, comments of any member of the public are normally restricted to a total of three (3) minutes in length per person for matters not on the agenda and a total of three (3) minutes per person in length for any and all items on the Consent Calendar.

The Mayor may extend the time limit for a reasonable time where a disability accommodation has been requested.

8. CONSENT CALENDAR (ACTION)
A. ADOPTION OF AN ORDINANCE TO APPROVE A MILITARY

EQUIPMENT USE POLICY
It is recommended that the City Council adopt an Ordinance for a Military Equipment Use Policy in accordance with AB 481.

B. ADOPTION OF A RESOLUTION TO CONTINUE CONDUCTING

COUNCIL, COMMISSION, AND COMMITTEE MEETINGS REMOTELY

DUE TO HEALTH AND SAFETY CONCERNS FOR THE PUBLIC
It is recommended that the City Council of the City of Cotati adopt a resolution authorizing virtual city council, commission and committee meetings during a declared state of emergency pursuant to government code 54953 (AB 361) C. ADOPTION OF AN AMENDED CITY WIDE SALARY SCHEDULE FOR FISCAL YEAR 2022/23
It is recommended that the City Council adopt a revised fiscal year 2022/23 salary schedule to incorporate the Associate Engineer position.

9. DIRECTION ON FUTURE AGENDA ITEMS

10. PUBLIC HEARINGS (ACTION)
Cotati City Council Agenda September 27, 2022

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A. MASTER FEE SCHEDULE UPDATE
It is recommended that the City Council of the City of Cotati adopt a resolution updating the Master Fee Schedule and charges for City services and repealing previously adopted or conflicting fees and charges for such services.

11. REGULAR AGENDA (ACTION)
A. CONSIDERATION OF A RESOLUTION TO APPROVE A DEFERRAL OF

IMPACT FEES AND GRANTING OF FUNDS FOR AFFORDABLE
HOUSING AND PUBLIC IMPROVEMENTS, AN ASSOCIATED INTERFUND GRANT, AND AFFORDABLE HOUSING AGREEMENT FOR THE

COTATI STATION APARTMENTS PROJECT
It is recommended that the City Council adopt:

1. A resolution to defer impact fees and grant funds for affordable housing and public improvements through an Impact Fee Deferral and Grant Agreement, including an associated inter-fund grant; and

2. A resolution to approve the Affordable Housing Agreement for the Cotati Station Apartments Project.

B. PROPOSED CHANGES TO THE SONOMA COUNTY TOURISM BUSINESS

IMPROVEMENT ASSESSMENT
It is recommended that the City Council adopt a resolution of consent to removing the minimum revenue threshold for tourism assessment in the existing Business Improvement Assessment (BIA).

12. CITY MANAGER'S REPORT

13. CITY COUNCIL MEMBER REPORTS

14. PUBLIC COMMENT ON NON-ACTION AGENDA ITEMS

15. INFORMATION RECEIVED AFTER THE AGENDA WAS POSTED
A. INFORMATION RECEIVED AFTER THE AGENDA WAS POSTED
Information or written comments pertaining to this meeting, and which was received after the agenda was posted, is attached below.

16. ADJOURNMENT
Certification of Posting of the Notice: I declare under penalty of perjury that I am employed by the City of Cotati and that I posted this notice on the City's website, bulletin boards of City Hall, Veterans' Memorial Building and the SMART Train Depot, on or before September 23, 2022.
/s/ Kevin Patterson, Deputy City Clerk

MINUTES

JOINT MEETING OF THE COTATI CITY COUNCIL AND THE SUCCESSOR

AGENCY TO THE FORMER COTATI COMMUNITY REDEVELOPMENT AGENCY Tuesday September 13, 2022
6:00 PM REGULAR MEETING

1. CALL TO ORDER
Mayor Landman called the meeting to order at 6:05pm.

2. ROLL CALL
Attendee Name Title Status
Mark Landman Mayor Remote
Susan Harvey Vice Mayor Remote
Laura Sparks Councilmember Remote
Ben Ford Councilmember Remote
John C. Moore Councilmember Remote
Staff present: City Attorney John Bakker, City Manager Damien O’Bid, Police Chief Michael Parish, Director of Public Works/City Engineer Craig Scott, Director of Administrative Services Angela Courter, Director of Community Development Noah Housh, Permit Technician Keri Pajon

3. PLEDGE OF ALLEGIANCE

4. APPROVAL OF MINUTES AND NOTICE OF WAIVING OF READING OF ALL

RESOLUTIONS AND ORDINANCES INTRODUCED AND/OR ADOPTED

UNDER THIS AGENDA (ACTION)
A. COTATI CITY COUNCIL - REGULAR MEETING - AUG 23, 2022 6:00 PM RESULT: ACCEPTED [UNANIMOUS]
MOVER: Susan Harvey, Vice Mayor
SECONDER: Ben Ford, Councilmember
AYES: Landman, Harvey, Sparks, Ford, Moore
No public comment.

5. ANNOUNCEMENTS

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Minutes Acceptance: Minutes of Sep 13, 2022 6:00 PM (APPROVAL OF MINUTES AND NOTICE OF WAIVING OF READING OF ALL Cotati City Council Minutes September 13, 2022

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A. Meeting Orientation for New Attendees/Viewers. In conformance with the Brown Act and the adopted City Council Rules, the meeting agenda includes items labeled as Action Items, where the City Council will consider the item and citizens are afforded the opportunity to provide comments relevant to the item being discussed. The meeting agenda also includes a Citizens Business item, which is the designated place on the agenda where citizens have the right to say whatever they wish.

6. PROCLAMATIONS
A. A PROCLAMATION OF THE CITY COUNCIL OF THE CITY OF COTATI PROCLAIMING THE WEEK OF SEPTEMBER 17 THROUGH 24, 2022 AS “NATIONAL POLLUTION PREVENTION WEEK” AND "CREEK WEEK"
Andy Rodgers, Executive Director of the Russian River Watershed Association, received the proclamation.

Councilmembers comment.

Public Comment:

Jenny Blaker of Cotati

7. APPROVAL OF FINAL AGENDA (ACTION)
No changes.

8. CITIZEN BUSINESS AND PUBLIC COMMENT FOR CONSENT CALENDAR ITEMS
No public comment.

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Minutes Acceptance: Minutes of Sep 13, 2022 6:00 PM (APPROVAL OF MINUTES AND NOTICE OF WAIVING OF READING OF ALL Cotati City Council Minutes September 13, 2022

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9. CONSENT CALENDAR (ACTION)
RESULT: ADOPTED [UNANIMOUS]
MOVER: Susan Harvey, Vice Mayor
SECONDER: Ben Ford, Councilmember
AYES: Landman, Harvey, Sparks, Ford, Moore
A. ACCEPT THE FISCAL YEAR 2021-2022 ANNUAL REPORT OF
DEVELOPMENT IMPACT FEE (AB1600)
B. AWARD CONSTRUCTION CONTRACT AND CONSTRUCTION

MANAGEMENT PROFESSIONAL SERVICES AGREEMENT FOR THE

WEST SIERRA AVENUE SEWER REPLACEMENT PROJECT
C. ADOPT AN ORDINANCE TO AMEND THE CALIFORNIA PUBLIC
EMPLOYEES’ RETIREMENT SYSTEM CONTRACT WITH THE CITY OF
COTATI
D. SONOMA STATE POLICE DISPATCH CONTRACT EXTENSION

10. DIRECTION ON FUTURE AGENDA ITEMS
None.

11. PUBLIC HEARINGS (ACTION)
A. PUBLIC HEARING REGARDING AN ORDINANCE TO APPROVE A

MILITARY EQUIPMENT USE POLICY
RESULT: INTRODUCED [3 TO 2]
Next: 9/27/2022 6:00 PM
MOVER: John C. Moore, Councilmember
SECONDER: Susan Harvey, Vice Mayor
AYES: Landman, Harvey, Moore
NAYS: Sparks, Ford
Presentation by Chief of Police Michael Parish.

Councilmembers primarily discuss bean bag shotgun and mutual aid portions of the proposed policy. Council amends 709.4(a)(b)(c) to replace "or is" with "such as" to clarify riotous behavior.

Public Comment:

Will Prouty
Marjory Crump-Shears of Cotati

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Minutes Acceptance: Minutes of Sep 13, 2022 6:00 PM (APPROVAL OF MINUTES AND NOTICE OF WAIVING OF READING OF ALL Cotati City Council Minutes September 13, 2022

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12. REGULAR AGENDA (ACTION)
A. CONSIDERATION AND FINAL DIRECTION ON THE COTATI TRAIL

AND DOWNTOWN INTERPRETIVE SIGN PANEL DESIGNS
Presentation by Director of Community Development Noah Housh.

Councilmembers comment.

Public Comment:

Jenny Blaker of Cotati
Marie McNaughton of Cotati
Council supports moving forward with the presented design without returning to Council, incorporating edits provided by public comments, seeking to provide a more accurate photograph of the type of shelter used by tribes in the area, and verifying text describing Native American tribes.

B. CITY COUNCIL CONSIDERATION OF THE SONOMA COUNTY GRAND

JURY RESPONSE
Presentation by Director of Community Development Noah Housh.

Councilmembers comment.

No public comment.

Council approves Mayor Landman to sign the recommended response to the Sonoma County Grand Jury.

13. CITY MANAGER'S REPORT
Report by City Manager Damien O'Bid.

14. CITY COUNCIL MEMBER REPORTS
Councilmembers report out on local and regional meetings and events.

15. PUBLIC COMMENT ON NON-ACTION AGENDA ITEMS
No public comment.

16. INFORMATION RECEIVED AFTER THE AGENDA WAS POSTED
A. INFORMATION RECEIVED AFTER THE AGENDA WAS POSTED

17. ADJOURNMENT
Mayor Landman adjourned the meeting at 8:32pm.

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Minutes Acceptance: Minutes of Sep 13, 2022 6:00 PM (APPROVAL OF MINUTES AND NOTICE OF WAIVING OF READING OF ALL Cotati City Council
Agenda Staff Report
Item type: CONSENT CALENDAR (ACTION)
To: City Council
Subject: Adoption of an Ordinance to Approve a Military Equipment Use Policy Date: September 27, 2022
Written by: Damien O'Bid, City Manager
Recommendation
It is recommended that the City Council adopt an Ordinance for a Military Equipment Use Policy in accordance with AB 481.

Background
Assembly Bill 481 (AB 481), codified in Government Code Sections 7070 through 7075 requires each law enforcement agency (LEA) to obtain approval from their governing body, via adoption of a military equipment use policy by ordinance, prior to that LEA funding, acquiring, or using military equipment. AB 481 requires each law enforcement agency to begin the process of obtaining such approval, otherwise, the LEA can no longer use the existing equipment. Once a policy is adopted, a LEA cannot procure military equipment that is not in the authorized policy, without first revising the policy, which is done by ordinance following a public hearing. A draft Military Equipment Use Policy was available publicly on the City of Cotati website, police department policy page, on June 20, 2022.

The term “military equipment”, as used in AB 481, in fact does not necessarily indicate equipment that has been used by the military. Pursuant to AB 481, items deemed to be “military equipment” include, but are not limited to, unmanned aerial or ground vehicles, armored vehicles, command and control vehicles, pepper balls, less lethal shotguns, less lethal 40mm projectile launchers, long range acoustic devices and flashbangs. The Cotati Police Department (CPD) uses the following equipment that is classified as “miliary equipment” under AB 481:
• Shotguns with bean bag rounds
• Sonoma County Operational Area Command Vehicle (Dodge Cargo Van)

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On July 26, 2022, the City Council opened the public hearing on this item and continued it to August 23, 2022. This item was again continued without discussion at the August 23, 2022 meeting. The item was heard again on September 13, 2022. After lengthy discussion on September 13, the authorized use section of the AB 481 policy was modified to clarify examples of “riotous” behavior before it was introduced. The amended policy is attached to the ordinance.

Shotguns with bean bag rounds
CPD is committed to using the most up to date tools and equipment to safeguard the citizens of Cotati. The above item deemed to be “military equipment” by AB 481 is utilized by CPD, and other LEAs across the country, specifically to reduce risk to community members. This less-lethal force option is the only means currently available to our officers to attempt to resolve encounters with a potentially violent person or person with a weapon from the distance of up to 75 (seventy-five) feet. This item provides police officers with the ability to safely resolve volatile situations which otherwise might rise to the level of a lethal force encounter. The shotguns used to deploy bean bag rounds by CPD have bright orange forestocks and buttstocks indicating to allied agencies that it is a less-lethal shotgun. CPD does not deploy regular shotguns (we have rifles) so there cannot be confusion between lethal vs less-lethal rounds.

To that end, the items at issue in this report, and accompanying Military Equipment Use Policy, also provide CPD officers with vital tools that facilitate compliance with its stringent use of force policy.

Sonoma County Operational Area Command Vehicle
As defined by AB 481, command and control vehicles that are either built or modified to facilitate the operational control and direction of public safety units are considered Military Equipment. On behalf of the Sonoma County Operational Area (all cities and the county, within Sonoma County), CPD hosts and operates a 2007 Dodge Command Cargo Van, which was procured through the State Homeland Security Grant Program (SHSGP) in 2006. This van is designated as a Sonoma County Operational Area Command Vehicle. This vehicle is made available for law enforcement purposes to support response (command and control) to active law enforcement deployment including but not limited to planned events, criminal investigations, natural disasters and active threats.

The Command Vehicle currently has one thousand six hundred (1,624) operational miles on the odometer. There are no current plans to replace the Command Vehicle. Images of the vehicle are provided below:

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Analysis/Discussion
CPD seeks approval of a military equipment use policy so that it can continue to make use of the following equipment:
• Shotguns with bean bag rounds
• Sonoma County Operational Area Command Vehicle (Dodge Cargo Van) There is significant interest in ensuring that law enforcement continues to have access to equipment that will provide peace officers as many options as possible to safeguard lives, ensure safety, and protect civil liberties. The use of the tools identified above are vital to the CPD mission and will continue to be strictly regulated through internal processes and oversight.

The proposed ordinance would approve the CPD Policy 709, “Military Equipment.” Policy 709 outlines each piece of the above military equipment that is currently owned by the City.

The policy also includes the current authorized uses and cost of each item. These particular items, and their stated authorized uses, have been in place prior to the enactment of AB 481.

Any future acquisitions of any item deemed to be “military equipment” will require a further public meeting, policy update, and Council approval.

Policy 709 ensures that there are safeguards, including transparency, oversight, and accountability measures in place. CPD will create an annual military equipment report, which is expected to be provided in conjunction with the Police Chief’s Annual Report to the Community.

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Violations of Policy 709 will be corrected when discovered, in accordance with existing Department policy. All items which are involved in a use of force event will be reviewed, as is already required by existing CPD policy. CPD has not discovered alternative items that can achieve the same objectives of officer and civilian safety.

Draft Policy Updates
Following the public hearing on July 26, 2022, there have been two changes to the proposed AB 481 policy. The first was to ensure clarity on mutual aid responses, with changes indicated in redline/strikeout. The second change was to align the AB 481 policy on authorized uses of bean bag shotguns with existing policy (CPD Policy Manual, Section 308.8) to ensure consistency across these policies, as indicated.

Financial Considerations
Compliance with Policy 709 will require additional staff time, including the duties defined by the Military Equipment Coordinator, and additional administrative time creating the annual Military Equipment Report. The staff time required is unknown at this time, but is expected to be up to 80 person hours per year.

Environmental Issues
The City Council finds the approval of this ordinance is exempt under Section 15061(b)(3) of the CEQA Guidelines because it can be seen with certainty that there is no possibility that the adoption of this ordinance may have a significant effect on the environment.

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ORDINANCE NO.

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF COTATI APPROVING

A POLICY FOR ACQUISITION AND USE OF MILITARY EQUIPMENT, IN ACCORDANCE WITH AB 481
WHEREAS, On September 30, 2021, Governor Gavin Newsom signed into law Assembly Bill 481, relating to the use of military equipment by law enforcement agencies; and WHEREAS, Assembly Bill 481, codified at California Government Code sections 7070 through 7075, requires law enforcement agencies to obtain approval of the applicable governing body prior to taking certain actions relating to the funding, acquisition, solicitation, or use of military equipment; and
WHEREAS, Assembly Bill 481, requires that the approval by the governing body be by an ordinance adopting a military equipment use policy, at a regular meeting held pursuant to open meeting laws; and
WHEREAS, Assembly Bill 481 allows the governing body of a city to approve the funding, acquisition, or use of military equipment within its jurisdiction only if it makes specified determinations with respect to a military equipment use policy; and WHEREAS, a draft of the Cotati Police Department Policy 709 “Military Equipment” (Exhibit A) was published on the Cotati Police Department internet website at least 30 days prior to opening the public hearing on July 26, 2022 in accordance with requirements of Government Code section 7071; and
WHEREAS, a draft of the Cotati Police Department Policy 709 “Military Equipment” (Exhibit A) was initially presented to the City Council at a public hearing on July 26, 2022, with introduction of the ordinance continued to August 23, 2022 and again continued to September 13, 2022, at which time it was introduced; and
WHEREAS, the Cotati Police Department Policy 709 “Military Equipment” meets the requirements of California Government Code section 7070, subdivision (d); and WHEREAS, the military equipment identified in the Cotati Police Department Policy 709 “Military Equipment” is necessary, because there are no reasonable alternatives that can achieve the same objectives of officer and civilian safety; and WHEREAS, The Cotati Police Department Policy 709 “Military Equipment” will safeguard the public’s welfare, safety, civil rights, and civil liberties; and WHEREAS, the military equipment identified in Cotati Police Department Policy 709 “Military Equipment” is reasonably cost effective compared to available alternatives that can achieve the same objective of officer and civilian safety; and Packet Pg. 13
WHEREAS, no prior military use policy has existed in the City of Cotati that was applicable to the use of military equipment, and the adoption of such policy shall serve to secure future compliance;

NOW THEREFORE, THE CITY COUNCIL OF THE CITY OF COTATI DOES ORDAIN AS FOLLOWS:

SECTION 1. Recitals. The above recitals are adopted as findings of the City Council in enacting this ordinance.

SECTION 2. Adoption of Policy. The Cotati Police Department Policy 709 “Military Equipment” (Exhibit A) is hereby approved and adopted.

SECTION 3. Reporting and Publication of Policy. In accordance with Government Code section 7071, the Chief of Police shall cause the Cotati Police Department Policy 709 “Military Equipment” to be made publicly available on the Department’s internet website for as long as military equipment is available for use. The Police Department is directed to make available the reports and conduct the required community engagement meeting required by Government Code section 7072 on an annual basis.

SECTION 4. Effective Date. This ordinance shall be in full force and effective 30 days after its adoption.

SECTION 5. Publication of Ordinance. The City Clerk is directed to cause this ordinance to be published in the manner required by law.

SECTION 6. Environmental Review. The City Council finds the approval of this ordinance is exempt under Section 15061(b)(3) of the CEQA Guidelines because it can be seen with certainty that there is no possibility that the adoption of this ordinance may have a significant effect on the environment.

Approved:________________________________
Mayor
Attest:____________________________
Kevin Patterson, Deputy City Clerk
Approved as to form:
___________________________
John Bakker, City Attorney
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This document is a true and correct copy of Ordinance Number and has been published or posted pursuant to law. California Government Code § 40806
_______________________________
Kevin Patterson, Deputy City Clerk
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Policy
709
Cotati Police Department
Cotati PD Policy Manual
Copyright Lexipol, LLC 2022/09/21, All Rights Reserved.

Published with permission by Cotati Police Department ***DRAFT*** Military Equipment - 1 Military Equipment
709.1 PURPOSE AND SCOPE
The purpose of this policy is to provide guidelines for the approval, acquisition, and reporting requirements of military equipment (Government Code § 7070; Government Code § 7071; Government Code § 7072).
709.1.1 DEFINITIONS
Definitions related to this policy include (Government Code § 7070):

Governing body – The elected or appointed body that oversees the Department.

Military equipment – Includes but is not limited to the following:
• Unmanned, remotely piloted, powered aerial or ground vehicles. • Mine-resistant ambush-protected (MRAP) vehicles or armored personnel carriers. • High mobility multipurpose wheeled vehicles (HMMWV), two-and-one-half-ton trucks, five-ton trucks, or wheeled vehicles that have a breaching or entry apparatus attached. • Tracked armored vehicles that provide ballistic protection to their occupants. • Command and control vehicles that are either built or modified to facilitate the operational control and direction of public safety units. • Weaponized aircraft, vessels, or vehicles of any kind. • Battering rams, slugs, and breaching apparatuses that are explosive in nature. This does not include a handheld, one-person ram.
• Firearms and ammunition of_.50 caliber or greater, excluding standard-issue shotguns and standard-issue shotgun ammunition.
• Specialized firearms and ammunition of less than_.50 caliber, including firearms and accessories identified as assault weapons in Penal Code § 30510 and Penal Code § 30515, with the exception of standard-issue firearms.
• Any firearm or firearm accessory that is designed to launch explosive projectiles. • Noise-flash diversionary devices and explosive breaching tools. • Munitions containing tear gas or OC, excluding standard, service-issued handheld pepper spray.
• TASER® Shockwave, microwave weapons, water cannons, and long-range acoustic devices (LRADs).
• Kinetic energy weapons and munitions.
• Any other equipment as determined by a governing body or a state agency to require additional oversight.

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Attachment: Exhibit A: Military Equipment Policy (AB 481 Military Equipment Ordinance v2) Cotati Police Department
Cotati PD Policy Manual
Military Equipment
Copyright Lexipol, LLC 2022/09/21, All Rights Reserved.

Published with permission by Cotati Police Department ***DRAFT*** Military Equipment - 2 709.2 POLICY
It is the policy of the Cotati Police Department that members of this department comply with the provisions of Government Code § 7071 with respect to military equipment. 709.3 MILITARY EQUIPMENT COORDINATOR
The Chief of Police should designate a member of this department to act as the military equipment coordinator. The responsibilities of the military equipment coordinator include but are not limited to:
(a) Acting as liaison to the governing body for matters related to the requirements of this policy.
(b) Identifying department equipment that qualifies as military equipment in the current possession of the Department, or the equipment the Department intends to acquire that requires approval by the governing body.
(c) Conducting an inventory of all military equipment at least annually. (d) Collaborating with any allied agency that may use military equipment within the jurisdiction of Cotati Police Department (Government Code § 7071). (e) Preparing for, scheduling, and coordinating the annual community engagement meeting to include:

1. Publicizing the details of the meeting.

2. Preparing for public questions regarding the department’s funding, acquisition, and use of equipment.
(f) Preparing the annual military equipment report for submission to the Chief of Police and ensuring that the report is made available on the department website (Government Code § 7072).
(g) Establishing the procedure for a person to register a complaint or concern, or how that person may submit a question about the use of a type of military equipment, and how the Department will respond in a timely manner.
709.4 MILITARY EQUIPMENT INVENTORY
The following constitutes a list of qualifying equipment for the Department:
[Insert attachment here]
(a) Less Lethal Shotgun: Less Lethal Shotguns are used to deploy the less lethal 12- gauge Defense Technology Drag Stabilized Bean Bag Round. (a) Description, quantity, capabilities and purchase cost (a) REMINGTON MODEL 870 LESS LETHAL SHOTGUN, cost: $750, quantity: 4. The Remington 870 Less Lethal Shotgun is used to deploy the less lethal 12-guage Defense Technology Bean Bag Round up to a maximum effective distance of 75 feet. The rang of the weapon system helps maintain the distance between the officers and a suspect reducing the immediacy of the threat, which is a principle of de-escalation.

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Attachment: Exhibit A: Military Equipment Policy (AB 481 Military Equipment Ordinance v2) Cotati Police Department
Cotati PD Policy Manual
Military Equipment
Copyright Lexipol, LLC 2022/09/21, All Rights Reserved.

Published with permission by Cotati Police Department ***DRAFT*** Military Equipment - 3 (b) 12-GAUGE DEFENSE TECHNOLOGY DRAG STABILIZED BEAN BAG ROUND, cost $7, quantity 150. The 12-gauge Defense Technology Drag Stabilized Bean Bag Round is a translucent 12-Guage shell loaded with a 40-Gram tear shaped bag made from cotton and ballistic material blend and filled with #9 shot. This design utilized four stabilizing tails and utilizes smokeless powder as a propellant. This round has a velocity of 270 feet per second (FPS) and a maximum effective range of 75 feet. This round proves most effective within the range of 20 to 50 feet. Accuracy is relative to the shotgun, barrel length, environmental conditions, and the operator.

This round is very accurate, however effectiveness depends on many variables, such as distance, clothing, stature, and the point of impact. (b) Authorized Use – Situations for use of less lethal weapons systems may include, but are not limited to:
(a) The suspect is armed with a weapon and the tactical circumstances allow for the safe application of approved munitions.
(b) The suspect has made credible threats to harm him/herself or others. (c) The suspect is engaged in riotous behavior such as throwing rocks, bottles or other dangerous projectiles at people and/or officers (d) There is probable cause to believe that the suspect has already committed a crime of violence and is refusing to comply with lawful order (e) Self-destructive, dangerous and/or combative individuals. Riot/crowd control and civil unrest incidents
(f) Circumstances where a tactical advantage can be obtained (g) Potentially vicious animals
(h) Training exercises
(c) Lifespan
(a) Remington 870 Less Lethal Shotgun: 35 years
(b) 12-gauge Defense Technology Drag Stabilized Bean Bag Round: 5 year warranty, but no listed expiration date
(d) Fiscal Impact – Annual Maintenance is approximately $50 per shotgun. (e) Training – Sworn Members of the Cotati Police Department utilizing the 12- Gauge Less Lethal Shotgun and munitions shall be trained in the use of such items by POST Certified Instructors.
(f) Legal and Procedural Rules – Use of the Less Lethal Shotguns and munitions is subject to the Policy 312 (Firearms), Policy 308.8 (Kinetic Energy Projectile Guidelines) and Policy 300 (De-escalation and Use of Force). It is the policy of the Cotati Police Department to utilize the less lethal shotgun only for official law enforcement purposes, and pursuant to State and Federal Law, including those regarding the use of force.
(b) Command and Control Vehicles:

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Attachment: Exhibit A: Military Equipment Policy (AB 481 Military Equipment Ordinance v2) Cotati Police Department
Cotati PD Policy Manual
Military Equipment
Copyright Lexipol, LLC 2022/09/21, All Rights Reserved.

Published with permission by Cotati Police Department ***DRAFT*** Military Equipment - 4 (a) Description, quantity, capabilities, and purchase cost (a) 2007 DODGE COMMAND CARGO VAN, cost: $76,208.04 obtained through a State Homeland Security Grant Program, quantity: 1. This van is an upfitted emergency response vehicle equipped with emergency lights and a siren. This van is available for other cities in Sonoma County as a designated Sonoma County Operational Area Command Vehicle. (b) Purpose – This vehicle is to be made available for law enforcement purposes in order to support law enforcement response (Command and Control Center) at an incident.
(c) Authorized Use – Situations for use of this vehicle may include, but are not limited to:
(a) Planned Events
(b) Criminal Investigations
(c) Natural Disasters
(d) Active Threats
(d) Training – The Cotati Police Department has a trained member responsible for ensuring the van and all of the equipment inside are operational. There are no additional certifications or driver's license endorsements needed to drive the van.
(e) Lifespan – The van currently has 1,624 operational miles on the odometer and there are no current plans to replace the van.
(f) Fiscal Impact- – Annual Cost of less than $1,000.00 annually to include fuel and maintenance costs.
(g) Legal and Procedural Rules- – Use of the van is subject to the requirements of Policy 704 (Vehicle Maintenance) and Policy 706 (Vehicle Use) 709.5 APPROVAL
The Chief of Police or the authorized designee shall obtain approval from the governing body by way of an ordinance adopting the military equipment policy. As part of the approval process, the Chief of Police or the authorized designee shall ensure the proposed military equipment policy is submitted to the governing body and is available on the department website at least 30 days prior to any public hearing concerning the military equipment at issue (Government Code § 7071). The military equipment policy must be approved by the governing body prior to engaging in any of the following (Government Code § 7071):
(a) Requesting military equipment made available pursuant to 10 USC § 2576a. (b) Seeking funds for military equipment, including but not limited to applying for a grant, soliciting or accepting private, local, state, or federal funds, in-kind donations, or other donations or transfers.

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Attachment: Exhibit A: Military Equipment Policy (AB 481 Military Equipment Ordinance v2) Cotati Police Department
Cotati PD Policy Manual
Military Equipment
Copyright Lexipol, LLC 2022/09/21, All Rights Reserved.

Published with permission by Cotati Police Department ***DRAFT*** Military Equipment - 5 (c) Acquiring military equipment either permanently or temporarily, including by borrowing or leasing.
(d) Collaborating with another law enforcement agency in the deployment or other use of military equipment within the jurisdiction of this department. (e) Using any new or existing military equipment for a purpose, in a manner, or by a person not previously approved by the governing body.
(f) Soliciting or responding to a proposal for, or entering into an agreement with, any other person or entity to seek funds for, apply to receive, acquire, use, or collaborate in the use of military equipment.
(g) Acquiring military equipment through any means not provided above. 709.6 COORDINATION WITH OTHER JURISDICTIONS
Military equipment used by other jurisdictions that are providing mutual aid to this jurisdiction shall comply with their respective military equipment use policies in rendering mutual aid. Military equipment should not be used by any other law enforcement agency or member in this jurisdiction unless the military equipment is approved for use in accordance with this policy. 709.7 ANNUAL REPORT
Upon approval of a military equipment policy, the Chief of Police or the authorized designee should submit a military equipment report to the governing body for each type of military equipment approved within one year of approval, and annually thereafter for as long as the military equipment is available for use (Government Code § 7072).

The Chief of Police or the authorized designee should also make each annual military equipment report publicly available on the department website for as long as the military equipment is available for use. The report shall include all information required by Government Code § 7072 for the preceding calendar year for each type of military equipment in department inventory. 709.8 COMMUNITY ENGAGEMENT
Within 30 days of submitting and publicly releasing the annual report, the Department shall hold at least one well-publicized and conveniently located community engagement meeting, at which the Department should discuss the report and respond to public questions regarding the funding, acquisition, or use of military equipment.

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Attachment: Exhibit A: Military Equipment Policy (AB 481 Military Equipment Ordinance v2) Cotati City Council
Agenda Staff Report
Item type: CONSENT CALENDAR (ACTION)
To: City Council
Subject: Adoption of a resolution to continue conducting Council, Commission, and Committee meetings remotely due to health and safety concerns for the public Date: September 27, 2022
Written by: Kevin Patterson, Deputy City Clerk
Recommendation
It is recommended that the City Council of the City of Cotati adopt a resolution authorizing virtual city council, commission and committee meetings during a declared state of emergency pursuant to government code 54953 (AB 361)
Background
When the COVID-19 pandemic started, local agencies struggled to conduct their public meetings in compliance with the Brown Act’s public accessibility requirements while still abiding by stayat-home orders. As a result, Governor Newsom signed Orders N-25-20, N-29-20, and N-35-20 to grant local agencies the flexibility to meet remotely during the COVID-19 pandemic. These orders expired on September 30, 2021.

On September 16, 2021, Governor Newsom signed into law AB 361 – Brown Act: Remote Meetings During Emergencies. AB 361 went into effect immediately upon signature by the governor. It amends the Brown Act to allow local legislative bodies to continue having purely virtual meetings using teleconferencing and virtual meeting technology under specified conditions.

There are key differences between the Executive Orders, which expired September 30, 2021, and AB 361. AB 361 imposes requirements with respect to public comment, however, the City of Cotati currently satisfies legal requirements with respect to live public comment via Zoom in alignment with AB 361. Additionally, public agencies must either make findings by majority vote that the state of emergency still exists and continues to directly impact the ability of the members to meet safely in person, or that health officials continue to impose or recommend

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measures to promote social distancing. These conditions continue to exist. Determinations by the local agency that the emergency impacts the ability to meet safely in person must be revisited every 30 days.

Governor Newsom’s March 4, 2020 Proclamation of Emergency related to the COVID-19 pandemic is still in effect. In addition, the Sonoma County Public Health Officer continues to recommend teleconferencing or social distancing to protect the public’s health and safety during local government meetings.

Continuing the remote meetings would provide for a consistent meeting format until the pandemic emergency is lifted.

Analysis/Discussion
AB 361 amends Government Code Section 54953 to provide an alternative to having the public access the locations where City Councilmembers are teleconferencing in from. To have teleconference public meetings, without providing access to City Councilmember’s private residences, the City Council must pass a resolution stating that they have reconsidered the circumstances of the COVID-19 state of emergency and that any of the following circumstances exist:

1. The state of emergency as a result of COVID-19 continues to directly impact the ability of the members of City Council and the members of the City’s Commissions, and Committees to meet safely in person; and

2. State or local officials continue to impose or recommend measures to promote social distancing.

This Resolution makes the findings to confirm the current conditions to allow teleconference meetings pursuant to AB 361 for the City Council and on behalf of all of the commissions and committees created by the City Council pursuant to Government Code section 54952(b). The Resolution authorizes teleconference meetings including hybrid meetings held both via teleconference and in-person. This Resolution will allow members of the public to safely observe and participate in local government teleconference meetings during the continued pandemic.

AB 361 requires City Council to make these findings every 30 days to continue teleconference hearings. If adopted, staff will agendize this item once a month until the state of emergency is

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over, or City Council no longer believes teleconference meetings are necessary.

If the Resolution is not adopted, the City will be required to hold public meetings in-person or conduct teleconference meetings pursuant to subsection 54953(b)(3) of the California Government Code which will require posting of the agenda at each teleconference location and for the public to be admitted to each teleconference location.

Financial Considerations
There are no direct financial impacts from enactment of the proposed resolution.

Environmental Issues
This action is exempt from the California Environmental Quality Act (CEQA) because it is not a project which has a potential for resulting in either a direct physical change in the environment, or a reasonably foreseeable indirect physical change in the environment, pursuant to CEQA Guideline section 15378.

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RESOLUTION NO.

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF COTATI

AUTHORIZING VIRTUAL CITY COUNCIL MEETINGS DURING A DECLARED STATE OF EMERGENCY PURSUANT TO GOVERNMENT CODE 54953 (AB 361) WHEREAS, the City Council of the City of Cotati is committed to ensuring public access to observe and participate in local government meetings; and WHEREAS, all meetings of the City Council and its other legislative bodies created pursuant to Government Code section 54952(b) are open and public, as required by the Ralph M. Brown Act, so that any member of the public may participate in local government meetings; and
WHEREAS, on March 17, 2020, in response to the COVID-19 pandemic, the Governor signed Executive Order N-29-20 suspending certain provisions of the Brown Act in order to allow local legislative bodies to conduct meetings by teleconference or by other means; and WHEREAS, on June 11, 2021, Governor Newsom issued Executive Order N-08-21 which ended the provisions of Executive Order N-29-20 on September 30, 2021; and WHEREAS, on September 16, 2021, the Governor signed AB 361 (2021) into law allowing legislative bodies to continue to conduct meetings via teleconferencing under specified conditions, including the requirement that the legislative body make specified findings. AB 361 (2021) took effect on October 1, 2021; and WHEREAS, AB 361 requires that, if a state of emergency remains active, or state or local officials have imposed or recommended measures to promote social distancing, the legislative body shall make findings that it reconsidered the circumstances of the state of emergency and that either the state of emergency continues to directly impact the ability of the members to meet safely in person, or state or local officials continue to impose or recommend measures to promote social distancing; and
WHEREAS, the state of emergency proclaimed by the Governor on March 4, 2020, related to the pandemic of coronavirus commonly as COVID-19 has not been rescinded and remains in effect; and
WHEREAS, new variants of COVID-19 have developed, and risks of illness or death due to such variants remains significant to the general public; and WHEREAS, State and local health officials have imposed and recommended social distancing measures for the protection of public health and safety in response to COVID-19; and
WHEREAS, the Sonoma County Public Health Officer continues to recommend teleconferencing or social distancing during public meetings of all legislative bodies to protect the community’s health against the spread of COVID-19; and Packet Pg. 24
WHEREAS, teleconference meetings may include hybrid meetings, in which all or some members of the legislative body meet in person while others attend by teleconference, and members of the public are either allowed to participate only by teleconference or both in person and by teleconference (“hybrid meetings”). The purpose of hybrid meetings is to allow for multiple modes of attending meetings while reducing the risks of COVID-19, including its variants; and
WHEREAS, the City Council, acting as a legislative body pursuant to Government Code section 54952(a) and for the benefit of the commissions, committees, and other bodies that were created by the City Council pursuant to Government Code section 54952(b) (collectively referred to as “Legislative Bodies”), finds that the current conditions meet the circumstances set forth in Government Code section 54953(e)(3) to allow Legislative Bodies to continue to use teleconferencing to hold open and public meetings if the Legislative Bodies comply with the requirements set forth in Government Code section 54953(e)(2) to ensure the public can safely participate in and observe local government meetings.

NOW THEREFORE, BE IT RESOLVED by the City Council of the City of Cotati that:

Section 1. Recitals. The Recitals set forth above are true and correct and are incorporated into this Resolution by this reference.

Section 2. Current Conditions Authorize Teleconference Public Meetings of Legislative Bodies.

Based on the California Governor’s continued declaration of a State of Emergency and the Sonoma County Public Health Officer’s recommendation to continue teleconferencing or social distancing during public meetings, the City Council finds that the conditions continue to exist pursuant to Government Code sections 54953(e)(3) to allow Legislative Bodies to use teleconferencing to hold public meetings in accordance with Government Code section 54953(e)(2) to ensure members of the public have continued access to safely observe and participate in local government meetings.

Section 3. Authorize Legislative Bodies to Conduct Teleconference Meetings. The Legislative Bodies are hereby authorized to take all actions necessary to carry out the intent and purpose of this Resolution including, conducting open and public meetings in accordance with Government Code section 54953(e)(2) and other applicable provisions of the Brown Act.

Section 4. Effective Date. This Resolution shall take effect immediately and shall be in effect for a period of 30 days from the date of adoption. The City Council may reconsider the circumstances necessitating this resolution within 30 days of the adoption of this resolution.

IT IS HEREBY CERTIFIED that the foregoing resolution was duly adopted at a regular meeting of the City Council of the City of Cotati held on the September 27th, 2022, by the following vote, to wit:

Approved:________________________________
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Mayor
Attest:____________________________
Kevin Patterson, Deputy City Clerk
Approved as to form:
____________________________
City Attorney
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Cotati City Council
Agenda Staff Report
Item type: CONSENT CALENDAR (ACTION)
To: City Council
Subject: Adoption of an Amended City Wide Salary Schedule for Fiscal Year 2022/23 Date: September 27, 2022
Written by: Damien O'Bid, City Manager
Recommendation
It is recommended that the City Council adopt a revised fiscal year 2022/23 salary schedule to incorporate the Associate Engineer position.

Background
On October 12, 2021, the City Council adopted Resolution 2021-56, approving an amendment to the Cotati Employees Association (CEA) Memorandum of Understanding (MOU). This MOU amendment revised job classification titles to better align and create job tracks to assist with employee recruitment and retention.

Analysis/Discussion
Included in the MOU amendment was the addition of the Associate Engineer, which was intended to be an intermediate classification between the Engineering Technician and Civil Engineer. Generally, an Engineering Technician has at most an associates degree. The Civil Engineer requires a bachelor's degree in engineering and licensure by the state, which also includes the prerequisite work experience to take the licensure exam.

The Associate Engineer is a graduate with a bachelor's degree in engineering, and typically an Engineer in Training (EIT) certificate, and therefore is an intermediate classification between the Engineering Technician and Civil Engineer.

The Civil Engineer position recently became vacant, so staff met and conferred with the CEA to

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review the job description and salary scale of the Associate Engineer. This will allow the City to cast a wider search for good candidates that can grow here in the City.

Financial Considerations
There are no budgetary adjustments required at this time due to conservative budgeting and staffing vacancies. If the vacant Civil Engineer position is filled with an Associate Engineer, there will be savings.

Environmental Issues
This action is exempt from the California Environmental Quality Act (CEQA) because it is not a project which has a potential for resulting in either a direct physical change in the environment, or a foreseeable indirect physical change in the environment, pursuant to CEQA Guideline section 15378.

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RESOLUTION NO.

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF COTATI APPROVING THE AMENDED FISCAL YEAR 2022/23 SALARY SCHEDULE.

WHEREAS, the Cotati Municipal Code and Personnel Rules empower the City Council to establish a compensation plan covering all classes of positions; and WHEREAS, on October 12, 2021 the City Council adopted Resolution 2021-56, approving an amendment to the Cotati Employees Association (CEA) Memorandum of Understanding (MOU) which, among other actions, added the Associate Engineer job classification; and
WHEREAS, the City Council’s representative has met and conferred in good faith with representatives with the CEA to develop a corresponding job description and salary scale; and WHEREAS, the action of approving the a revised salary schedule does not constitute a project as defined by California Environmental Quality Act Guidelines Section 15378; therefore, no further environmental review is required.

NOW THEREFORE BE IT RESOLVED THAT THE CITY COUNCIL OF THE

CITY OF COTATI HEREBY

1. Finds the recitals herein true and correct;

2. Approves the amended salary schedule attached hereto as Exhibit “A” effective September 28, 2022; and

3. Finds that resolutions in conflict herewith are hereby superseded.

IT IS HEREBY CERTIFIED that the foregoing resolution was duly adopted at a regular meeting of the City Council of the City of Cotati held on the September 27th, 2022, by the following vote, to wit:

Approved:________________________________
Mayor
Attest:____________________________
Kevin Patterson, Deputy City Clerk
Approved as to form:
____________________________
City Attorney
Attachments:

EXHIBIT A - SALARY SCHEDULE SEPTEMBER 28, 2022 (PDF)
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Salary Schedule 2022/23
Step Step Step Step Step
ABCDE
Accountant CEA 36.02 37.82 39.71 41.70 43.78
Account Clerk CEA 26.77 28.11 29.52 31.00 32.55
Accounting Technician CEA 31.11 32.67 34.30 36.02 37.82 Administrative Assistant CEA 30.70 32.23 33.84 35.53 37.31 Assistant Planner CEA 37.10 38.95 40.90 42.94 45.09
Associate Engineer CEA 41.21 43.27 45.43 47.70 50.09
Associate Planner CEA 41.21 43.27 45.43 47.70 50.09
Building Official Non-Rep 58.20 61.11 64.17 67.38 70.75 Chief of Police Non-Rep 76.30 80.12 84.13 88.34 92.76
City Clerk Non-Rep 53.56 56.24 59.05 62.00 65.10
City Manager Contract - - - - 97.42
Civil Engineer CEA 47.19 49.55 52.03 54.63 57.36
Community Services Officer CPOA 29.00 30.45 31.97 33.57 35.25 Deputy City Clerk Non-Rep 37.06 38.91 40.86 42.90 45.04 Director of Administrative Services Non-Rep 76.30 80.12 84.13 88.34 92.76 Director of Community Development Non-Rep 76.30 80.12 84.13 88.34 92.76 Director of Public Works/City Engineer Non-Rep 76.30 80.12 84.13 88.34 92.76 Engineering Technician CEA 32.72 34.36 36.08 37.88 39.77 Intern Part Time 16.00 - 17.00 - 18.00
Laborer CEA 21.47 22.54 23.67 24.85 26.09
Maintenance Worker I CEA 27.30 28.67 30.10 31.60 33.18
Maintenance Worker II CEA 31.21 32.77 34.41 36.13 37.94 Maintenance Worker III CEA 34.40 36.12 37.93 39.83 41.82 Management Analyst CEA 38.35 40.27 42.28 44.39 46.61
Management Analyst - Confidential Non-Rep 38.35 40.27 42.28 44.39 46.61 Office Assistant CEA 21.98 23.08 24.23 25.44 26.71
Permit Technician CEA 31.84 33.43 35.10 36.86 38.70
Planning Technician CEA 31.84 33.43 35.10 36.86 38.70
Police Corporal CPOA 39.14 41.10 43.15 45.31 47.58
Police Dispatcher/Clerk CPOA 29.61 31.09 32.64 34.27 35.98 Police Lieutenant Non-Rep 54.85 57.59 60.47 63.49 66.66 Police Officer CPOA 37.27 39.13 41.09 43.14 45.30
Police Sergeant CPMA 44.28 46.49 48.81 51.25 53.81
Police Service Aide Part Time/Non Rep 26.76 28.10 29.50 30.97 32.52 Public Works Superintendent Non-Rep 52.05 54.65 57.38 60.25 63.26 Recreation Coordinator CEA 26.77 28.11 29.52 31.00 32.55 Recreation Manager Non-Rep 44.93 47.18 49.54 52.02 54.62 Reserve Police Officer Part Time/CPOA 37.27 39.13 41.09 43.14 45.30 Senior Accountant CEA 39.48 41.45 43.52 45.70 47.98
Senior Management Analyst CEA 42.27 44.38 46.60 48.93 51.38 Senior Management Analyst - Confidential Non-Rep 42.27 44.38 46.60 48.93 51.38 Senior Planner CEA 47.19 49.55 52.03 54.63 57.36
Recreation Seasonal Staff Part Time Step A Step B Step C Camp Director Part Time 18.00 19.00 20.00
Assistant Camp Director Part TIme 17.00 18.00 19.00
Recreation Leader Part Time 16.00 17.00 18.00
Effective 09/28/2022
Position Title Bargaining Unit
Hourly (2080/yr)

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Attachment: EXHIBIT A - SALARY SCHEDULE SEPTEMBER 28, 2022 (Amend FY 22/23 Salary Schedule for Assoc Engineer) Cotati City Council
Agenda Staff Report
Item type: PUBLIC HEARINGS (ACTION)
To: City Council
Subject: Master Fee Schedule Update
Date: September 27, 2022
Written by: Damien O'Bid, City Manager
Recommendation
It is recommended that the City Council of the City of Cotati adopt a resolution updating the Master Fee Schedule and charges for City services and repealing previously adopted or conflicting fees and charges for such services.

Background
A user fee study determines the full cost of services offered by a governmental agency to ensure that not only are the fees and charges reasonable and equitable, but that they also meet industry standards and uphold the statutory requirements of the State of California.

The City of Cotati has historically maintained a policy of recovering the cost of providing miscellaneous City services and regulatory activities so that the costs are borne by the direct beneficiaries of the services and regulatory activities, rather than by the City's General Fund. A comprehensive user fee study was conducted by NBS to establish appropriately calculated fees, the minimum staff time required for each service, multiplied by the current billing rate of the position processing the request. This resulted in a comprehensive update to the user fee schedule in 2021, adopted with Resolution 2021-37.

Notice of the Council's consideration of the updated Master Fee Schedule and fee changes has been provided in compliance with applicable law. As also required by the Mitigation Fee Act, the City's information and cost data supporting the fee increases has been made available to the public at the City Clerk's office ten days in advance of this meeting.

Analysis/Discussion
Following the comprehensive update to the fee schedule in 2021, in practice, staff have found some areas of the fee schedule need updates to improve clarity. These changes have been shown in the updated fee study, shown in tracked changes. In summary, the changes are as follows:
• In-house building plan check. This was changed from a flat fee to a percentage of the

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building permit costs, as this is more in line with the regional norm. Based on the value of the building permit and staff time needed, this is likely less than 100% cost recovery but more reasonable for lower value permits.
• Water Heater, HVAC, Panel Upgrades. This update is proposed to bring it closer to cost recovery, align it with regional norms for simple single purpose permits. • Mechanical, Electrical, Plumbing (MEP) Permits. A new category of fee was added to allow a simple percentage to calculate the fee when this work is included as part of other work under a building permit, while retaining the fee schedule for MEP work only. • Impact Fees. The Traffic Impact Fee category for Hotel is removed, as this is included under Commercial Uses, and was analyzed as such in the Traffic Impact Fee study. • Water Meters. Given the continually changing cost of materials, this change sets the meter cost at actual cost, rather a fixed cost in the fee schedule. • Cannabis Permit Fees. The fees are changed to be consistent with the same fees listed elsewhere in the Fee Schedule, which were set by the comprehensive fee study in 2021. • Concealed Weapon Permit. The current fee schedule only includes a renewal fee. The revision adds a fee for issuance of a new permit.
• Cancellation Fee for Facility Rentals. The cancellation fee is updated from a flat fee to a fee that allows no cancellation fee with 7 days notice, but adds fees when the cancellation is short notice making it difficult for the City to rent to another customer. • Events in Parks. Updated to be consistent with the level of staff effort needed for permitting medium and large park events, as well as updating the security deposit for large events.
• Fee for Non-Contract Events in City Parks. Since COVID, there have been instructors that don’t want to rent a park for the day and are not affiliated with any City program.

This new category of fee provides a clear fee structure for non-affiliated instructors in City Parks.

Most proposed fees have a recovery level of 100% of the estimated reasonable cost of providing the related services; that is, full recovery. However, as noted above, staff recommends that several fees recover less than full cost because the underlying services provide a benefit to the public at large, or for other social, safety or welfare purposes.

The City’s updated Master Fee Schedule being recommended to council is intended to provide clarity and transparency to the public and staff. This schedule is to supersede the previously adopted fee schedules and is intended to be updated periodically for any identified missing fees.

Financial Considerations

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The fiscal impact from the proposed fee schedules is difficult to determine and will be driven by utilization of the related services. However, the proposed fee schedule is intended improve overall the City’s recovery of costs incurred providing it the ability to stretch other resources further for the benefit of the public at-large.

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RESOLUTION NO.

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF COTATI UPDATING THE

MASTER SCHEDULE OF FEES AND CHARGES FOR CITY SERVICES AND

REPEALING PREVIOUSLY ADOPTED AND CONFLICTING FEES AND CHARGES FOR SUCH SERVICES.

WHEREAS, the City Council of the City of Cotati (“City”) has maintained a policy of recovering up to the full cost of providing miscellaneous voluntary City services and regulatory activities from those persons utilizing them, so that such costs are borne by the direct beneficiaries of such services and regulatory activities rather than by the City General Fund, pursuant to applicable law; and
WHEREAS, the City Council adopted a comprehensive update of the City’s schedule of such services and regulatory activities by Resolution No. 2021-37 on the 27th day of July 2021; and
WHEREAS, after using the updated fee schedule, staff have found some areas that require additional clarity, as set forth in the Fee Schedule attached hereto and made part of this Resolution as Exhibit A (“Fee Schedule”);
WHEREAS, in adopting the fees and charges for City services as set forth in this Resolution, the City Council is exercising its powers under Article XI, Section 7 of the California Constitution, Section 66014 of the California Government Code, and other applicable law; and
WHEREAS, none of the fees and charges set forth in the Fee Schedule adopted by this Resolution is a “tax” as defined in Section 1, paragraph (e) of Article XIIIC of the California Constitution because such fees and charges are imposed for a specific benefit conferred or privilege granted directly to the payer that is not provided to those not charged, and which does not exceed the reasonable cost to the local government of providing the service or product; such fees and charges are imposed for a specific government service or product provided directly to the payer that is not provided to those not charged, and which does not exceed the reasonable cost to the local government of providing the service or product; and/or such fees and charges are imposed for the reasonable regulatory costs to a local government for issuing licenses and permits, performing investigations, inspections and audits, enforcing agricultural marketing orders and the administrative enforcement and adjudication thereof; and/or such fees and charges are imposed as a condition of property development; and WHEREAS, in accordance with Government Code Section 50076, fees and charges that do not exceed the reasonable cost of providing the service or regulatory activity for which the fees are charged and which are not levied for general revenue purposes are not special taxes as defined in Article 3.5 of the Government Code; and
WHEREAS, in accordance with Government Code Section 65909.5, reasonable city fees Packet Pg. 34
for the processing of use permits, zone variances, or zone changes shall not exceed the amount reasonably required to administer the processing of such permits, zone variances or changes; and WHEREAS, in accordance with the Government Code Section 66016, the fees contained in the Fee Schedule and the basis for calculating such fees constitute cost data supporting the fee increases and new fees and charges, and such cost data was available for public review and comment for ten days prior to the public hearing at which this Resolution was adopted; and WHEREAS, 10 days advance notice of the public hearing at which this Resolution was adopted was given by publication in accordance with Section 6062a of the Government Code; and
WHEREAS, it is the intention of the City Council to adopt a schedule of fees and charges, which updates certain existing fees and charges, and/or establishes certain new fees and charges based on the City's budgeted and projected costs of providing such services; and WHEREAS, the schedule of fees and the total amounts thereof, described in Exhibit "A," which is attached to and made a part of this Resolution, are hereby determined to be reasonable in that the amounts thereof do not exceed the estimated reasonable costs of providing the services for which the charges and fees are made;
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Cotati as follows:

Section 1. Findings. The following findings are true and correct and adopted as the findings of the City Council:

A. The purpose of the fees and charges set forth in Exhibit "A" of this Resolution is to recover up to the full, lawfully recoverable costs incurred by the City in providing various City services, and such fees and charges are not levied for general revenue purposes.

B. After consideration of the data and information regarding the costs of providing services relating to all fees and charges subject to this Resolution, including the Fee Schedule, Staff Billing Rates, all testimony received orally or in writing at or before the noticed public hearing, the agenda report and the background documents to the agenda report and all correspondence received (together, “Record”), the City Council of the City of Cotati approves and adopts the methods and basis of calculations of the fees and charges identified in Exhibit “A” as establishing the reasonable estimated cost of providing such services or activities.

C. Adoption of the fees and charges set forth in Exhibit "A" of this Resolution is intended to recover costs necessary to maintain such services within the City within existing service areas and is not a “project” within the meaning of the California Environmental Quality Act ("CEQA") pursuant to 14 California Code of Regulations ("CEQA Guidelines") section 15378(b)(4) (the creation of government funding mechanisms or other government fiscal activities which do not involve any specific commitment to any specific project which may result in a potentially significant impact on the environment); and/or CEQA Guidelines section 15273 (statutory exemption for rates, tolls, fares and charges within an existing service area); and/or Packet Pg. 35
CEQA Guidelines section 15061(b)(3) (“common sense” general exemption where there is no possibility the activity in question may have a significant effect on the environment).

D. The Record establishes that the costs listed in the Fee Schedule and the staff rates applicable to those fees and charges which are to be increased and/or established as costs incurred by the City in providing City services are reasonable estimates of the cost of providing such services, and that the revisions recommended to existing fees for such services are necessary to recover the reasonable, estimated cost of providing such services.

Section 2. Fee Schedule Adoption. The fee amounts that result from the application of the methods and basis of calculation of the Fees identified in Exhibit “A” to current staff billing rates specified for services and activities subject to such fees are hereby imposed on the services or activities subject to such Fees at the time such services or activities are sought and/or performed by the City or its designated contractors.

Section 3. Separate Fee for Each Process. All fees set by this Resolution are for each identified process or service; additional fees shall be required for each additional process or service that is requested or required. Where fees are indicated on a per unit of measurement basis, the fee is for each identified unit or portion thereof within the indicated ranges of such units.

Section 4. Adoption of Fees.

A. Definitions.
(1) “Applicant” shall mean any person required by the Cotati Municipal Code or other applicable law to apply to the City seeking a permit or other approval or services or to file documents, including, but not limited to, maps, concerning proposed Development Projects within the City. “Applicant” shall also mean any person who: (i) is permitted by the Cotati Municipal Code or other applicable law to apply to the City seeking a permit or other approval or services or to file documents, including, but not limited to, maps, concerning proposed Development Projects within the City and who (ii) actually applies to the City seeking such permit or other approval or services or files such documents. (2) “Development Projects” shall mean the construction, alteration or addition, other than by the City, of any building or structure within the City, and any use of land, other than by the City, including, but not limited to, subdivision of land, within the City that is subject pursuant to the Cotati Municipal Code or other applicable law to first seeking and obtaining from the City a permit or other approval or services or to first filing documents, including, but not limited to, maps with the City.
(3) “Fees” shall mean the charge or charges imposed on members of the public or Applicants to recover the costs incurred by the City in providing City services to any member of the public and development related services to Applicants.

B. Services Fees Imposed.

Fees shall be imposed on and paid by members of the public and Applicants at the times, and in the amounts, and otherwise apply and be administered as prescribed in this Resolution.

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The City shall accept for processing no applications or other filings that are subject to payment of Fees without the fee required pursuant to this Resolution.

C. Time for Payment of Fees.

The estimated Fees applicable to members of the public and Applicants subject to payment of Fees shall be deposited and/or be paid, upon a member of the public or an Applicant seeking or being required to seek a permit or other approval or services or filing documents, including, but not limited to, maps, concerning or related to City services and/or proposed Development Projects within the City, and upon notice from the City that a deposit for future processing is required.

D. Fee Amounts.

The fee amounts shall be as specified in the Fee Schedule attached as Exhibit A to this Resolution. The total Fees applicable to any City services or Development Projects that require payment of multiple Fees shall be the sum of all such Fees.

E. Use of Fee Revenue.

The revenues raised by payment of the Fees shall be used to fund the estimated reasonable cost of providing the services for which the Fees are charged, and the fee revenues shall not be used for general revenue purposes. Fees shall be applied against the cost of providing the services for which the fees are charged. The City shall maintain a record of direct and indirect costs of providing services for City services and Development Projects subject to the deposit.

F. Deposit Maintenance.

Applicants subject to Fees in the form of a deposit must maintain minimum deposit balances in accordance with this resolution and any corresponding deposit agreement.

G. Refund of Unused Deposit Balances.

Fees other than deposit amounts are not subject to refund. If a fund balance remains in the deposit for a Development Project, and the City services for such Development Project are completed and all City service costs paid from such deposit, the remaining deposit balance shall be refunded, without interest, to the Applicant.

Section 5. Subsequent Analysis and Revision of the Fees. The fees and charges set forth herein are adopted and implemented by the City Council in reliance on the Record identified above. The City may continue to conduct further study and analysis to determine whether the fees and charges for City services should be revised. When additional information is available, the City Council may review the fees and charges to determine that the amounts do not exceed the estimated reasonable cost of providing the services for which the fees and charges are charged.

Section 6. Adjustment. Annually, City staff are directed to update the Fees contained in Exhibit “A” in accordance with Cotati Municipal Code 3.42. If the fees are no longer adequate to recover the reasonable estimated cost of providing such services and regulatory activities, staff Packet Pg. 37
are directed to return to the City Council with a new staff analysis and proposed Fee calculations for consideration and possible adoption by the City Council.

Section 7. Effective Date. This Resolution shall become effective 60 days following adoption. In accordance with Government Code Section 66017, all new and/or increased fees and charges upon a development project, as defined in Government Code Section 66000, which apply to the filing, accepting, reviewing, approving, or issuing of an application, permit, or entitlement to use shall be effective no sooner than 60 days following the effective date of this Resolution.

Section 8. Repealed. These Fees and charges shall supersede the fees previously established and adopted by the City Council. All previously adopted and conflicting fees and charges and all resolutions, including, but not limited to, Resolution No. 2019-32 and other actions of the City Council are hereby repealed to the extent they conflict with the contents of this Resolution.

Section 9. Severability. The individual fees and charges set forth in Exhibit "A" of this Resolution and all portions of this Resolution are severable. Should any of the fees or charges or any portion of this Resolution be adjudged to be invalid and unenforceable by a body of competent jurisdiction, then the remaining fees, charges and/or Resolution portions shall be and continue in full force and effect, except as to those fees, charges, and/or Resolution portions that have been adjudged invalid. The City Council of the City of Cotati hereby declares that it would have adopted each of the fees and charges set forth in Exhibit "A" of this Resolution, and this Resolution and each section, subsection, clause, sentence, phrase and other portion thereof, irrespective of the fact that one or more of the fees, charges, or sections, subsections, clauses, sentences, phrases or other portions of this Resolution may be held invalid or unconstitutional.

IT IS HEREBY CERTIFIED that the foregoing resolution was duly adopted at a regular meeting of the City Council of the City of Cotati held on the September 27th, 2022, by the following vote, to wit:

Approved:________________________________
Mayor
Attest:____________________________
Kevin Patterson, Deputy City Clerk
Approved as to form:
____________________________
City Attorney
Attachments:

Exhibit "A" Master Fee Schedule (DOCX)
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October September 20221
Master Fee Schedule

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Attachment: Exhibit "A" Master Fee Schedule (Master Fee Schedule Update Reso) October 2021September 2022 1
Contents
Administrative Services Fees....................................................................................................................................................2 Building and Development Fees................................................................................................................................................5 Cannabis Permit Fees..........................................................................................................................................................1917 Public Safety Fees...................................................................................................................................................................22 Park, Recreation and Facilities Fees .......................................................................................................................................28

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Administrative
Services Fees

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ADMINISTRATIVE SERVICES
Fee Name Fee Unit /
Type Fee Deposit
Water Meter Test Charge
On-site each $100.00
3rd party
City Administrative Fee each $100.00
Consultant Fee actual cost Actual Cost
New Water Account
Owner deposit $150.00
Renter deposit $250.00
Water Test Fee
City Administrative Fee each $205.36
Consultant Fee actual cost Actual Cost
Bill Delinquency Charge per bill $20.00
Return Check Fee
First Returned Check per check $25.00
Each Additional Check per check $35.00
Delinquent Account Reconnection Charge each $50.00
Inspection of Modification of Service
City Administrative Fee per service $350.00
Consultant Fee actual cost Actual Cost
Fire Hydrant Meter
Meter Deposit deposit $1,200.00
Usage Deposit deposit Est. Cost of Temp
Service in Advance
City Administrative Fee per month $50.00
Water Usage actual cost Actual Cost
After Hours Turn-On Fee each $150.00
Penalties
Greater of $15 or current
LAIF interest for
penalization period
Tampering Fee
First occurrence each $150.00
Each subsequent occurrence each $600.00
For services requested of City staff which have no fee listed in this fee schedule, the City Manager of the City Manager's designee shall determine the appropriate fee based on the established hourly rates for this department/division.

Additionally, the City will pass-through to the applicant any discrete costs incurred from the use of external service providers if required to process the specific application. hourly $154.02

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¹ When water service is discontinued for non-payment of bills, the City will apply a $25 non-refundable fee to the delinquent account. The City may demand that the full amount of the delinquent bill, any subsequent bills, as well as any applied fees, be paid in full before service is restored. Additionally, a non-refundable after-hours fee of $100 is payable for service requests outside City Hall business hours as stated at footnote 2. ² For after-hours water service (turn-on/service), a $100 non-refundable fee plus any account balance due, as noted in footnote 1 above, is to be paid at the Cotati Police Department before the Public Works Department will be called out.

GENERAL ADMINISTRATIVE FEES
Fee Name Fee Unit / Type Deposit
Copy Fees

8.5" x 14" or smaller per page $0.10
Oversize documents, or documents requiring special processing each
Actual Cost
Electronic copy (readily available) each No Charge
Electronic Copy (requiring data compilation, extraction, or programming to produce the record) each
Actual Cost
CD Copy each Actual Cost
DVD Copy each Actual Cost
USB Drive Copy each Actual Cost
Solicitor Permit
501 (c) (3) each $30.67
All others - Blanket Permit each $30.67
Identification card each $30.67
Subpoena
Deposition Subpoena per day
$275 per day as deposit in
advance, plus actual cost.

GC §6809.1; §68097.2
Records Subpoena per request $15.00
For services requested of City staff which have no fee listed in this fee schedule, the City Manager of the City Manager's designee shall determine the appropriate fee based on the established hourly rates for this department/division. Additionally, the City will pass-through to the applicant any discrete costs incurred from the use of external service providers if required to process the specific application.
hourly $122.69

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Building and Development Fees

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ImportantInformation on Fees
If you are submitting an application for building permit or review by planning or engineering, you will be required to pay various fees associated with review and processing of your application(s). The following information is provided as a guide, but the specific circumstances of your application may result in multiple fees being assessed. Please ensure that you have a complete understanding of the various fees that may apply to your application before you submit. Most building permit costs are onetime fees while planning and engineering reviews are completed on a full cost recovery basis with initial deposits. The time to review, and therefore the cost, varies by complexity of the project, completeness of the information provided and applicant responsiveness. Building fees based on the valuation and details of your project and are due at time of permit issuance with some deposits due at application if outside plan check or inspection services are required. The vast majority of amounts listed in the Planning and Engineering sections are deposits unless otherwise noted as a fee and are due at time of application. Applicants are responsible for actual costs incurred including consultant costs and staff costs at fully burdened rates. For requested services of City staff for which no fee is listed in the Fee Schedule, the Director or Directors of the department or departments whose services are requested shall determine the appropriate fee based on current hourly rates of staff.

Please also note that the Cotati-Rohnert Park Unified School District and the Rancho Adobe Fire Protection District may also levy fees on your project. Those fees are not included here. You should contact those agencies directly to determine if additional fees apply.

If you have questions about fees that may apply to your project, please feel free to contact the Community Development Department at 707-665-3637.

Adopting Adopting Ordinancces/Resolutions
Fee for services, Ordinance 692
Master Fee Schedule, eff. 07/27/2021 (Reso No. 2021-37) Traffic Impact Fees, eff. 10/27/15 (Ord. 858, Reso 2015-71) Water & Sewer connection fees – eff. 9/27/16 (Reso No. 2016-68) Water Connection Fee Inflationary Adjustment (Ord. 840) Water Conservation Fee – Reso. No. 93-83
Master Fee Schedule, eff. 07/27/2021 (Reso No. 2021-37) Affordable Housing In-Lieu (Ord. 782, Reso. 88-33A)
Commercial Linkage Fee April 12, 2006 (Ord. 782, Reso. 06-21) Growth Management April 24, 1991 (Ord. 548)
Penalties for Unpermitted Construction November 9, 2016 (Ord. 864) Park In Lieu 2004 (Ord. 766)
Bed Tax June 11, 1974 (Ord. 204)
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PLANNING DEPARTMENT
Fee Name Fee Unit / Type Fee Deposit
Annexation deposit $7,684

Appeals flat $500

Commercial Cannabis Permit
Application new application $6,943
Renewal (Refer to cannabis permit section for detail) bi-annual $2,750

Design Review
Administrative Review flat $1,993
Preliminary Review deposit $6,000
Final Review deposit $2,184

Environmental Review
CEQA Exemption Determination hourly $183
Initial Study / Negative Declaration / Mitigated Negative Declaration City Administrative Fee deposit $7,333
Consultant Costs actual cost actual cost
Initial Study / Environmental Impact Report
City Administrative Fee deposit $7,333
Consultant Costs actual cost actual cost

General Plan Amendment deposit $16,070

Hillside Development Permit deposit $2,184

Limited Term Permits deposit $1,000

Pre-Application Reviews
Single Family Home (Owner Occupied) flat actual cost
Formal Conceptual Plan Review or Preliminary
(with written comments) flat $2,406
Public Noticing / Re-Noticing flat actual cost

Signs
New Sign flat $250
Replacement flat $100
Master Sign Program / Planning Commission Review deposit $2,200

Subdivisions
Parcel Map deposit $8,737
Tentative Subdivision Map deposit $16,070
Time Extension deposit $4,583

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Fee Name Fee Unit / Type Fee Deposit
Tree Removal
Standard Removal
First 5 Trees flat $50 each tree
Each Additional each $92
Removal Requiring Arborist
City Staff Review flat $733
Consultant Review actual cost actual cost
Penalty For Removal Without Permit 2 x standard removal fee +2x replacement value Use Determination hourly $183

Use Permit
Minor Use Permit deposit $1,818
Modification to previously approved Use Permit deposit $3,284 Major Use Permit deposit $4,369

Variance
Minor flat $1,467
Major deposit $3,667

Zoning Code /Zoning Map / PUD Amendment deposit $11,000 Zoning Clearance or Research actual cost actual cost

Planning Plan Check (of Building Plans/Permits)* hourly $183 For services requested of City staff which have no fee listed in this fee schedule, the City Manager of the City Manager's designee shall determine the appropriate fee based on the established hourly rates for this department/division.

Additionally, the City will pass-through to the applicant any discrete costs incurred from the use of external service providers if required to process the specific application.

Hourly
* 1/2 hour
minimum
$183

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BUILDING PERMIT AND PLAN CHECK FEES
Fee Name Fee Unit / Type Fee Deposit
Building Permit/Inspection - Single Family Residential
$500 base fee up to $500 $100
each additional $100 or fraction thereof each additional $100 $5.00 $2,001 base fee @ 2,000 $175
each additional $1000 or fraction thereof each additional $1,000 $33.64 $25,001 base fee @ $25,000 $949
each additional $1000 or fraction thereof each additional $1,000 $16.22 $50,001 base fee @ $50,000 $1,354
each additional $1000 or fraction thereof each additional $1,000 $8.94 $100,001 base fee @ $100,000 $1,801
each additional $1000 or fraction thereof each additional $1,000 $3.61 $500,001 base fee @ $500,000 $3,245
each additional $1000 or fraction thereof each additional $1,000 $5.39 $1,000,001 base fee @ 1,000,000 $5,939
each additional $1000 or fraction thereof each additional $1,000 $5.94 Building Permit/Inspection - Commercial/Multi-Family/Industrial $500 base fee up to $500 $100
each additional $100 or fraction thereof each additional $100 $5.00 $2,001 base fee @ 2,000 $175
each additional $1000 or fraction thereof each additional $1,000 $25.87 $25,001 base fee @ $25,000 $770
each additional $1000 or fraction thereof each additional $1,000 $14.57 $50,001 base fee @ $50,000 $1,134
each additional $1000 or fraction thereof each additional $1,000 $12.51 $100,001 base fee @ $100,000 $1,760
each additional $1000 or fraction thereof each additional $1,000 $6.19 $500,001 base fee @ $500,000 $4,235
each additional $1000 or fraction thereof each additional $1,000 $10.78 $1,000,001 base fee @ $1,0500,000 $9,624
each additional $1000 or fraction thereof each additional $1,000 $1.10 $5,000,001 base fee @ $5,000,000 $14,024
each additional $1000 or fraction thereof each additional $1,000 $1.29 $10,000,001 base fee @ 10,000,000 $20,486
each additional $1000 or fraction thereof each additional $1,000 $2.05 Building Plan Check
In-House Plan Check percentage 65% of building
permit fee
City Processing Fee
Up to $10,000 valuation each $550
$10,000+ Valuation each $1,100
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Third Party Consultant actual costs actual cost

MISCELLANEOUS FEES - FLAT RATE PERMITS
Fee Name Fee Unit / Type Fee Deposit
Photovoltaic Systems (Solar Systems)
Residential Roof Mount (Up to 15 kW) flat $450
Per kW over 15 kW flat $15
Commercial (Up to 50 kW) flat $1,000
Per kW between 51kW - 250kW flat $7
Per kW above 250kW flat $5
Energy (T24/CALGREEN) each $120
Re-roof
Residential each $450
Commercial each $921
Minor Repair each $520

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MECHANICAL, ELECTRICAL, PLUMBING PERMIT (MEP) AND PLAN CHECK FEES Fee Name Fee Unit / Type Fee Deposit
Single Item Permit – Single Family Residential
Water Heater each base* $120 $180
HVAC each base* $120 $180
Panel Upgrade bBase* $250
* Does not include required state fees.

Electric Vehicle Charging Station
Residential - Up to 50 Amps flat $495
Commercial - Up to 50 Amps flat $495
Commercial - Over 50 Amps flat $674
Non-itemized Stand Alone MEP Permit - Single Family Residential $500 base fee up to $500 $90
each additional $100 or fraction thereof each additional $100 $21.03 $2,001 base fee @ 2,000 $406
each additional $1000 or fraction thereof each additional $1,000 $6.87 $25,001 base fee @ $25,000 $564
each additional $1000 or fraction thereof each additional $1,000 $2.75 $50,001 base fee @ $50,000 $632
each additional $1000 or fraction thereof each additional $1,000 $4.95 $100,001 base fee @ $100,000 $880
each additional $1000 or fraction thereof each additional $1,000 $1.19 $500,001 base fee @ $500,000 $1,354
each additional $1000 or fraction thereof each additional $1,000 $1.17 $1,000,001 base fee @ 1,000,000 $1,939
each additional $1000 or fraction thereof each additional $1,000 $1.94 For MEP work as a part of larger Building
Permit percentage of permit 25% of building permit fee
Non-itemized Stand Alone MEP Permit - Commercial/Multi-Family/Industrial (Includes T24 Energy / CalGreen)
$500 base fee up to $500 $90
each additional $100 or fraction thereof each additional $100 $21.03 $2,001 base fee @ 2,000 $406
each additional $1000 or fraction thereof each additional $1,000 $7.77 $25,001 base fee @ $25,000 $584
each additional $1000 or fraction thereof each additional $1,000 $6.32 $50,001 base fee @ $50,000 $742
each additional $1000 or fraction thereof each additional $1,000 $4.95 $100,001 base fee @ $100,000 $990
each additional $1000 or fraction thereof each additional $1,000 $2.47 $500,001 base fee @ $500,000 $1,980
each additional $1000 or fraction thereof each additional $1,000 $2.25 $1,000,001 base fee @ 1,000,000 $3,107
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$5,000,001 base fee @ 5,000,000 $5,665
each additional $1000 or fraction thereof each additional $1,000 $0.74 $10,000,001 base fee @
10,000,000 $9,349
each additional $1000 or fraction thereof each additional $1,000 $0.93 For MEP work as a part of a larger Building
Permit Percentage of Permit 250% of Building Permit Fee

ADDITIONAL SERVICES
Fee Name Fee Unit / Type Fee Deposit
Inspections outside of normal business hours
hourly $286
(2-hour min)
CASP Consultant hourly actual cost
City Processing hourly $286
Re-inspection (1 hour min.) $286
Growth Management Review per unit $137
Additional plan review required by changes,
additions, or revisions to plans (1 hour min.) $286
Technology Fee
$500 to $100,000 valuation each
.0010 times value
(min $6)
$100,001 to $500,000 valuation each
.0008 times value
(min $80)
$500,001 and above valuation each
.0006 times value
(min $300, max
$500)
California Building Standards
$1 - $25,000 each $1
$25,001 - $50,000 each $2
$50,001 - $75,000 each $3
$75,001 - $100,000 each $4
Every $25,000 or fraction thereof above
$100,000 each $1
SMIP Fee
Single Family Residential each .01% of valuation
Commercial/Multi-Family/Industrial each .021 % of
valuation
Penalty Fee - Working without a permit each 2 times building permit fee
Permit Renewal Hourly (1/2-hour min.) $286
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DEVELOPMENT IMPACT
ApplicationType Fee/Deposit Amount
AFFORDABLE HOUSING IN-LIEU Based on sales price of unit, calculated asfollows:
$2,400 first $125,000 ofsales price +$200 for each $5,000 incrementthereafter
BED TAX (all new residential construction)
a. 2 bedrooms $350
b. 3 bedrooms $400
c. 4 or more bedrooms $450
LINKAGE*
a. Commercial
b. Industrial
c. Retail
$2.39/sf
$2.47/sf
$4.12/sf
Please note that new construction less than 2,000 sf, and the first 2,000 sf of any commercial project is exempt. There are additional exemptions, please check with the Community Development Department.

PARK IN-LIEU
Calculated according to the following formula:
(DUs x Population/DU) x (5 acres/1000 population) x (Fair Market Value/Total Acres of Project Site) = Subtotal x 6/5 = In Lieu Fee TRAFFIC1*
a. Residential $7,324.62/ unit
b. Commercial $7,731.373/ 1000 sf
c. Restaurant $11,756.28/ 1000 sf
d. Industrial $4,252.02/ 1000 sf
e. Office $5,215.17/ 1000 sf
f. Hotel $,5182.87 /room
SEWER CONNECTIONS(based on water metersize)
a. ¾-inch $16,638
b. 1-inch $27,787
c. 1.5-inch $55,407
d. 2-inch $88,685
e. 3-inch $148,103
f. 4-inch $282,858
Applicable to all customer classes. Fees for multi-family projects will be charged on the size of the water meter.

WATER CONNECTIONS* (based on water metersize)
a. ¾-inch $11,258
b. 1-inch $18,801
c. 1.5-inch $37,490
d. 2-inch $60,007
e. 3-inch $112,581
f. 4-inch $191,388
g. 6-inch $371,518
All customer classes based on meter size.

WATERCONSERVATION
a. NewResidential
b. Industrial/Commercial/MixedUse
$1,750/unit
$1,500/acre
FIRE SYSTEM CONNECTION Per resolution 2016-68, thisfee isincluded in the water connection fee.
1 For land use designations not specifically included in the Traffic Impact Fee table above, the fee shall be calculated at a rate of $5,425.51 per p.m. peak hour trip as established by the project’s traffic impact analysis. For land use designations of Specific Plan, the fee shall be calculated by aggregating the proposed individual use types and paid in accordance with the adopting resolution.

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ENGINEERING DEPARTMENT
Fee Name Fee Unit / Type Fee Deposit
Backflow Device
Annual Administration
Annual Monitoring Administrative Fee per year $77
City Tested Devices
City Staff Testing Administration per year $77
3rd party provider/contractor actual cost actual Cost
New Device
City Staff per device $308
3rd party provider/contractor actual cost actual Cost

Certificate of Compliance each $500

Encroachment Permits
Minor (no construction/no inspection) each $263
Major (short duration/inspection required) each $1,053
Major (long duration/consultant required)
City Staff deposit $5,615
Consultant actual cost actual Cost

Engineering Review of Planning
Application
Simple each $526
Complex
City Staff hourly $175
Consultant actual cost actual Cost

Engineering Review of Building Application
Simple each $526
Complex
City Staff hourly $175
Consultant actual cost actual Cost

Flood Plain Certificate Review each $175
Flood Plain Review deposit $702

Grading Plan Check, Permit & Inspection
Plan Check
Fee Name Fee Unit / Type Fee Deposit

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< 50 CY flat $702
> 50 CY
City Staff flat $1,404
Consultant actual cost actual Cost
Permit & Inspection
< 50 CY flat $1,404
> 50 CY
City Staff flat $2,807
Consultant actual cost actual Cost

Improvement Plan Review
4 lots or less
City Staff deposit $3,509
Consultant actual cost actual Cost
5 lots or more
City Staff deposit $7,018
Consultant actual cost actual Cost

Real Property Document Review
City Staff deposit $5,615
Consultant actual cost actual Cost

Maps
Parcel Map - 4 lots or less
City Staff deposit $5,615
Consultant actual cost actual Cost
Final Map - 5 lots or more
City Staff deposit $7,018
Consultant actual cost actual Cost

Lot Line Adjustment/Lot Merger each
City Staff deposit $3,509
Consultant actual cost actual Cost

Public Improvement Inspections
4 lots or less
City Staff deposit $5,615
Consultant actual cost actual Cost
5 lots or more fee specified by
agreement

Street or Right-of-Way Vacation
Fee Name Fee Unit / Type Fee Deposit
Formatted: Centered

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Attachment: Exhibit "A" Master Fee Schedule (Master Fee Schedule Update Reso) October 2021September 2022 17
City Staff each $7,018
Consultant each actual Cost

Temporary Water Meter Rental $77

Certificate of Correction per application $702

Water Meter Installation/Charge
Turn On Service
(City Administrative Processing) each $166
Installation
2" or less each $257
3" or more each $334
Meter Charge
3/4 inch each $230.61322Actual
Cost
1 inch each $379.423Actual
Cost

1.5 inch each $818.30740 Actual
Cost
2 inch each $1,138.96945Actual
Cost
3 inch each
Requires
Quote$1,535Actual
Cost
4 inch each
Requires
Quote$2,143Actual
Cost
Downsizing Meter Size each Actual Cost$1,232

Outside Utility Service Agreement
City Staff deposit $7,018
Consultant actual cost actual Cost

Condominium Plats
City Staff deposit $7,018
Consultant actual cost actual Cost
Reconciliation of Deposit billing annual $35,875

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Attachment: Exhibit "A" Master Fee Schedule (Master Fee Schedule Update Reso) October 2021September 2022 18
For services requested of City staff
which have no fee listed in this fee schedule,
the City Manager of the City Manager's
designee shall determine the appropriate fee
based on the established hourly rates for this
department/division. Additionally, the City
will pass-through to the applicant any discrete
costs incurred from the use of external service
providers if required to process the specific
application.
hourly $175

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Attachment: Exhibit "A" Master Fee Schedule (Master Fee Schedule Update Reso) October 2021September 2022 19
Cannabis Permit Fees

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Attachment: Exhibit "A" Master Fee Schedule (Master Fee Schedule Update Reso)

CANNABIS PERMIT SERVICES
Fee Type Amount of Fee Fee Authority
ANNUAL REGISTRATION FEE $100 CMC § 5.30.060.C

NEW CANNABIS
PERMIT
APPLICATION1
$6,9433,000 CMC § 5.30.320

CANNABIS PERMIT

ADMINISTRATIVE

RENEWAL
$2,7501,500 CMC § 5.30.320

CANNABIS PERMIT

NON- ADMINISTRATIVE

RENEWAL
$6,9433,000 CMC § 5.30.320

CASH BUSINESS TAX

PAYMENT SURCHARGE
$500 per payment CMC § 5.30.320
ANNUAL FINANCIAL AUDIT Actual Cost + 10% CMC § 5.30.190.B

DELINQUENCY AND APPEALS
DELINQUENT REGISTRATION2 Registration Due + 25% (+25% each additional month)
CMC § 5.30.110

DELINQUENT BUSINESS

TAX PAYMENT
Tax Due + 25% (+25% each additional month) CMC § 5.30.110 BUSINESS TAX APPEAL $5,000 CMC § 5.30.320
Footnotes
CMC=City of Cotati Municipal Code

1. Permit application fees do not include the cost of any required entitlement processes or building permitting.

2. See CMC §5.04.200 for additional details
21 October 2021

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Attachment: Exhibit "A" Master Fee Schedule (Master Fee Schedule Update Reso) 22 October 2021
Public Safety Fees

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Attachment: Exhibit "A" Master Fee Schedule (Master Fee Schedule Update Reso) 23 October 2021

PUBLIC SAFETY SERVICES
Fee Type Amount of Fee
ANIMAL CONTROL RECOVERY a. $25 per animal
a. 1st incident b. $50 per animal
b. 2nd incident c. $100 per animal
c. 3rd incident
d. Animal Trap Rental d. $50 security
ANIMAL CONTROL REGISTRATION deposit for trap
a. Spayed/neutered dog a. $20
b. Unspayed/un-neutered dog b. $35
c. Unlicensed dog found c. $50
d. Animal Trap Rental d. $50
ANIMAL TRAP RENTAL $50 (deposit)

ANNUAL TAXI PERMIT
a. Initial Deposit for Application a. $500
b. Initial owner or driver b. $5,750
c. Annual owner renewal
d. Driver Renewal
c. $500
d. $100
e. Department of Justice Fee - Payable to DOJ e. Actual Cost BICYCLE REGISTRATION No Charge
CITATION NOT ISSUED BY COTATI POLICE DEPARTMENT No Charge

CONCEALED WEAPON PERMIT
a. Department of Justice Fee – Payable to the DOJ a. Actual Cost b. New Permit b. $360
cb. Renewal cb. $180
IMPOUNDED VEHICLE STORAGE FEE No Charge
IMPOUND/ABANDONMENT/ABATEMENT VEHICLE RELEASE Per Incident a. 72 Hour Impound a. $192
b. Felony Offense b. $192
c. Misdemeanor Offense c. $192
d. Non-criminal based d. $100

LIVESCAN FEE
a. City’s Processing Fee a. $90.00
b. Department of Justice Fee - Payable to DOJ b. Actual Cost

MANDATED FIREARM STORAGE
a. Intake, recordation, and return/disposal of first five firearms a. $192 per request b. Intake, recordation, and return/disposal of additional firearms b. $96 per firearm c. Storage c. $192 per month

NOISE DISTURBANCE RESPONSE
a. First Response
b. Second Response
c. Third Response
d. Fourth Response and Thereafter
a. No Charge
b. $65
c. $130
d. $185 per response

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Attachment: Exhibit "A" Master Fee Schedule (Master Fee Schedule Update Reso) 24 October 2021
Fee Type Amount of Fee

PARTY ORDINANCE RESPONSE
a. First Violation a. $100 flat
b. Second Violation b. $200 flat
c. Each Additional Violation c. $500 each
d. Posting on Premises d. $100 flat
PHOTO REPRODUCTION $50 per request
POLICE CRIME VERIFICATION LETTER $25 per request

POLICE FALSE ALARM RESPONSE
a. First response (per year) a. No charge
b. Second response (per year) b. $50
c. Third response (per year) c. $75
d. Fourth response and thereafter (per year) d. $102 per response

POLICE REPORT COPY
a. Police crime report a. $20 each
b. Incident report/CAD printout b. $20 each
c. Vehicle Accident Investigation Report c. $20 each
Report fee waived for a “Victim of Violent Crime” as defined on the State of California Victim Compensation Website

POLICE SPECIAL SERVICES
a. Sworn a. $203
b. Non-Sworn b. $180

PRIVATE ALARM PERMIT
a. Residential alarm a. $15 per year
b. Commercial or industrial alarm b. $25 per year
RECORDS CHECK/CLEARANCE LETTER $25 per records check or clearance letter STAFF TIME CHARGES
a. Sworn a. $203
b. Non-Sworn b. $180
SUBPOENA WITNESS – POLICE
$275
per day as deposit in advance
plus actual cost
TRANSPORTATION PERMIT (per application) $192
VEHICLE EQUIPMENT CORRECTION INSPECTION No charge
VEHICLE REPOSSESSION RECEIPT $45.00

VIDEO/AUDIO TAPE REPRODUCTION
a. Dispatch Recording a. $45 per request
b. Body Worn Camera Video Reproduction b. $45 per request VIN VERIFICATION (per verification) $203

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Attachment: Exhibit "A" Master Fee Schedule (Master Fee Schedule Update Reso) October 2021September 2022 28
Park, Recreation and Facilities
Fees

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Attachment: Exhibit "A" Master Fee Schedule (Master Fee Schedule Update Reso) October 2021September 2022 29

RECREATION DEPARTMENT
Fee Name Fee Unit / Type Fee Deposit
Facility Room Rentals (Per Hour)
Classrooms
Non-Profit/Community Service Org/Govt.

Agency Per Hour $15
Private (Resident) Per Hour $20
Private (Non-Resident) Per Hour $25
Cotati Room
Non-Profit/Community Service Org/Govt.

Agency Per Hour $50
Private (Resident) Per Hour $70
Private (Non-Resident) Per Hour $80
Facility Room Security Deposits
Classrooms deposit $50
Cotati Room deposit $400
Miscellaneous Room/Park Facility Rental Fees
Portable Stereo Rental (Room Rentals Only) each $25
Cleaning Fee (Contractor) each Actual Cost
Cleaning (City Staff Provided) per hour $100
Cancellation Fee (8-30 days prior to the
reservation)(Less than 30 days prior to event) each $5050% of Fee2 Cancellation Fee (Less than 7 days or less prior to
eventreservation)
each Actual Facility Rental
Fee
Damage to Facility each Actual Cost
Lost Key each $125
Non-City Sponsored Events
Fees for Outdoor Public Space Events, If
Applicable
Application Fee - Public Large Events each $50
Special Event Business License Fee as applicable $15
Street Closure Fee Small each $702
Street Closure With Traffic Re-routing New $1,755
Restroom Cleaning (Contractor) each Actual Cost
Restroom Cleaning (City Staff Provided) Per Hour $175
Event Related Damage each Actual Cost
Special Events Not In Parks
Approved Permit Fee per day $125
Security Deposit
Small Event - (Less than 501-49
Patrons) eEach $100
Medium Event - (Less than 25050-249
Patrons) each $250
Large Event - (More than 250+ Patrons) each $500
2 Room/Park Cancellation Policy. The City will issue a full refund more than 30 days prior to the reservation date. Applicant can transfer rental to a different day at no charge up to 7 calendar days prior to the reservation date.

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Attachment: Exhibit "A" Master Fee Schedule (Master Fee Schedule Update Reso) October 2021September 2022 30

RECREATION DEPARTMENT
Fee Name Fee Unit / Type Fee Deposit
Free Events in City Parks
Permit Fees
Small Event - (Less than 501-49 Patrons)
Resident Permit Fee each $60
Non-Resident Permit Fee each $85
Medium Event - (Less than 25050-249
Patrons)
Fee Name Fee Unit / Type Fee Deposit
Resident Permit Fee each $60 150
Non Resident Permit Fee each $85 200
Large Event - (More than 250+ Patrons)
Resident Permit Fee each $60 350
Non Resident Permit Fee each $85 500
Security Deposits
Small Event - (Less than 50 Patrons) each $100
Medium Event - (Less than 250 Patrons) each $250
Large Event - (More than 250 Patrons) each $500350
Fee for Admission Events in City Parks
Permit Fees
Small Event - (Less than 1001-99
Patrons)
Resident Permit Fee each $250
Non Resident Permit Fee each $350
Medium Event - (100-249Less than 250
Patrons)
Resident Permit Fee each $350
Non Resident Permit Fee each $550
Large Event - (More than 250+ Patrons)
Resident Permit Fee each $650
Non Resident Permit Fee each $800
Security Deposits
Small Event - (Less than 1001-99 Patrons) each $100
Medium Event - (100-249Less than 250
Patrons) each $250
Large Event - (More than 250+ Patrons) each $500
Recreation City Hosted Space Rental Fees
Vendor Fees
Small Event - (Less than 200 Patrons)
10x10 Space - No Sales- Non-Profit each $0
10x10 Space - With Sales- Non-Profit each $25
10x20 Space - No Sales- Non-Profit each $30
10x20 Space - With Sales- Non-Profit each $40
10x10 -Other each $50
10X20 - Other each $75
Electricity each $15
Medium Event - (Less than 500 Patrons)
10x10 Space - No Sales- Non-Profit each $0
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Attachment: Exhibit "A" Master Fee Schedule (Master Fee Schedule Update Reso) October 2021September 2022 31

RECREATION DEPARTMENT
Fee Name Fee Unit / Type Fee Deposit
10x10 Space - With Sales- Non-Profit each $25
10x20 Space - No Sales- Non-Profit each $30
10x20 Space - With Sales- Non-Profit each $40
10x10 -Other each $50
10X20 - Other each $75
Electricity each $15
Large Event - (More than 250 Patrons)
10x10 Space - No Sales- Non-Profit each $0
10x10 Space - With Sales- Non-Profit each $35
10x20 Space - No Sales- Non-Profit each $30
10x20 Space - With Sales- Non-Profit each $70
Fee Name Fee Unit / Type Fee Deposit
10x10 -Other each $75
10X20 - Other each $125
Electricity each $15
Contract Classes
Contracted Classes in City Facilities
Instructor uses the Rec DeskCity Registration
System per person
30% of Fees
Instructor Manages Registration per person 20% of Fees
Contracted Classes for Licensees at Farm
Instructor uses the Rec DeskCity Registration
System per person
10% of Fees
Instructor Manages Registration per person 10% of Fees
Cancellation Fees Each Per Instructor Policy
Instructor Fee for Non-Contract Classes held in
City Parks
Resident $25/hr
Non-Resident $30/hr
Camps
One Day Drop In per person $44
Single Day Program/Class per person $44
Camp Registration by Week Per Week/Person $160
Late Fee per minute $1
Other
Cancellation Fees (All City Hosted Programs) each See Note3 3 City Program Cancellation Policy. The City will issue a full refund up to 7 calendar days prior to the start of the program. Within 7 calendar days of the start of the program, the City will refund 50% of the registration fee. The City will not issue a refund after the start of the program.

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Attachment: Exhibit "A" Master Fee Schedule (Master Fee Schedule Update Reso) October 2021September 2022 32

RECREATION DEPARTMENT
Fee Name Fee Unit / Type Fee Deposit
For services requested of City staff, or other
programing of events, whichevents, which have no fee
listed in this fee schedule, the City Manager of the City Manager's designee shall determine the appropriate fee
based on the established hourly rates for this
department/division.

Additionally, the City will pass-through to the
applicant any discrete costs incurred from the use of
external service providers if required to process the
specific application.

Full Time hourly $102
Part Time hourly $38
Formatted Table

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Attachment: Exhibit "A" Master Fee Schedule (Master Fee Schedule Update Reso) Cotati City Council
Agenda Staff Report
Item type: REGULAR AGENDA (ACTION)
To: City Council
Subject: Consideration of a resolution to approve a deferral of impact fees and granting of funds for affordable housing and public improvements, an associated inter-fund grant, and affordable housing agreement for the Cotati Station Apartments Project Date: September 27, 2022
Written by: Damien O'Bid, City Manager
Recommendation
It is recommended that the City Council adopt:

1. A resolution to defer impact fees and grant funds for affordable housing and public improvements through an Impact Fee Deferral and Grant Agreement, including an associated inter-fund grant; and

2. A resolution to approve the Affordable Housing Agreement for the Cotati Station Apartments Project.

Background
On June 14, 2022, Colvin Group LLC., a California limited liability company (“Developer”) was granted Design Review and Density Bonus approval by the Cotati City Council for the Cotati Station Apartments (“Project”), a 98-unit mixed use project consisting of 98-apartment homes (1, 2, and 3 bedroom units) and approximately 5,600 square feet of commercial space on three parcels totaling approximately 2.42 acres. The primary change from the previously approved project was a reduction in the number of 3-bedroom units and increase in the number of 1- bedroom units.

At the June 14, 2022 public hearing, the City Council approved Resolution 2022-26, which included various conditions of approval, including authorizing an impact fee deferral (subject to City Council approval of the agreement), and authorizing a grant from the Affordable Housing Fund for the impact fees related to the low and very low affordable units, to be included in the Affordable Housing Agreement.

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Subsequently, the lead on the revised application (Doug Elliot) was not able to secure financing for construction, so the Project fell back to Colvin Group, LLC. This led to further discussions with City staff on ways to reduce costs to bring this long-stalled project to construction. Given the public benefits of the Project, including a variety of additional public amenities, including the widening of Santero Way to improve fire access, a new public park, and additional public parking beyond the development requirements adjacent to the SMART station, city staff explored ways to assist and bring these housing units and public infrastructure on-line.

Analysis/Discussion
Following the June 14 City Council meeting and the subsequent unwinding of construction financing, staff engaged with the Developer to negotiate the affordable housing agreement, including the affordable unit mix, as well as other cost reduction options.

For the final mix of affordable unit types, staff worked with the Developer to align it with the overall mix of units in the project. The table below shows the overall mix of unit types in the project:

PROJECT UNIT MIX
UNIT SUMMARY UNIT TYPE NET S.F. # OF UNITS % OF TOTAL SQUARE FT 1 Bdrm 625 58 59% 36,250
2 Bdrm 1042 33 34% 34,386
3 Bdrm 1220 7 7% 8,540
TOTAL 98 100% 79,176
As indicated in the table below, the final mix of affordable units is within 1-3% of the overall project mix of 1, 2 and 3-bedroom units. Following up on the June 14 discussion with the City Council, staff negotiated a move of 1 low income and 1 moderate income unit from 1 bedroom to 2-bedroom. While this ensures more unit types are available for lower income tenants, it also incrementally increases the cost of the project.

AFFORDABLE HOUSING LEVELS 1 BDRM 2 BDRM 3 BDRM TOTAL
Very Low Income 5 3 0 8
Low Income 2 1 0 3
Moderate income 4 3 1 8
TOTAL 11 7 1 19
% of Affordable Units as a % of Total Affordable Units 58% 37% 5% 100% OVERALL UNIT MIX FOR TOTAL PROJECT 59% 34% 7% 100%

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As part of the Affordable Housing Agreement, in accordance with Resolution 2022-26, staff included grant funding from the Affordable Housing Fund to offset City impact fees for the low and very low-income units. Given the cost to construct and the restricted sale price or lease rates, these units have historically been the most difficult to produce, thus were incentivized. In the current 5th cycle of RHNA, while the City will produce more overall units than allocated, the City will fall short on the very low income unit category. It is estimated that the impact fees for the eleven (11) low and very low affordable units total $275,000. The City would apply the grant from the Housing In-Lieu Fund at the time the impact fees are due.

In parallel with the Affordable Housing Agreement, staff began negotiations on an Impact Fee Deferral Agreement. This standard agreement allows the Developer to defer payment of City impact fees from the normal time of collection (at issuance of building permits) to the end of construction (certificate of occupancy) to minimize the carrying time for these costs under the more costly construction loan. During the deferment period, the City charges the developer interest equal to the LAIF rate, so that the impact fee funds are cost neutral and do not create a gift of public funds.

As part of the fee deferral conversations, including the broader conversation about potential ways to lower costs and increase the chances that the project will go into construction, staff began to explore ways to reduce impact fees. The proposed unique situation was considered by staff because this transit-oriented development project brings significant additional public benefits, above and beyond the typical public improvements associated with most projects. In addition to the additional parking, publicly accessible park, and widening of Santero Way for improved fire access, the developer has also agreed to build this project as a 100% electric project to eliminate greenhouse gas emissions associated with natural gas usage.

Therefore, staff recommends City Council approve an additional city impact fee reduction for the Developer to be paid by the City through an interfund grant between the Traffic Impact Fee Fund and the General Fund. The grant terms are included in the attached Impact Fee Deferral and Grant Agreement. The City would apply the grant funds to the project at the time the impact fees are paid, which is expected to occur at the end of the project construction (i.e. occupancy). If the project is not built, the City will have no obligation to provide grant funds.

Financial Considerations
If the City Council approves the attached resolutions, the deferred impact fees will be cost

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neutral but will change the timing of receipt of the funds. At this time, it’s not expected to impact any impact fee funded city projects. However, if timing did become an issue in the future, the General Fund and Affordable Housing Funds could advance the funds as available.

For the grant of funds, the cost to the General Fund will be $325,000 (plus interest at the LAIF rate) spread out over an initial term of 5 years and the cost to the Affordable Housing Fund will be a lump sum payment of $275,000 in either FY 22-23 or 23-24, depending on timing of developer payment of the other impact fees.

Environmental Issues
The action of approving an Affordable Housing Agreement, Impact Fee Deferral and Grant Agreement, as well as the associated documents and an inter-fund grant, does not constitute a project as defined by California Environmental Quality Act Guidelines Section 15378; therefore, no further environmental review is required.

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RESOLUTION NO.

RESOLUTION OF THE COTATI CITY COUNCIL APPROVING A DEFERRAL OF

FEES AND GRANT OF FUNDS FOR AFFORDABLE HOUSING AND PUBLIC

IMPROVEMENTS, INCLUDING AN ASSOCIATED INTER-FUND GRANT, FOR THE

COTATI STATION APARTMENTS PROJECT
WHEREAS, an application was submitted by Doug Elliot and the Colvin Group LLC requesting Design Review and Use Permit approval to allow the development of the 98-unit Cotati Station mixed-use project, on three un-addressed vacant parcels totaling 2.42 acres, more particularly described as Assessor's Parcel Number(s) 144-320-034, 144-320-035 and 144-320- 036, dated April 27, 2022, and on file in the Office of the Department of Community Development; and
WHEREAS, on June 14, 2022, Developer was granted Design Review and Density Bonus approval by the Cotati City Council for the Cotati Station Apartments, a 98-unit mixed use project consisting of 98-apartment homes (1, 2, and 3 bedroom units) and approximately 5,600 square feet of commercial space on three parcels totaling approximately 2.42 acres; and WHEREAS, at the June 14, 2022 public hearing, the City Council approved Resolution 2022-26, which included various conditions of approval including the following condition (#9), “The City Council shall approve the requested deferral of impact fees until the buildings are ready for occupancy and the request to utilize the City’s Affordable Housing Fund to cover the Impact Fees of the Low and Very Low income units as a component of the finalized Affordability Agreement. Said approval shall be memorialized and defined within an agreement approved by the City Council and recorded against the project and property”; and WHEREAS, in recognition of the public benefits, including the Project’s low and very low affordable housing and a variety of additional public amenities, including the widening of Santero Way to improve fire access, a new public park, additional public parking beyond the development requirements adjacent to the SMART station, and use of all electric (no natural gas) to reduce greenhouse gas emissions in the development, the City Council finds that it’s in the public interest to further incentivize development of the Project; and WHEREAS, the City Council has determined that California Government Code Section 53601(e) authorizes the City to invest its surplus funds from its own funds, and further that such an investment of its surplus funds does not violate City Council policy on reserve fund balances or investments; and
WHEREAS, the City Council finds that in recognition with the stated additional public benefits of the project, it is in the public interest to grant up to $324,999 to the project, in addition to the Affordable Housing Fund grant of approximately $275,000, for a total of $599,999.99; and
WHEREAS, the grant and the deferral of payment of impact fees from issuance of the Packet Pg. 72
building permit to occupancy is set forth in the attached Impact Fee Deferral and Grant Agreement (Exhibit A-A-2), and
WHEREAS, the deferred impact fees accrue interest at the LAIF rate to ensure the deferral is cost neutral to the impact fee funds, but can be paid at any time without penalty prior to granting the certificate of occupancy; and
WHEREAS, the grant terms are structured such that the City has no obligation to grant funds to the project until the impact fees are paid, which is expected to occur at occupancy; and WHEREAS, the proposed grant of up to $324,999 shall be accomplished through a grant from the General Fund to the Traffic Impact Fee Fund, as further described in the Inter-Fund Grant Term Sheet, attached as Exhibit B.

WHEREAS, the action of approving the Impact Fee Deferral and Grant Agreement, as well as the associated documents and an inter-fund grant, does not constitute a project as defined by California Environmental Quality Act Guidelines Section 15378; therefore, no further environmental review is required.

NOW, THEREFORE BE IT RESOLVED THAT THE CITY OF COTATI CITY COUNCIL FINDS AS FOLLOWS:

1. The City Council hereby declares that each of the statements, findings and determinations of the City set forth in the recitals set forth above are true and correct and are incorporated herein by reference; and

2. The City Council hereby finds and declares that the granting funds to the Project will result in significant public benefits; and

3. The Impact Fee Deferral and Grant Agreement, the Promissory Note, and the Deed of Trust between the City and Colvin Group LLC., a California limited liability company (Exhibit A, A-1, A-2), are hereby approved, and subject to final approval of form by the City Attorney, the City Manager is authorized to execute said agreement and take all actions necessary to effect the intent of this Resolution.

4. The City Council hereby authorizes an Inter-Fund Grant from the General Fund to the Traffic Impact Fee Fund (Fund 205) in the amount of up to $324,000, and make any needed budgetary adjustments, subject to the terms and conditions listed on Exhibit B to this Resolution.

IT IS HEREBY CERTIFIED that the foregoing resolution was duly adopted at a regular meeting of the City Council of the City of Cotati held on the September 27th, 2022, by the following vote, to wit:

Approved:________________________________
Mayor
Attest:____________________________
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Kevin Patterson, Deputy City Clerk
Approved as to form:
____________________________
City Attorney
Attachments:

Exhibit A: Impact Fee Deferral and Grant Agreement (DOCX) Exhibit A-1: Deed of Trust (DOCX)
Exhibit A-2: Promissory Note (DOCX)
Exhibit B: Interfund Grant Term Sheet (DRAFT) (DOCX)
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BN 72408843v2
When Recorded Mail to:

City of Cotati
Attn: City Clerk
201 West Sierra Avenue
Cotati, CA 94931

EXEMPT FROM FILING FEES
GOVERNMENT CODE §§ 6103, 27383

(Space above for Recorder's Use)

DEVELOPMENT IMPACT FEE DEFERRAL AND GRANT AGREEMENT
between

THE CITY OF COTATI,
a California municipal corporation
and
Colvin Group LLC., a California limited liability company

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Attachment: Exhibit A: Impact Fee Deferral and Grant Agreement (Cotati Station 98-Units Fee Deferral + Grant) -1-
BN 72408843v2
This Development Impact Fee Deferral and Grant Agreement ("Deferral Agreement") is entered into effective _____________, 2022 (“Effective Date”) by and between the City of Cotati, a California municipal corporation (“City”), and Colvin Group LLC., a California limited liability company (“Owner”). City and Owner are hereinafter collectively referred to as the “Parties.”

RECITALS
A. Owner is the fee simple owner of that certain real property designated by APNs 144-320-035, 144-320-034, and 144-320-036in Cotati, California ("Property") and more particularly described in Exhibit A attached hereto and incorporated herein by reference.

B. Owner desires to develop a 98-unit mixed use project consisting of 98-apartment homes (1, 2, an 3 bedroom units) and approximately 5,600 square feet of commercial space on the Property, consisting of three parcels totaling approximately 2.42 acres, at a project cost of not less than $30 million ("Project").

C. Owner has applied to the City for those permits and entitlements necessary for construction of the Project.

D. In connection with the granting of such permits and entitlements for the Project, the City has imposed certain development impact fees and charges ("Impact Fees").

E. The City has established an Impact Fee Deferral Program (“Deferral Program”) as Chapter 4.14 of the Cotati Municipal Code, pursuant to which, subject to compliance with the terms and conditions thereof, the payment of certain Impact Fees in an amount of Ten Thousand Dollars ($10,000) or more may be deferred until the earlier of (i) final inspection or (ii) the date the City issues the first Certificate of Occupancy for the Project; Provided, however, that such Impact Fees shall not be deferred for more than two (2) years from the date when Impact Fees would otherwise be due and payable.

F. Owner has submitted an application for the Deferral Program (“Application”) requesting that the City defer the collection of certain Impact Fees imposed on the Project in order to make the Project financially viable.

G. The City has determined that this Project is eligible for the Deferral Program and will generally contribute to the economic and commercial well-being of the City and its residents.

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H. In recognition of the additional public benefits and to support Owner’s construction of the Project’s associated public amenities, including the widening of Santero Way for improved fire access, a new public park, additional public parking beyond the development requirements adjacent to the SMART station, and use of all electric (no natural gas) to reduce greenhouse gas emissions in the development, City further desires to award Owner, and Owner desires to accept from the City, a grant in the total amount of up to Three Hundred and Twenty Four Thousand and 99/100 Dollars and 99 cents ($324,999.99) (the “Grant Funds”) from the City’s General Fund to be applied by the City to reduce the Impact Fees due from the Owner.

The total funds committed by the City is $599,999.99, consisting of a grant to pay approximately $275,000 in impact fees for the low and very low units (see the Affordable Housing Regulatory Agreement), with the remainder the Grant Funds described herein.

H. The City has agreed, subject to the terms, conditions and limitations of this Deferral Agreement, to reduce and defer payment of certain Impact Fees payable with respect to the Project as more particularly set forth in this Deferral Agreement.

I. The City shall cause this Deferral Agreement to be recorded in the Official Records of the County of Sonoma.

AGREEMENT
NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby agree as follows.

1. Deferred and Reduced Fees.
(a) The City hereby agrees, subject to the terms, conditions and limitations of this Deferral Agreement, to defer payment of the following Impact Fees due for or in connection with development of the Project (“Deferred Fees”):

Fee Type Estimated Amount*
Water Capacity & Conservation Fees $448,409
Wastewater Capacity Fees $377,203
Traffic Impact Fees $701,745
Park Impact Fees $0
Linkage Fees $12,297
Inclusionary Housing Fees $0
Total $1,539,654

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*Based on June 2, 2022 fee estimate.

The Deferred Fees listed above are an estimate based on the Impact Fees in effect as of June 2, 2022. Owner shall be responsible to pay the Impact Fees in effect at the Due Date. At the time of Owner’s payment, the total Deferred Fees shall be reduced by the City’s Grant Funds (“Reduced Deferred Fees”).
(b) Owner shall pay the total amount of the Reduced Deferred Fees to the City upon the earlier of (i) final inspection, or (ii) the date the City issues the first Certificate of Occupancy for the Project (“Due Date”). Owner shall have the right to prepay the Reduced Deferred Fees at any time, without penalty or premium. Notwithstanding the foregoing, unless the City agrees otherwise in writing, the total amount of the Reduced Deferred Fees shall be due and payable upon the occurrence of any of the following events:
(i) The sale, transfer, conveyance or further encumbrance by Owner of any portion of, or interest in, the Property or Project, or upon a change in direct or indirect majority ownership of Owner or a change in control of Owner, except as otherwise permitted under Section 21 below; or
(ii) The occurrence of an Event of Default under this Deferral Agreement.

2. Conditions to Deferment. The City shall defer the payment of the Impact Fees upon satisfaction of each of the following conditions:
(a) the Owner’s execution and delivery to the City of this Deferral Agreement, the Note (as defined in Section 3 below), and the Deed of Trust;
(b) Recordation of the Deed of Trust in the Official Records of Sonoma County;
(c) the Owner’s delivery to the City of a Preliminary Title Report for the Property evidencing that there are no liens senior to City’s Deed of Trust, except for those senior liens approved by the City;
(d) Owner’s delivery to the City of each of the following: (i) certificate of good standing, certified by the Secretary of State indicating that Owner is properly organized and authorized to do business in the State of California, (ii) a certified resolution indicating that Owner has authorized this transaction and that the persons executing the Deferred Fee Documents (defined below) on behalf of Owner have been duly authorized

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to do so, and (iii) a certified copy of Owner’s articles of incorporation and bylaws; and
(e) No material adverse change as determined by the City in its reasonable judgment shall have occurred in the condition of the Property or in the financial or other condition of Owner since the date of Owner’s application for the Program.

3. Security. The Owner's obligation to pay the Reduced Deferred Fees shall be evidenced by a Promissory Note (“Note”) that is substantially in the form attached hereto as Exhibit B and secured by a Deed of Trust ("Deed of Trust") on the Property that is substantially in the form attached hereto as Exhibit C, both to be dated as of the Effective Date and executed by Owner in favor of the City and delivered to the City, and each of which is incorporated herein by reference. Owner’s Deferral Program Application, this Deferral Agreement, the Note and the Deed of Trust are hereinafter collectively referred to as the “Deferred Fee Documents.”

4. Subordination. At the Owner’s request, the City may subordinate the Deed of Trust to the liens securing loans senior to Owner’s obligation to the City (“Senior Loans”), but only if all of the following conditions are satisfied:
(a) All of the proceeds of the Senior Loans, less any transaction costs, must be used to provide acquisition, construction and/or permanent financing for the Project;
(b) The Owner must demonstrate to the City’s satisfaction that subordination of the Deed of Trust is necessary to secure adequate acquisition, construction and/or permanent financing to ensure the viability of the Project;
(c) The subordination agreement(s) must be structured to minimize the risk that the Deed of Trust would be extinguished as a result of a foreclosure by the holder of any Senior Loan. To satisfy this requirement, the subordination agreement must provide the City with adequate rights to cure any defaults by Owner, including: (i) providing the City with copies of any notices of default at the same time and in the same manner as provided to Owner; and (ii) providing the City with a reasonable period to cure any default;
(d) The subordination(s) described in this Section may be effective only during the original term of the Senior Loan(s) and any extension of its term approved in writing by the City;

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(e) No subordination may limit the effect of the Deed of Trust before a foreclosure, nor require consent of the holder of the Senior Loan in order for the City to exercise any remedies under any of the documents evidencing the Deferred Fees;
(f) Upon a determination by the City Manager that the conditions in this Section have been satisfied, the City Manager or his/her designee is authorized to execute a subordination agreement, in a form approved by the City Attorney, without the necessity of any further City Council action or approval.

5. Representations and Warranties. Owner makes the following representations, warranties and covenants and acknowledges that the City is relying thereupon in agreeing to defer payment of the Reduced Deferred Fees:
(a) Owner is a limited liability company duly organized and in good standing under the laws of the State of California. The person(s) executing this Deferral Agreement on behalf of Owner have been duly authorized to do so. Owner has all requisite power and authority to execute, deliver and perform its obligations under the Deferred Fee Documents.

Owner is the fee simple owner of the Property, subject only to liens, encumbrances, easements, restrictions, conditions, and other matters of record or disclosed in writing to the City. (b) The execution of the Deferred Fee Documents and Owner’s performance thereunder do not and will not result in a breach of or constitute a default under any agreement, indenture or other instrument to which Owner is a party or by which Owner may be bound. (c) The Deferred Fee Documents and the transactions contemplated thereby have each been duly authorized by Owner, and when executed and delivered will each constitute a valid and binding obligation of Owner, enforceable in accordance with the respective terms thereof.
(d) There are no pending, or to Owner’s knowledge, threatened, actions or proceedings before any court or administrative agency which may adversely affect the financial condition or operation of Owner or Owner’s interest in the Property. (e) Owner is in compliance in all material respects with all local, state and federal laws, rules, regulations, orders and decrees which are applicable to the Property, the Project or to Owner in relation thereto (“Applicable Laws”) including without limitation, all environmental, health and safety and employment laws. Owner has received no notice from any governmental authority regarding any threatened or pending zoning, building, fire, or health code violation or violation of other governmental regulations concerning the Property that has not been corrected, and no condition on the Property violates any Applicable Law. (f) No representation or warranty made by Owner in this Deferral Agreement

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or in the Deferred Fee Documents contains any untrue statement of a material fact or omits to state any material fact necessary to make the statements therein not misleading. There is no fact known to Owner which has or might reasonably be anticipated to have a material adverse effect on the business, assets, financial condition of Owner which has not been disclosed to the City in writing.

6. Affirmative Covenants.
(a) Owner covenants to punctually pay the principal balance of the Note and interest (if any) accrued thereon at the times and place and in the manner specified in the Note. (b) Owner covenants to comply with all Applicable Laws. (c) Owner shall maintain and keep in force at Owner’s expense, insurance coverage with respect to the Property in accordance with the requirements set forth in Exhibit D attached hereto and incorporated herein.
(d) Owner shall keep the Property and any improvements thereon, and the personal property used in Owner’s operations, in good repair and condition, and from time to time make necessary repairs, renewals and replacements thereto so that the Property and improvements shall be preserved and maintained.
(e) Owner shall pay and discharge when due any and all indebtedness, obligations, assessments, taxes, including federal and state payroll and income taxes which are the obligations of Owner in relation to the Property except those that Owner may in good faith contest or as to which a bona fide dispute may arise, provided provision is made to the satisfaction of the City for eventual payment thereof in the event that it is found that the same is an obligation of Owner.

7. Rights Not Granted Under Deferral Agreement. This Deferral Agreement is not, and shall not be construed to be, an approval or an agreement to issue permits or a granting of any right or entitlement by the City concerning the construction of the Project, or any other project, development or other construction by Owner within the City. This Deferral Agreement does not, and shall not be construed to, exempt Owner from paying any fees for any permits, licenses or other approvals which may be required by the City, and (other than the Reduced Deferred Fees) at the time required by the City, concerning the construction of the Project, or any other project, development or other construction by Owner within the City. This Deferral Agreement does not, and shall not be construed to, exempt Owner in any way from the requirement to obtain permits and/or other discretionary or non-discretionary approvals as may be necessary for the development, maintenance or operation of the Project, or any other project, development or other construction by Owner within the City. This Deferral Agreement does not, and shall not be construed to, exempt Owner or the Property from the application and/or exercise of the City’s power of eminent domain, or its police powers including, but not limited to, the

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regulation of land uses, and the taking of any actions necessary to protect the health, safety and welfare of its citizenry.

8. Default.
(a) Events of Default. Each of the following events shall constitute an event of default hereunder (“Event of Default”):
(i) Owner fails to pay when due any principal payment or other sum due under this Deferral Agreement or the Note;
(ii) Any representation or warranty contained in the Application, this Deferral Agreement, the Note, the Deed of Trust or any document furnished in connection with the foregoing proves to have been false or misleading in any material adverse respect when made;
(iii) A default has been declared by a lender under any loan secured by a deed of trust on the Project;
(iv) Pursuant to or within the meaning of the United States Bankruptcy Code or any other federal or state law relating to insolvency or relief of debtors (a Bankruptcy Law): (1) Owner (i) commences a voluntary case or proceeding, (ii) consents to the entry of an order for relief against it in an involuntary case, (iii) applies for or consents to the appointment of a trustee, receiver, assignee, liquidator or similar official, (iv) makes an assignment for the benefit of its creditors, or (v) admits in writing its inability to pay its debts as they become due; or (2) a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that (i) is for relief against Owner in an involuntary case, (ii) appoints a trustee, receiver, assignee, liquidator or similar official for Owner or substantially all of Owner’s assets, (iii) orders the liquidation of Owner, or (iv) issues or levies a judgment, writ, warrant of attachment or similar process against the Property or any other property of Owner, and in each case the order or decree is not released, vacated, dismissed or fully bonded within sixty (60) days after its issuance;
(v) An Event of Default is declared under the Note or the Deed of Trust, subject to the expiration of any applicable cure period set forth in such documents;
(vi) Owner defaults in the performance of any term, provision, covenant or agreement (other than an obligation enumerated in this Section 8) contained in this Deferral Agreement or unless a shorter cure

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period for such default is specified herein, the default continues for ten (10) days in the event of a monetary default or thirty (30) days in the event of a nonmonetary default after the date upon which the City shall have given written notice of the default to Owner (or such longer time as the City may agree upon in writing), provided that in each case Owner commences to cure the default within thirty (30) days and thereafter prosecutes the curing of such default with due diligence and in good faith; or
(vii) Owner allows or permits occupancy or resale for the purpose of occupancy without payment of the Deferred Fees.
(b) Rights Upon Event of Default. Upon the occurrence of an Event of Default, the City shall have all remedies available to it under law or equity, including, but not limited to the following, and the City may, at its election, without notice to or demand upon Owner, except for notices or demands required by law or expressly required pursuant to this Deferral Agreement, exercise one or more of the following remedies:
(i) Seek specific performance to enforce the terms of this Deferral Agreement;
(ii) Accelerate and declare the balance of the Note and interest (if any) accrued thereon immediately due and payable;
(iii) Foreclose on the Property pursuant to the Deed of Trust; and (iv) Pursue any and all other remedies available under law to enforce the terms of this Deferral Agreement and the City’s rights hereunder. (c) Cumulative Remedies. Each of the remedies provided herein is cumulative and not exclusive of, and shall not prejudice any other remedy provided herein. The City may exercise from time to time any rights and remedies available to it under applicable law, in addition to, and not in lieu of, any rights and remedies expressly granted in this Deferral Agreement or in any other instrument or notice.

9. Indemnification. Owner shall indemnify, defend (with counsel approved by the City), and hold harmless the City and its elected and appointed officers, agents, employees, consultants and contractors (collectively, the Indemnitees"), from and against, and shall pay on demand, any and all losses, liabilities, damages, costs, claims, demands, penalties, deficiencies, fines, orders, judgments, actions, suits, judicial or administrative proceedings, injunctive or other relief, expenses and charges (including attorneys’ fees and court costs) (collectively “Claims”) arising directly or indirectly in any manner in connection with or as a result of (a) any breach of Owner’s covenants under the Deferred Fee Documents, (b) any failure of Owner’s representations and warranties to be true and correct in all material respects when made, (c) injury or death to

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persons or damage to property or other loss occurring on the Property, whether caused by the negligence or any other act or omission of Owner or any other person or by negligent, faulty, inadequate or defective design, building, construction or maintenance or any other condition or otherwise, or (d) any claim, demand or cause of action, or any action or other proceeding, whether meritorious or not, brought or asserted against any Indemnitee which relates to or arises out of the Property, the Project, the Deferred Fees, the Deferred Fee Documents, or any transaction contemplated thereby, or any failure of Owner to comply with all Applicable Laws in connection with the Property and the Project, provided that no Indemnitee shall be entitled to indemnification under this Section for matters caused by such Indemnitee's gross negligence or willful misconduct.

The obligations of Owner under this Section shall survive the expiration or termination of this Deferral Agreement and the making and repayment of the Deferred Fees.

10. Successors and Assigns. Owner may not assign this Deferral Agreement, in whole or in part, without the prior written consent of the City, and any attempt to make such assignment shall be null and void. This Deferral Agreement shall be binding on any and all successors and permitted assigns of the Parties.

11. Governing Laws. This Deferral Agreement shall in all respects be construed and enforced in accordance with laws of the State of California without regard to principles of conflicts of laws. The Parties consent to the jurisdiction of any federal or state court in the jurisdiction in which the Property is located (the “Property Jurisdiction”). Owner agrees that any controversy arising under or in relation to this Deferral Agreement or any other Deferred Fee Document shall be litigated exclusively in courts having jurisdiction in the Property Jurisdiction.

Owner irrevocably consents to service, jurisdiction, and venue of such courts for any such litigation and waives any other venue to which it might be entitled by virtue of domicile, habitual residence or otherwise.

12. Notices. All notices required to be delivered under this Deferral Agreement or applicable law shall be delivered by personal delivery, express mail or by United States mail, certified, postage prepaid. Notices personally delivered or delivered by express mail shall be deemed received upon receipt. Notices delivered by certified mail shall be deemed received the earlier of three (3) days following deposit of such notice with the United States Postal Service or actual receipt. Notices shall be sent as follows:

To City: City of Cotati
201 West Sierra Avenue
Cotati, CA 94931
Attn: Community Development Director
To Owner:

Colvin Group, LLC
45 Camino Alto Suite 208
Mill Valley, CA, 94941

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Attn: Larry Colvin

13. Attorneys' Fees and Costs. In the event any legal action is commenced to interpret or to enforce the terms of this Deferral Agreement or to collect damages as a result of any breach thereof, the Party prevailing in any such action shall be entitled to recover against the other Party all reasonable attorneys’ fees and costs incurred in such action.

14. Entire Agreement. This Deferral Agreement, together with Exhibits A-D, which are incorporated herein by reference, constitutes the entire agreement of the City and Owner and supersedes all previous agreements, oral or written, on the subject matter of this Deferral Agreement.

15. Modification. This Deferral Agreement shall be amended or modified only by an agreement in writing signed by each of the Parties.

16. Further Acts. The Parties agree to execute such additional documents and to take such further actions as are reasonably necessary to accomplish the objectives and intent of this Deferral Agreement.

17. Severability. If any provision or clause of this Deferral Agreement or any application of it to any person, firm, organization, partnership or corporation is held invalid, such invalidity shall not affect any other provision of this Deferral Agreement, and the Deferral Agreement shall be construed as if such provisions or clauses did not exist.

18. Captions; Interpretation; Time. The captions of the Sections of this Deferral Agreement are for convenience only and are not intended to affect the interpretation or construction of the provisions herein contained. The language of this Deferral Agreement shall be construed as a whole according to its fair meaning and not strictly for or against any Party.

Time is of the essence in the performance of this Deferral Agreement.

19. Counterparts. This Deferral Agreement may be executed in multiple counterparts each of which shall be an original and all of which taken together shall constitute one and the same instrument.

20. No Third Party Beneficiary. This Deferral Agreement and the performance of the City’s and the Owner's obligations hereunder are for the sole and exclusive benefit of the City and the Owner. No person or entity who or which is not a signatory to this Deferral Agreement shall be deemed to be benefited or intended to be benefited by any provision hereof, and no such person or entity shall acquire any rights or causes of action against either the City or the Owner hereunder as a result of the City’s or the Owner's performance or nonperformance of their respective obligations under this Deferral Agreement.

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21. Assignment. This Deferral Agreement shall be binding upon and inure to the benefit of the Parties and their respective successors and assigns. Notwithstanding the foregoing, the City’s obligation to enter into this Deferral Agreement is personal to Owner, and shall not be assignable by Owner by operation of law or otherwise absent the express written consent of the City, and any such assignment by operation of law or otherwise shall be void.

22. Prevailing Wage Requirements. To the full extent required by all applicable State and Federal laws, rules and regulations, if any, Owner shall for itself and shall require its contractors and agents to comply with California Labor Code Section 1720 et seq., the Davis Bacon Act, and the regulations adopted pursuant to each of them, as the same may be applicable to the Project ("Prevailing Wage Laws"), and shall be responsible for carrying out the requirements of such provisions.

Subject to the last sentence of this paragraph, to the fullest extent permitted by law, Owner shall indemnify, defend (with counsel approved by City) and hold the City, and its elected and appointed officers, officials, employees, agents, consultants, and contractors (collectively, the "lndemnitees") harmless from and against all liability, loss, cost, expense (including without limitation attorneys' fees and costs of litigation), claim, demand, action, suit, judicial or administrative proceeding, penalty, deficiency, fine, order, and damage (all of the foregoing collectively "Claims") which directly or indirectly, in whole or in part, are caused by, arise in connection with, result from, relate to, or are alleged to be caused by, arise in connection with, or relate to, the payment or requirement of payment of prevailing wages (including without limitation, all claims that may be made by contractors, subcontractors. or other third party claimants pursuant to Labor Code Sections 1726 and 1781), the failure to comply with any state or federal labor laws, regulations or standards in connection with this Deferral Agreement, including but not limited to the Prevailing Wage Laws, or any act or omission of Owner related to this Deferral Agreement with respect to the payment or requirement of payment of prevailing wages, whether or not any insurance policies shall have been determined to be applicable to any such Claims. It is further agreed that City does not and shall not waive any rights against Owner which it may have by reason of this indemnity and hold harmless agreement because of the acceptance by City, or Owner’s deposit with City of any of the insurance policies described in this Agreement. The provisions of this Section 22 shall survive the expiration or earlier termination of this Deferral Agreement and the issuance of a Certificate of Completion for the Project and shall be assumed by any successor to Owner’s interest in this Deferral Agreement.

Owner’s indemnification obligations set forth in this Section 22 shall not apply to claims to the extent arising from the gross negligence or willful misconduct of one or more of the Indemnitees.

Owner’s indemnification obligations set forth in this Section 22 shall only apply to work performed by or on behalf of Owner or any entity affiliated with Owner, including without limitation, a Controlled Affiliate or an entity controlled by or under common control with Owner.

23. Survival. All representations made by Owner herein and the provisions of Section 9 hereof shall survive the expiration or earlier termination of this Deferral Agreement.

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The representations of Owner made herein have been or will be relied upon by the City, notwithstanding any investigation made by the City or on its behalf. [SIGNATURES ON FOLLOWING PAGE; SIGNATURES OF CITY AND
OWNER MUST BE NOTARIZED.]

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IN WITNESS WHEREOF, the Parties have each caused this Deferral Agreement to be duly executed as of the date first written above.

OWNER
By:_______________________
Its:_______________________

CITY OF COTATI
a California municipal corporation
By: ____________________________
Damien O’Bid, City Manager
ATTEST:
___________________________
Kevin Patterson, Deputy City Clerk
APPROVED AS TO FORM:

By: ________________________
John Bakker, City Attorney

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EXHIBIT A

PROPERTY
(attach legal description)

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EXHIBIT B
NOTE

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EXHIBIT C

DEED OF TRUST

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EXHIBIT D

INSURANCE REQUIREMENTS
(a) Owner and all contractors working on behalf of Borrower on the Project shall maintain a commercial general liability policy in the amount of One Million Dollars ($1,000,000) each occurrence, Two Million Dollars ($2,000,000) annual aggregate, or such other policy limits as the City may require in its reasonable discretion, including coverage for bodily injury, property damage, products, completed operations and contractual liability coverage.

Such policy or policies shall be written on an occurrence basis and shall name the Indemnitees as additional insureds.
(b) Owner and all contractors working on behalf of Owner shall maintain a comprehensive automobile liability coverage in the amount of One Million Dollars ($1,000,000), combined single limit including coverage for owned and non-owned vehicles and shall furnish or cause to be furnished to the City evidence satisfactory to the City that Owner and any contractor with whom Owner has contracted for the performance of work on the Property or otherwise pursuant to this Deferral Agreement carries workers’ compensation insurance as required by law.

Automobile liability policies shall name the Indemnitees as additional insureds. (c) Upon commencement of construction work and continuing until issuance of a Certificate of Completion, Owner and all contractors working on behalf of Owner shall maintain a policy of builder's all-risk insurance in an amount not less than the full insurable cost of the Project on a replacement cost basis naming the City as loss payee. (d) Borrower shall maintain property insurance covering all risks of loss (other than earthquake), including flood (if required) for one hundred percent (100%) of the replacement value of the Project with deductible, if any, in an amount acceptable to the City, naming the City as loss payee.
(e) Companies writing the insurance required hereunder shall be licensed to do business in the State of California. Insurance shall be placed with insurers with a current A.M. Best's rating of no less than A: VII. The Commercial General Liability and comprehensive automobile policies required hereunder shall name the Indemnitees as additional insureds.

Builder’s Risk and property insurance shall name the City as a loss payees as its interests may appear.
(f) Prior to commencement of construction work, Owner shall furnish the City with certificates of insurance in form acceptable to the City, evidencing the required insurance coverage and duly executed endorsements evidencing such additional insured status.

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

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(g) If any insurance policy or coverage required hereunder is canceled or reduced, Owner shall, within fifteen (15) days after receipt of notice of such cancellation or reduction in coverage, but in no event later than the effective date of cancellation or reduction, file with the City a certificate showing that the required insurance has been reinstated or provided through another insurance company or companies. Upon failure to so file such certificate, the City may, without further notice and at its option, procure such insurance coverage at Owner’s expense, and Owner shall promptly reimburse the City for such expense upon receipt of billing from the City.
(h) Coverage provided by Owner shall be primary insurance and shall not be contributing with any insurance, or self-insurance maintained by the City, and the policies shall so provide. The insurance policies shall contain a waiver of subrogation for the benefit of the City. Owner shall furnish the required certificates and endorsements to the City prior to the commencement of construction of the Project, and shall provide the City with certified copies of the required insurance policies upon request of the City. 5183223.1

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Attachment: Exhibit A: Impact Fee Deferral and Grant Agreement (Cotati Station 98-Units Fee Deferral + Grant) Development Impact Fee Deferral Program
Deed of Trust
1 Recording Requested by
and when Recorded, return to:

City of Cotati
ATTN: City Clerk
201 West Sierra Avenue
Cotati, CA 94931

EXEMPT FROM RECORDING FEES PER
GOVERNMENT CODE §§6103, 27383
Space above this line for Recorder’s use.

DEED OF TRUST,

SECURITY AGREEMENT AND FIXTURE FILING
THIS DEED OF TRUST, SECURITY AGREEMENT AND FIXTURE FILING (“Deed of Trust”) is made as of <DATE> by Colvin Group LLC., a California limited liability company (“Trustor”) to <TYP. TITLE COMPANY> (“Trustee”), for the benefit of the City of Cotati, a California municipal corporation (“Beneficiary”).

WHEREAS, Trustor owns fee simple title to the land located on Santero Way, designated by APNs 144-320-035, 144-320-034, and 144-320-036 in Cotati, California and more particularly described in Exhibit A attached hereto and incorporated herein by this reference (the “Land”); and
WHEREAS, Beneficiary and Trustor have entered into a Development Impact Fee Deferral Agreement dated as of the date hereof (“Deferral Agreement”) pursuant to which Trustor has agreed to defer Beneficiary’s payment of a sum in in the amount of One Million Five Hundred Thirty-Nine Thousand Six Hundred Fifty-Four and 00/100 Dollars ($1,539,654) (the “Deferral”) for purposes of financing the payment of certain development impact fees and charges; and
WHEREAS, Trustor has executed a promissory note (the “Note”) to secure payment of the Deferral; and
WHEREAS, as a condition precedent to entering into the Deferral Agreement, Beneficiary has required that Trustor enter into this Deed of Trust and grant to Trustee for the benefit of Beneficiary, a lien and security interest in the Property (as defined below) to secure payment of the Deferral; and
WHEREAS, capitalized terms not defined herein shall have the meaning ascribed to them in the Deferral Agreement.

NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, it is agreed as follows.

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2 1. Grant in Trust. In consideration of the foregoing and for the purpose of securing payment and performance of the Secured Obligations defined and described in Section 2, Trustor hereby irrevocably and unconditionally grants, conveys, transfers and assigns to Trustee, in trust for the benefit of Beneficiary, with power of sale and right of entry and possession, all estate, right, title and interest which Trustor now has or may later acquire in and to the Land, and all of the following, whether presently owned or hereafter acquired:
a. All buildings, structures, and improvements, now or hereafter located or constructed on the Land (“Improvements”);
b. All appurtenances, easements, rights of way, pipes, transmission lines or wires and other rights used in connection with the Land or the Improvements or as a means of access thereto, whether now or hereafter owned or constructed or placed upon or in the Land or Improvements and all existing and future privileges, rights, franchises and tenements of the Land, including all minerals, oils, gas and other commercially valuable substances which may be in, under or produced from any part of the Land, and all water rights, rights of way, gores or strips of land, and any land lying in the streets, ways, and alleys, open or proposed, in front of or adjoining the Land and Improvements (collectively, “Appurtenances”); c. All machinery, equipment, fixtures, goods and other personal property of the Trustor, whether moveable or not, now owned or hereafter acquired by the Trustor and now or hereafter located at or used in connection with the Land, the Improvements or Appurtenances, and all improvements, restorations, replacements, repairs, additions or substitutions thereto (collectively, “Equipment”);
d. All existing and future leases, subleases, licenses, and other agreements relating to the use or occupancy of all or any portion of the Land or Improvements (collectively, “Leases”), all amendments, extensions, renewals or modifications thereof, and all rent, royalties, or other payments which may now or hereafter accrue or otherwise become payable thereunder to or for the benefit of Trustor, including but not limited to security deposits (collectively, “Rents”); e. All insurance proceeds and any other proceeds from the Land, Improvements, Appurtenances, Equipment, Leases, and Rents, including without limitation, all deposits made with or other security deposits given to utility companies, all claims or demands relating to insurance awards which the Trustor now has or may hereafter acquire, including all advance payments of insurance premiums made by Trustor, and all condemnation awards or payments now or later made in connection with any condemnation or eminent domain proceeding (“Proceeds”);

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3 f. All revenues, income, rents, royalties, payments and profits produced by the Land, Improvements, Appurtenances and Equipment, whether now owned or hereafter acquired by Trustor (“Gross Revenues”);
g. All architectural, structural and mechanical plans, specifications, design documents and studies produced in connection with development of the Land and construction of the Improvements (collectively, “Plans”); and
h. All interests and rights in any private or governmental grants, subsidies, loans or other financing provided in connection with development of the Land and construction of the Improvements (collectively, “Financing”).

All of the above-referenced interests of Trustor in the Land, Improvements, Appurtenances, Equipment, Leases, Rents, Proceeds, Gross Revenues, Plans and Financing as hereby conveyed to Trustee or made subject to the security interest herein described are collectively referred to herein as the “Property.”

2. Obligations Secured. This Deed of Trust is given for the purpose of securing payment and performance of the following (collectively, the “Secured Obligations”): (i) all present and future indebtedness evidenced by the Note and any amendment thereof, including principal, interest and all other amounts payable under the terms of the Note; (ii) all present and future obligations of Trustor to Beneficiary under the Deferred Fee Documents; (iii) all additional present and future obligations of Trustor to Beneficiary under any other agreement or instrument acknowledged by Trustor (whether existing now or in the future) which states that it is or such obligations are, secured by this Deed of Trust; (iv) all obligations of Trustor to Beneficiary under all modifications, supplements, amendments, renewals, or extensions of any of the foregoing, whether evidenced by new or additional documents; and (v) reimbursement of all amounts advanced by or on behalf of Beneficiary to protect Beneficiary’s interests under this Deed of Trust. The Deferral Agreement, the Note and this Deed of Trust are hereinafter collectively referred to as the “Deferred Fee Documents.”

3. Assignment of Rents, Issues, and Profits. Trustor hereby irrevocably, absolutely, presently and unconditionally assigns to Beneficiary the rents, royalties, issues, profits, revenue, income and proceeds of the Property. This is an absolute assignment and not an assignment for security only. Beneficiary hereby confers upon Trustor a license to collect and retain such rents, royalties, issues, profits, revenue, income and proceeds as they become due and payable prior to any Event of Default hereunder. Upon the occurrence of any such Event of Default, Beneficiary may terminate such license without notice to or demand upon Trustor and without regard to the adequacy of any security for the indebtedness hereby secured, and may either in person, by agent, or by a receiver to be appointed by a court, enter upon and take possession of the Property or any part thereof, and sue for or otherwise collect such rents, issues, and profits, including those past due and unpaid, and apply the same, less costs and expenses of operation and

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4 collection, including reasonable attorneys’ fees, to any indebtedness secured hereby, and in such order as Beneficiary may determine. Beneficiary’s right to the rents, royalties, issues, profits, revenue, income and proceeds of the Property does not depend upon whether or not Beneficiary takes possession of the Property. The entering upon and taking possession of the Property, the collection of such rents, issues, and profits, and the application thereof as aforesaid, shall not cure or waive any default or notice of default hereunder or invalidate any act done pursuant to such notice. If an Event of Default occurs while Beneficiary is in possession of all or part of the Property and/or is collecting and applying Rents as permitted under this Deed of Trust, Beneficiary, Trustee and any receiver shall nevertheless be entitled to exercise and invoke every right and remedy afforded any of them under this Deed of Trust and at law or in equity, including the right to exercise the power of sale granted hereunder. Regardless of whether or not Beneficiary, in person or by agent, takes actual possession of the Land or the Improvements, Beneficiary shall not be deemed to be a “mortgagee in possession,” shall not be responsible for performing any obligation of Trustor under any Lease, shall not be liable in any manner for the Property, or the use, occupancy, enjoyment or operation of any part of it, and shall not be responsible for any waste committed by Trustor, lessees or any third parties, or for dangerous or defective condition of the Property or any negligence in the management, repair or control of the Property. Absent Beneficiary’s written consent, Trustor shall not accept prepayment of rents for any rental period exceeding one month.

4. Security Agreement. The parties intend for this Deed of Trust to create a lien on the Property, and an absolute assignment of the Rents and Leases, all in favor of Beneficiary. The parties acknowledge that some of the Property may be determined under applicable law to be personal property or fixtures. To the extent that any Property may be or be determined to be personal property, Trustor as debtor hereby grants to Beneficiary as secured party a security interest in all such Property to secure payment and performance of the Secured Obligations. This Deed of Trust constitutes a security agreement under the California Uniform Commercial Code, as amended or recodified from time to time (the “UCC”), covering all such Property. To the extent such Property is not real property encumbered by the lien granted above, and is not absolutely assigned by the assignment set forth above, it is the intention of the parties that such Property shall constitute "proceeds, products, offspring, rents, or profits" (as defined in and for the purposes of Section 552(b) of the United States Bankruptcy Code, as such section may be modified or supplemented) of the Land and Improvements.

5. Financing Statements. Pursuant to the UCC, Trustor, as debtor, hereby authorizes Beneficiary, as secured party, to file such financing statements and amendments thereof and such continuation statements with respect thereto as Beneficiary may deem appropriate to perfect and preserve Beneficiary's security interest in the Property and Rents, without requiring any signature or further authorization by Trustor. If requested by Beneficiary, Trustor shall pay all fees and costs that Beneficiary may incur in filing such documents in public offices and in obtaining such record searches as Beneficiary may reasonably require. If any financing statement or other

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5 document is filed in the records normally pertaining to personal property, that filing shall not be construed as in any way derogating from or impairing this Deed of Trust or the rights or obligations of the parties under it.

Everything used in connection with the Property and/or adapted for use therein and/or which is described or reflected in this Deed of Trust is, and at all times and for all purposes and in all proceedings both legal or equitable shall be regarded as part of the estate encumbered by this Deed of Trust irrespective of whether (i) any such item is physically attached to the Improvements, (ii) serial numbers are used for the better identification of certain equipment items capable of being thus identified in a recital contained herein or in any list filed with Beneficiary, or (iii) any such item is referred to or reflected in any such financing statement so filed at any time. Similarly, the mention in any such financing statement of (1) rights in or to the proceeds of any fire and/or hazard insurance policy, or (2) any award in eminent domain proceedings for a taking or for lessening of value, or (3) Trustor's interest as lessor in any present or future lease or rights to income growing out of the use and/or occupancy of the property conveyed hereby, whether pursuant to lease or otherwise, shall not be construed as in any way altering any of the rights of Beneficiary as determined by this instrument or impugning the priority of Beneficiary’s lien granted hereby or by any other recorded document. Such mention in any financing statement is declared to be solely for the protection of Beneficiary in the event any court or judge shall at any time hold, with respect to the matters set forth in the foregoing clauses (1), (2), and (3), that notice of Beneficiary's priority of interest is required in order to be effective against a particular class of persons, including but not limited to the federal government and any subdivisions or entity of the federal government.

6. Fixture Filing. This Deed of Trust is intended to be and constitutes a fixture filing pursuant to the provisions of the UCC with respect to all of the Property constituting fixtures, is being recorded as a fixture financing statement and filing under the UCC, and covers property, goods and equipment which are or are to become fixtures related to the Land and the Improvements. Trustor covenants and agrees that this Deed of Trust is to be filed in the real estate records of Sonoma County and shall also operate from the date of such filing as a fixture filing in accordance with Section 9502 and other applicable provisions of the UCC. This Deed of Trust shall also be effective as a financing statement covering minerals or the like (including oil and gas) and accounts subject to the UCC, as amended. Trustor shall be deemed to be the "debtor" and Beneficiary shall be deemed to be the "secured party" for all purposes under the UCC.

7. Trustor’s Representations, Warranties and Covenants; Rights and Duties of the Parties.

7.1 Representations and Warranties. Trustor represents and warrants that: (i) Trustor lawfully possesses and holds a fee simple interest in the Land and the Improvements, (ii) Trustor has good and marketable title to all of the Property; (iii) Trustor has the full and unlimited power,

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6 right and authority to encumber the Property and assign the Rents; (iv) subject only to encumbrances of record and senior liens approved in writing by Beneficiary (“Permitted Encumbrances”), this Deed of Trust creates a valid lien on Trustor’s entire interest in the Property; (v) except with respect to Permitted Encumbrances, Trustor owns the Property free and clear of all deeds of trust, mortgages, security agreements, reservations of title or conditional sales contracts, (vi) there is no financing statement affecting the Property on file in any public office other than as disclosed in writing to Beneficiary; and (vii) the correct address of Trustor’s office is specified in Section 10.2.

7.2 Condition of Property. Trustor represents and warrants that except as disclosed to Beneficiary in writing, as of the date hereof: (i) Trustor has not received any notice from any governmental authority of any threatened or pending zoning, building, fire, or health code violation or violation of other governmental regulations concerning the Property that has not previously been corrected, and no condition on the Land violates any health, safety, fire, environmental, sewage, building, or other federal, state or local law, ordinance or regulation; (ii) no contracts, licenses, leases or commitments regarding the maintenance or use of the Property or allowing any third party rights to use the Property are in force; (iii) there are no threatened or pending actions, suits, or administrative proceedings against or affecting the Property or any portion thereof or the interest of Trustor in the Property; (iv) there are no threatened or pending condemnation, eminent domain, or similar proceedings affecting the Property or any portion thereof; (v) Trustor has not received any notice from any insurer of defects of the Property which have not been corrected; (vi) there are no natural or artificial conditions upon the Land or any part thereof that could result in a material and adverse change in the condition of the Land; (vii) all information that Trustor has delivered to Beneficiary, either directly or through Trustor's agents, is accurate and complete; and (viii) Trustor or Trustor’s agents have disclosed to Beneficiary all material facts concerning the Property.

7.3 Authority. Trustor represents and warrants that the Deferred Fee Documents and all other documents delivered or to be delivered by Trustor in connection herewith: (a) have been duly authorized, executed, and delivered by Trustor; (b) are binding obligations of Trustor; and (c) do not violate the provisions of any agreement to which Trustor is a party or which affects the Property. Trustor further represents and warrants that there are no pending, or to Trustor’s knowledge, threatened actions or proceedings before any court or administrative agency which may adversely affect Trustor’s ownership of the Property.

7.4 Payment and Performance of Secured Obligations. Trustor shall promptly pay when due the principal and any interest due on the indebtedness evidenced by the Note, and shall promptly pay and perform all other obligations of Trustor arising in connection with the Secured Obligations.

7.5 Preservation and Maintenance of Property; Compliance with Laws. Trustor covenants that it shall keep the Land and Improvements in good repair and condition, and from

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7 time to time shall make necessary repairs, renewals and replacements thereto so that the Property shall be preserved and maintained. Trustor covenants to comply with all federal, state and local laws, regulations, ordinances and rules applicable to the Property, including without limitation all applicable requirements of state and local building codes and regulations, and all applicable statutes and regulations relating to accessibility for the disabled. Trustor shall not remove, demolish or materially alter any Improvement without Beneficiary’s consent, shall complete or restore promptly and in good and workmanlike manner any building, fixture or other improvement which may be constructed, damaged, or destroyed thereon, and shall pay when due all claims for labor performed and materials furnished therefor. Trustor shall not commit or allow waste of the Property, and shall not commit or allow any act upon or use of the Property which would violate any applicable law or order of any governmental authority, nor shall Trustor bring on or keep any article on the Property or cause or allow any condition to exist thereon which could invalidate or which would be prohibited by any insurance coverage required to be maintained on the Property pursuant to this Deed of Trust.

7.6 Restrictions on Conveyance and Encumbrance; Acceleration. It shall be an Event of Default hereunder if the Property, any part thereof, or interest therein is voluntarily or involuntarily sold, assigned, conveyed, transferred, hypothecated, leased, licensed, or encumbered (“Transfer”) without the prior written consent of the Beneficiary. If any such Transfer shall occur in violation of this Deed of Trust, without limiting the provisions of Section 8 hereof, all obligations secured by this Deed of Trust, irrespective of the maturity dates of such obligations, shall at the option of Beneficiary, and without demand, immediately become due and payable, subject to any applicable cure period.

7.7 Inspections; Books and Records. Beneficiary and its agents and representatives shall have the right at any reasonable time upon reasonable notice to enter upon the Land and inspect the Property to ensure compliance with this Deed of Trust. Trustor shall maintain complete and accurate books of account and other records (including copies of supporting bills and invoices) adequate to document the operation of the Property, together with copies of all written contracts, Leases and other instruments which affect the Property. The books, records, contracts, Leases and other instruments shall be subject to examination and inspection by Beneficiary at any reasonable time following two business days prior notice.

7.8 Charges, Liens, Taxes and Assessments. Trustor shall pay before delinquency all taxes, levies, assessments and other charges affecting the Property that are (or if not paid may become) a lien on all or part of the Property. Trustor may, at Trustor’s expense, contest the validity or application of any tax, levy, assessment or charge affecting the Property by appropriate legal proceedings promptly initiated and conducted in good faith and with due diligence, provided that (i) Beneficiary is reasonably satisfied that neither the Property nor any part thereof or interest therein will be in danger of being sold, forfeited, or lost as a result of such contest, and (ii) Trustor shall have posted a bond or furnished other security as may reasonably

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Deed of Trust
8 be required from time to time by Beneficiary; and provided further that Trustor shall timely make any payment necessary to prevent a lien foreclosure, sale, forfeiture or loss of the Property.

Trustor shall immediately discharge or cause to be discharged any lien on the Property (other than encumbrances approved by Beneficiary as of the date hereof in writing). Trustor shall pay when due each obligation secured by or reducible to a lien, charge or encumbrance which now does or later may encumber or appear to encumber all or part of the Property or any interest in it, whether or not such lien, charge or encumbrance is or would be senior or subordinate to this Deed of Trust. Trustor shall not be required to pay any tax, levy, charge or assessment so long as its validity is being actively contested in good faith and by appropriate actions and/or proceedings.

7.9 Subrogation. Beneficiary shall be subrogated to the liens of all encumbrances, whether released of record or not, which are discharged in whole or in part by Beneficiary in accordance with this Deed of Trust.

7.10 Hazard, Liability and Workers’ Compensation Insurance. At all times during the term hereof, at Trustor’s expense, Trustor shall keep the Improvements and personal property now existing or hereafter located on the Property insured against loss by fire, vandalism and malicious mischief by a policy of standard fire and extended all-risk insurance. The policy shall be written on a full replacement value basis and shall name Beneficiary as loss payee as its interest may appear. The full replacement value of the Improvements to be insured shall be determined by the company issuing the policy at the time the policy is initially obtained. Not more frequently than once every two (2) years, either the Trustor or the Beneficiary shall have the right to notify the other party that it elects to have the replacement value redetermined by the insurance company. Subject to the rights of any senior lienholder, the proceeds collected under any insurance policy may be applied by Beneficiary to any indebtedness secured hereby and in such order as Beneficiary may determine, or at the option of Beneficiary, the entire amount so collected or any part thereof may be released to Trustor. Such application or release shall not cure or waive any default or notice of default hereunder or invalidate any act done pursuant to such notice. Notwithstanding anything to the contrary set forth herein, provided that Trustor is not in default under the Note or this Deed of Trust, Trustor shall be permitted to use the proceeds of insurance to rebuild the Improvements.

7.10.1 Trustor shall at all times during the term hereof, maintain a comprehensive general liability insurance policy in an amount not less than One Million Dollars ($1,000,000) each occurrence, Two Million Dollars ($2,000,000) annual aggregate, together with Three Million Dollars ($3,000,000) excess liability coverage or such other policy limits as Beneficiary may require in its reasonable discretion, including coverage for bodily injury, property damage, products, completed operations and contractual liability coverage. Such policy or policies shall be written on an occurrence basis and shall name the Beneficiary as an additional insured.

Trustor shall maintain workers’ compensation insurance as required by law.

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9 7.10.2 Upon Beneficiary’s request, Trustor shall file with Beneficiary certificates (or such other proof as Beneficiary may require, including without limitation, copies of the required insurance policies) evidencing each of the insurance policies and endorsements thereto as required by this Section, and such certificates (or policies) shall provide that at least thirty (30) days’ prior written notice shall be provided to Beneficiary prior to the expiration, cancellation or change in coverage under each such policy.

7.10.3 If any insurance policy required hereunder is canceled or the coverage provided thereunder is reduced, Trustor shall, within fifteen (15) days after receipt of written notice of such cancellation or reduction in coverage, but in no event later than the effective date of cancellation or reduction, file with Beneficiary a certificate showing that the required insurance has been reinstated or provided through another insurance company or companies.

Upon failure to so file such certificate, Beneficiary may, without further notice and at its option, procure such insurance coverage at Trustor’s expense, and Trustor shall promptly reimburse Beneficiary for such expense upon receipt of billing from Beneficiary.

7.10.4 The insurance policies required hereunder shall be issued by insurance companies authorized to do business in the State of California with a financial rating of at least A VII status as rated in the most recent edition of Best's Key Rating Guide. Each policy of insurance shall contain an endorsement requiring the insurer to provide at least thirty (30) days written notice to Beneficiary prior to change in coverage, cancellation or expiration thereof. If any insurance policy required pursuant to this Deed of Trust is canceled or the coverage provided thereunder is reduced, Trustor shall, within ten (10) days after receipt of written notice of such cancellation or reduction in coverage, but in no event later than the effective date of cancellation or reduction, file with Beneficiary a certificate showing that the required insurance has been reinstated or provided through another insurance company or companies. Upon failure to so file such certificate, Beneficiary may, without further notice and at its option, procure such insurance coverage at Trustor’s expense, and Trustor shall promptly reimburse Beneficiary for such expense upon receipt of billing from Beneficiary.

7.11 Hazardous Materials. Trustor represents and warrants that except as disclosed to Beneficiary in writing, as of the date hereof to the best knowledge of Trustor: (i) the Land is free and has always been free of Hazardous Materials (as defined below) and is not and has never been in violation of any Environmental Law (as defined below); (ii) there are no buried or partially buried storage tanks located on the Land; (iii) Trustor has received no notice, warning, notice of violation, administrative complaint, judicial complaint, or other formal or informal notice alleging that conditions on the Land are or have ever been in violation of any Environmental Law or informing Trustor that the Land is subject to investigation or inquiry regarding Hazardous Materials on the Land or the potential violation of any Environmental Law; (iv) there is no monitoring program required by the Environmental Protection Agency or any other governmental agency concerning the Land; (v) no toxic or hazardous chemicals, waste, or substances of any kind have ever been spilled, disposed of, or stored on, under or at the Land,

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10 whether by accident, burying, drainage, or storage in containers, tanks, holding areas, or any other means; (vi) the Land has never been used as a dump or landfill; and (vii) Trustor has disclosed to Beneficiary all information, records, and studies in Trustor’s possession or reasonably available to Trustor relating to the Land concerning Hazardous Materials.

Trustor shall not cause or permit any Hazardous Material (as defined below) to be brought upon, kept, stored or used in, on, under, or about the Land by Trustor, its agents, employees, contractors or invitees except for incidental supplies ordinarily used in connection with the construction, rehabilitation, repair, and operation of commercial developments similar to the Project and in compliance with all applicable laws, and shall not cause any release of Hazardous Materials into, onto, under or through the Land. If any Hazardous Material is discharged, released, dumped, or spilled in, on, under, or about the Land and results in any contamination of the Land or adjacent property, or otherwise results in the release or discharge of Hazardous Materials in, on, under or from the Land, Trustor shall promptly take all actions at its sole expense as are necessary to comply with all Environmental Laws (as defined below).

Trustor shall indemnify, defend (with counsel reasonably acceptable to Beneficiary), and hold Beneficiary and its elected and appointed officials, officers, agents and employees (collectively, “Indemnitees”) harmless from and against any and all loss, claim, liability, damage, demand, judgment, order, penalty, fine, injunctive or other relief, cost, expense (including reasonable fees and expenses of attorneys, expert witnesses, and other professionals advising or assisting Beneficiary), action, or cause of action (all of the foregoing, hereafter individually “Claim” and collectively “Claims”) arising in connection with the breach of Trustor’s covenants and obligations set forth in this Section 7.11 or otherwise arising in connection with the presence or release of Hazardous Materials in, on, under, or from the Property. The foregoing indemnity includes, without limitation, all costs of investigation, assessment, containment, removal, remediation of any kind, and disposal of Hazardous Materials, all costs of determining whether the Land is in compliance with Environmental Laws, all costs associated with bringing the Land into compliance with all applicable Environmental Laws, and all costs associated with claims for damages or injury to persons, property, or natural resources.

Without limiting the generality of the foregoing, Trustor shall, at Trustor’s own cost and expense, do all of the following:
a. pay or satisfy any judgment or decree that may be entered against any Indemnitee or Indemnitees in any legal or administrative proceeding incident to any matters against which Indemnitees are entitled to be indemnified under this Deed of Trust; b. reimburse Indemnitees for any expenses paid or incurred in connection with any matters against which Indemnitees are entitled to be indemnified under this Deed of Trust; and

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11 c. reimburse Indemnitees for any and all expenses, including without limitation outof-pocket expenses and fees of attorneys and expert witnesses, paid or incurred in connection with the enforcement by Indemnitees of their rights under this Deed of Trust, or in monitoring and participating in any legal or administrative proceeding.

Trustor’s obligation to indemnify the Indemnitees shall not be limited or impaired by any of the following, or by any failure of Trustor to receive notice of or consideration for any of the following: (i) any amendment or modification of the Deferred Fee Documents; (ii) any extensions of time for performance required by the Deferred Fee Documents; (iii) any provision in the Deferred Fee Documents limiting Beneficiary's recourse to property securing the Secured Obligations, or limiting the personal liability of Trustor, or any other party for payment of all or any part of the Secured Obligations; (iv) the accuracy or inaccuracy of any representation and warranty made by Trustor under the Deferred Fee Documents, (v) the release of Trustor or any other person, by Beneficiary or by operation of law, from performance of any obligation under the Deferred Fee Documents; (vi) the release or substitution in whole or in part of any security for the Secured Obligations; and (vii) Beneficiary’s failure to properly perfect any lien or security interest given as security for the Secured Obligations.

The provisions of this Section 7.11 shall be in addition to any and all other obligations and liabilities that Trustor may have under applicable law, and each Indemnitee shall be entitled to indemnification under this Section without regard to whether Beneficiary or that Indemnitee has exercised any rights against the Property or any other security, pursued any rights against any guarantor or other party, or pursued any other rights available under the Deferred Fee Documents or applicable law. The obligations of Trustor to indemnify the Indemnitees under this Section shall survive any repayment or discharge of the Secured Obligations, any foreclosure proceeding, any foreclosure sale, any delivery of any deed in lieu of foreclosure, and any release of record of the lien of this Deed of Trust.

Without limiting any of the remedies provided in this Deed of Trust, Trustor acknowledges and agrees that each of the provisions in this Section 7.11 is an environmental provision (as defined in Section 736(f)(2) of the California Code of Civil Procedure) made by Trustor relating to real property security (the “Environmental Provisions”), and that Trustor's failure to comply with any of the Environmental Provisions will be a breach of contract that will entitle Beneficiary to pursue the remedies provided by Section 736 of the California Code of Civil Procedure (“Section 736”) for the recovery of damages and for the enforcement of the Environmental Provisions. Pursuant to Section 736, Beneficiary's action for recovery of damages or enforcement of the Environmental Provisions shall not constitute an action within the meaning of Section 726(a) of the California Code of Civil Procedure or constitute a money judgment for a deficiency or a deficiency judgment within the meaning of Sections 580a, 580b, 580d, or 726(b) of the California Code of Civil Procedure.

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Deed of Trust
12 “Hazardous Materials” means any substance, material or waste which is or becomes regulated by any federal, state or local governmental authority, and includes without limitation (i) petroleum or oil or gas or any direct or indirect product or by-product thereof; (ii) asbestos and any material containing asbestos; (iii) any substance, material or waste regulated by or listed (directly or by reference) as a “hazardous substance”, “hazardous material”, “hazardous waste”, “toxic waste”, “toxic pollutant”, “toxic substance”, “solid waste” or “pollutant or contaminant” in or pursuant to, or similarly identified as hazardous to human health or the environment in or pursuant to, the Toxic Substances Control Act [15 U.S.C. Section 2601, et seq.]; the Comprehensive Environmental Response, Compensation and Liability Act [42 U.S.C. Section 9601, et seq.], the Hazardous Materials Transportation Authorization Act [49 U.S.C. Section 5101, et seq.], the Resource Conservation and Recovery Act [42 U.S.C. Section 6901, et seq.], the Federal Water Pollution Control Act [33 U.S.C. Section 1251], the Clean Air Act [42 U.S.C.

Section 7401, et seq.], the California Underground Storage of Hazardous Substances Act [California Health and Safety Code Section 25280, et seq.], the California Hazardous Substances Account Act [California Health and Safety Code Section 25300, et seq.], the California Hazardous Waste Act [California Health and Safety Code Section 25100, et seq.], the California Safe Drinking Water and Toxic Enforcement Act [California Health and Safety Code Section 25249.5, et seq.], and the Porter-Cologne Water Quality Control Act [California Water Code Section 13000, et seq.], as they now exist or are hereafter amended, together with any regulations promulgated thereunder; (iv) any substance, material or waste which is defined as such or regulated by any “Superfund” or “Superlien” law, or any Environmental Law; or (v) any other substance, material, chemical, waste or pollutant identified as hazardous or toxic and regulated under any other federal, state or local environmental law, including without limitation, asbestos, polychlorinated biphenyls, petroleum, natural gas and synthetic fuel products and by-products. “Environmental Law” means all federal, state or local statutes, ordinances, rules, regulations, orders, decrees, judgments or common law doctrines, and provisions and conditions of permits, licenses and other operating authorizations regulating, or relating to, or imposing liability or standards of conduct concerning (i) pollution or protection of the environment, including natural resources; (ii) exposure of persons, including employees and agents, to any Hazardous Material (as defined above) or other products, raw materials, chemicals or other substances; (iii) protection of the public health or welfare from the effects of by-products, wastes, emissions, discharges or releases of chemical substances from industrial or commercial activities; (iv) the manufacture, use or introduction into commerce of chemical substances, including without limitation, their manufacture, formulation, labeling, distribution, transportation, handling, storage and disposal; or (iv) the use, release or disposal of toxic or hazardous substances or Hazardous Materials or the remediation of air, surface waters, groundwaters or soil, as now or may at any later time be in effect, including but not limited to the Toxic Substances Control Act [15 U.S.C. 2601, et seq.]; the Comprehensive Environmental Response, Compensation and Liability Act [42 U.S.C. Section 9601, et seq.], the Hazardous Materials Transportation Authorization Act [49 U.S.C. Section 5101, et seq.], the Resource

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Packet Pg. 105 Attachment: Exhibit A-1: Deed of Trust (Cotati Station 98-Units Fee Deferral + Grant) Development Impact Fee Deferral Program
Deed of Trust
13 Conservation and Recovery Act [42 U.S.C. 6901, et seq.], the Federal Water Pollution Control Act [33 U.S.C. Section 1251], the Clean Air Act [42 U.S.C. Section 7401, et seq.], the California Underground Storage of Hazardous Substances Act [California Health and Safety Code Section 25280, et seq.], the California Hazardous Substances Account Act [California Health and Safety Code Section 25300, et seq.], the California Hazardous Waste Act [California Health and Safety Code Section 25100, et seq.], the California Safe Drinking Water and Toxic Enforcement Act [California Health and Safety Code Section 25249.5, et seq.], and the Porter-Cologne Water Quality Control Act [California Water Code Section 13000, et seq.], as they now exist or are hereafter amended, together with any regulations promulgated thereunder.

7.12 Notice of Claims; Defense of Security; Reimbursement of Costs. a. Notice of Claims. Trustor shall provide written notice to Beneficiary of any uninsured or partially uninsured loss affecting the Property through fire, theft, liability, or property damage in excess of an aggregate of Fifty Thousand Dollars ($50,000) within three business days of the occurrence of such loss. Trustor shall ensure that Beneficiary shall receive timely notice of, and shall have a right to cure, any default under any other financing document or other lien affecting the Property and shall use best efforts to ensure that provisions mandating such notice and allowing such right to cure shall be included in all such documents. Within three business days of Trustor’s receipt thereof, Trustor shall provide Beneficiary with a copy of any notice of default Trustor receives in connection with any financing document secured by the Property or any part thereof.
b. Defense of Security. At Trustor's sole expense, Trustor shall protect, preserve and defend the Property and title to and right of possession of the Property, the security of this Deed of Trust and the rights and powers of Beneficiary and Trustee created under it, against all adverse claims.
c. Compensation; Reimbursement of Costs. Trustor agrees to pay all reasonable fees, costs and expenses charged by Beneficiary or Trustee for any service that Beneficiary or Trustee may render in connection with this Deed of Trust, including without limitation, fees and expenses related to provision of a statement of obligations or related to a reconveyance. Trustor further agrees to pay or reimburse Beneficiary for all costs, expenses and other advances which may be incurred or made by Beneficiary or Trustee in any efforts to enforce any terms of this Deed of Trust, including without limitation any rights or remedies afforded to Beneficiary or Trustee or both of them under Sections 7.18 and 8.2, whether or not any lawsuit is filed, or in defending any action or proceeding arising under or relating to this Deed of Trust, including reasonable attorneys’ fees and other legal costs, costs of any disposition of the Property under the power of sale granted hereunder or any judicial foreclosure, and any cost of evidence of title.

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Packet Pg. 106 Attachment: Exhibit A-1: Deed of Trust (Cotati Station 98-Units Fee Deferral + Grant) Development Impact Fee Deferral Program
Deed of Trust
14 d. Notice of Changes. Trustor shall give Beneficiary prior written notice of any change in the address of Trustor and the location of any Property, including books and records pertaining to the Property.

7.13 Indemnification. To the fullest extent permitted by law, Trustor shall indemnify, defend (with counsel reasonably acceptable to Beneficiary), and hold harmless the Trustee and the Indemnitees from and against all Claims arising directly or indirectly in any manner in connection with or as a result of (a) any breach of Trustor’s covenants under the Deferred Fee Documents, (b) any representation by Trustor in the Deferred Fee Documents which proves to be false or misleading in any material respect when made, (c) injury or death to persons or damage to property or other loss occurring on the Land or the Improvements, whether caused by the negligence or any other act or omission of Trustor or any other person or by negligent, faulty, inadequate or defective design, building, construction or maintenance or any other condition or otherwise, (d) any claim, demand or cause of action, or any action or other proceeding, whether meritorious or not, brought or asserted against any Indemnitee which relates to or arises out of the Property, the Deferred Fee Documents or any transaction contemplated thereby, or any failure of Trustor to comply with all applicable state, federal and local laws and regulations applicable to the Property, provided that no Indemnitee shall be entitled to indemnification under this Section for matters caused by such Indemnitee's gross negligence or willful misconduct.

The obligations of Trustor under this Section shall survive the repayment of the Note and shall be secured by this Deed of Trust. Notwithstanding any contrary provision contained herein, the obligations of Trustor under this Section shall survive any foreclosure proceeding, any foreclosure sale, any delivery of a deed in lieu of foreclosure, and any release or reconveyance of this Deed of Trust.

7.14. Limitation of Liability. Beneficiary shall not be directly or indirectly liable to Trustor or any other person as a consequence of any of the following: (i) Beneficiary's exercise of or failure to exercise any rights, remedies or powers granted to Beneficiary in this Deed of Trust; (ii) Beneficiary's failure or refusal to perform or discharge any obligation or liability of Trustor under any agreement related to the Property or under this Deed of Trust; (iii) any waste committed by Trustor, the lessees of the Property or any third parties, or any dangerous or defective condition of the Property; or (iv) any loss sustained by Trustor or any third party resulting from any act or omission of Beneficiary in managing the Property after an Event of Default, unless the loss is caused by the willful misconduct, gross negligence, or bad faith of Beneficiary. Trustor hereby expressly waives and releases all liability of the types described in this Section 7.14 and agrees that Trustor shall assert no claim related to any of the foregoing against Beneficiary.

7.15 Insurance and Condemnation Proceeds. Subject to the rights of any senior lienholders, any award of damages in connection with any condemnation for public use of, or injury to the Property or any part thereof is hereby assigned and shall be paid to Beneficiary who

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Packet Pg. 107 Attachment: Exhibit A-1: Deed of Trust (Cotati Station 98-Units Fee Deferral + Grant) Development Impact Fee Deferral Program
Deed of Trust
15 may apply such moneys to any indebtedness secured hereby in such order as Beneficiary may determine, or at the option of Beneficiary the entire amount so collected or any part thereof may be released to Trustor. Such application or release shall not cure or waive any default or notice of default hereunder or invalidate any act done pursuant to such notice. Notwithstanding the foregoing, so long as the value of Beneficiary’s lien is not impaired, insurance and/or condemnation proceeds may be used to repair and/or restore the Improvements.

7.16 Release, Extension, Modification. At any time and from time to time, without liability therefor and without notice, upon written request of Beneficiary and presentation of this Deed of Trust and the Note for endorsement, Trustee may release or reconvey all or any part of the Property, consent to the making of any map or plat of the Land or part thereof, join in granting any easement or creating any restriction affecting the Property, or join in any extension agreement or other agreement affecting the lien or charge hereof. At any time and from time to time, without liability therefor and without notice, Beneficiary may (i) release any person liable for payment of any Secured Obligation, (ii) extend the time for payment or otherwise alter the terms of payment of any Secured Obligation; (iii) accept additional real or personal property of any kind as security for any Secured Obligation, or (iv) substitute or release any property securing the Secured Obligations.

7.17 Reconveyance. Upon written request of Beneficiary stating that all of the Secured Obligations have been paid in full, and upon surrender of this Deed of Trust, and the Note, Trustee shall reconvey, without warranty, the Property or so much of it as is then held under this Deed of Trust. The recitals in any reconveyance executed under this Deed of Trust of any matters or facts shall be conclusive proof of the truthfulness thereof. Trustor shall pay all fees of Trustee and all recordation fees related to such reconveyance.

7.18 Cure; Protection of Security. Either Beneficiary or Trustee may cure any breach or default of Trustor, and if it chooses to do so in connection with any such cure, Beneficiary or Trustee may also enter the Property and/or do any and all other things which it may in its sole discretion consider necessary and appropriate to protect the security of this Deed of Trust. Such other things may include: appearing in and/or defending any action or proceeding which purports to affect the security of, or the rights or powers of Beneficiary or Trustee under, this Deed of Trust; paying, purchasing, contesting or compromising any encumbrance, charge, lien or claim of lien which in Beneficiary’s or Trustee’s sole judgment is or may be senior in priority to this Deed of Trust, such judgment of Beneficiary or Trustee to be conclusive as among Beneficiary, Trustee and Trustor; obtaining insurance and/or paying any premiums or charges for insurance required to be carried hereunder; otherwise caring for and protecting any and all of the Property; and/or employing counsel, accountants, contractors and other appropriate persons to assist Beneficiary or Trustee. Beneficiary and Trustee may take any of the actions permitted under this Section 7.18 either with or without giving notice, except for notices required under applicable

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Packet Pg. 108 Attachment: Exhibit A-1: Deed of Trust (Cotati Station 98-Units Fee Deferral + Grant) Development Impact Fee Deferral Program
Deed of Trust
16 law. Any amounts disbursed by Beneficiary pursuant to this paragraph shall become additional indebtedness secured by this Deed of Trust.

8. Default and Remedies.

8.1 Events of Default. Trustor acknowledges and agrees that an event of default (“Event of Default”) shall occur under this Deed of Trust upon the occurrence of any one or more of the following events:
a. Beneficiary’s declaration of an event of default under the Deferred Fee Documents, subject to the expiration of any applicable cure period set forth in such document; b. Trustor fails to perform any monetary obligation which arises under this Deed of Trust, and does not cure that failure within ten (10) days following written notice from Beneficiary or Trustee;
c. If Trustor’s interest in the Property or any part thereof is voluntarily or involuntarily sold, transferred, leased, encumbered, or otherwise conveyed in violation of Section 7.6 hereof and Trustor fails to rescind such conveyance or otherwise cure such breach within the time period specified in paragraph j below;
d. Trustor fails to maintain the insurance coverage required hereunder or otherwise fails to comply with the requirements of Section 7.10 hereof and Trustor fails to cure such default within the time specified in Section 7.10; e. Subject to Trustor’s right to contest such charges as provided herein, Trustor fails to pay taxes or assessments due on the Land or the Improvements or fails to pay any other charge that may result in a lien on the Land or the Improvements, and Trustor fails to cure such default within ten (10) days.
f. Any representation or warranty of Trustor contained in or made in connection with the execution and delivery of the Deferred Fee Documents or in any certificate or statement furnished pursuant hereto proves to have been false or misleading in any material adverse respect when made;
g. If, pursuant to or within the meaning of the United States Bankruptcy Code or any other federal or state law relating to insolvency or relief of debtors (“Bankruptcy Law”), Trustor (i) commences a voluntary case or proceeding; (ii) consents to the entry of an order for relief against Trustor in an involuntary case; (iii) consents to the appointment of a trustee, receiver, assignee, liquidator or similar official for Trustor; (iv) makes an assignment for the benefit of its creditors; or (v) admits in writing its inability to pay its debts as they become due.

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Packet Pg. 109 Attachment: Exhibit A-1: Deed of Trust (Cotati Station 98-Units Fee Deferral + Grant) Development Impact Fee Deferral Program
Deed of Trust
17 h. If a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that (i) is for relief against Trustor in an involuntary case, (ii) appoints a trustee, receiver, assignee, liquidator or similar official for Trustor or substantially all of such Trustor’s assets, (iii) orders the liquidation of Trustor, or (iv) issues or levies a judgment, writ, warrant of attachment or similar process against the Land or the Improvements, and in each case the order or decree is not released, vacated, dismissed or fully bonded within sixty (60) days after its issuance.
i. The holder of any other debt instrument secured by a mortgage or deed of trust on the Property or part thereof declares an event of default thereunder and exercises a right to declare all amounts due under that debt instrument immediately due and payable, subject to the expiration of any applicable cure period set forth in such holder’s documents; or j. Trustor fails to perform any obligation arising under this Deed of Trust other than one enumerated in this Section 8.1, and does not cure that failure either within ten (10) days after written notice from Beneficiary or Trustee in the event of a monetary default, or within thirty (30) days after such written notice in the event of a nonmonetary default, provided that in the case of a nonmonetary default that in Beneficiary’s reasonable judgment cannot reasonably be cured within thirty (30) days, an Event of Default shall not arise hereunder if Trustor commences to cure such default within thirty (30) days and thereafter prosecutes such cure to completion with due diligence and in good faith and in no event later than sixty (60) days following receipt of notice of default.

8.2 Remedies. Subject to the applicable notice and cure provisions set forth herein, at any time after an Event of Default, Beneficiary and Trustee shall be entitled to invoke any and all of the rights and remedies described below, and may exercise any one or more or all, of the remedies set forth in the Deferred Fee Documents, and any other remedy existing at law or in equity or by statute. All of Beneficiary’s rights and remedies shall be cumulative, and the exercise of any one or more of them shall not constitute an election of remedies. Beneficiary shall be entitled to collect all expenses incurred in pursuing the remedies provided hereunder, including without limitation reasonable attorneys’ fees and costs. a. Acceleration. Beneficiary may declare any or all of the Secured Obligations, including without limitation all sums payable under the Note and this Deed of Trust, to be due and payable immediately.
b. Receiver. Beneficiary may apply to any court of competent jurisdiction for, and obtain appointment of, a receiver for the Property. c. Entry. Beneficiary, in person, by agent or by court-appointed receiver, may enter, take possession of, manage and operate all or any part of the Property, and may also do any and all other things in connection with those actions that Beneficiary may in its sole

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Packet Pg. 110 Attachment: Exhibit A-1: Deed of Trust (Cotati Station 98-Units Fee Deferral + Grant) Development Impact Fee Deferral Program
Deed of Trust
18 discretion consider necessary and appropriate to protect the security of this Deed of Trust. Such other things may include: taking and possessing copies of all of Trustor’s or the then owner's books and records concerning the Property; entering into, enforcing, modifying, or canceling Leases on such terms and conditions as Beneficiary may consider proper; obtaining and evicting tenants; fixing or modifying Rents; collecting and receiving any payment of money owing to Trustor; completing any unfinished construction; and/or contracting for and making repairs and alterations. If Beneficiary so requests, Trustor shall assemble all of the Property that has been removed from the Land and make all of it available to Beneficiary at the site of the Land. Trustor hereby irrevocably constitutes and appoints Beneficiary as Trustor's attorney-in-fact to perform such acts and execute such documents as Beneficiary in its sole discretion may consider to be appropriate in connection with taking these measures, including endorsement of Trustor's name on any instruments.
d. UCC Remedies. Beneficiary may exercise any or all of the remedies granted to a secured party under the UCC.
e. Judicial Action. Beneficiary may bring an action in any court of competent jurisdiction to foreclose this Deed of Trust in the manner provided by law for foreclosure of mortgages on real property and/or to obtain specific enforcement of any of the covenants or agreements of this Deed of Trust.
f. Power of Sale. Under the power of sale hereby granted, Beneficiary shall have the discretionary right to cause some or all of the Property, including any Property which constitutes personal property, to be sold or otherwise disposed of in any combination and in any manner permitted by applicable law.

8.3 Power of Sale. If Beneficiary elects to invoke the power of sale hereby granted, Beneficiary shall execute or cause the Trustee to execute a written notice of such default and of its election to cause the Property to be sold to satisfy the obligations hereof, and shall cause such notice to be recorded in the office of the Recorder of each County wherein the Property or some part thereof is situated as required by law and this Deed of Trust.

Prior to publication of the notice of sale, Beneficiary shall deliver to Trustee this Deed of Trust and the Note or other evidence of indebtedness which is secured hereby, together with a written request for the Trustee to proceed with a sale of the Property, pursuant to the provisions of law and this Deed of Trust.

Notice of sale having been given as then required by law, and not less than the time then required by law having elapsed after recordation of such notice of default, Trustee, without demand on Trustor, shall sell the Property at the time and place fixed by it in the notice of sale, either as a whole or in separate parcels and in such order as it may determine, at public auction to the highest bidder for cash in lawful money of the United States, payable at time of sale. Trustee

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Packet Pg. 111 Attachment: Exhibit A-1: Deed of Trust (Cotati Station 98-Units Fee Deferral + Grant) Development Impact Fee Deferral Program
Deed of Trust
19 may, and at Beneficiary’s request shall, postpone sale of all or any portion of the Property by public announcement at such time and place of sale, and from time to time thereafter may postpone such sale by public announcement at the time and place fixed by the preceding postponement. Trustee shall deliver to the purchaser its deed conveying the property so sold, but without any covenant or warranty, express or implied. The recitals in such deed of any matters or facts shall be conclusive proof of the truthfulness thereof. Any person, including Trustor, Trustee, or Beneficiary, may purchase at such sale.

After deducting all costs, fees, and expenses of Trustee and of the trust hereby created, including reasonable attorneys’ fees in connection with sale, Trustee shall apply the proceeds of sale to payment of all sums advanced or expended by Beneficiary or Trustee under the terms hereof and all outstanding sums then secured hereby, and the remainder, if any, to the person or persons legally entitled thereto.

Without limiting the generality of the foregoing, Trustor acknowledges and agrees that regardless of whether or not a default has occurred hereunder, if an event of default has occurred under the Note or the Deferral Agreement, and if in connection with such event of default Beneficiary exercises its right to foreclose on the Property, then: (i) Beneficiary shall be entitled to declare all amounts due under the Note immediately due and payable, and (ii) the proceeds of any sale of the Property in connection with such foreclosure shall be used to pay all Secured Obligations, including without limitation, the outstanding principal balance and all other amounts due under the Note.

At any foreclosure sale, any person, including Trustor, Trustee or Beneficiary, may bid for and acquire the Property or any part of it to the extent permitted by then applicable law.

Instead of paying cash for such property, Beneficiary may settle for the purchase price by crediting the sales price of the property against the following obligations:
a. First, the portion of the Secured Obligations attributable to the expenses of sale, costs of any action and any other sums for which Trustor is obligated to pay or reimburse Beneficiary or Trustee under Section 7.12(c); and
b. Second, the remaining balance of all other Secured Obligations in any order and proportions as Beneficiary in its sole discretion may choose.

8.4 Trustor’s Right to Reinstate. Notwithstanding Beneficiary’s acceleration of the sums secured by this Deed of Trust, Trustor shall have the right to have any proceedings begun by Beneficiary to enforce this Deed of Trust discontinued at any time prior to five (5) days before sale of the Property pursuant to the power of sale contained in this Deed of Trust or at any time prior to entry of a judgment enforcing this Deed of Trust if: (a) Trustor pays Beneficiary all sums which would be then due under the Note and the Deferral Agreement if the Secured Obligations had no acceleration provision; (b) Trustor cures all breaches of any other covenants

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Packet Pg. 112 Attachment: Exhibit A-1: Deed of Trust (Cotati Station 98-Units Fee Deferral + Grant) Development Impact Fee Deferral Program
Deed of Trust
20 or agreements of Trustor contained in this Deed of Trust; (c) Trustor pays all reasonable expenses incurred by Beneficiary and Trustee in enforcing the covenants and agreements of Trustor contained in this Deed of Trust, and in enforcing Beneficiary’s and Trustee’s remedies as provided herein, including, but not limited to, reasonable attorney’s fees; and (d) Trustor takes such action as Beneficiary may reasonably require to assure that the lien of this Deed of Trust, Beneficiary’s interest in the Property and Trustor’s obligation to pay the sums secured by this Deed of Trust shall continue unimpaired. Upon such payment and cure by Trustor, this Deed of Trust and the obligations secured hereby shall remain in full force and effect as if no acceleration had occurred.

9. Trustor's Waivers. To the fullest extent permitted by law, Trustor waives: (a) all statutes of limitations as a defense to any action or proceeding brought against Trustor by Beneficiary; (b) the benefit of all laws now existing or which may hereafter be enacted providing for any appraisement, valuation, stay, extension, redemption or moratorium; (c) all rights of marshalling in the event of foreclosure; and (d) all presentments, demands for performance, notices of nonperformance, protests, notices of protest, notices of dishonor, notices of acceptance of this Deed of Trust and of the existence, creation, or incurring of new or additional indebtedness, and demands and notices of every kind.

10. Miscellaneous Provisions.

10.1 Additional Provisions. The Note and the Deferral Agreement grant further rights to Beneficiary and contain further agreements and affirmative and negative covenants by Trustor which apply to this Deed of Trust and the Property.

10.2 Notices. Trustor requests that a copy of notice of default and notice of sale be mailed to Trustor at the address set forth below. That address is also the mailing address of Trustor as debtor under the UCC. Beneficiary’s address set forth below is the address for Beneficiary as secured party under the UCC. Except for any notice required under applicable law to be given in another manner, all notices to be sent pursuant to this Deed of Trust shall be made in writing, and sent to the parties at their respective addresses specified below or to such other address as a party may designate by written notice delivered to the other parties in accordance with this Section. All such notices shall be sent by:
a. personal delivery, in which case notice shall be deemed delivered upon receipt;
b. certified or registered mail, return receipt requested, in which case notice shall be deemed delivered two (2) business days after deposit, postage prepaid in the United States mail;

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Packet Pg. 113 Attachment: Exhibit A-1: Deed of Trust (Cotati Station 98-Units Fee Deferral + Grant) Development Impact Fee Deferral Program
Deed of Trust
21 c. nationally recognized overnight courier, in which case notice shall be deemed delivered one (1) day after deposit with such courier; or d. facsimile transmission, in which case notice shall be deemed delivered on transmittal, provided that a transmission report is generated reflecting the accurate transmission thereof.

Beneficiary: City of Cotati
201 West Sierra Avenue
Cotati, CA 94931
Attention: Community Development Director
Trustor: _______________________
_______________________
_______________________
_______________________
Trustee: _______________________
_______________________
_______________________
_______________________

10.3 Binding on Successors. The terms, covenants and conditions of this Deed of Trust shall be binding upon and inure to the benefit of the heirs, administrators, executors, successors in interest, transferees, and assigns of the Trustor, Beneficiary and Trustee; provided however this Section 10.3 does not waive any provision of this Deed of Trust or the Note imposing restrictions on transfer.

10.4 Substitution of Trustee. Beneficiary may from time to time or at any time substitute a trustee or trustees to execute the trust hereby created, and when any such substitution has been filed for record in the office of the Recorder of Sonoma County, it shall be conclusive evidence of the appointment of such trustee or trustees, and such new trustee or trustees shall succeed to all of the powers and duties of the Trustee named herein.

10.5 Attorneys’ Fees and Costs. In any action or proceeding to foreclose this Deed of Trust or to enforce any right of Beneficiary or of Trustee, Trustor shall pay to Beneficiary and Trustee all costs of such action or proceeding, including reasonable attorneys’ fees.

10.6 Governing Law; Severability; Interpretation. This Deed of Trust shall be governed by the laws of the State of California without regard to principles of conflicts of laws.

Trustor agrees that any controversy arising under or in relation to this Deed of Trust shall be litigated exclusively in the jurisdiction where the Land is located (the “Property Jurisdiction”).

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Packet Pg. 114 Attachment: Exhibit A-1: Deed of Trust (Cotati Station 98-Units Fee Deferral + Grant) Development Impact Fee Deferral Program
Deed of Trust
22 The state and federal courts and authorities with jurisdiction in the Property Jurisdiction shall have exclusive jurisdiction over all controversies which shall arise under or in relation to this Deed of Trust. Trustor irrevocably consents to service, jurisdiction, and venue of such courts for any such litigation, and waives any other venue to which it might be entitled by virtue of domicile, habitual residence or otherwise. If any provision of this Deed of Trust is held unenforceable or void, that provision shall be deemed severable from the remaining provisions, and shall in no way affect the validity of this Deed of Trust. The captions used in this Deed of Trust are for convenience only and are not intended to affect the interpretation or construction of the provisions herein contained. In this Deed of Trust, whenever the context so requires, the singular number includes the plural.

10.7 Waiver, Modification and Amendment. Any waiver by Beneficiary of any obligation of Trustor hereunder must be in writing, and no waiver shall be construed as a continuing waiver. No waiver shall be implied from any delay or failure by Beneficiary or Trustee to take action on account of any default of Trustor. Consent by Beneficiary or Trustee to any act or omission by Trustor shall not be construed as a consent to any other or subsequent act or omission or to waive the requirement for Beneficiary’s or Trustee’s consent to be obtained in any future or other instance. No amendment to or modification of this Deed of Trust shall be effective unless and until such amendment or modification is in writing, executed by Trustor and Beneficiary. Without limiting the generality of the foregoing, Beneficiary’s acceptance of payment of any sum secured hereby after its due date shall not constitute a waiver by Beneficiary of its right either to require prompt payment when due of all other sums so secured or to declare default for failure so to pay.

10.8 Action by Beneficiary. Except as may be otherwise specifically provided herein, whenever any approval, notice, direction, or consent by the Beneficiary is required or permitted under this Agreement, such action shall be in writing, and such action may be given, made or taken by Beneficiary’s City Manager or by any person who shall have been designated by Beneficiary’s City Manager, without further approval by the governing board of Beneficiary.

Beneficiary shall use reasonable best efforts to respond to requests for any such approval, notice, direction, or consent in a timely manner. In any approval, consent, or other determination by Beneficiary required hereunder, Beneficiary shall act reasonably and in good faith.

10.9 Joint and Several Liability. If Trustor consists of more than one person or entity, each shall be jointly and severally liable for the faithful performance of all of Trustor’s obligations under this Deed of Trust.

10.10 Time is of the Essence. Time is of the essence for each provision of this Deed of Trust.

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Packet Pg. 115 Attachment: Exhibit A-1: Deed of Trust (Cotati Station 98-Units Fee Deferral + Grant) Development Impact Fee Deferral Program
Deed of Trust
23 SIGNATURES ON FOLLOWING PAGE; SIGNATURES
MUST BE NOTARIZED.

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Packet Pg. 116 Attachment: Exhibit A-1: Deed of Trust (Cotati Station 98-Units Fee Deferral + Grant) Development Impact Fee Deferral Program
Deed of Trust
24 IN WITNESS WHEREOF, Trustor has executed this Deed of Trust as of the Effective Date first written above.

TRUSTOR:
_____________________________
By: ______________________________
Its:_____________________________

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Packet Pg. 117 Attachment: Exhibit A-1: Deed of Trust (Cotati Station 98-Units Fee Deferral + Grant) Development Impact Fee Deferral Program
Deed of Trust
25 Exhibit A
Land
(attach legal description)
2724558.1

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Packet Pg. 118 Attachment: Exhibit A-1: Deed of Trust (Cotati Station 98-Units Fee Deferral + Grant) 1 Development Impact Fee Deferral Program
Promissory Note

PROMISSORY NOTE
Development Impact Fee Deferral Program
Cotati Station Apartments Project
Cotati, California
September 13, 2022
FOR VALUE RECEIVED, the undersigned ______________________ (“Owner”) promises to pay to the City of Cotati (“City”) at 201 West Sierra Avenue, Cotati, CA 94931, or such other place as City may from time to time designate by written notice to Owner, in lawful money of the United States, the principal sum of One Million Five Hundred Thirty-Nine Thousand Six Hundred Fifty-Four and 00/100 Dollars ($1,539,654) , together with interest on the outstanding principal balance in accordance with the terms set forth in this Note. This Promissory Note (this “Note”) is secured by that certain Deed of Trust, Assignment of Rents, Fixture Filing and Security Agreement (the “Deed of Trust”) dated as of the date hereof, executed by Owner and recorded against the Property in the Official Records of Sonoma County.

In addition to securing Owner’s obligation to repay the sums payable pursuant to this Note, the Deed of Trust secures Owner’s obligations set forth in that certain Development Impact Fee Deferral Agreement (the “Deferral Agreement”) dated as of the date hereof, executed by Owner and City, and recorded against the Property. Capitalized terms used but not defined herein shall have the meaning ascribed to such terms in the Agreement.

1. Interest Rate; Maturity Date. Commencing on the Effective Date of the Deferral Agreement, through the date that all indebtedness and other amounts payable under this Note are paid in full, interest shall accrue on the outstanding principal balance of this Note at a rate equal to the average annual rate of interest earned by the City on its investment of pooled funds for the prior Fiscal Year (the “LAIF Rate”). The entire outstanding principal balance of this Note, together with accrued interest, and all other sums accrued hereunder shall be payable in full on the Due Date set forth in the Deferral Agreement (the “Maturity Date”). Notwithstanding the foregoing, the entire outstanding principal balance of this Note, together with accrued interest and all other sums due hereunder, shall be immediately due and payable upon the occurrence of an Event of Default (as defined in Section 6).

2. Prepayment. Owner may, without premium or penalty, at any time and from time to time, prepay all or any portion of the outstanding principal balance due under this Note provided that each such payment is accompanied by accrued interest on the amount of principal prepaid calculated to the date of such repayment. Payments shall be applied first to any unpaid late charges and other costs and fees then due, then to accrued but unpaid interest, and then to principal.

3. Due on Sale; Restrictions on Assignment and Assumption. The entire unpaid principal balance and all sums accrued hereunder shall be immediately due and payable upon the transfer or other event specified in Section 1(b) of the Deferral Agreement, absent City consent, of all or any part of the Property or the Project, or any interest therein, or upon the occurrence of

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Packet Pg. 119 Attachment: Exhibit A-2: Promissory Note (Cotati Station 98-Units Fee Deferral + Grant) 2 Development Impact Fee Deferral Program
Promissory Note
an Event of Default under this Note or the Deed of Trust, subject to the expiration of any applicable cure period. Without limiting the generality of the foregoing, this Note shall not be assumable without City’s prior written consent, which consent may be granted or denied in City’s sole discretion.

4. Manner of Payment. All payments on this Note shall be made to the City at 201 West Sierra Avenue, Cotati, CA 94931 or such other place as City shall designate to Owner in writing, or by wire transfer of immediately available funds to an account designated by the City in writing.

5. Events of Default; Acceleration of Payment. Each of the following events will constitute an event of default (each, an “Event of Default”) under this Note permitting City to declare all sums payable hereunder immediately due and payable, and to exercise all remedies available to City pursuant to the Agreement and the Deed of Trust:
(a) Failure to pay when due the principal payment or other sum due under the Deferral Agreement or the Deed of Trust;
(b) Any representation or warranty contained in the Application, the Agreement, this Note, the Deed of Trust or any document furnished in connection with the foregoing proves to have been false or misleading in any material adverse respect when made;
(c) A default has been declared by a lender under any loan secured by a deed of trust on the Project;
(d) Pursuant to or within the meaning of the United States Bankruptcy Code or any other federal or state law relating to insolvency or relief of debtors (a “Bankruptcy Law”): (1) Owner (i) commences a voluntary case or proceeding, (ii) consents to the entry of an order for relief against it in an involuntary case, (iii) applies for or consents to the appointment of a trustee, receiver, assignee, liquidator or similar official, (iv) makes an assignment for the benefit of its creditors, or (v) admits in writing its inability to pay its debts as they become due; or (2) a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that (i) is for relief against Owner in an involuntary case, (ii) appoints a trustee, receiver, assignee, liquidator or similar official for Owner or substantially all of Owner’s assets, (iii) orders the liquidation of Owner, or (iv) issues or levies a judgment, writ, warrant of attachment or similar process against the Property or any other property of Owner, and in each case the order or decree is not released, vacated, dismissed or fully bonded within sixty (60) days after its issuance;
(e) An Event of Default is declared under the Deferral Agreement or the Deed of Trust, subject to the expiration of any applicable cure period set forth in such documents;

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Packet Pg. 120 Attachment: Exhibit A-2: Promissory Note (Cotati Station 98-Units Fee Deferral + Grant) 3 Development Impact Fee Deferral Program
Promissory Note
(f) Owner defaults in the performance of any term, provision, covenant or agreement (other than an obligation enumerated in this Section 5) contained in this Agreement or unless a shorter cure period for such default is specified herein, the default continues for ten (10) days in the event of a monetary default or thirty (30) days in the event of a nonmonetary default after the date upon which the City shall have given written notice of the default to Owner (or such longer time as the City may agree upon in writing), provided that in each case Owner commences to cure the default within thirty (30) days and thereafter prosecutes the curing of such default with due diligence and in good faith; or (g) Owner allows or permits occupancy or resale for the purpose of occupancy without payment of the Deferred Fees.

6. Default Rate. Upon the occurrence of an Event of Default, interest shall automatically be increased without notice to the rate of ten percent (10%) per annum (the “Default Rate"); provided however, if any payment due hereunder is not paid when due, the Default Rate shall apply commencing upon the due date for such payment. When Owner is no longer in default, the Default Rate shall no longer apply, and the interest rate shall once again be the rate specified in Section 1 of this Note. Notwithstanding the foregoing provisions, if the interest rate charged exceeds the maximum legal rate of interest, the rate shall be the maximum rate permitted by law.

The imposition or acceptance of the Default Rate shall in no event constitute a waiver of a default under this Note or prevent the City from exercising any of its other rights or remedies.

7. Remedies. Upon the occurrence of any Event of Default, in addition to its other rights under this Note, at law or in equity, City may exercise any one or more of the following rights and remedies without prior demand:
a) Accelerate and declare the entire unpaid balance of this Note together with all accrued interest thereon, if any, and all other sums owed to the City immediately due and payable; and
b) Proceed at law or in equity to require Owner to perform its obligations and covenants under this Note; and
c) Foreclose on the Property pursuant to the Deed of Trust.

The remedies provided herein are cumulative and not exclusive of, and do not prejudice any other remedy provided by law.

8. Attorneys’ Fees. Owner agrees to pay all costs and expenses, including reasonable attorneys’ fees, which City may incur in the collection or enforcement of this Note and the exercise of any or all of its rights and remedies hereunder, whether or not suit is filed, and all such sums shall be a part of the indebtedness secured by the Deed of Trust.

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Packet Pg. 121 Attachment: Exhibit A-2: Promissory Note (Cotati Station 98-Units Fee Deferral + Grant) 4 Development Impact Fee Deferral Program
Promissory Note

9. No Offset; Owner’s Waivers. Owner hereby waives any rights of offset it now has or may hereafter have against City, its successors and assigns, and agrees to make the payments called for hereunder in accordance with the terms of this Note. Owner hereby waives diligence, presentment, protest, and demand, and notice of protest, notice of dishonor and notice of nonpayment of this Note, and expressly waives any rights to be released by reason of any extension of time or change in terms of payment, or change, alteration or release of any security given for the payments hereof, and expressly waives the right to plead any and all statutes of limitation as a defense to any demand on this Note.

10. Notices. Any notice required or permitted to be given hereunder shall be given in accordance with Section 12 of the Deferral Agreement.

11. Governing Law. This Note is construed in accordance with and is governed by the laws of the State of California without regard to principles of conflicts of laws.

12. Severability. If any provision of this Note is held by a court of competent jurisdiction to be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions hereof are not in any way affected or impaired thereby.

13. No Waiver by City; Remedies Cumulative. The rights and remedies of City under this Note shall be cumulative and not alternative. No waiver by City of any right or remedy under this Note shall be effective unless in writing signed by City. Neither the failure nor any delay in exercising any right, power or privilege under this Note will operate as a waiver of such right, power or privilege, and no single or partial exercise of any such right, power or privilege by City will preclude any other or further exercise of such right, power or privilege or the exercise of any other right, power or privilege. To the maximum extent permitted by applicable law: (a) no claim or right of City arising out of this Note can be discharged by City, in whole or in part, by a waiver or renunciation of the claim or right unless in a writing, signed by City; (b) no waiver that may be given by City will be applicable except in the specific instance for which it is given; and (c) no notice to or demand on Owner will be deemed to be a waiver of any obligation of Owner or of the right of City to take further action without notice or demand as provided in this Note.

Owner hereby waives presentment, demand, protest, notices of dishonor and of protest and all defenses and pleas on the grounds of any extension or extensions of the time of payment or of any due date under this Note, in whole or in part, whether before or after maturity and with or without notice.

14. Joint and Several Obligations. If this Note is executed by more than one person as Owner, the obligations of each Owner will be joint and several.

15. Entire Agreement; Amendments in Writing. This Note, together with the Deferral Agreement and the Deed of Trust, sets forth the entire understanding and agreement of Owner and City with respect to the subject matter hereof. Any amendment to this Note must be in writing signed by both City and Owner.

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Packet Pg. 122 Attachment: Exhibit A-2: Promissory Note (Cotati Station 98-Units Fee Deferral + Grant) 5 Development Impact Fee Deferral Program
Promissory Note

16. Relationship of the Parties. The relationship of the Parties under this Note is solely that of Owner and lender, and the deferral of fees evidenced by this Note and secured by the Deed of Trust will in no manner make City the partner or joint venturer of Owner.

17. Time. Time is of the essence in the performance of the terms and conditions of this Note.

18. Headings. The headings within this Note are for the purpose of reference only and do not limit or otherwise affect any of the terms of this Note.

Executed as of the date first written above:
__________________________
By: ____________________________
Its:____________________________
2724371.1

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Packet Pg. 123 Attachment: Exhibit A-2: Promissory Note (Cotati Station 98-Units Fee Deferral + Grant)

EXHIBIT B

GENERAL FUND IMPROVEMENT GRANT MATCHING TERM SHEET
$375,000 Due from the General Fund and Paid to Traffic Impact Fee Fund on Behalf of Cotati Station Apartments Project
Purpose The grant of fund proceeds shall be used exclusively for the purpose of matching city impact fees associated with the Cotati Station Apartment Project, in recognition of additional improvements to benefit the public, including street widening for fire access, additional parking adjacent to the Cotati SMART Train Station, a publicly accessible park, and 100% electric building construction.

Grantor The City General Fund (General Fund)
Grantee Cotati Station Apartment Project
Beneficiary The City Traffic Impact Fee Fund (Traffic Impact Fee Fund) Amount $375,000
Interest The principal balance related traffic impact fees of all building permits issued and deferred shall accrue interest equivalent to a fixed annual rate of

1.5% or the Local Agency Investment Fund Quarterly Apportionment rates, Compounded quarterly, whichever is greater.

Payments Quarterly payments will be made on behalf of the Grantee, by the Grantor to the Beneficiary Fund. Payments to begin on the next quarterly interval (Dec 31, March 31, June 30, Sept. 30), following the developers deferred payment of the impact fees. Payments are due within 30 days of the end of the quarter. Payments not received on time will continue to accrue interest on the remaining principal balance.

Payment Calculation The quarterly payments shall be based on the 5 Year Term Loan compounded quarterly based on the appropriate interest rate.

Maturity The grant of funds will be paid to the beneficiary fund in full no later than five (5) years after the developers deferred payment of the impact fees.

Payments may be extended, if needed, for up to two additional five-year periods if authorized by the City Council.

Prepayment Grantee has the right to fund part or the entire outstanding grant amount at any time without penalty.

Security Net Revenues of the General Fund (being total available revenues less maintenance and operation expenses)

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Packet Pg. 124 Attachment: Exhibit B: Interfund Grant Term Sheet (DRAFT) (Cotati Station 98-Units Fee Deferral + Grant) RESOLUTION NO.

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF COTATI APPROVING

THE AFFORDABLE HOUSING AGREEMENT FOR THE COTATI STATION

APARTMENTS PROJECT
WHEREAS, on June 14, 2022, Colvin Group LLC., a California limited liability company (“Developer”) was granted Design Review and Density Bonus approval by the Cotati City Council for the Cotati Station Apartments (“Project”), a 98-unit mixed use project consisting of 98-apartment homes (1, 2, and 3 bedroom units) and approximately 5,600 square feet of commercial space on three parcels totaling approximately 2.42 acres; and WHEREAS, the Developer intends to sell the Project, inclusive of 19 affordable, below market rate (“BMR”) housing units for very low, low and moderate income residents and families (each a “Unit,” and collectively with amenities and any associated public improvements, the “Development”); and
WHEREAS, the 19 BMR units are proposed to be restricted affordable for 55 years through an Affordable Housing Regulatory Agreement and Declaration of Restrictive Covenants (“Affordable Housing Agreement”), subject to the terms and conditions substantially as attached hereto as Exhibit A; and
WHEREAS, very low- and low- income units are particularly difficult to bring on-line, and while the City has exceeded the total housing allocation for the 5th Regional Housing Needs Assessment (RHNA), the City will not be able to meet the allocation of very low income units; and
WHEREAS, in recognition of the shortage of lower income housing, the City desires to utilize the Affordable Housing Fund to lower the cost of construction for the very low- and lowincome units by granting funds to offset the estimated cost of the City’s impact fees attributable to the eleven (11) very low- and low- BMR units; and
WHEREAS, the action of approving an Affordable Housing Agreement does not constitute a project as defined by California Environmental Quality Act Guidelines Section 15378; therefore, no further environmental review is required.

NOW THEREFORE BE IT RESOLVED THAT the City Council of the City of Cotati hereby:

1. Approves the Affordable Housing Agreement and related documents, substantially in the form attached hereto as Exhibit A; and

2. Authorizes transfer of up to $275,000 from the Affordable Housing Fund to the applicable impact fee funds to reduce the impact fees on the eleven (11) low and very low units; and
Packet Pg. 125

3. Authorizes the City Manager to execute the Affordable Housing Agreement in substantially the form attached, subject to the approval of the City Attorney, and to sign all documents and take all actions necessary or appropriate to carry out and implement the intent of this Resolution.

IT IS HEREBY CERTIFIED that the foregoing resolution was duly adopted at a regular meeting of the City Council of the City of Cotati held on the September 27th, 2022, by the following vote, to wit:

Approved:________________________________
Mayor
Attest:____________________________
Kevin Patterson, Deputy City Clerk
Approved as to form:
____________________________
City Attorney
Attachments:

Exhibit A: Cotati Station Affordable Housing Regulatory Agreement (DOCX) Packet Pg. 126
BN 72392808v2
Recording Requested by
and when Recorded, return to:

City of Cotati
201 West Sierra Avenue
Cotati, CA 94931-4217
Attn: City Clerk

EXEMPT FROM RECORDING FEES PER
GOVERNMENT CODE §§6103, 27383
APN 144-320-035, 144-320-034, and 144-
320-036
Space above this line for Recorder’s use.

AFFORDABLE HOUSING REGULATORY AGREEMENT
AND

DECLARATION OF RESTRICTIVE COVENANTS
This Affordable Housing Regulatory Agreement and Declaration of Restrictive Covenants (this “Agreement”) is dated as of ____________, 2022, by and between the City of Cotati, a municipal corporation (“City”) and the Colvin Group LLC., a California limited liability company (“Developer”). City and Developer are hereinafter collectively referred to as the “Parties.” This Agreement shall be effective as of the date this Agreement is recorded (“Effective Date”).

RECITALS
A. Developer is a company that has developed housing throughout Cotati.

B. Developer owns that certain property located in the City of Cotati, California (APNs 144-320-035, 144-320-034, and 144-320-036) more particularly described as Exhibit A attached hereto and incorporated herein by reference (the “Property”).

C. On June 14, 2022, Developer was granted Design Review and Density Bonus approval by the Cotati City Council for the Cotati Station Apartments, a 98-unit mixed use project consisting of 98-apartment homes (1, 2, and 3 bedroom units) and approximately 5,600 square feet of commercial space on three parcels totaling approximately 2.42 acres.

D. Developer intends to sell the Cotati Station Apartments, a 98-unit market rate mixed use development project inclusive of 19 affordable below market rate (“BMR”) housing units for very low, low and moderate income residents and families (each a “Unit,” and collectively with amenities and any associated public improvements, the “Development”). The specific Unit affordability shall be as follows:

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Packet Pg. 127 Attachment: Exhibit A: Cotati Station Affordable Housing Regulatory Agreement (Cotati Station 98-Units Affordable Housing Agreement Reso) Cotati Affordable Housing Regulatory Agreement Page 2 of 25 BN 72392808v2
Cotati Station Apartments Affordable Housing Requirement 1-bedroom 2-bedroom 3-bedroom (total)
Very Low
Income
5 3 0 8
Low Income 2 1 0 3
Moderate
Income
4 3 1 8
Total 11 7 1 19 units
E. Prior to the issuance of building permits to allow construction of the Development, the Parties will execute this Agreement for recordation in the Official Records of the County of Sonoma (the “Official Records”).

F. The City’s Housing Element includes policies and programs intended to support and promote the development of affordable housing stock.

G. The City’s Affordable Housing Fund is intended to increase and improve the supply of housing affordable to moderate, low, and very low- income households in the City.

H. The Santero Way Specific Plan allows up to 48 units on the Property (the base zoning). The State Density Bonus Law (Government Code § 65915) specifies that an applicant can receive up to a 50% density bonus if 15% of the total project units are restricted for occupancy to very low-income households. The state regulations are meant to incentivize the production of affordable housing and any housing development can elect to take advantage of the allowances created.

I. The City approved 98 units, 26 units more than the density allowed solely by the base zoning and the State Density Bonus Law. Through Government Code § 65915(n), additional units can be requested and the governing body has the authority to approve the additional units requested. Similarly, the City Council may grant alternatives to the inclusionary housing requirements identified in Cotati Municipal Code (CMC) Chapter 17.31, which otherwise requires a minimum of 15% of a project’s base density to be designated as BMR units. Section 17.31.060 identifies the process required for the City Council to approve an alternative to the City’s inclusionary housing requirements and states that an approval of a proposed alternative should be based on a finding that the purposes of the City’s affordable housing regulations would be better served by granting such an alternative. As identified in City Council Resolution 2022-26, the City Council made such findings when approving the Development.

J. As of the date of this Agreement, the City Council’s June 14, 2022 approval of Planning Application No. PA21-16 allows the Developer to develop up to 79 market rate residential units and 19 BMR units on the Property.

K. The above recitals relating to the Development are for information purposes only, and in no way affect the Developer’s and City’s rights and obligations under this Agreement with respect to the Property. The above recitals also are not intended to relieve the Developer of any additional inclusionary obligations the Developer may incur as a result of modifications to development plans existing as of the date of this Agreement.

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Packet Pg. 128 Attachment: Exhibit A: Cotati Station Affordable Housing Regulatory Agreement (Cotati Station 98-Units Affordable Housing Agreement Reso) Cotati Affordable Housing Regulatory Agreement Page 3 of 25 BN 72392808v2
L. In connection with the granting of the entitlements and permits for the Development, the City will impose certain development impact fees and charges (“Impact Fees”).

M. The City desires to award Developer, upon issuance of a building permit, and Developer desires to accept from the City, a grant not less than the total cost of city impact fees attributable to the eleven (11) low and very low units, but no less than Two Hundred Seventy Five Thousand and No/100 Dollars ($275,000.00) (the “Grant Funds”) from the City’s Affordable Housing Fund. The City will apply the Grant Funds to the Development’s Impact Fees associated with the eleven (11) Very Low and Low Income Units at the same time as other impact fees are paid. The total funds committed by the City is $599,999.99, consisting of the Grant Funds that are the subject of this agreement, with the remainder of the grant to offset the cost of the additional public improvements, as described in the project Development Impact Fee Deferral and Grant Agreement.

N. Nineteen (19) Units in the Development shall be affordable to, and occupied by or made available for occupancy to, eligible households with an income of no greater than fifty percent (50%) for the very-low income units, eighty percent (80%) for the low-income units and one-hundred and twenty percent (120%) for the moderate income units of the most recently published Area Median Income for Sonoma County for a period of not less than fifty-five (55) years (the “Restricted Units”).

O. The Parties have agreed to enter into and record this Agreement in order to satisfy the conditions described in the foregoing Recitals. The Parties agree that the covenants set forth in this Agreement run with the land and are binding upon Developer and Developer’s successors in interest and assigns for a period of not less than fifty-five (55) years from the date of recordation of this agreement.

NOW THEREFORE, in consideration of the foregoing, and other valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby agree as follows.

1. Definitions. The following terms have the meanings set forth in this Section wherever used in this Agreement or the attached exhibits.
“Actual Household Size” means the actual number of persons in the applicable household.
“Adjusted for Family Size Appropriate to the Unit” shall be determined consistent with Section 50052.5(h) of the California Health and Safety Code and applicable federal rules, including the rules and regulations applicable to the use of federal low-income housing tax credits. “Adjusted Income” means the total anticipated annual income of all persons in a household, as calculated in accordance with 25 California Code of Regulations Section 6914 or pursuant to a successor State housing program that utilizes a reasonably similar method of calculation of adjusted income. In the event that no such program exists, the City shall provide the Developer with a reasonably similar method of calculation of adjusted income as provided in said Section 6914.
“Affordable Rent” means that the gross monthly rent payable by the tenant does not exceed one-twelfth of thirty percent (30%) of the applicable AMI limit, Adjusted for Family Size Appropriate to the Unit, as specified in Section 2.2, less a reasonable utility allowance.

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Packet Pg. 129 Attachment: Exhibit A: Cotati Station Affordable Housing Regulatory Agreement (Cotati Station 98-Units Affordable Housing Agreement Reso) Cotati Affordable Housing Regulatory Agreement Page 4 of 25 BN 72392808v2
“Area Median Income” or “AMI” means the median gross yearly income adjusted for Actual Household Size (to qualify residents) or Assumed Household Size (to calculate rents), as applicable, in the County of Sonoma, California, as published from time to time by HCD. In the event that such income determinations are no longer published, or are not updated for a period of at least eighteen (18) months, the City shall provide the Developer with other income determinations which are reasonably similar with respect to methods of calculation to those previously published by HCD.
“Assumed Household Size” shall have the meaning set forth in Section 2.2. The definition is utilized to calculate Affordable Rent and is not intended to be a limit on the number of persons occupying a unit. The minimum Assumed Household Size shall be the number of bedrooms plus one, or the actual size of the household, whichever is greater. “Claims” is defined in Section 10.
“Eligible Household” means a household for which gross household income upon initial occupancy does not exceed the applicable maximum income level for a Restricted Unit, as specified in Section 2.1.
“Indemnitees” is defined in Section 10.
“HCD” means the California Department of Housing and Community Development. “Low Income Household” shall mean a household with an Adjusted Income that does not exceed eighty percent (80%) of Area Median Income.
“Low Income Rent” means the rent allowed to be charged on the Low Income Units pursuant to Section 2.1(b) below.
“Low Income Units” mean the Units that, pursuant to Section 2.1(b) below, are required to be occupied by Low Income Households.
“Management and Marketing Plan” is defined in Section 6.4. “Moderate Income Household” shall mean a household with an Adjusted Income that does not exceed 120 percent (120%) of Area Median Income. “Moderate Income Rent” means the rent allowed to be charged on the Moderate Income Units pursuant to Section 2.2 below.
“Moderate Income Units” mean the Units that, pursuant to Section 2.1 below, are required to be occupied by Moderate Income Households.
“Regulations” means Title 25 of the California Code of Regulations. “Rent” means the total of monthly payments by the residents of a Unit (other than the manager’s Unit) for the following: (1) use and occupancy of the Unit and land and related improvements, including parking; (2) any separately charged fees or service charges assessed by the Developer which are required of all tenants, other than security deposits; (3) the cost of an adequate level of service for utilities paid by the tenant, including garbage collection, sewer, water, electricity, gas and other heating, cooking and refrigeration fuel, but not telephone service,

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Packet Pg. 130 Attachment: Exhibit A: Cotati Station Affordable Housing Regulatory Agreement (Cotati Station 98-Units Affordable Housing Agreement Reso) Cotati Affordable Housing Regulatory Agreement Page 5 of 25 BN 72392808v2
cable service or any other utility or service permitted to be excluded from the calculation of Rent pursuant to the terms of 25 California Code of Regulations Section 6918; and (4) any other interest, taxes, fees or charges for use of the land or associated facilities and assessed by a public or private entity other than the Developer, and paid by the tenant. “Restricted Unit” means a dwelling unit which is reserved for occupancy at an Affordable Rent by a household of not more than a specified household income in accordance with and as set forth in Section 2.1.
“Very Low Income Household” shall mean a household with an Adjusted Income that does not exceed fifty percent (50%) of Area Median Income. “Very Low Income Rent” shall mean the rent permitted to be charged for a Very Low Income Unit pursuant to Section 2.2 below.
“Very Low Income Units” shall mean the Units, which, pursuant to Section 2.1 below, are required to be occupied by Very Low Income Households.

2. Use and Affordability Restrictions. Developer hereby covenants and agrees, for itself and its successors and assigns, that 19 BMR Units in the Development shall be used solely for the operation of an affordable residential rental development for Eligible Households. Developer represents and warrants that it has not entered into any agreement that would restrict or compromise its ability to comply with the occupancy and affordability restrictions set forth in this Agreement, and Developer covenants that it shall not enter into any agreement that is inconsistent with such restrictions without the express written consent of City.

2.1 Affordability Requirements.

For a term of fifty-five (55) years, commencing upon the Effective Date of this Agreement, nineteen (19) of the Units in the Development will be restricted for occupancy by Eligible Households as further set forth in Recital D (the “Restricted Units”), subject to Section 2.3. The City and the Developer acknowledge that other financing sources for the Development may impose additional affordability restrictions on the Development.

2.2 Rents for Restricted Units.
(a) Affordable Rent. Subject to the provisions of Section 2.3 below, the Rent charged to residents in the following Units shall not exceed:
i. Very Low Income Unit Rent. One-twelfth (1/12th) of thirty percent (30%) of fifty percent (50%) of Area Median Income, adjusted for Assumed Household Size. ii. Low Income Unit Rent. One-twelfth (1/12th) of thirty percent (30%) of eighty percent (80%) of Area Median Income, adjusted for Assumed Household Size. iii. Moderate Income Unit Rent. One-twelfth (1/12th) of thirty percent (30%) of one hundred and twenty (120%) of Area Median Income, adjusted for Assumed Household Size.
(b) In calculating the allowable Rent for the Restricted Units, Assumed Household Size shall be the federally-mandated household size assumptions as set forth in federal statutes

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Packet Pg. 131 Attachment: Exhibit A: Cotati Station Affordable Housing Regulatory Agreement (Cotati Station 98-Units Affordable Housing Agreement Reso) Cotati Affordable Housing Regulatory Agreement Page 6 of 25 BN 72392808v2
or regulations for programs also providing financial assistance to the Development (“Assumed Household Size”) and as further defined in the definition of Assumed Household Size in this agreement.
(c) The Rent may only be increased one time per year (unless otherwise approved in writing by the City) and the Rent level following an increase, or upon a new occupancy, shall not exceed the Rent level set forth in subsection (a) above, as applicable. Eligible Households occupying Units shall be given at least sixty (60) days written notice prior to any increase in the Rent.
(d) Notwithstanding anything to the contrary contained in this Agreement, if the other lenders, tax credit investor, or regulatory agencies require stricter household income eligibility or affordability requirements than those imposed hereby, the requirements of such other lenders, tax credit investor, or regulatory agencies shall prevail, but such requirements and the requirements of this Agreement shall be reconciled to the greatest extent possible. In meeting all such income and affordability requirements, the Developer may count each Unit at a specific income eligibility level as meeting the same specific income eligibility level requirement in each of the lender, tax credit, or regulatory agency regulatory agreements.

2.3 Increased Income of Occupying Households.

2.3.1 Increase in Tenant Income. If, upon recertification of tenant incomes, Developer determines that a Very-Low Income Household or Low-Income Household no longer qualifies as a Very-Low Income or Low-Income, but does qualify as a Low Income Household or Moderate Income Household, such household's Restricted Unit shall be considered a Low Income Unit or Moderate Income Unit, as appropriate (and the Rent may be increased to the Rent allowed for such unit under Section 2.2). Developer shall rent the next available dwelling Unit(s) in the Development with the same number of bedrooms to Eligible Household(s) at the Rent that does not exceed the amounts set forth in Section 2.2, until the requirements of Section 2.1 and this Agreement are satisfied.

2.3.2 Non-Qualifying Household. If, upon recertification of tenant incomes, Developer determines that a tenant’s household income has increased to exceed the qualifying income for a Moderate Income Household, such tenant shall be permitted to continue to occupy the unit and upon expiration of the tenant’s lease: (i) following one hundred eighty (180) days’ notice, and if so permitted by local and state law, such tenant shall be required to vacate the Restricted Unit. Developer shall rent the Restricted Unit to a Very Low Income Household, Low Income Household, or Moderate Income Household as required by Section 2.1 of this Agreement.

Alternatively, an equivalent market rate unit which becomes available during this period may be converted to a BMR unit, with the tenants of this unit meeting the same income qualifications as that of the disqualified tenant.

In the event of inconsistency between the provisions of Section 2.3.2 and the rules applicable to the Development in connection with low-income housing tax credits, tax-exempt bond financing, or financing or rent subsidies provided to the Development by a federal, State or other public agency, the rules applicable pursuant to such financing or subsidy source shall prevail.

2.3.3 Continued Compliance. In the event an occupant household’s income increases and the rent is increased as set forth in Sections 2.3.1 and 2.3.2 above, the Restricted Unit shall continue to be classified as a Very Low Income Unit, Low Income Unit, or Moderate

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Income Unit, as applicable, and Developer shall be deemed to be in compliance with the provisions of Section 2.1, 2.2, and 2.3 of this Agreement, until such time as the Tenant is required to vacate the Restricted Unit under Section 2.3.2.

2.4 No Condominium Conversion. Developer shall not convert the Development to condominium or cooperative ownership or sell condominium or cooperative rights to the Development or any part thereof during the term of this Agreement without the express authorization and approval from the City of Cotati.

2.5 Disbursement of City Grant Funds. Upon issuance of a building permit for the Development that includes impact fees for the low and very low income units, the City shall grant to the Developer, and the Developer shall acknowledge acceptance from City, the respective amount of all impact fees attributable to very low and low income units under the permit being issued, not to exceed to the total cost of city impact fees attributable to the eleven (11) low and very low units, approximately Two Hundred Seventy Five Thousand and No/100 Dollars ($275,000.00) in Grant Funds. The City will apply the Grant Funds to the Development’s Impact Fees associated with the eleven (11) Very Low and Low Income Units at the same time as other impact fees are paid.

2.7 Non-Discrimination; Compliance with Fair Housing Laws.

2.7.1 Fair Housing. Developer shall comply with state and federal fair housing laws in the marketing, leasing and management of the units in the Development. Developer shall accept as tenants, on the same basis as all other prospective tenants, persons who are recipients of federal certificates or vouchers for rent subsidies pursuant to the existing Section 8 program or any successor thereto, however Developer at his sole discretion, may limit the total units rented to tenants under the Section 8 program to a maximum of 19 units.

2.7.2 Non-Discrimination. Developer shall not restrict the rental, sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Property, or any portion thereof, on the basis of race, color, religion, creed, sex, sexual orientation, disability, marital status, ancestry, or national origin of any person. Developer covenants for itself and all persons claiming under or through it, and this Agreement is made and accepted upon and subject to the condition that there shall be no discrimination against or segregation of any person or group of persons on account of any basis listed in subdivision (a) or (d) of Section 12955 of the Government Code, as those biases are defined in Sections 12926, 12926.1, subdivision (m) and paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of the Government Code in, the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Property or part thereof, nor shall Developer or any person claiming under or through Developer establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees in, of, or for the Property or part thereof. Developer shall include such provision in all deeds, leases, contracts and other instruments executed by Developer, and shall enforce the same diligently and in good faith.

3. Reporting Requirements.

3.1 Tenant Certification. Developer or Developer’s authorized agent shall obtain from each household prior to initial occupancy of each Restricted Unit, and on every anniversary thereafter, a written certificate containing all of the following in such format and with such supporting documentation as City may reasonably require:

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(a) The identity of each household member; and
(b) The total gross household income; and
(c) The number and type of calculated preference points, if applicable.

Developer shall retain such certificates for not less than five (5) years from the date of the last Tenant Certification for a specific unit, and annually upon City’s requested date and time, shall provide copies of such certificates to City and make the originals available for City inspection.

3.2 Annual Report; Inspections. By not later than April 30 of each year during the term of this Agreement, Developer shall submit an annual report (“Annual Report”) to the City for the prior calendar year in form satisfactory to City, together with a certification that the Development is in compliance with the requirements of this Agreement. The Annual Report shall, at a minimum, include the following information for each dwelling unit in the Development as of the date of the Annual Report: (i) unit number; (ii) number of bedrooms; (iii) current rent and other charges, specifying the amount chargeable to the Tenant; and (iv) dates of any vacancies during the previous year; (v) number of people residing in the unit as reported to the Developer; (vi) total gross household income of residents; (vii) documentation of source of household income in the form of occupants’ tax returns or other generally acceptable income verification documents; and (viii) the information required by Section 3.1. The Annual Report shall include a site improvement (if any) and maintenance plan and shall include a report on the current waitlist for BMR units, including number of households, unit size desired, and typical wait period. Developer shall include with the Annual Report, an income recertification for each household, documentation verifying tenant eligibility and such additional information as City may reasonably request from time to time in order to demonstrate compliance with this Agreement. The Annual Report shall conform to the format requested by City; provided however, during such time that the Development is subject to a regulatory agreement restricting occupancy and/or rents pursuant to requirements imposed in connection with the use of state or federal low-income housing tax credits or tax-exempt bond financing or grants, Developer may satisfy the requirements of this Section by providing City with a copy of compliance reports required in connection with such financing or grants.

Developer shall permit representatives of City to enter and inspect the Property, the Development, and the property management records, in order to monitor compliance with this Agreement during normal business hours upon two (2) business days advance notice of such visit to Developer or to Developer’s management agent.

The Development shall be subject to an annual monitoring fee of $125 per BMR unit, as adjusted from time to time pursuant to the City’s Master Fee Schedule, or if compliance monitoring is conducted by a third party, the true cost of said compliance up to $125 per unit, as may be adjusted from time to time. Upon approval of the City, the Developer may elect to engage a qualified a third party for monitoring compliance pursuant to this agreement, and the City shall not unreasonably withhold approval of this election by the Developer.

4. Term of Agreement.

4.1 Term of Restrictions. This Agreement shall remain in effect through the 55th anniversary of the date of recordation of this Agreement in the Official Records, unless the term is extended by mutual agreement of the Parties.

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4.2 Effectiveness Succeeds Conveyance of Property. This Agreement shall remain effective and fully binding for the full term hereof, as such may be extended pursuant to Section

4.1, regardless of any sale, assignment, transfer, or conveyance of the Property or the Development or any part thereof or interest therein.

4.3 Reconveyance. Upon the termination of this Agreement, the Parties agree to execute and record appropriate instruments to release and discharge this Agreement; provided, however, the execution and recordation of such instruments shall not be necessary or a prerequisite to the termination of this Agreement upon the expiration of the term as such may be extended pursuant to Section 4.1.

5. Binding Upon Successors; Covenants to Run with the Land. Developer hereby subjects its interest in the Property and the Development to the covenants and restrictions set forth in this Agreement. The City and Developer hereby declare their express intent that the covenants and restrictions set forth herein shall be deemed covenants running with the land and shall be binding upon and inure to the benefit of the heirs, administrators, executors, successors in interest, transferees, and assigns of Developer and City, regardless of any sale, assignment, conveyance or transfer of the Property, the Development or any part thereof or interest therein. Any successor-in-interest to Developer, including without limitation any purchaser, transferee or lessee of the Property or the Development (other than the tenants of the individual dwelling units within the Development) shall be subject to all of the duties and obligations imposed hereby for the full term of this Agreement. Each and every contract, deed, or other instrument affecting or conveying the Property or the Development or any part thereof, shall conclusively be held to have been executed, delivered and accepted subject to the covenants, restrictions, duties and obligations set forth herein, regardless of whether such covenants, restrictions, duties and obligations are set forth in such contract, deed, or other instrument. If any such contract, deed, or other instrument has been executed prior to the date hereof, Developer hereby covenants to obtain and deliver to City an instrument in recordable form signed by the parties to such contract, deed, or other instrument pursuant to which such parties acknowledge and accept this Agreement and agree to be bound hereby.

Developer agrees for itself and for its successors that in the event that a court of competent jurisdiction determines that the covenants herein do not run with the land, such covenants shall be enforced as equitable servitudes against the Property and the Development in favor of City.

6. Property Management; Repair and Maintenance; Marketing.

6.1 Management Responsibilities. Developer shall be responsible for all management functions with respect to the Property and the Development, including without limitation the selection of tenants, certification and recertification of household income and eligibility, evictions, collection of rents and deposits, maintenance, landscaping, routine and extraordinary repairs, replacement of capital items, and security. City shall have no responsibility for management or maintenance of the Property or the Development.

6.2 Management Entity. City shall have the right to review and approve the qualifications of the management entity proposed by Developer for the BMR units in the Development. The contracting of management services to a management entity shall not relieve Developer of its primary responsibility for proper performance of management duties.

6.3 Repair, Maintenance and Security. Throughout the term of this Agreement, Developer shall at its own expense, maintain the Property and the Development in good physical

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condition, in good repair, and in decent, safe, sanitary, habitable and tenantable living conditions in conformity with all applicable state, federal, and local laws, ordinances, codes, and regulations.

Without limiting the foregoing, Developer agrees to maintain the Development and the Property (including without limitation, the residential units, common areas, meeting rooms, landscaping, driveways, parking areas and walkways) in a condition free of all waste, nuisance, debris, unmaintained landscaping, graffiti, disrepair, abandoned vehicles/appliances, and illegal activity, and shall take all reasonable steps to prevent the same from occurring on the Property or at the Development. Developer shall prevent and/or rectify any physical deterioration of the Property and the Development and shall make all repairs, renewals and replacements necessary to keep the Property and the improvements located thereon in good condition and repair. Developer shall provide adequate industry standard security services for occupants of the Development. The Management and Marketing Plan shall provide for the installation of a security camera system at initial occupancy. Nothing in the proceeding sentence shall require the continued use of a camera system if the parties agree upon a different or updated security system.

6.3.1 City’s Right to Perform Maintenance. In the event that Developer breaches any of the covenants contained in Section 6.3, and such default continues for a period of ten (10) business days after written notice from City (with respect to graffiti, debris, and waste material) or thirty (30) days after written notice from City (with respect to landscaping, building improvements and general maintenance), then City, in addition to any other remedy it may have under this Agreement or at law or in equity, shall have the right, but not the obligation, to enter upon the Property and perform all acts and work necessary to protect, maintain, and preserve the improvements and the landscaped areas on the Property. All costs expended by City in connection with the foregoing, shall constitute an indebtedness and shall be paid by Developer to City upon demand. All such sums remaining unpaid thirty (30) days following delivery of City’s invoice therefor shall bear interest at the lesser of ten percent (10%) per annum or the highest rate permitted by applicable law.

6.4 Management and Marketing Plan. The Developer shall be responsible for creating and maintaining a plan for managing the Property and marketing the units for rent in the Project (the “Management and Marketing Plan”). The Management and Marketing Plan shall be updated every five (5) years, and be available to the City for review upon request. Updates and revisions to the Management and Marketing Plan may be subject to prior approval of Developer’s investors, limited partners, and/or project lenders before being implemented.

The Management and Marketing Plan shall describe the management team and shall address how the Developer and the management entity plan to manage and maintain the Property and the Development. The Management and Marketing Plan shall include the proposed management agreement and the form of rental agreement that Developer proposes to enter into with the Development’s tenants. The Management and Marketing Plan shall address in detail how Developer plans to market the Restricted Units to prospective Eligible Households, in conformance with fair housing laws, this Agreement, and with Developer’s tenant selection criteria. The Management and Marketing Plan shall also address in detail how Developer plans to certify the eligibility of Eligible Households. Developer shall abide by the terms of the Management and Marketing Plan in marketing, managing, and maintaining the Property and the Development, and throughout the term of this Agreement, shall submit proposed modifications to City for review and approval, which shall not be unreasonably withheld.

6.5 Approval of Amendments. If City has not responded to any submission of the Management and Marketing Plan, the proposed management entity, or a proposed amendment

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or change to any of the foregoing within thirty (30) days following City’s receipt of such plan, proposal or amendment, the plan, proposal or amendment shall be deemed approved by City.

6.6 Fees, Taxes, and Other Levies. Developer shall be responsible for payment of all fees, assessments, taxes, charges, liens and levies applicable to the Property or the Development, including without limitation possessory interest taxes, if applicable, imposed by any public entity, and shall pay such charges prior to delinquency. However, Developer shall not be required to pay any such charge so long as (a) Developer is contesting such charge in good faith and by appropriate proceedings, (b) Developer maintains reserves adequate to pay any contested liabilities, and (c) on final determination of the proceeding or contest, Developer immediately pays or discharges any decision or judgment rendered against it, together with all costs, charges and interest. The Parties acknowledge that the Developer will apply for exemption from property tax for the affordable units under Revenue and Taxation Code Section 214.

6.7 Insurance Coverage. Throughout the term of this Agreement Developer shall at Developer’s expense, maintain in full force and effect insurance coverage as specified in Exhibit B and shall comply with all insurance requirements set forth in the Exhibit B.

6.8 Property Damage or Destruction. If any part of the Development is damaged or destroyed, Developer shall repair or restore the same, consistent with the occupancy and rent restriction requirements set forth in this Agreement. Such work shall be commenced as soon as reasonably practicable after the damage or loss occurs and shall be completed within one year thereafter or as soon as reasonably practicable, provided that insurance proceeds are available to be applied to such repairs or restoration within such period and the repair or restoration is financially feasible. During such time that lenders. low-income housing tax credit investors and State housing programs providing financing for the Development impose requirements that differ from the requirements of this Section the requirements of such lenders and investors shall prevail.

7. Recordation; Subordination. This Agreement shall be recorded in the Official Records.

Developer hereby represents, warrants and covenants that with the exception of easements of record, absent the written consent of City, this Agreement shall not be subordinated in priority to any lien (other than those pertaining to taxes or assessments), encumbrance, or other interest in the Property or the Development without the City’s approval. If at the time this Agreement is recorded, any interest, lien, or encumbrance has been recorded against the Development in position superior to this Agreement, upon the request of City, Developer hereby covenants and agrees to promptly undertake all action necessary to clear such matter from title or to subordinate such interest to this Agreement consistent with the intent of and in accordance with this Section 7, and to provide such evidence thereof as City may reasonably request. Notwithstanding the foregoing, the City agrees that City will not withhold consent to reasonable and industry standard requests for subordination of this Agreement pursuant to Section 8.3.

8. Transfer and Encumbrance.

8.1 Restrictions on Transfer and Encumbrance. During the term of this Agreement, except as permitted pursuant to this Agreement, Developer shall not directly or indirectly, voluntarily, involuntarily or by operation of law make or attempt any total or partial sale, transfer, conveyance, assignment or lease (collectively, “Transfer”) of the whole or any part of the Property, the Development, or the improvements located on the Property, without the prior written consent of the City, which approval shall not be unreasonably withheld. In addition, prior to the expiration of the term of this Agreement, except as expressly permitted by this Agreement, Developer shall not undergo any significant change of ownership without the prior written approval

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of City. For purposes of this Agreement, a “significant change of ownership” shall mean a transfer of the beneficial interest of more than twenty-five percent (25%) in aggregate of the present ownership and/or control of Developer, taking all transfers into account on a cumulative basis; provided however, neither the admission of an investor limited partner, nor the transfer by the investor limited partner to subsequent limited partners shall be restricted by this provision.

8.2 Permitted Transfers. Notwithstanding any contrary provision hereof, the prohibitions on Transfer set forth herein shall not be deemed to prevent: (i) the granting of easements or permits to facilitate development of the Property; (ii) the dedication of any property; (iii) the lease of individual dwelling units to tenants for occupancy as their principal residence, or the lease of commercial space to commercial tenants, if applicable; (iv) assignments creating security interests for the purpose of financing the acquisition, construction, or permanent financing of the acquisition or the Property in accordance with the Agreement, or Transfers directly resulting from the foreclosure of, or granting of a deed in lieu of foreclosure of, such a security interest; (v) a Transfer to a limited partnership in which the managing general partner is a tax-exempt entity under the direct control of or under common control with a qualified non-profit affordable housing company; (vi) the admission of limited partners and any transfer of limited partnership interests in accordance with Developer’s agreement of limited partnership (the “Partnership Agreement”), provided that the Partnership Agreement and/or the instrument of Transfer provides for development and operation of the Property and Development in a manner consistent with this Agreement; (vii) the removal of the general partner by the investor limited partner for a default under the Partnership Agreement, provided the replacement general partner is an affiliate of the limited partner or an entity which is reasonably satisfactory to City; or (viii) the transfer of the General Partner’s interest to a nonprofit entity that is or its member/manager is tax-exempt under Section 501(c)(3) of the Internal Revenue Code of 1986 as amended, provided such replacement general partner is reasonably satisfactory to City; or (ix) the grant, exercise and subsequent the transfer of the Project or limited partner interests in Developer to a qualified non-profit affordable housing company or an affiliate thereof pursuant to the right of first refusal and/or option granted under Developer’s Partnership Agreement.

In addition, City shall not withhold its consent to the sale, transfer or other disposition of the Development, in whole or in part, provided that: (a) the Development is and shall continue to be operated in compliance with this Agreement; (b) the transferee expressly assumes all obligations of Developer imposed by this Agreement; (c) the transferee executes all documents reasonably requested by the City with respect to the assumption of the Developer’s obligations under this Agreement, and upon City’s request, delivers to the City an opinion of its counsel to the effect that such document and this Agreement are valid, binding and enforceable obligations of such transferee; and (d) either (A) the transferee has at least three (3) years’ experience in the ownership, operation and management of multifamily rental housing projects of similar size to that of the Development, without any record of material violations of nondiscrimination provisions or other state or federal laws or regulations applicable to such projects, or (B) the transferee agrees to retain a property management firm with the experience and record described in Section 6.4.

Unless waived by City, Owner shall reimburse City for all City costs, including but not limited to reasonable attorneys’ fees, incurred in reviewing instruments and other legal documents proposed to effect a Transfer under this Agreement and in reviewing the qualifications and financial resources of a proposed successor, assignee, or transferee within ten (10) days following City’s delivery of an invoice detailing such costs.

8.3 Encumbrances; Subordination. City agrees that the City will not withhold consent to reasonable requests to subordinate this Agreement to a third-party lender providing loan

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proceeds for the acquisition, development, construction, rehabilitation and/or operation of the Development; provided, that Developer agrees to use best efforts to ensure that any subordination agreement recorded against the Property, the Development or part thereof for the benefit of a lender other than City (“Third-Party Lender”) shall contain each of the following provisions: (i) Third-Party Lender shall use its best efforts to provide to City a copy of any notice of default issued to Developer concurrently with provision of such notice to Developer; (ii) City shall have the reasonable right, but not the obligation, to cure any default by Developer within the same period of time provided to Developer for such cure. Developer agrees to provide to City a copy of any notice of default Developer receives from any Third-Party Lender within three (3) business days following Developer’s receipt thereof.

8.4 Mortgagee Protection. No violation of any provision contained herein shall defeat or render invalid the lien of any mortgage or deed of trust made in good faith and for value upon all or any portion of the Development or the Property. The purchaser at any trustee’s sale or foreclosure sale shall not be liable for any violation of any provision hereof occurring prior to the acquisition of title by such purchaser. Promptly upon determining that a violation of this Agreement has occurred, City shall give written notice to the holders of record of any mortgages or deeds of trust encumbering the Development or the Property that such violation has occurred.

9. Default and Remedies.

9.1 Events of Default. The occurrence of any one or more of the following events shall constitute an event of default hereunder (“Event of Default”):
(a) The occurrence of a Transfer in violation of Section 8 hereof; (b) Developer’s failure to maintain insurance on the Property and the Development as required hereunder, and the failure of Developer to cure such default within ten (10) business days;
(c) Subject to Developer’s right to contest the following charges, Developer’s failure to pay taxes or assessments due on the Property or the Development or failure to pay any other charge that may result in a lien on the Property or the Development, and Developer’s failure to cure such default within thirty (30) days of delinquency; (d) A default has been declared under any loan secured by a mortgage, deed of trust or other security instrument recorded against the Property and remains uncured beyond any applicable cure period such that the holder of such security instrument has the right to accelerate repayment of such loan;
(e) Developer’s default in the performance of any term, provision or covenant under this Agreement (other than an obligation enumerated in this Subsection 9.1), and unless such provision specifies a shorter cure period for such default, the continuation of such default for ten (10) days in the event of a monetary default or thirty (30) days in the event of a non-monetary default following the date upon which City shall have given written notice of the default to Developer, or if the nature of any such non-monetary default is such that it cannot be cured within thirty (30) days, Developer’s failure to commence to cure the default within thirty (30) days and thereafter prosecute the curing of such default with due diligence and in good faith, but in no event longer than ninety (90) days from receipt of the notice of default or such longer period of time as City may allow.

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The limited partners, investors, general partners and other lenders of Developer shall have the right to cure any default of Developer hereunder upon the same terms and conditions afforded to Developer. Provided that City has been given written notice of the address for delivery of notices to the limited partners, City shall provide any notice of default hereunder to the limited partners investors, general partners and other lenders concurrently with the provision of such notice to Developer, and as to the limited partners, et al, the cure periods specified herein shall commence upon the date of delivery of such notice in accordance with Subsection 11.3.

9.2 Remedies. Upon the occurrence of an Event of Default and its continuation beyond any applicable cure period, City may proceed with any of the following remedies:

A. Bring an action for equitable relief seeking the specific performance of the terms and conditions of this Agreement, and/or enjoining, abating, or preventing any violation of such terms and conditions, and/or seeking declaratory relief; B. For violations of obligations with respect to rents for Restricted Units, impose as liquidated damages a charge in an amount equal to the actual amount collected in excess of the Affordable Rent;
C. If, in connection with an Event of Default under Subsection 9.1(d), a lienholder of any loan secured by a mortgage, deed of trust or other security instrument recorded against the Property exercises its right to foreclose on the Property, then:
(i) City shall be entitled to declare that a return of the Grant Funds is immediately due and payable, and (ii) the proceeds of any sale of the Property in connection with such foreclosure shall be used to pay all indebtedness, claims and liabilities due under this Agreement. The City’s rights under this paragraph shall be fully subordinated to the prior payment in full of any senior secured obligations to which this Agreement has been subordinated pursuant to Section 8.3; D. Pursue any other remedy allowed at law or in equity.

Each of the remedies provided herein is cumulative and not exclusive. The City may exercise from time to time any rights and remedies available to it under applicable law or in equity, in addition to, and not in lieu of, any rights and remedies expressly provided in this Agreement.

10. Indemnity. Notwithstanding any other provision in the Agreement or other documents executed in connection with the City funds, Developer shall indemnify, defend (with counsel approved by City) and hold City and their respective elected and appointed officers, officials, employees, agents, and representatives (collectively, the “Indemnitees”) harmless from and against all liability, loss, cost, expense (including without limitation attorneys’ fees and costs of litigation), claim, demand, action, suit, judicial or administrative proceeding, penalty, deficiency, fine, order, and damage (all of the foregoing collectively “Claims”) arising directly or indirectly, in whole or in part, as a result of or in connection with Developer’s construction, management, or operation of the Property and the Development or any failure to perform any obligation as and when required by this Agreement. Developer’s indemnification obligations under this Section 10 shall not extend to Claims resulting solely from the gross negligence or willful misconduct of Indemnitees. It is further agreed that City does not and shall not waive any rights against Developer that it may have by reason of this indemnity and hold harmless agreement because of the acceptance by City, or the deposit with City by Developer, of any of the insurance policies’ proceeds described in this Agreement.

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The provisions of this Section 10 shall survive the expiration or earlier termination of this Agreement.

11. Miscellaneous.

11.1 Amendments. This Agreement may be amended or modified only by a written instrument signed by both Parties.

11.2 No Waiver. Any waiver by City of any term or provision of this Agreement must be in writing. No waiver shall be implied from any delay or failure by City to take action on any breach or default hereunder or to pursue any remedy allowed under this Agreement or applicable law.

No failure or delay by City at any time to require strict performance by Developer of any provision of this Agreement or to exercise any election contained herein or any right, power or remedy hereunder shall be construed as a waiver of any other provision or any succeeding breach of the same or any other provision hereof or a relinquishment for the future of such election.

11.3 Notices. Except as otherwise specified herein, all notices to be sent pursuant to this Agreement shall be made in writing, and sent to the Parties at their respective addresses specified below or to such other address as a Party may designate by written notice delivered to the other parties in accordance with this Section. All such notices shall be sent by:
(i) personal delivery, in which case notice is effective upon delivery; (ii) certified or registered mail, return receipt requested, in which case notice shall be deemed delivered upon receipt if delivery is confirmed by a return receipt; (iii) nationally recognized overnight courier, with charges prepaid or charged to the sender’s account, in which case notice is effective on delivery if delivery is confirmed by the delivery service;
City: City of Cotati
201 West Sierra Avenue
Cotati, CA 94931-4217
Attention: City Manager
Developer: Colvin Group, LLC
45 Camino Alto Suite 208
Mill Valley, CA, 94941
Attention: Larry Colvin
With a copy to Developer’s investor limited partner. General partner or investor as shown below: Not Applicable.

11.4 Further Assurances. The Parties shall execute, acknowledge and deliver to the other such other documents and instruments, and take such other actions, as either shall reasonably request as may be necessary to carry out the intent of this Agreement.

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11.5 Parties Not Co-Venturers. Nothing in this Agreement is intended to or shall establish the Parties as partners, co-venturers, or principal and agent with one another.

11.6 Action by the City. City Manager Authority. Except as may be otherwise specifically provided herein, whenever any approval, notice, direction, consent or request by the City is required or permitted under this Agreement, such action shall be in writing, and such action may be given, made or taken by the City’s City Manager or by any person who shall have been designated by the City Manager, without further approval by the City Council. City hereby authorizes the City Manager or designee to take such other actions and negotiate and execute any additional agreements, including, without limitation, implementing agreements hereof and amendments hereto, as may be necessary or proper to satisfy the purpose and intent of this Agreement. Notwithstanding the foregoing, the City Manager shall maintain the right to submit to the City Council for consideration and action any action or additional agreement under the City Manager’s authority if the City Manager desires to do so.

11.7 Non-Liability of City Officials, Officers, Directors, Employees and Agents. No member, official, employee or agent of the City shall be personally liable to Developer or any successor in interest, in the event of any default or breach by the City, or for any amount of money which may become due to Developer or its successor or for any obligation of City under this Agreement. No director, officer, employee or agent of the Developer shall be personally liable to the City or any successor in interest, in the event of any default or breach by the Developer, or for any amount of money which may become due to the City or its successor or for any obligation of the Developer under this Agreement.

11.8 Headings; Construction. The headings of the sections and paragraphs of this Agreement are for convenience only and shall not be used to interpret this Agreement. The language of this Agreement shall be construed as a whole according to its fair meaning and not strictly for or against any Party.

11.9 Time is of the Essence. Time is of the essence in the performance of this Agreement.

11.10 Governing Law. This Agreement shall be construed in accordance with the laws of the State of California without regard to principles of conflicts of law.

11.11 Attorneys’ Fees and Costs. If any legal or administrative action is brought to interpret or enforce the terms of this Agreement, the prevailing party shall be entitled to recover all reasonable attorneys’ fees and costs incurred in such action.

11.12 Severability. If any provision of this Agreement is held invalid, illegal, or unenforceable by a court of competent jurisdiction, the validity, legality, and enforceability of the remaining provisions shall not be affected or impaired thereby.

11.13 Entire Agreement. This Agreement contains the entire agreement of Parties with respect to the subject matter hereof, and supersedes all prior oral or written agreements between the Parties with respect thereto.

11.14 Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be an original and all of which together shall constitute one agreement.

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SIGNATURES ON FOLLOWING PAGES.

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IN WITNESS WHEREOF, the Parties have executed this Affordable Housing Regulatory Agreement and Declaration of Restrictive Covenants as of the date first written above.

CITY
City of Cotati, a municipal corporation
By: _______________________
Damien O’Bid, City Manager
Attest:_______________________
City Clerk
Approved as to form:
__________________
City Attorney

DEVELOPER
Colvin Group, LLC
By: Colvin Group LLC,
a California limited liability company, its managing general partner By: ________________________
XXX
Chief Executive Officer
SIGNATURES MUST BE NOTARIZED.

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Packet Pg. 144 Attachment: Exhibit A: Cotati Station Affordable Housing Regulatory Agreement (Cotati Station 98-Units Affordable Housing Agreement Reso) Cotati Affordable Housing Regulatory Agreement Page 19 of 25 BN 72392808v2
A notary public or other officer
completing this certificate verifies only
the identity of the individual who signed
the document to which this certificate is
attached, and not the truthfulness,
accuracy, or validity of that document.

STATE OF CALIFORNIA )
)

COUNTY OF SONOMA )
On , 20__, before me, ______________________, (here insert name and title of the officer), personally appeared , who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

Signature _______________________________ (Seal)

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A notary public or other officer
completing this certificate verifies only
the identity of the individual who signed
the document to which this certificate is
attached, and not the truthfulness,
accuracy, or validity of that document.

STATE OF CALIFORNIA )
)

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

Signature _______________________________ (Seal)

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Packet Pg. 146 Attachment: Exhibit A: Cotati Station Affordable Housing Regulatory Agreement (Cotati Station 98-Units Affordable Housing Agreement Reso) Cotati Affordable Housing Regulatory Agreement Page 21 of 25 BN 72392808v2
Exhibit A

PROPERTY
Real property in the City of Cotati, County of Sonoma, State of California, described as follows:

Legal Description
144-320-035, 144-320-034, and 144-320-036

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Packet Pg. 147 Attachment: Exhibit A: Cotati Station Affordable Housing Regulatory Agreement (Cotati Station 98-Units Affordable Housing Agreement Reso) Cotati Affordable Housing Regulatory Agreement Page 22 of 25 BN 72392808v2
Exhibit B
Insurance Requirements
Throughout the term of this Agreement, Developer shall obtain and maintain, at Developer’s expense, the following policies of insurance.

A. Property Insurance. Insurance for the risks of direct physical loss, with minimum coverage being the perils insured under the standard Causes of Loss - Special form (ISO Form CP 10 30) or its equivalent, covering all improvements, all fixtures, equipment and personal property, located on or in, or constituting a part of, the Property (“Improvements”), in an amount equal to one hundred percent (100%) of the full replacement cost of all such property naming the City as a Loss Payee, as its interests may appear.

1. The insurance required hereunder shall be in amounts sufficient to prevent Developer from becoming a co-insurer under the terms of the applicable policies, with not more than a Ten Thousand Dollars ($10,000) deductible (or such higher deductible approved by the City, which approval shall not be unreasonably withheld) from the loss payable for any casualty.

B. Liability Insurance. Comprehensive general liability insurance on an “occurrence basis” covering all claims with respect to injury or damage to persons or property occurring on, in or about the Property and the Improvements. The limits of liability under this Paragraph B shall be not less than Two Million Dollars ($2,000,000) combined single limit per occurrence, with a deductible no greater than Ten Thousand Dollars ($10,000) or such higher deductible as may be approved by City, which approval shall not be unreasonably withheld.

1. The insurance shall also include coverage for:
(a) Liability for bodily injury or property damage arising out of the use, by or on behalf of Developer, of any owned, non-owned, leased or hired automotive equipment in the conduct of any and all operations conducted in connection with the Project or the Property;
(b) Premises and operations including, without limitation, bodily injury, personal injury, death or property damage occurring upon, in or about the Property or the Improvements on any elevators or any escalators therein and on, in or about the adjoining sidewalks, streets and passageways;
(c) Broad form property damage liability;

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Packet Pg. 148 Attachment: Exhibit A: Cotati Station Affordable Housing Regulatory Agreement (Cotati Station 98-Units Affordable Housing Agreement Reso) Cotati Affordable Housing Regulatory Agreement Page 23 of 25 BN 72392808v2
(d) Additional insured and primary insured endorsements protecting the City and its respective elected and appointed officials, officers, employees and agents;
(e) Personal injury endorsement.

C. Worker’s Compensation Insurance. Worker’s compensation insurance, in the amount required under then applicable state law, covering Developer’s employees, if any, at work in or upon the Property or engaged in services or operations in connection with the Project or the Property. Developer shall require that any contract entered into by Developer with regard to work to be undertaken on the Property include a contractual undertaking by the contractor to provide worker’s compensation insurance for its employees in compliance with applicable state law.

D. Course of Construction Insurance. Course of construction insurance in the same amount as required in Paragraph A above for property insurance, covering all construction activities on the Property.

E. General Insurance Provisions.

1. All policies of insurance provided for in this Exhibit B shall be provided under valid and enforceable policies, in such forms and amounts as hereinbefore specified, issued by insurers licensed to do business in the State of California and having a rating of A-VII or better in Best Insurance Guide. Developer shall deliver to City certificates evidencing the insurance required to be carried by Developer under this Exhibit B. If requested by City, Developer shall deliver within ten (10) days following such request, certified, complete copies of the insurance policies required hereunder. Insurance policies to be provided hereunder shall meet the following requirements:

2. Each policy of insurance obtained pursuant to this Agreement, other than worker’s compensation insurance, shall contain endorsements which provide:
(a) A waiver by the insurer of the right of subrogation against City or Developer for negligence of any such person,
(b) A statement that the insurance shall not be invalidated should any insured waive in writing prior to the loss any or all right of recovery against any party for loss accruing to the property described in the insurance policy, and
(c) A provision that no act or omission of Developer which would otherwise result in forfeiture or reduction of the insurance therein provided shall affect or limit the obligation of the insurance company to pay the amount of any loss sustained.

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Packet Pg. 149 Attachment: Exhibit A: Cotati Station Affordable Housing Regulatory Agreement (Cotati Station 98-Units Affordable Housing Agreement Reso) Cotati Affordable Housing Regulatory Agreement Page 24 of 25 BN 72392808v2
(d) By endorsements, City, and its elected and appointed officials, officers, employees and agents shall be named as additional insured under the liability insurance required to be maintained by Developer hereunder. City shall be named as loss payee on the property insurance policies required to be maintained hereunder.

3. Each policy required hereunder shall include a Notice of Cancellation or Change in Coverage Endorsement which shall provide that such policy shall not be cancelled or materially changed without at least thirty (30) days’ prior written notice by registered or certified mail to City.

4. All insurance policies shall provide that there shall be no exclusion from coverage for cross liability among the listed insureds.

5. Any certificate of insurance applicable to course of construction insurance to be maintained shall be deposited with City prior to commencement of construction of any Improvements.

6. Each policy shall contain an endorsement that provides that the insurance applies separately to each insured that is seeking coverage or against whom a claim is made, except with respect to the limits of liability.

7. Each policy shall be written as a primary policy not contributing with and not in excess of coverage that City may carry.

F. Blanket Policies. Any insurance provided for in this Exhibit B may be placed by a policy or policies of blanket insurance; provided, however, that such policy or policies provide that the amount of the total insurance allocated to the Property and the Project shall be such as to furnish protection the equivalent of separate policies in the amounts herein required, and provided further that in all other respects any such policy or policies shall comply with the other provisions of this Agreement.

G. Waiver of Subrogation. To the extent permitted by law and the policies of insurance required to be maintained hereunder, and without affecting such insurance coverage, City and Developer each waive any right to recover against the other:

1. Damages for injury or death of persons,

2. Damage to property,

3. Damage to the Property or the Improvements or any part thereof, or

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4. Claims arising by reason of any of the foregoing, to the extent that such damages and/or claims are covered (and only to the extent of such coverage) by insurance actually carried by either City or Developer.

This provision is intended to restrict each party (as permitted by law) to recover against insurance carriers to the extent of such coverage, and waive fully, and for the benefit of each, any rights and/or claims which might give rise to a right of subrogation in any insurance carrier. 5183222.1

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Packet Pg. 151 Attachment: Exhibit A: Cotati Station Affordable Housing Regulatory Agreement (Cotati Station 98-Units Affordable Housing Agreement Reso) Cotati City Council
Agenda Staff Report
Item type: REGULAR AGENDA (ACTION)
To: City Council
Subject: Proposed Changes to the Sonoma County Tourism Business Improvement Assessment
Date: September 27, 2022
Written by: Damien O'Bid, City Manager
Recommendation
It is recommended that the City Council adopt a resolution of consent to removing the minimum revenue threshold for tourism assessment in the existing Business Improvement Assessment (BIA).

Background
Established on November 2, 2004, with resolutions of consent from the Cities of Santa Rosa, Rohnert Park, Petaluma, Cloverdale, Cotati, and Sebastopol, and the Town of Windsor, the Sonoma County Tourism Business Improvement Area (BIA) was formed to promote tourism in Sonoma County.

The BIA was adopted pursuant to the “Parking and Business Improvement Area Law of 1989,” Sections 36500 et seq. of the California Streets and Highways Code, and Resolution Nos. 04- 0850 and 04-0984, adopted by the Board of Supervisors on September 14, 2004, and October 12, 2004. The purpose of forming the BIA as a business improvement area under the Law is to provide revenue to defray the costs of services, activities, and programs that promote and encourage tourism within the County, which will benefit the Operators of Lodging establishments paying Assessments in the BIA through the promotion of the scenic, recreational, cultural, and other attractions in the County. Revenues from Assessments are used to conduct Marketing Activities designed to increase overnight visits to the County.

Sonoma County Tourism provided a presentation to the City Council on August 9, 2022. At that meeting, the City Council requested information on Sonoma County Tourism’s budget, how they market to ensure equity, and return on investment. A summary letter from Sonoma County Tourism with links to more information is attached to this staff report. The City also reached out to the developer for the Cotati Hotel on several occasions to inquire about the BIA changes, but has not received any feedback.

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Sonoma County Tourism originally requested an update to its existing BIA to raise collection from 2% to 3% and to remove the existing revenue threshold of $350,000 annually for participating in collection of the BIA. Following the initial presentation to the City Council, Sonoma County Tourism amend the request to simply remove the $350,000 threshold and not proceed at this time with an increase in the assessment rate.

A Resolution of Consent is required by the participating BIA cities for the change in the County of Sonoma Ordinance 5255 to be considered by the Board of Supervisors or ultimately take effect in the city. As of September 22, 2022, the cities of Petaluma, Sebastopol, Rohnert Park, Windsor and Cloverdale have adopted the Resolution of Consent. The only remaining city, Santa Rosa, is scheduled to hear this on October 11.

Analysis/Discussion
Sonoma County Tourism (SCT) exists to drive overnight visitation into Sonoma County lodging properties and drive revenue into the county through tourism activities. In recent years, SCT has shown that its programming provides a significant return-on-investment, generating $14 in local taxes for every $1 invested in tourism marketing. Every additional dollar spent in marketing will benefit the overall brand awareness of the county and drive business into the doors of customerfacing businesses.

At present, SCT is working within the framework outlined in its current funding structure, that being receiving 1.25% of the first 9% of Transient Occupancy Tax (TOT) collected in unincorporated Sonoma County and 2% of county-wide overnight lodging revenue for properties with an excess of $350,000 per year in revenue, save the towns of Sonoma and Healdsburg as assessed through the Business Improvement Area (BIA). Sonoma and Healdsburg have their own local tourism BIA.

SCT is seeking to remove the $350,000 threshold for the BIA program, which will level the playing field for hotels and vacation rentals by making them both subject to the same assessments. Currently, many vacation rentals are not subject to the assessment. Both vacation rentals and hotels benefit equally from tourism marketing, which brings new guests for both to Sonoma County. The estimated $2 - 2.5 million in additional funds each year would also allow SCT the ability to increase targeted marketing to responsible travelers.

Throughout the year, SCT operates its consumer campaigns during the time periods that drive business. SCT is mandated to drive business November through April. It’s during this time period that the majority of the paid advertising has and will occur. These funds will help augment the campaigns run during that time with a travel responsibly message. During the remainder of the year, May – October, the chief messaging will be around responsible travel.

The need to drive business is not as acute during this “high season” time, but the need to tout responsible and sustainable travel takes the forefront. These funds will help ensure each campaign time frame is as effective as possible.

Sonoma County’s agricultural community has long had a commitment to sustainability but finding and inviting like-minded travelers on the consumer side is a recent undertaking.

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Attracting new visitors is always a more costly proposition than inviting travelers from core markets (San Francisco Bay to Sacramento) who are very familiar with the destination and its marketing messages. Also, as the cost of purchasing media time continues to rise, the key consumer markets for Sonoma County are San Francisco, Los Angeles, San Diego, Dallas, Phoenix, Portland and Seattle – represent some of the most expensive markets in the country.

Additional funds will help SCT be more effective in connecting with the responsible traveler target audiences within these coveted traveler markets.

Financial Considerations
The City of Cotati does not currently have overnight lodging or allow vacation rentals.

Therefore, the City does not currently collect BIA funds. Should a lodging property be established, there will be staff time to collect funds and remit them to the County. An administrative fee may be collected to offset that cost.

Environmental Issues
The action of adopting a Resolution of Consent does not constitute a project as defined by California Environmental Quality Act Guidelines Section 15378; therefore, no further environmental review is required.

Attachments:

Sonoma County Tourism Overview Letter (PDF)

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Dear Members of the Cotati Council:

We very much appreciate your time during the recent Council meeting as Sonoma County Tourism (SCT) works to identify a way to help ensure the organization’s budget can benefit the entire county to the best of our ability.

During our conversation your group posed a number of questions and identified concerns you have with SCT and the way the organization functions and our approach to marketing. We very much hope the materials provided within this folder answer those questions and elevate your perception of Sonoma County Tourism as the region’s destination stewardship organization.

There’s a wealth of information here, but we are always happy to answer any questions you have.

In addition to the folders in this Dropbox file (Financials, ROI Research, Marketing Materials), it would help to better understand the organization by reviewing the following pieces available through the links shown below:

Organizational Effectiveness
As a 501(c) 6, SCT operates with a board of directors and a number of committees that provide guidance and oversight of the organization. In addition to the sample financials provided in the Dropbox folder, the organization also produces the following:

Sonoma County Tourism FY21-23 Strategic Plan
Sonoma County Tourism FY20-21 Annual Report
Updated Destination Research is always available within the partner portal of the website.

Destination Stewardship
We talked about the organization’s evolution from a destination marketing organization to a destination stewardship organization. This is important because not only is SCT the first in the nation to make this authentic change, but it means the organization no longer has numbers as its sole focus, but rather inviting travelers who live the same ethos of protecting and preserving the region. Claudia spoke to a national travel blog about this journey. Claudia Vecchio’s interview with the Travel Vertical regarding the organization’s journey to becoming a Destination Stewardship Organization.

Destination Marketing
SCT creates and executes a number of marketing campaigns throughout the year. We’ve included some of these materials in the Dropbox folder. We’re hopeful you will see that we position Sonoma County as a place that welcomes all, celebrates an authentic sense of place and aligns with our “Life Opens Up” brand.

We also have a YouTube channel dedicated to Sonoma County. We encourage you to look at the videos on this channel. These include:

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Packet Pg. 155 Attachment: Sonoma County Tourism Overview Letter (Tourism District Tax Assessment Increase) • Intentional Itineraries – a unique combination of art and science. The influencers showcased in these videos first spoke with an expert in that field to ensure a solid foundation for the experiences.
• Videos from the Cultivated Series (all on SonomaCounty.com and shared through SCT’s social channels). These videos highlight the luminaries, creatives and real people of Sonoma County.

This creates a true, emotional connection with potential visitors and, we hope, elevates the pride residents have in Sonoma County.
• Life Opens Up in Sonoma County
• Stars of the Industry 2022 – SCT celebrates the local industry’s best and brightest. • Wine, Two, Three – a primer on wine tasting and enjoying from the TravelMom • Fall and Spring marketing campaign videos
Commitment to Diversity, Equity and Inclusion
One of the greatest concerns from the Council was ensuring that SCT show Sonoma County to a diverse and authentic audience. We very definitely strive to do that.

SCT is very concerned that we promote the region to a wide diversity of potential visitors. Of note, the LGBTQ+ audience is highlighted in specific LGBTQ+ pages on the website. The ads shown in the Dropbox folder that pertain to this audience were distributed specially across these channels.

We were asked the question about whether the media buy reaches a diverse audience. The most specific media plan we have is around finding responsible travelers who will protect and preserve the region. This buy is included in the Dropbox folder.

SCT is also working to ensure both the organization and our external marketing materials are relevant within the Diversity, Equity and Inclusion area. During this past year, the SCT Board adopted the following DEI statement:

At Sonoma County Tourism, our commitment to diversity, equity and inclusion is unwavering. We strive to ensure those in our workforce, and participation in our board and committees reflect the diversity of the communities we serve. We embrace diversity of identity, experience, and thought. We will elevate, provide access to, and intentionally integrate this abundance of input across our organization and within the stories we create that inspire travel to the region.

As an organization that resides in Sonoma County, we align with the County of Sonoma in recognizing that we are on the ancestral lands of the Coast Miwok, Pomo, and Wappo who are the original caretakers of this area. We respectfully acknowledge the Indigenous peoples who have been stewarding and maintaining relationship on this land as knowledge keepers for millennia.

We hope this information and associated sample files help answer the questions and concerns raised by the Council. We welcome continued conversation about Sonoma County Tourism, and how we can best benefit the businesses and residents of Cotati.

Warm regards,
Claudia Vecchio
CEO
Sonoma County Tourism

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Packet Pg. 156 Attachment: Sonoma County Tourism Overview Letter (Tourism District Tax Assessment Increase) RESOLUTION NO.

RESOLUTION OF THE COUNCIL OF THE CITY OF COTATI CONSENTING TO

AMENDMENT OF THE SONOMA COUNTY ORDINANCE CREATING THE
SONOMA COUNTY TOURISM BUSINESS IMPROVEMENT AREA (“SCTBIA”) AND

CONTINUED INCLUSION OF THE CITY WITHIN THE SCTBIA, AND

AUTHORIZING COLLECTION AND REMITTANCE OF ASSESSMENTS
WHEREAS, in 2004 the Sonoma County Board of Supervisors adopted Ordinance number 5525 (enrolled as sections 33-1 to 33-17 of the Sonoma County Municipal Code), forming the SCTBIA in accordance with the Parking and Business Improvement Area Law of 1989 (Streets and Highways Code Sections 36500, et seq. [the “Law”]); and WHEREAS, prior to adoption of the Ordinance, the City consented to inclusion of the territory within the City limits in the SCTBIA.

WHEREAS, once a lodging property comes on-line, the City will enter into an administrative agreement with the County pursuant to which SCTBIA assessments are collected from lodging facilities and remitted to the County, with reimbursement of City expenses from assessment proceeds as authorized by the Law; and
WHEREAS, the County is considering adoption of an amendment to the 2004 Ordinance removing the $350,000 threshold for application of the assessment to a lodging property. A copy of the proposed amendment is attached as Exhibit A. The proposed amendment is referred to as the Responsible Tourism Assessment, and is intended to provide funding for increased destination stewardship efforts to promote sustainable tourism; and WHEREAS, the Law requires consent of this Council before the effectiveness of the Responsible Tourism Assessment may be extended to include the territorial limits of this City; and
WHEREAS, once the City begins collection of Transient Occupancy Taxes (“TOT”) from lodging establishments within its territorial jurisdiction, they will be subject to the amended assessment; and
WHEREAS, the action of adopting this resolution of consent does not constitute a project as defined by California Environmental Quality Act Guidelines Section 15378; therefore, no further environmental review is required.

NOW, THEREFORE, BE IT RESOLVED that the Council of the City of Cotati consents to inclusion of the territorial jurisdiction of this City within the amended SCTBIA and directs collection and remittance of the assessments authorized by the amended SCTBIA to the County of Sonoma in accordance with the provisions of the attached amendment.

Packet Pg. 157
IT IS HEREBY CERTIFIED that the foregoing resolution was duly adopted at a regular meeting of the City Council of the City of Cotati held on the September 27th, 2022, by the following vote, to wit:

Approved:________________________________
Mayor
Attest:____________________________
Kevin Patterson, Deputy City Clerk
Approved as to form:
____________________________
City Attorney
Attachments:

Exhibit A - Sonoma County BIA Ordinance (PDF)
Packet Pg. 158

EXHIBIT A
ORDINANCE NO. _________

AN ORDINANCE OF THE BOARD OF SUPERVISORS OF THE COUNTY OF SONOMA AMENDING CHAPTER 33, SECTION 33-5(a) OF THE SONOMA

COUNTY CODE, REGARDING SONOMA COUNTY TOURISM BUSINESS

IMPROVEMENT AREA ASSESSMENTS

THE BOARD OF SUPERVISORS OF THE COUNTY OF SONOMA, STATE OF CALIFORNIA, DOES ORDAIN AS FOLLOWS:

SECTION I:
(a) On November 2, 2004, the Board of Supervisors adopted Ordinance No. 5525 (the “Ordinance”), pertaining to the creation of the Sonoma County Tourism Business Improvement Area, in accordance with the terms of the Parking and Business Improvement Area Law of 1989 (Streets & Highways Code Section 36500, et seq., the “Act”).
(b) Section 33-5(a) of the Ordinance imposed an assessment on lodging establishments equal to 2% of the rent charged. The assessment only applies to lodging establishments that generate over $350,000 in the preceding fiscal year (July 1 to June 30). Assessment proceeds may only be used to pay for marketing activities that increase overnight visits to Sonoma County. In the 15 years since the assessment began, tourism in Sonoma County has dramatically increased, with TOT funds rising more than 63% surpassing $48 million annually, economic impact reaching $2.3 billion, and employment in the tourism and hospitality sectors topping 22,200.
(c) During the last few years, natural disasters have taken a heavy toll on the tourism industry in Sonoma County. The Tubbs Fire in 2017, Russian River floods and the Kincaid Fire in 2019, and the Corona virus in 2020, have changed travel plans for millions of potential visitors and consequently stressed local hospitality businesses.

Moreover, evolving trends in tourism have also stressed resources within Sonoma County, highlighting the importance of attracting responsible visitors that will engage in sustainable tourism, respecting both the natural resources and local residents of Sonoma County. The increased assessment proposed by this amendment will allow the Sonoma County Tourism Bureau to perform its evolving destination stewardship role and is hence referred to as the Responsible Tourism Assessment (“RTA”). (d) In recognition of the need to increase marketing efforts, the same hoteliers who spearheaded adoption of the original assessment have joined again to propose an amendment to the Ordinance designed to increase available funding. Specifically, this proposed amendment to the Ordinance will remove the $350,000.00 threshold for collection of the assessment.

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Packet Pg. 159 Attachment: Exhibit A - Sonoma County BIA Ordinance ('Tourism District Tax Assessment Increase Reso) (e) Pursuant to the Act, on ___________, 2022, this Board adopted Resolution No. ____, declaring its intention to amend the Ordinance by removing the $350,000.00 threshold for collection of the assessment. (b) Resolution No. ____ was duly published, and copies thereof were mailed, as provided by the Act.
(c) As specified in Resolution No. _____, a public meeting concerning the proposed amendments was held on October 4, 2022, before this Board in the Board’s chambers at 575 Administration Drive, Santa Rosa.
(d) As further specified in Resolution No. _____, a public hearing concerning the proposed amendments was held on December 13, 2022 before this Board in the Board’s chambers at 575 Administration Drive, Santa Rosa. At the hearing, all protests, both written and oral, made or filed, were considered and duly overruled and denied, and this Board determined that there was no majority protest to the proposed amendments within the meaning of Section 36523 of the Act.
(e) Pursuant to Section 36521.5 of the Act, the County of Sonoma may not collect assessments under a business improvement area formed within the territorial jurisdiction of a city without the consent of the city council of that city. The Board has received resolutions providing consent to the proposed amendment from each of the following cities: [list].

SECTION II:

Section 33-5(a) of Chapter 33 of the Sonoma Code, as adopted in Section II of Ordinance No. 5525, is hereby amended to read in its entirety as follows:
(a) Each operator of a lodging establishment generating rent during the preceding fiscal year (July 1 to June 30) shall pay as an assessment a sum equal to two percent (2%) of the rent charged by the operator.

SECTION III:

If any section, subsection, sentence, clause, or phrase of this Ordinance is for any reason held to be unconstitutional and invalid, such decision shall not affect the validity of the remaining portion of this Ordinance. The Board of Supervisors hereby declares that it would have passed this Ordinance, and every section, subsection, sentence, clause or phrase thereof, irrespective of the fact that any one or more sections, subsections, sentences, clauses or phrases be declared unconstitutional or invalid.

SECTION IV:

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Packet Pg. 160 Attachment: Exhibit A - Sonoma County BIA Ordinance ('Tourism District Tax Assessment Increase Reso) This Ordinance shall be, and the same is hereby declared to be in full force and effect from and after 30 days after its passage and shall be published once before the expiration of 15 days after said passage, with the names of the Supervisors voting for or against the same in a newspaper of general circulation published in the County of Sonoma, State of California.

In regular session of the Board of Supervisors of the County Sonoma passed and adopted this 13th day of December, 2022, on regular roll call of the members of the Board by the following vote:

SUPERVISORS:

Gorin ___________ Rabbitt ___________ Coursey
___________
Gore ___________ Hopkins ___________
Ayes ______ Noes _______ Abstain ________ Absent ________

SO ORDERED
By: __________________________
Chair, Board of Supervisors
County of Sonoma
State of California

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Packet Pg. 161 Attachment: Exhibit A - Sonoma County BIA Ordinance ('Tourism District Tax Assessment Increase Reso) Cotati City Council
Agenda Staff Report
Item type: INFORMATION RECEIVED AFTER THE AGENDA WAS POSTED To: City Council
Subject: Information received after the agenda was posted.

Date: September 27, 2022
Written by: Kevin Patterson, Deputy City Clerk
Recommendation
Information or written comments pertaining to this meeting, and which was received after the agenda was posted, is attached below.

Pursuant to City Council Policy 2021-01: City Council Rules section IV A., written Communications, interested persons or their authorized representative may address the Council by written communication on any matters concerning the City’s business, or any matters over which the Council has control.

1. To be considered for inclusion in the agenda packet, such written communication shall be delivered to the Deputy City Clerk no later than 11:00 a.m. of the Wednesday the week preceding the regular Council meeting for which such written communication is intended.

2. If received after the above date and time, but no later than noon the day before the meeting, written communications received by the Deputy City Clerk shall be posted on the website by the end of that day and notification provided to the electronic Agenda mailing list by the end of the day. All written communications received by the Deputy City Clerk by 5 pm on the City Council meeting day shall be made available to the City Council and public at the City Council meeting.

City Council Policy 2021-01 is available at the online meeting portal at www.cotaticity.org or by request from the Deputy City Clerk at 707-665-3622 or [email protected].

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Cotati City CouncilSeptember 27, 2022

Cotati City Council
September 27, 2022