Agenda packet — East Palo Alto City Council, May 17, 2022 (part 2 of 3)

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Packet Pg. 219 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”) Finding 3:

The direct and indirect costs of Ransomware can be significant.

Response: The respondent agrees with the finding.

Finding 4:

Cybersecurity reviews and assessments, and an updated, well-executed Cybersecurity plan are critical components of IT security strategy.

Response: The respondent agrees with the finding.

Finding 5:

A comprehensive Cybersecurity plan should include, at a minimum, information concerning prevention steps, spam and malware software, and backups and full recovery testing.

Response: The respondent agrees with the finding.

Finding 6:

The identification of phishing attempts, including the use of spam filters, is an important component to protecting an IT system from Ransomware attacks.

Response: The respondent agrees with the finding.

Finding 7:

Testing a full restore of a server to ensure that backups are reliable should be undertaken regularly as part an entity’s backup plan to recover lost information.

Response: The respondent agrees with the finding.

Finding 8:

Training of new employees, and the recurring training of existing employees, is an important component of defense against Ransomware.

Response: The respondent agrees with the finding.

RECOMMENDATIONS
Recommendation 1:

Each of the governmental entities in San Mateo County with an IT department or IT function (whether in-house, handled by another government unit or outsourced to a private enterprise) as listed in Appendix F, should by November 30, 2020, make a request for a report from their IT organization that addresses the concerns identified in the report, specifically:

1. System Security (Firewalls, Anti-malware/Antivirus software, use of subnets, strong password policies, updating/patching regularly)

2. Backup & Recovery (In the event of an attack, can you shut down your system quickly? What is being backed up, how it is being backed up, when are backups run, and where are the backups being stored? Have backups been tested? Can you fully restore a Server from a

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Packet Pg. 220 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”) backup?)

3. Prevention (turning on email filtering, setting up message rules to warn users, providing employee training on phishing and providing a reporting system to flag suspect content) Response: The respondent will implement the recommendation with the assistance of the County’s Information Services Department (ISD). The San Mateo County Sheriff’s Office and the San Mateo County Assessor-Clerk-Recorder-Elections (ACRE) also agree with the recommendation and will implement the recommendation through their respective internal IT service divisions.

Recommendation 2:

These confidential internal reports should be provided to the governing body by June 30, 2021. This report should describe what actions have already been taken and which will be given timely consideration for future enhancements to the existing cybersecurity plan.

Response: The recommendation has not yet been implemented by respondent but will be implemented in the future with a specific time frame for implementation and reporting.

Recommendation 3:

Given the results of their internal reports, governmental entities may choose to request further guidance by means of a Cybersecurity review from the U.S. Department of Homeland Security and/or a cyber hygiene assessment from the County Controller’s Office.

Response: The respondent will implement the recommendation with the assistance of the County’s Information Services Department (ISD). The San Mateo County Sheriff’s Office and the San Mateo County Assessor-Clerk-Recorder-Elections (ACRE) also agree with the recommendation and will implement the recommendation through their respective internal IT service divisions, including obtaining guidance from the U.S.

Department of Homeland Security, as necessary.

Recommendation 4:

Given the results of their internal reports, governmental entities may choose to ask their IT departments to review their own Cybersecurity Plan with the detailed template provided by the FCC’s Cybersecurity Planning Guide and consider customizing it using FCC’s Create Custom Cybersecurity Planning Guide tool (see footnote 52).

FISCAL IMPACT:

There is no fiscal impact associated with the acceptance of this report.

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Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”)

JEFFERSON
Elementary School District
Governing Board
Shakeel All
Marie Brizuela
Clayton Koo
Manufou Liaiga-Anoa'i
Maybelle Mania
Superintendent
Bernardo Vidales
November 18, 2020
Via Email ferandiurvfS.sanmateocourt. ors)
The Honorable Danny Y. Chou
Judge of the Superior Court
c/o Jenarda Dubois
Hall of Justice
400 County Center; 2"d Floor
Redwood City, CA 94063-1655
Re: Response to the 2019-2020 Grand Jury Report entitled "Ransomware: It Is Not Enough To Think You Are Protected. "
Dear Judge Chou:

The Jefferson Elementary School District (the "District") has received and reviewed the 2019-2020 Grand Jury Report entitled "Ransomware: It Is Not Enough To Think You Are Protected. " We appreciate the Grand Jury's interest in this matter. Having reviewed and considered the Grand Jury's Findings and Recommendations, the District responds below pursuant to section 933.05 of the California Penal Code.

Please be advised that the District presented the Grand Jury Report to its Board of Trustees, and the District's Board approved these responses, on November 18, 2020 Findings:

1. Ransomware is a real and growing threat to public entities including those in San Mateo County.

The District agrees with this Finding.

Martin Luther King Jr. Education Center
101 Lincoln Avenue . Daly City, CA 94015 650-991-1000 phone . 650-992-2265 fax . http://www.jsd. k12.ca.us

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Packet Pg. 234 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”) 2of4
2 Across the country, local govemments and schools represent 12% of all Ransomware attacks.

The District lacks information to fully agree or disagree with this Finding given that it did not conduct the research related to this Report. The District, however, accepts the Grand Jury's Finding for the purposes of this Response.

3. The direct and indirect costs ofRansomware can be significant.

The District agrees with this Finding.

4. Cyberseciirily reviews and assessments, and an updated, well-executed Cybersecurity plan, are critical components of IT security strateg)'.

The District agrees with this Finding.

5. A comprehensive Cyberseciirity plan should include, at a minimum, information concerning prevention steps, spam and malware software, and backups and full recoveiy testing.

The District agrees with this Finding.

6. The identification ofphishing attempts, including the use of spam filters, is an important component to protecting an IT system from Ransomware attacks.

The District agrees with this Finding.

7. Testing a full restore of a server to ensure that backups are reliable should be undertaken regularly as part an entity 's backup plan to recover lost information.

8. Training of new employees, and the recurring training of existing employees, is an important component of defense against Ransomware.

The District agrees with this Finding.
101 Lincoln Avenue . Daly City, CA 94015 . 650-991-1000 phone . 650-992-2265 fax . http://www.jsd. k12.ca.us

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Packet Pg. 235 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”) 3of4
Recommenilations:
/. Each of the governmental entities in San Mateo County with an IT department or IT function (whether in-house, handled by another government unit or outsourced to a private enterprise) as listed in Appendix F, should by November 30, 2020, make a request for a report from their IT organization that addresses the concerns identified in the report, specifically:
/. System Security (Firewalls, Anti-malware/Antivirus software, use ofsilbnets, strong password policies, updating/patching regularly)

2. Backiip & Recovery (In the event of an attack, can you shut down your system quickly? What is being backed up, how it is being backed up, when are backups run, and where are the backups being stored? Have backups been tested? Can you fully restore a Server from a backup?)

3. Prevention (turning on email filtering, setting up message rules to warn users, providing employee training on phishing and providing a reporting system to flag suspect content) The District implemented this Recommendation on November 5, 2020 by directing the District's IT Department to prepare a confidential report which addresses the three concerns specifically identified above.

2. These confidential internal reports should be provided to the governing body by June 30, 2021. This report should describe what actions have already been taken and which will be given timely consideration for future enhancements to the existing cybersecurity plan.

The District intends to implement this Recommendation, provided that the District may require an extension of time (not to exceed six months) beyond June 30, 2021 depending on the scope, complexity, and feasibility of any recommended actions and/or enhancements.

3. Given the results of their internal reports, governmental entities may choose to request further guidance by means of a Cybersecurity review from the U. S. Department of Homeland Security and/or a cyber hygiene assessment from the County Controller's Office.

The District will implement this Recommendation if warranted and appropriate based on the results of the District s confidential internal report.

4. Given the results of their internal reports, governmental entities may choose to ask their FT departments to review their own Cyhersecwily Plan with the detailed template provided by the FCC 's Cybersecurity Planning Guide and consider customizing it using FCC 's Create Custom Cybersecurity Planning Giiide tool (see footnote 52).

The District will implement this Recommendation if warranted and appropriate based on the results of the District's confidential internal report.
101 Lincoln Avenue . Daly City, CA 94015 . 650-991-1000 phone . 650-992-2265 fax . http://www. jsd. k12. ca. us

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Please do not hesitate to contact me if you have questions or require additional information.

Sincerely,,
BemarUo Vidales
Superintendent
Jefferson Elementary School District
101 Lincoln Avenue . Daly City, CA 94015 . 650-991-1000 phone . 650-992-2265 fax . http://www.jsd.k12.ca.us

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Packet Pg. 237 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”) November 3, 2020
Via Email ([email protected])
The Honorable Danny Y. Chou
Judge of the Superior Court
c/o Jenarda Dubois
Hall of Justice
400 County Center; 2nd Floor
Redwood City, CA 94063-1655
Re: Response to the 2019-2020 Grand Jury Report entitled “Ransomware: It Is Not Enough to Think You Are Protected.”
Dear Judge Chou:

The Jefferson Union High School District (the “District”) has received and reviewed the 2019- 2020 Grand Jury Report entitled “Ransomware: It Is Not Enough To Think You Are Protected.” We appreciate the Grand Jury’s interest in this matter. Having reviewed and considered the Grand Jury’s Findings and Recommendations, the District responds below pursuant to section 933.05 of the California Penal Code.

Please be advised that the District presented the Grand Jury Report to its Board of Trustees, and the District’s Board approved these responses, on November 2, 2020 Findings:

1. Ransomware is a real and growing threat to public entities including those in San Mateo County.

The District agrees with this Finding.

2. Across the country, local governments and schools represent 12% of all Ransomware attacks.

Jefferson Union High School District
ADMINISTRATIVE OFFICES – SERRAMONTE DEL REY
699 Serramonte Boulevard, Suite 100
Daly City, CA 94015-4132
650-550-7900  FAX 650-550-7888
Board of Trustees
Andrew Lie
Carla Ng-Garrett
Nick Occhipinti
Kalimah Y. Salahuddin
Rosie U. Tejada
Dr. Terry A. Deloria
Superintendent

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Packet Pg. 238 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”)

3. The direct and indirect costs of Ransomware can be significant.

The District agrees with this Finding.

4. Cybersecurity reviews and assessments, and an updated, well-executed Cybersecurity plan, are critical components of IT security strategy.

The District agrees with this Finding.

5. A comprehensive Cybersecurity plan should include, at a minimum, information concerning prevention steps, spam and malware software, and backups and full recovery testing.

The District agrees with this Finding.

6. The identification of phishing attempts, including the use of spam filters, is an important component to protecting an IT system from Ransomware attacks.

The District agrees with this Finding.

7. Testing a full restore of a server to ensure that backups are reliable should be undertaken regularly as part an entity’s backup plan to recover lost information.

8. Training of new employees, and the recurring training of existing employees, is an important component of defense against Ransomware.

The District agrees with this Finding.

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Packet Pg. 239 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”) Recommendations:

1. System Security (Firewalls, Anti-malware/Antivirus software, use of subnets, strong password policies, updating/patching regularly)

3. Prevention (turning on email filtering, setting up message rules to warn users, providing employee training on phishing and providing a reporting system to flag suspect content)
The District implemented this Recommendation on February 19, 2020 by directing the District’s IT Department to prepare a confidential report which addresses the three concerns specifically identified above with the exception of providing employee training on phishing. The District intends to implement this Recommendation by June 30, 2021.

3. Given the results of their internal reports, governmental entities may choose to request further guidance by means of a Cybersecurity review from the U.S. Department of Homeland Security and/or a cyber hygiene assessment from the County Controller’s Office.

The District will implement this Recommendation if warranted and appropriate based on the results of the District’s confidential internal report.

4. Given the results of their internal reports, governmental entities may choose to ask their IT departments to review their own Cybersecurity Plan with the detailed template provided by the FCC’s Cybersecurity Planning Guide and consider customizing it using FCC’s Create Custom Cybersecurity Planning Guide tool (see footnote 52).

The District will implement this Recommendation if warranted and appropriate based on the results of the District’s confidential internal report.

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Packet Pg. 240 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”) Please do not hesitate to contact me if you have questions or require additional information.

Sincerely,
Dr. Terry A. Deloria
Superintendent
Jefferson Union High School District

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Packet Pg. 245 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”) Ladera Recreation District
150 Andeta Way
Portola Valley, CA 94028

Response to Grand Jury Report re: Ransomware
December 14, 2020
Hon. Danny Y. Chou
Judge of the Superior Court
c/o Jenarda Dubois
Hall of Justice
400 County Center; 8th Floor
Redwood City, CA 94063-1655
Dear Judge Chou:

The Ladera Recreation District has had an opportunity to review the 2020 Grand Jury report entitled “Ransomware: It is Not Enough to Think You Are Protected.” The Board, after reviewing the report and allowing for public comment at its Ladera Recreation District meeting on December 23, 2020 offers the following responses:

Responses to Findings
Finding F1. Ransomware is a real and growing threat to public entities including those in San Mateo County.

Response: The District agrees with the finding.

Finding F2. Across the country, local governments and schools represent 12% of all Ransomware attacks.

Response: The District lacks the information to fully agree or disagree with this finding, but for purposes of this response, the District accepts the Grand Jury’s findings.

Finding F3. The direct and indirect costs of Ransomware can be significant.

Response: The District agrees with the finding.

Finding F4. Cybersecurity reviews and assessments, and an updated, well-executed Cybersecurity plan, are critical components of IT security strategy.

Response: The District agrees with the finding.

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Packet Pg. 246 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”) Finding F5. A comprehensive Cybersecurity plan should include, at a minimum, information concerning prevention steps, spam and malware software, and backups and full recovery testing.

Response: The District agrees with the finding.

Finding F6. The identification of phishing attempts, including the use of spam filters, is an important component to protecting an IT system from Ransomware attacks.

Response: The District agrees with the finding.

Finding F7. Testing a full restore of a server to ensure that backups are reliable should be undertaken regularly as part of an entity’s backup plan to recover lost information.

Response: The District agrees with the finding.

Finding F8. Training of new employees, and the recurring training of existing employees, is an important component of defense against Ransomware.

Response: The District agrees with the finding.

Response to Recommendations
R1. Each of the governmental entities in San Mateo County with an IT department or IT function (whether in-house, handled by another government unit or outsourced to a private enterprise) as listed in Appendix F, should by November 30, 2020, make a request for a report from their IT organization that addresses the concerns identified in the report, specifically:

1. System Security (Firewalls, Anti-malware/Antivirus software, use of subnets, strong password policies, updating/patching regularly)

R2. These confidential internal reports should be provided to the governing body by June 30, 2021. This report should describe what actions have already been taken and which will be given timely consideration for future enhancements to the existing cybersecurity plan.

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Packet Pg. 247 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”) Response: The recommendation will be implemented within the requested timeframe.

R3. Given the results of their internal reports, governmental entities may choose to request further guidance by means of a Cybersecurity review from the U.S. Department of Homeland Security and/or a cyber hygiene assessment from the County Controller’s Office.

Response: If necessary, the recommendation will be implemented within the requested timeframe.

R4. Given the results of their internal reports, governmental entities may choose to ask their IT departments to review their own Cybersecurity Plan with the detailed template provided by the FCC’s Cybersecurity Planning Guide and consider customizing it using FCC’s Create Custom Cybersecurity Planning Guide tool (see footnote 52).

Response: If necessary, the recommendation will be implemented within the requested timeframe.

Respectfully submitted,
Diane Gow
General Manager
Ladera Recreation District
Cc: [email protected]

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Packet Pg. 248 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”) District Office
1011 Altschul Avenue
Menlo Park, CA 94025
(650) 854-6311
Las Lomitas School
299 Alameda de las Pulgas
Atherton, CA 94027
(650) 854-5900
La Entrada School
2200 Sharon Road
Menlo Park, CA 94025
(650) 854-3962
December 15, 2020
The Honorable Danny Y. Chou
Judge of the Superior Court
c/o Jenarda Dubois
Hall of Justice
400 County Center; 2nd Floor
Redwood City, CA 94063-1655
Re: Response to the 2019-2020 Grand Jury Report entitled “Ransomware: It Is Not Enough To Think You Are Protected.”
Dear Judge Chou:

The Las Lomitas Elementary School District (the “District”) has received and reviewed the 2019-2020 Grand Jury Report entitled “Ransomware: It Is Not Enough To Think You Are Protected.” We appreciate the Grand Jury’s interest in this matter. Having reviewed and considered the Grand Jury’s Findings and Recommendations, the District responds below pursuant to section 933.05 of the California Penal Code.

As required, the District presented the Grand Jury Report to its Board of Trustees, and the District’s Board of Trustees approved these responses on December 14, 2020.

Findings:

F1. Ransomware is a real and growing threat to public entities including those in San Mateo County.

The District agrees with this Finding.

F2. Across the country, local governments and schools represent 12% of all Ransomware attacks.

F3. The direct and indirect costs of Ransomware can be significant.

The District agrees with this Finding.

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Packet Pg. 249 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”) F4. Cybersecurity reviews and assessments, and an updated, well-executed Cybersecurity plan, are critical components of IT security strategy.

The District agrees with this Finding.

F5. A comprehensive Cybersecurity plan should include, at a minimum, information concerning prevention steps, spam and malware software, and backups and full recovery testing.

The District agrees with this Finding.

F6. The identification of phishing attempts, including the use of spam filters, is an important component to protecting an IT system from Ransomware attacks.

The District agrees with this Finding.

F7. Testing a full restore of a server to ensure that backups are reliable should be undertaken regularly as part an entity’s backup plan to recover lost information.

F8. Training of new employees, and the recurring training of existing employees, is an important component of defense against Ransomware.

The District agrees with this Finding.

Recommendations:

R1. Each of the governmental entities in San Mateo County with an IT department or IT function (whether in-house, handled by another government unit or outsourced to a private enterprise) as listed in Appendix F, should by November 30, 2020, make a request for a report from their IT organization that addresses the concerns identified in the report, specifically:

1. System Security (Firewalls, Anti-malware/Antivirus software, use of subnets, strong password policies, updating/patching regularly)

3. Prevention (turning on email filtering, setting up message rules to warn users, providing employee training on phishing and providing a reporting system to flag suspect content) The District implemented this Recommendation on November 30, 2020 by directing the District’s IT Department to prepare a confidential report which addresses the three concerns specifically identified above.

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Packet Pg. 250 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”) R2. These confidential internal reports should be provided to the governing body by June 30, 2021.

This report should describe what actions have already been taken and which will be given timely consideration for future enhancements to the existing cybersecurity plan.

The District intends to implement this Recommendation. Depending on the scope, complexity, and feasibility of the recommended actions and/or enhancements required, the implementation schedule of some items (e.g. those which require user training) may extend into the 2021-2022 school year.

The District will implement this Recommendation to request further guidance if warranted and appropriate based on the results of the District’s confidential internal report.

The District will implement this Recommendation to use the FCC’s Cybersecurity Planning Guide if warranted and appropriate based on the results of the District’s confidential internal report.

Please do not hesitate to contact me if you have questions or require additional information.

Sincerely,
Dr. Beth Polito
Superintendent
Las Lomitas Elementary School District

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Packet Pg. 251 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”)

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Packet Pg. 256 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”) March 24, 2021
Honorable Danny Y. Chou
Judge of the Superior Court
c/o Jenarda Dubois
Hall of Justice
400 County Center, 8th Floor
Redwood City, CA 94063-1655
Dear Judge Chou,
We are in receipt of the Civil Grand Jury report entitled, "Ransomware: It Is Not Enough To Think You Are Protected” (Report).

As a preliminary matter, the transmittal of the Grand Jury Report did not specify that the Midpeninsula Regional Open Space District (“District”) was required to provide a response, but it is pleased to do so, pursuant to a follow up letter from the Grand Jury Coordinator dated February 22, 2021. The District’s Board of Directors held a public meeting on March 24, 2021 and approved this response.

Also of note, the Report states that in 2019, all local agencies in San Mateo County were contacted via an online survey about ransomware. The District has no record of being contacted or receiving a survey on this topic. We respectfully request confirmation that you have our correct mailing address, as noted on this letterhead. Future mailings should be sent in C/O the General Manager. Email copies can also be sent to [email protected].

The District responds to the Grand Jury's recommendations as follows:

Findings
The District generally agrees with the Findings of the Grand Jury.

Recommendations
R1. Each of the governmental entities in San Mateo County with an IT department or IT function should make a request for a report from their IT organization that addresses the concerns identified in the report, specifically:

1. System Security (Firewalls, Anti-malware/Antivirus software, use of subnets, strong password policies, updating/patching regularly)

2. Backup & Recovery (In the event of an attack, can you shut down your system quickly? What is

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Packet Pg. 257 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”) 2 being backed up, how it is being backed up, when are backups run, and where are the backups being stored? Have backups been tested? Can you fully restore a Server from a backup?)

3. Prevention (turning on email filtering, setting up message rules to warn users, providing employee training on phishing and providing a reporting system to flag suspect content) District Response: The District has implemented this recommendation by directing the District’s Information Systems and Technology Department to prepare a confidential report addressing concerns specifically identified in this recommendation. Moreover, the District has been aggressively implementing numerous cybersecurity measures, in particular over the last three years, given the rise of ransomware, phishing, and hacking attempts that have been known to unfortunately occur with other public agencies.

R2. These confidential internal reports should be provided to the governing body by June 30, 2021.

This report should describe what actions have already been taken and which will be given timely consideration for future enhancements to the existing cybersecurity plan.

Response: This recommendation will be implemented by June 30, 2021.

Response: The District appreciates the suggestion to request further guidance from these entities. The recommendation has not yet been implemented and will be considered after the confidential internal report is issued to the governing body.

Response: The District will implement this recommendation as appropriate. After providing a written report to the Board of Directors, the District’s Information Systems and Technology Department will make a recommendation to the General Manager whether the FCC’s Planning Guide tool, or a cyber security audit, best meets District needs.

Very truly yours,
Curt Riffle, Board President
Midpeninsula Regional Open Space District
Cc: Board of Directors, Midpeninsula Regional Open Space District Ana M. Ruiz, General Manager

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Packet Pg. 264 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”) 1 _____________________________________________________________________________________ March 22, 2021
Via Email ([email protected])
The Honorable Danny Y. Chou
Judge of the Superior Court
c/0 Jenarda Dubois
Hall of Justice
400 County Center; 2nd Floor
Redwood City, California 94063-1655
RE: Response to the 2019-2020 Grand Jury Report entitled “Ransomware: It Is Not Enough To Think You Are Protected.”
Dear Judge Chou,
The Montara Water and Sanitary District (MWSD) has received and reviewed the 2019-2020 Grand Jury Report entitled “Ransomware: It Is Not Enough To Think You Are Protected.” We appreciate the Grand Jury’s interest in this matter. Having reviewed and Considered the Grand Jury’s Findings and Recommendations, the District responds below pursuant to section 933.05 of the California Penal Code.

MWSD presented the Grand Jury Report to its Board of Directors, and the District’s Board approved these responses, on March 18, 2021.

Montara Water & Sanitary District
Serving the Communities of Montara and Moss Beach
P.O. Box 370131 Tel: (650) 728-3545
8888 Cabrillo Highway Fax: (650) 728-8556
Montara, CA 94037-0131 E-mail: [email protected]
Visit Our Web Site: http://www.mwsd.montara.com

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Packet Pg. 265 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”) 2 Findings

1. Ransomware is a real and growing threat to public entities including those in San Mateo County
MWSD agrees with this Finding

2. Across the country, local governments and schools represent 12% of all Ransomware attacks
MWSD lacks information to fully agree or disagree with this Finding however we recognize that local governments and schools are likely to be targeted by Ransomware attacks.

3. The direct and indirect costs of Ransomware can be significant MWSD agrees with this Finding

4. Cybersecurity reviews and assessments, and an updated, well-executed Cybersecurity plan, are critical components of IT security strategy.

MWSD agrees with this Finding

5. A comprehensive Cybersecurity plan should include at a minimum, information concerning prevention steps, spam and malware software, and backups and full recovery testing
MWSD agrees with this Finding

6. The identification of phishing attempts, including the use of spam filters, is an important component of protecting an IT system from Ransomware attacks.

MWSD agrees with this Finding

7. Testing a full restore of a server to ensure that backups are reliable should be undertaken regularly as part of an entity’s backup plan to recover lost data.

MWSD agrees with this Finding in principle but recognizes that regular full hardware restoration may be impractical due to hardware, logistical and budget restraints.

Partial data only restores may be more appropriate.

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Packet Pg. 266 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”) 3 8. Training of new employees, and the recurring training of existing employees, is an important component of defense against Ransomware
MWSD agrees with this Finding
Recommendations

1. System Security (Firewalls, Anti-malware/Antivirus software, use of subnets, strong password policies, updating/patching regularly)

2. Backup & Recovery (In the event of an attack, can you shut down your system quickly? What is being backed up, how it is being backed up, when are the backups run, and where are the backups being stored? Have backups been tested? Can you fully restore a Server from a Backup?)

3. Prevention (turning on email filtering, setting up message rules to warn users, providing employee training on phishing and providing a reporting system to flag suspect content)

MWSD has implemented these Recommendation by requesting a confidential report which addresses the three concerns specifically identified above. The report will be provided to the governing board by June 30, 2021.

3. Given the results of their internal reports, governmental entities may choose to request further guidance by means of a Cybersecurity review from the U.S. Department of Homeland Security and/or a cyber hygiene assessment from the County Controller’s Office
MWSD will implement this Recommendation if warranted based on the district’s confidential internal report.

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Packet Pg. 267 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”) 4 4. Given the results of their internal reports, governmental entities may choose to ask their IT departments to review their own Cybersecurity Plan with the detailed template provided by the FCC’s Cybersecurity Planning Guide and consider customizing it using FCC’s Create Custom Cybersecurity Planning Guide tool (see footnote 52).

MWSD will implement this Recommendation if warranted and appropriate based on the results of the District’s confidential internal report.

Please do not hesitate to contact me if you have questions or require additional information.

Sincerely,
Clemens Heldmaier
General Manager
Montara Water and Sanitary District

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Packet Pg. 268 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”)

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Packet Pg. 269 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”)

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Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”)

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Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”)

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Packet Pg. 273
Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”) March 25, 2021
Mr. Neal Taniguchi
Court Executive Officer
San Mateo Superior Court
400 County Center
Redwood City, CA 94063
Peninsula
Health Care
District
RE: Grand Jury Report: "Ransomware: It Is Not Enough to Think You Are Protected." Response of Peninsula Health Care District
Dear Mr. Taniguchi:

The Board of Directors and staff of the Peninsula Health Care District (the "District) have been provided with a copy of the above-referenced report from the San Mateo County Civil Grand Jury. We appreciated the thorough research and recommendations in the report.

In general, the Board agrees with the findings and recommendations in the report. The specific responses are set forth below.

The District employs an outside consultant to advise on cybersecurity and ransomware protections. As requested by the report, we reviewed the status of the District's security and backup storage with the consultant. The District was found to have robust security measures in place due to the c_onsultant's annual review of the District's system and current knowledge of trends and technologies. He is consulted annually as part of the budget process and with the Board's approval of the budget, funding is made available to ensure the system remains "state-of-the-art". The consultant's assessment in response to the Grand Jury's "Ransomware" report found the District to be compliant with the Grand Jury's recommendations.

The District has also consulted with our bank to ensure maximum protections are in place against fraudulent check writing and hacking into wire transfer information. The bank recommended to install its "Positive Pay" system which tracks every check coming into the bank for processing against the list by date and check number provided by the District when issuing the check.

Against this background, the District responds to the findings and recommendations as follows:

District Office 1819 Trousdale Drive, Burlingame, CA 94010 Phone 650.697.6900 Fax 650.652.9374 www.peninsulahealthcaredistrict.org

SAN BRUNO MILLBRAE BURLINGAME SAN MATEO HILLSBOROUGH FOSTER CITY

BOARD OF DIRECTORS
Lawrence W. Cappel, Ph.D.

Chair
Helen C. Galligan R.N
Vice Chair
Frank J. Pagliaro, Esq.

Secretary
Dennis Zell, Esq.

Director
Rick Navarro, M.D
Director

EXECUTIVE STAFF
Cheryl A. Fama, MPA, BSN, R.N
Chief Executive Officer
Vickie Yee
Board Treasurer/
Chief Financial Officer

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Packet Pg. 274 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”)

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Packet Pg. 286 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”)

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Packet Pg. 287 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”)

REDWOOD CITY SCHOOL DISTRICT
750 Bradford Street • Redwood City • CA 94063 (650) 423-2200 FAX: (650) 423-2204 Board of Education Superintendent
Janet Lawson, President John R. Baker, Ed.D
Alisa MacAvoy, Vice President
María Díaz-Slocum, Clerk
Cecilia I. Márquez
Dennis McBride
December 4, 2020
Via Email ([email protected])
The Honorable Danny Y. Chou
Judge of the Superior Court
c/o Jenarda Dubois
Hall of Justice
400 County Center; 2nd Floor
Redwood City, CA 94063-1655
Re: Response to the 2019-2020 Grand Jury Report entitled “Ransomware: It Is Not Enough To Think You Are Protected.”
Dear Judge Chou:

The Redwood City School District (the “District”) has received and reviewed the 2019-2020 Grand Jury Report entitled “Ransomware: It Is Not Enough To Think You Are Protected.” We appreciate the Grand Jury’s interest in this matter. Having reviewed and considered the Grand Jury’s Findings and Recommendations, the District responds below pursuant to section 933.05 of the California Penal Code.

Please be advised that the District presented the Grand Jury Report to its Board of Trustees, and the District’s Board approved these responses, on December 9, 2020.

Findings:

1. Ransomware is a real and growing threat to public entities including those in San Mateo County.

The District agrees with this Finding.

2. Across the country, local governments and schools represent 12% of all Ransomware attacks.

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Packet Pg. 288 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”)

3. The direct and indirect costs of Ransomware can be significant.

The District agrees with this Finding.

4. Cybersecurity reviews and assessments, and an updated, well-executed Cybersecurity plan, are critical components of IT security strategy.

The District agrees with this Finding.

5. A comprehensive Cybersecurity plan should include, at a minimum, information concerning prevention steps, spam and malware software, and backups and full recovery testing.

The District agrees with this Finding.

6. The identification of phishing attempts, including the use of spam filters, is an important component to protecting an IT system from Ransomware attacks.

The District agrees with this Finding.

7. Testing a full restore of a server to ensure that backups are reliable should be undertaken regularly as part an entity’s backup plan to recover lost information.

8. Training of new employees, and the recurring training of existing employees, is an important component of defense against Ransomware.

The District agrees with this Finding.

Recommendations:

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Packet Pg. 289 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”)

1. System Security (Firewalls, Anti-malware/Antivirus software, use of subnets, strong password policies, updating/patching regularly)

3. Prevention (turning on email filtering, setting up message rules to warn users, providing employee training on phishing and providing a reporting system to flag suspect content)
The District implemented this Recommendation on June 1, 2020 by directing the District’s IT Department to prepare a confidential report which addresses the three concerns specifically identified above.

The District has implemented this Recommendation.

3. Given the results of their internal reports, governmental entities may choose to request further guidance by means of a Cybersecurity review from the U.S. Department of Homeland Security and/or a cyber hygiene assessment from the County Controller’s Office.

The District has implemented this Recommendation.

The District implemented this Recommendation.

Please do not hesitate to contact me if you have questions or require additional information.

Sincerely,
John R. Baker, Ed.D.

Superintendent
Redwood City School District

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Packet Pg. 290 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”)

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Packet Pg. 291 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”)

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Packet Pg. 296 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”) December 21, 2020 Via Email to [email protected] The Honorable Danny Y. Chou
Judge
San Mateo County Superior Court
c/o Jenarda Dubois
Hall of Justice
400 County Center, 2nd Floor
Redwood City, CA 94063-1655
RE: Response to the 2019-2020 Grand Jury Report entitled "Ransomware: It Is Not Enough To Think You Are Protected."
Dear Judge Chou:

The San Mateo County Community College District (“the District”) has received and reviewed the 2019-2020 Grand Jury Report entitled "Ransomware: It Is Not Enough To Think You Are Protected. " We appreciate the Grand Jury's interest in this matter. Having reviewed and considered the Grand Jury's Findings and Recommendations, the District responds below pursuant to section 933.05 of the California Penal Code.

Please be advised that the District presented the Grand Jury Report to its Board of Trustees, and the District's Board approved these responses on December 14, 2020.

In its report, the Grand Jury delivered eight findings and the District provides the following responses:

Finding 1. Ransomware is a real and growing threat to public entities including those in San Mateo County.

District Response: The District agrees with this finding.

Finding 2. Across the country, local governments and schools represent 12% of all Ransomware attacks.

District Response: The District lacks information to fully agree or disagree with this finding given that it did not conduct the research related to this Report. The District, however, accepts the Grand Jury's finding for the purposes of this Response.

Finding 3. The direct and indirect costs of Ransomware can be significant.

District Response: The District agrees with this finding.

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Packet Pg. 297 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”) SMCCCD Response to Grand Jury Ransomware Report, pg. 2
Finding 4. Cybersecurity reviews and assessments, and an updated, well-executed Cybersecurity plan, are critical components of IT security strategy.

District Response: The District agrees with this finding.

Finding 5. A comprehensive Cybersecurity plan should include, at a minimum, information concerning prevention steps, spam and malware software, and backups and full recovery testing.

District Response: The District agrees with this finding.

Finding 6. The identification of phishing attempts, including the use of spam filters, is an important component to protecting an IT system from Ransomware attacks.

District Response: The District agrees with this finding.

Finding 7. Testing a full restore of a server to ensure that backups are reliable should be undertaken regularly as part an entity’s backup plan to recover lost information.

Finding 8. Training of new employees, and the recurring training of existing employees, is an important component of defense against Ransomware.

District Response: The District agrees with this finding.

Further, the Grand Jury has offered the following recommendations who which it has asked the District to respond:

Recommendation 1. Each of the governmental entities in San Mateo County with an IT department or IT function (whether in-house, handled by another government unit or outsourced to a private enterprise) as listed in Appendix F, should by November 30, 2020, make a request for a report from their IT organization that addresses the concerns identified in the report, specifically:

1. System Security (Firewalls, Anti-malware/Antivirus software, use of subnets, strong password policies, updating/patching regularly)

3. Prevention (turning on email filtering, setting up message rules to warn users, providing employee training on phishing and providing a reporting system to flag suspect content) District Response: The Chancellor has directed the District’s Chief Technology Officer to prepare a confidential report which addresses the issues outlined above.

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Packet Pg. 298 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”) SMCCCD Response to Grand Jury Ransomware Report, pg. 3
Recommendation 2. These confidential internal reports should be provided to the governing body by June 30, 2021. This report should describe what actions have already been taken and which will be given timely consideration for future enhancements to the existing cybersecurity plan.

District Response: The District intends to prepare and provide a confidential report to the District’s Board of Trustees by June 30, 2021.

Recommendation 3. Given the results of their internal reports, governmental entities may choose to request further guidance by means of a Cybersecurity review from the U.S. Department of Homeland Security and/or a cyber hygiene assessment from the County Controller’s Office.

District Response: The District will implement this Recommendation if warranted and appropriate based on the results of the District s confidential internal report.

Recommendation 4. Given the results of their internal reports, governmental entities may choose to ask their IT departments to review their own Cybersecurity Plan with the detailed template provided by the FCC’s Cybersecurity Planning Guide and consider customizing it using FCC’s Create Custom Cybersecurity Planning Guide tool (see footnote 52).

District Response: The District will implement this Recommendation if warranted and appropriate based on the results of the District s confidential internal report.

The District appreciates the work of the Grand Jury and the opportunity to respond to the findings and recommendations of its report. Should the Grand Jury have any questions regarding the District’s responses, or need additional information, please let me know.

Sincerely,
Michael E. Claire
Chancellor

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Packet Pg. 299 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”) February 8, 2021
Honorable Danny Y. Chou
Judge of the Superior Court
C/O Jenarda Dubois
Hall of Justice
400 County Center, 8th Floor
Redwood City, CA 94063-1655
Subject: October 7, 2020 Grand Jury Report: “Ransomware: It Is Not Enough To Think You Are Protected”
Dear Honorable Judge Chou:

The San Mateo County Mosquito and Vector Control District Board of Trustees reviewed the following responses at its November 12, 2020. The District Board subsequently approved the following responses to the San Mateo County Civil Grand Jury 2019-2020 Report entitled “Ransomware: It is Not Enough To Think You Are Protected.” Findings:

F1. Ransomware is a real and growing threat to public entities including those in San Mateo County.

The District agrees with this Finding.

F2. Across the country, local governments and schools represent 12% of all Ransomware attacks.

The District accepts the Grand Jury’s Finding that appears to be based on 2020 first quarter data from the Coveware Report.

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Packet Pg. 300 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”) F3. The direct and indirect costs of Ransomware can be significant.

The District agrees with this Finding.

F4. Cybersecurity reviews and assessments, and an updated, well-executed Cybersecurity plan, are critical components of IT security strategy.

The District agrees with this Finding.

F5. A comprehensive Cybersecurity plan should include, at a minimum, information concerning prevention steps, spam and malware software, and backups and full recovery testing.

The District agrees with this Finding.

F6. The identification of phishing attempts, including the use of spam filters, is an important component to protecting an IT system from Ransomware attacks.

The District agrees with this Finding.

F7. Testing a full restore of a server to ensure that backups are reliable should be undertaken regularly as part an entity’s backup plan to recover lost information.

The District agrees with this Finding.

F8. Training of new employees, and the recurring training of existing employees, is an important component of defense against Ransomware.

The District agrees with this Finding.

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Packet Pg. 301 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”) Recommendations:

1. System Security (Firewalls, Anti-malware/Antivirus software, use of subnets, strong password policies, updating/patching regularly)

3. Prevention (turning on email filtering, setting up message rules to warn users, providing employee training on phishing and providing a reporting system to flag suspect content)
The District received this report from its IT staff on these three areas of concern to the Board of Trustees at its November 12, 2020 meeting.

The District’s IT staff have received this request and is working on completing the Recommended confidential internal report by June 30, 2021.

The District will consider requesting further guidance based on the internal reports.

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Packet Pg. 302 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”) R4. Given the results of their internal reports, governmental entities may choose to ask their IT departments to review their own Cybersecurity Plan with the detailed template provided by the FCC’s Cybersecurity Planning Guide and consider customizing it using FCC’s Create Custom Cybersecurity Planning Guide tool.

The District’s IT staff will utilize the FCC Cybersecurity Planning Guide to review and update the District’s cybersecurity plan.

We appreciate the research and awareness brought forth by the Grand Jury. We thank the members of the Grand Jury for their work and contributions toward this important issue.

Sincerely,
Brian Weber
District Manager

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Packet Pg. 303 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”)

SAN MATEO
COUNTY

OFFICE OF

EDUCATION
Excellence and Equity in Education
Nancy Magee • County Superintendent of Schools
December 2,2020
Via Email ([email protected])
The Honorable Danny Y. Chou
Judge of the Superior Court
c/o Jenarda Dubois
Hall of Justice
400 County Center; 2nd Floor
Redwood City, CA 94063-1655
Re: Response to the 2019-2020 Grand Jury Report entitled “Ransomware: It Is Not Enough to Think You Are Protected.”
Dear Judge Chou:

The San Mateo County Office of Education (“the SMCOE”) has received and reviewed the 2019-2020 Grand Jury Report entitled “Ransomware: It Is Not Enough to Think You Are Protected.” We appreciate the Grand Jury’s interest in this matter. Having reviewed and considered the Grand Jury’s Findings and Recommendations, the SMCOE responds below pursuant to section 933.05 of the California Penal Code.

Findings:

1. Ransomware is a real and growing threat to public entities including those in San Mateo County.

The SMCOE agrees with this Finding.

2. Across the country, local governments and schools represent 12% ofall Ransomware attacks.

The SMCOE lacks information to fully agree or disagree with this Finding given that it did not conduct the research related to this Report. The SMCOE, however, accepts the Grand Jury’s Finding for the purposes of this Response.

3. The direct and indirect costs ofRansomware can be significant.

The SMCOE agrees with this Finding.
!
101 Twin Dolphin Drive • Redwood City • CA • 94065-1064 • 650-802-5300 • www.smcoe.org

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Packet Pg. 304 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”) The Honorable Danny Y. Chou 2
Response to the 2019-2020 Grand Jury Report
December 2,2020

4. Cybersecurity reviews and assessments, and an updated, well-executed Cybersecurity plan, are critical components ofIT security strategy.

The SMCOE agrees with this Finding.

5. A comprehensive Cybersecurity plan should include, at a minimum, information concerning prevention steps, spam and malware software, and backups andfull recovery testing.

The SMCOE agrees with this Finding.

6. The identification ofphishing attempts, including the use ofspamfilters, is an important component to protecting an ITsystemfrom Ransomware attacks.

The SMCOE agrees with this Finding.

7. Testing afull restore ofa server to ensure that backups are reliable should be undertaken regularly as part ofan entity’s backup plan to recover lost information.

8. Training ofnew employees, and the recurring training ofexisting employees, is an important component ofdefense against Ransomware.

The SMCOE agrees with this Finding.

Recommendations:

1. Each ofthe governmental entities in San Mateo County with an IT department or IT function (whether in-house, handled by another government unit or outsourced to a private enterprise) as listed in Appendix F, should by November 30, 2020, make a request for a reportfrom their IT organization that addresses the concerns identified in the report, specifically:
a. System Security (Firewalls, Anti-malware/Antivirus software, use ofsubnets, strong password policies, updating/patching regularly)
b. Backup & Recovery (In the event ofan attack, can you shut down your system quickly? What is being backed up, how it is being backed up, when are backups run, and where are the backups being stored? Have backups been tested? Can you fidly restore a Serverfrom a backup?)

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Packet Pg. 305 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”) The Honorable Danny Y. Chou 3
Response to the 2019-2020 Grand Jury Report
December 2,2020
c. Prevention (turning on emailfiltering, setting up message rules to warn users, providing employee training on phishing and providing a reporting system to flag suspect content)
The SMCOE implemented this Recommendation on October 7,2020, by directing the SMCOE IT Department to prepare a confidential report which addresses the three concerns specifically identified above.

2. These confidential internal reports should be provided to the governing body by June 30, 2021. This report should describe what actions have already been taken and which will be given timely considerationforfitlire enhancements to the existing cybersecurity plan.

The SMCOE intends to implement this Recommendation, provided that the SMCOE may require an extension of time (not to exceed six months) beyond June 30,2021, depending on the scope, complexity, and feasibility of any recommended actions and/or enhancements.

The SMCOE will implement this Recommendation if warranted and appropriate based on the results of our confidential internal report.

4. Given the results oftheir internal reports, governmental entities may choose to ask their IT departments to review their own Cybersecurity Plan with the detailed template provided by the FCC’s Cybersecurity Planning Guide and consider customizing it using FCC’s Create Custom Cybersecurity Planning Guide tool (see footnote 52).

The SMCOE will implement this Recommendation if warranted and appropriate based on the results of our confidential internal report.

Sincerely,
Nancy Magee
San Mateo County Superintendent of Schools
C: San Mateo County Board of Supervisors

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Packet Pg. 306 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”)

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Packet Pg. 312 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”) December 22, 2020
Hon. Danny Y. Chou
Judge of the Superior Court
c/o Jenarda Dubois
Hall of Justice
400 County Center, 8th Floor
Redwood City, CA 94063-1655
Re: Response to Grand Jury Report: “Ransomware: It Is Not Enough To Think You Are Protected” Dear Honorable Danny Y. Chou,
At the November 19, 2020 RCD Regular Meeting of the Board of Directors, the Board approved Executive Director, Kellyx Nelson, to respond. Due to the small size of the San Mateo Resource Conservation District (RCD), many of the “Best Practices” as outlined in the report do not apply or have been implemented in a scaled down fashion more appropriate to the RCD situation. Please find the RCD’s responses to the Grand Jury Report below.

1. Office network is protected with a business class firewall with no external resources exposed to the internet. All computers and servers are setup to install updates automatically as they are released by Microsoft. Ancillary software such as Adobe Acrobat also updates automatically. On site computer patching is monitored at the server level. Network and email accounts share the same credentials, and all accounts require strong passwords. 2-Factor authentication for email is being implemented and should be complete by early 2021.

2. All RCD data is stored on the server. The server is backed up daily with an offsite backup solution. A second local backup is configured to allow rapid recovery of the server to new hardware should a catastrophic failure occur. A small amount of ancillary data is kept on the shared Geographic Information System mapping (GIS) workstation related to GIS projects. The GIS machine is backed up with an offsite backup solution. Workstations are not backed up and are considered expendable. RCD has a policy for users to never store important data on their laptops. All data is kept on the server network shares.

Subnetting does not apply to RCD. Backups are monitored but full server recovery is not tested due to limited hardware resources.

3. Basic Email Spam and Malware filtering is provided via Office 365 tools. More sophisticated filtering is available and is currently under consideration. The cost of the expanded filtering functionality is a limiting factor. Currently we have no planned structured employee training on avoiding security issues. Frequent casual guidance given on an individual basis.

Sincerely,
Kellyx Nelson, Executive Director
San Mateo Resource Conservation District

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Packet Pg. 313 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”)

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Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”) 150 WATKINS AVENUE | ATHERTON, CALIFORNIA 94027 | PH: (650) 752-0500 EM: [email protected] www.ci.atherton.ca.us
December 18, 2020
Hon. Danny Y. Chou
Judge of Superior Court
C/o Jenarda Dubois
Hall of Justice
400 County Center; 8th Floor
Redwood City, CA 94063-1655
VIA EMAIL: [email protected]
SUBJECT: RESPONSE TO GRAND JURY REPORT: “Ransomware: It Is Not Enough To Think You Are Protected"
Honorable Judge Chou,
Attached please find the Town of Atherton’s response to the above Grand Jury Report. The response to both the findings and recommendations are listed below. Pursuant to California Penal Code Section 933.05, the response was considered by the City Council at a public meeting on December 16, 2020.

Should you have any questions concerning the response, please contact City Manager George Rodericks at (650) 752-0504 or [email protected].

Respectfully,

TOWN OF ATHERTON
Elizabeth Lewis
Mayor

TOWN OF ATHERTON

ADMINISTRATIVE OFFICES
150 WATKINS AVENUE
ATHERTON, CALIFORNIA 94027
(650) 752-0500

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Packet Pg. 328 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”) 150 WATKINS AVENUE | ATHERTON, CALIFORNIA 94027 | PH: (650) 752-0500 EM: [email protected] www.ci.atherton.ca.us
Response to Grand Jury Report Findings and Recommendations Report Title: “Ransomware: It Is Not Enough To Think You Are Protected" Report Date: October 7, 2020
Response by: Town of Atherton
From: Elizabeth Lewis, Mayor
The Town of Atherton is responding to each Finding solely with respect to itself and not regarding any other City.

Response to Grand Jury Findings:

F1. Ransomware is a real and growing threat to public entities including those in San Mateo County.

Response: The Town of Atherton agrees with this finding F2. Across the country, local governments and schools represent 12% of all Ransomware attacks.

Response: The Town of Atherton agrees with this finding F3. The direct and indirect costs of Ransomware can be significant.

Response: The Town of Atherton agrees with this finding.

F4. Cybersecurity reviews and assessments, and an updated, well-executed Cybersecurity plan, are critical components of IT security strategy.

Response: The Town of Atherton agrees with this finding.

F5. A comprehensive Cybersecurity plan should include, at a minimum, information concerning prevention steps, spam and malware software, and backups and full recovery testing.

Response: The Town of Atherton agrees with this finding.

F6. The identification of phishing attempts, including the use of spam filters, is an important component to protecting an IT system from Ransomware attacks.

Response: The Town of Atherton agrees with this finding.

F7. Testing a full restore of a server to ensure that backups are reliable should be undertaken regularly as part an entity’s backup plan to recover lost information.

Response: The Town of Atherton agrees with this finding.

F8. Training of new employees, and the recurring training of existing employees, is an important component of defense against Ransomware.

Response: The Town of Atherton agrees with this finding.

Response to Grand Jury Recommendations:

The Grand Jury recommends that each governing body undertake its own confidential effort to protect against Ransomware attacks. Specifically:

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Packet Pg. 329 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”) 150 WATKINS AVENUE | ATHERTON, CALIFORNIA 94027 | PH: (650) 752-0500 EM: [email protected] www.ci.atherton.ca.us
R1. Each of the governmental entities in San Mateo County with an IT department or IT function (whether inhouse, handled by another government unit or outsourced to a private enterprise) as listed in Appendix F, should by November 30, 2020, make a request for a report from their IT organization that addresses the concerns identified in the report, specifically:

1. System Security (Firewalls, Anti-malware/Antivirus software, use of subnets, strong password policies, updating/patching regularly)

3. Prevention (turning on email filtering, setting up message rules to warn users, providing employee training on phishing and providing a reporting system to flag suspect content) Response: This recommendation has been implemented
The Town of Atherton City Manager’s Office made this request of the Town’s IT Department upon receipt of the Grand Jury Report. The IT Department will prepare a study session report for City Council which will, at a minimum, address the concerns listed in R1.1, R1.2, and R1.3.

Response: This recommendation will be implemented by the June deadline The Town of Atherton’s IT Department will prepare a comprehensive study session report for City Council, planned for Q1 calendar year 2021, that addresses the concerns identified in the report. This report will include actions taken and plans for future enhancements.

Response: This recommendation will be implemented on or before June 30, 2021 The Town of Atherton IT Department will make a request with the Department of Homeland Security, Cybersecurity & Infrastructure Security Agency, for cyber-hygiene services before June 30, 2021.

Response: This recommendation will be implemented on or before June 30, 2021 The Town of Atherton IT Department will utilize the Federal Communications Commission Cyber Security Planning Guide and the FCC Cyber Security Planner to review and update our cyber-security plans. This work will be completed on or before June 30, 2021.

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Packet Pg. 337 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”) Town of Portola Valley
Town Hall: 765 Portola Road, Portola Valley, CA 94028 Tel: (650) 851-1700 Fax: (650) 851-4677 December 9, 2020
Hon. Danny Chou
Judge of the Superior Court
c/o ChJenarda Dubois
Hall of Justice
400 County Center, 8th Floor
Redwood City, CA 94063
Dear Judge Chou,
Thank you for the opportunity to respond to the Grand Jury report entitled “Ransomware: It’s Not Enough To Think You Are Protected”.

Below are the Town’s responses to the report’s findings and recommendations.

Findings
F1. Ransomware is a real and growing threat to public entities including those in San Mateo County.

Response: The Town agrees with this finding.

F2. Across the country, local governments and schools represent 12% of all Ransomware attacks.

Response: The Town cannot independently confirm this finding, but does not disagree.

F3. The direct and indirect costs of Ransomware can be significant.

Response: The Town agrees with this finding.

F4. Cybersecurity reviews and assessments, and an updated, well-executed Cybersecurity plan, are critical components of IT security strategy.

Response: The Town agrees with this finding.

F5. A comprehensive Cybersecurity plan should include, at a minimum, information concerning prevention steps, spam and malware software, and backups and full recovery testing.

Response: The Town agrees with this finding.

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Packet Pg. 338 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”)

F6. The identification of phishing attempts, including the use of spam filters, is an important component to protecting an IT system from Ransomware attacks.

Response: The Town agrees with this finding.

F7. Testing a full restore of a server to ensure that backups are reliable should be undertaken regularly as part an entity’s backup plan to recover lost information.

Response: The Town agrees with this finding.

F8. Training of new employees, and the recurring training of existing employees, is an important component of defense against Ransomware.

Response: The Town agrees with this finding.

Recommendations
R1. Each of the governmental entities in San Mateo County with an IT department or IT function (whether in-house, handled by another government unit or outsourced to a private enterprise) as listed in Appendix F, should by November 30, 2020, make a request for a report from their IT organization that addresses the concerns identified in the report, specifically: 1. System Security (Firewalls, Anti-malware/Antivirus software, use of subnets, strong password policies, updating/patching regularly) 2. Backup & Recovery (In the event of an attack, can you shut down your system quickly? What is being backed up, how it is being backed up, when are backups run, and where are the backups being stored? Have backups been tested? Can you fully restore a Server from a backup?) 3. Prevention (turning on email filtering, setting up message rules to warn users, providing employee training on phishing and providing a reporting system to flag suspect content)
Response: Recommendations 1 and 3 have been implemented fully over the last two years.

Recommendation 2 has been implemented by way of a 2015 server crash that utilized backup systems that have subsequently been improved.

Response: The recommendation has not been implemented at the Town Council level at this time, but the Council has been informed of multiple improvements to the Town’s IT infrastructure. A full report will be provided to the Council by June 30, 2021.

R3. Given the results of their internal reports, governmental entities may choose to request further guidance by means of a Cybersecurity review from the U.S. Department of Homeland Security56 and/or a cyber hygiene assessment from the County Controller’s Office.

Response: The recommendation has not been implemented, but the Town will request a cyber hygiene assessment from the County Controller’s Office by the end of the fiscal year R4. Given the results of their internal reports, governmental entities may choose to ask their IT departments to review their own Cybersecurity Plan with the detailed template provided by the

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Packet Pg. 339 Attachment: Grand Jury Report (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”)

FCC’s Cybersecurity Planning Guide and consider customizing it using FCC’s Create Custom Cybersecurity Planning Guide tool (see footnote 52).

Response: The recommendation has not been implemented, but will be by June 30, 2021 which will be based on our annual auditor’s enhanced cybersecurity audit.

Thank you,
Mayor, Town of Portola Valley
cc: Members of the Town Council

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CITY OF EAST PALO ALTO
Office of the City Council
May 19, 2022
Honorable Danny Y. Chou
Judge of the Superior Court
c/o Jenadra Dubois
Hall of Justice
400 County Center, 8th Floor
Redwood City, CA 94063-1655
RE: Civil Grand Jury Report: “Ransomware: It is not enough to think that you are protected” Dear Judge Chou:

The City Council of the City of East Palo Alto (City) voted at its public meeting on May 17, 2022, to authorize this response to San Mateo County’s civil grand jury 2019-20 report “Ransomware: It is not enough to think that you are protected,” released on October 7, 2020.

RESPONSES TO FINDINGS
F1. Ransomware is a real and growing threat to public entities including those in San Mateo County.

City Response: City of East Palo Alto agrees that cybersecurity threats, including ransomware, are a growing threat to public agencies.

F2. Across the country, local governments and schools represent 12% of all Ransomware attacks.

City response: City of East Palo Alto agrees with the finding that local governments are increasingly the target of cybersecurity threats.

F3. The direct and indirect costs of Ransomware can be significant.

City response: City of East Palo Alto agrees that the direct and indirect costs of cybersecurity threats are significant.

F4. Cybersecurity reviews and assessments, and an updated, well-executed Cybersecurity plan, are critical components of IT security strategy.

City response: City of East Palo Alto agrees with the finding.

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Packet Pg. 355 Attachment: City Response Letter (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”) F5. A comprehensive Cybersecurity plan should include, at a minimum, information concerning prevention steps, spam and malware software, and backups and fully recovery testing.

City response: City of East Palo Alto agrees with the finding.

F6. The identification of phishing attempts, including the use of spam filters, is an important component to protecting an IT system from Ransomware attacks.

City response: City of East Palo Alto agrees with the finding.

F7. Testing a full restore of a server to ensure that backups are reliable should be undertaken regularly as part an entity’s backup plan to recover lost information.

City response: City of East Palo Alto agrees with the finding.

F8. Training of new employees, and the recurring training of existing employees, is an important component of defense against Ransomware.

City response: City of East Palo Alto agrees with the finding.

RESPONSES TO RECOMMENDATIONS
The Grand Jury recommends that each governing body undertake its own confidential effort to protect against Ransomware attacks, as follows:

R1. Each of the governmental entities in San Mateo County with an IT department or IT function (whether in-house, handled by another government unit or outsourced to a private enterprise), should by November 30, 2020, make a request for a report from their IT organization that addresses the concerns identified in the report, specifically:

1. System Security (Firewalls, Anti-malware/Antivirus software, use of subnets, strong password policies, updating/patching regularly)

City response: Will be implemented by December 31, 2022.

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Packet Pg. 356 Attachment: City Response Letter (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”) City response: Further analysis required pending results from R1.

City response: Further analysis required pending results from R1.

Sincerely,
Ruben Abrica
Mayor

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Packet Pg. 357 Attachment: City Response Letter (2246 : Grand Jury Report: “Ransomware: It is not enough to think you are protected”)

EAST PALO ALTO

CITY COUNCIL

STAFF REPORT
DATE: May 17, 2022
TO: Honorable Mayor and Members of the City Council
VIA: Patrick Heisinger, Interim City Manager
BY: Kelly Beggs, Consultant Planner
Elena Lee, Planning Manager
SUBJECT: University Circle Phase II Development Agreement Recommendation
Waive the second reading and adopt an ordinance approving the Development Agreement for University Circle II.

Alignment with City Council Strategic Plan
This recommendation is primarily aligned with:

Priority No. 1: Enhance Public Safety and Emergency Preparedness Priority No. 4: Improve Public Facilities and Infrastructure Priority No. 6: Create a Healthy and Safe Community
Background
On May 3, 2022, the City Council approved the University Circle Phase II project. The staff report1 and presentation included the certification of the project’s Environmental Impact Report (EIR) and approval of the project entitlements (Design Review Permit (DR19-019) and Conditional Use Permit (CUP22-001)). City Council adopted a resolution approving the project and certifying the EIR (4 votes approving, and 1 abstain). An additional component of the project is a Development Agreement. The Council waived the first reading and introduced an ordinance approving the Development Agreement for the University Circle Phase II project (Attachment 1).

Analysis
The City Council directed staff to make non-substantive changes to the Development Agreement, including edits to increase the amount of time that the temporary parking is made 1 https://eastpaloalto.iqm2.com/Citizens/Detail_Meeting.aspx?ID=1809

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available to the community and to clarify that the community function space is operated in consultation with the City and that this community benefit survives termination of the development agreement.

The City Council added several new conditions of approval regarding the following topics:
• When technologically and economically feasible, diesel backup generators shall be substituted with battery operated generators.
• Shuttle trips between University Circle and the Palo Alto Caltrain station shall be open to East Palo Alto residents.
• The applicant shall contribute $75,000 to lighting improvements that is architectural in nature to highlight the pedestrian bridge.
• The applicant shall contribute $200,000 to nonprofits to support job seekers. 100 percent of the funds shall go to the non-profit organization and like kind contribution shall be credited towards $200,000.
• The applicant shall install a minimum of one level 3 non-Tesla Electric Vehicle Charging station above ground. If there is sufficient electrical capacity, additional charging stations shall be added, provided demand warrants.
• The applicant shall contribute $75,000 by the developer to a City fund for the purposes of tree planting.
• The applicant shall provide parking garage usage data to the City as part of compliance with the City’s Transportation Demand Management (TDM) Ordinance. • The applicant shall contribute $150,000 for tenant improvements for the City-owned incubator space at Cummings Loft. If the funds are requested prior to the issuance of the building permit, the funds shall be provided as an interest free loan for 20 years.

These additional conditions of approval were incorporated into the final conditions of approval for the project.

Fiscal Impact
There is a neutral fiscal impact to adopting the Development Agreement ordinance. The purpose of a Development Agreement, as set forth in Chapter 18.108, is in exchange for assurance from the City that a project can be developed as approved for a specific time period, the project provides the City with significant tangible benefits beyond what would be required.

The applicant will provide community benefits including payment for a security camera, a public access license agreement, a community function space, funds for public art to be distributed to a non-profit arts group, overflow parking spaces, bus stop improvements, a new staircase, landscaping improvements, and a third left-turn lane on eastbound Woodland Avenue at University Avenue.

The Fiscal Impact Analysis concludes the proposed project itself is projected to have a positive net impact on the City of East Palo Alto’s General Fund, resulting in an estimated $649,900 in annual General Fund revenues in excess of the estimated annual General Fund expenditures required for the City to provide services to the project, plus approximately $450,000 per year in Measure HH revenue for affordable housing programs and programs that facilitate job opportunities for East Palo Alto residents. Additional financial contributions to the City will be made through payment of Development Impact Fees and implementation of the project Conditions of Approval, as described above.

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Public Notice
The public was provided notice via publication in the San Mateo Daily Journal on May 12, 2022, and by posting the agenda on the City’s official bulletin board outside City Hall and making the agenda and report available online at
http://eastpaloalto.iqm2.com/Citizens/Default.aspx.

Environmental
An Environmental Impact Report (EIR) was prepared for the project pursuant to the California Environmental Quality Act (CEQA) to identify and address any potentially significant environmental effects associated with the project. The City Council certified that the Final Environmental Impact Report (FEIR) had been done in compliance with the California Environmental Quality Act (CEQA) and adopted a Mitigation, Monitoring and Reporting Plan pursuant to Public Resources Code 21000 and the CEQA Guidelines (California Code of Regulations, Title 14, Section 15000) at the May 3, 2022 Public Hearing.

Attachments

1. Ordinance

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ORDINANCE NO. _______

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF EAST PALO

ALTO APPROVING A DEVELOPMENT AGREEMENT BETWEEN THE

CITY OF EAST PALO ALTO AND COLUMBIA REIT-UNIVERSITY

CIRCLE, LP RELATING TO THE DEVELOPMENT OF THE UNIVERSITY

CIRCLE PHASE II PROJECT AT UNIVERSITY AVENUE AND

WOODLAND AVENUE
WHEREAS, to strengthen the public planning process, encourage private participation in comprehensive planning and reduce the economic risk of development, the Legislature of the State of California adopted Government Code Sections 65864 et seq. (the "Development Agreement Statute") which authorizes cities to enter into agreements for the development of real property with any person having a legal or equitable interest in such property in order to establish certain development rights in such property; and WHEREAS, in accordance with the Development Agreement Statute, the City of East Palo Alto enacted Chapter 18.108 of the East Palo Alto Municipal Code (the "Development Agreement Regulations") to implement procedures for the processing and approval of development agreements in accordance with the Development Agreement Statute; and
WHEREAS, Seven Bridges Properties, on behalf of Columbia Realty Trust ("Developer") submitted an application requesting approval of Design Review (DR19-019), Conditional Use Permit (CUP22-001), and Development Agreement, to redevelop an existing landscaped surface parking lot with an approximately 180,000 square foot, six story office building above three levels of below grade parking (the "Project"); and
WHEREAS, Developer proposes to enter into a Development Agreement with the City of East Palo Alto for the purpose of developing the Project in exchange for contributions to the community, as articulated in the Development Agreement; and
WHEREAS, pursuant to the Development Agreement Statute and Development Agreement Regulations, the Planning Commission held a duly noticed public hearing on April 4, 2022, on the proposed Project and found the proposed Development Agreement is consistent with the objectives of the general plan and the Westside Area Specific Plan, in conformity with public

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Packet Pg. 361 Attachment: Ordinance (2250 : University Circle Phase II Development Agreement) convenience and beneficial to the public welfare, and will not adversely impact the orderly development of property; and
WHEREAS, the City Council, after published notice, held a public hearing on May 3, 2022, concerning the proposed Project, and considered the reports and documents presented by City staff, the Planning Commission's recommendations, and the written and oral comments presented at the public hearing.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF EAST
PALO ALTO DOES ORDAIN AS FOLLOWS:

SECTION 1. Findings and Determination.

The City Council hereby finds and declares the above recitals are true and correct. The City Council finds the provisions of the Development Agreement are consistent with the City's General Plan and Westside Area Specific Plan as they exist on the effective date of this ordinance, and hereby incorporates the conformity findings from the City Council staff report dated May 3, 2022.

SECTION 2. Approval of Development Agreement.

Based on the findings herein and in the resolution included in the above recitals, the City Council hereby approves the Development Agreement attached as Exhibit 1 and authorizes the City Manager to execute the Development Agreement, subject to such minor, conforming, or clarifying changes consistent with the terms thereof as may be approved by the City Manager prior to execution thereof, and any and all other documents necessary to effectuate the Development Agreement.

SECTION 3. CEQA
The environmental effects of the Project subject to the Development Agreement were analyzed in the Environmental Impact Report (EIR) and Mitigation Monitoring and Reporting Plan, which were certified and approved by the City Council and mitigation measures incorporated into the Project.

SECTION 4. Severability.

If any section, subsection, sentence, clause or phrase of this Ordinance is for any reason held to be unconstitutional, invalid or ineffective by a court of competent jurisdiction, such decision shall not affect the validity or effectiveness of the remaining portions of this Ordinance. The City Council hereby declares that it would have adopted this Ordinance, and each section, subsection, sentence, clause and phrase thereof irrespective of the fact that any one or more

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Packet Pg. 362 Attachment: Ordinance (2250 : University Circle Phase II Development Agreement) sections, subsections, sentences, clauses or phrases be declared unconstitutional, invalid or ineffective.

SECTION 5. Effective Dates
This Ordinance shall be in full force and effect thirty (30) days after its adoption.

SECTION 6. Publication. The City Clerk is directed to cause publication of this Ordinance as required by Government Code Section 36933.

This Ordinance was introduced at the______________ meeting of the City Council of the City of East Palo Alto.

PASSED AND ADOPTED this _____ day of ______________, 2022 by the following vote:

AYES:

NOES:

ABSTAIN:

ABSENT:
_______________________________
Ruben Abrica, Mayor
ATTEST: APPROVED AS TO FORM:
_____________________________ __________________________ James Colin, Acting City Clerk Valerie J. Armento, Interim City Attorney

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Packet Pg. 363 Attachment: Ordinance (2250 : University Circle Phase II Development Agreement) [

RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:

City Clerk's Office
City of East Palo Alto
2415 University Avenue
East Palo Alto, CA 94303
Exempt from Recording Fee
Pursuant to Government
Code Section 27383
______________________________________________________________________________ Space Above This Line for Recorder's Use Only

DEVELOPMENT AGREEMENT
by and between

THE CITY OF EAST PALO ALTO
and

COLUMBIA REIT - UNIVERSITY CIRCLE, LP
concerning

UNIVERSITY CIRCLE PHASE II

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Packet Pg. 364 Attachment: Ordinance (2250 : University Circle Phase II Development Agreement)

TABLE OF CONTENTS
Page
Page i
ARTICLE I. DEFINITIONS .......................................................................................................... 2

1.1 Definitions................................................................................................... 2

1.2 Capitalized Terms. ...................................................................................... 4 ARTICLE II. GENERAL PROVISIONS....................................................................................... 4

2.1 Developer Representations and Warranties. ............................................... 4

2.2 Relationship of City and Developer............................................................ 5

2.3 Recording.................................................................................................... 5

2.4 Term............................................................................................................ 5 ARTICLE III. DEVELOPMENT OF THE PROJECT SITE......................................................... 5

3.1 Use of the Project Site and Applicable Law. .............................................. 5

3.2 Reservations of Authority........................................................................... 6

3.3 Subsequently Enacted Rules and Regulations. ........................................... 7

3.4 Nexus/Reasonable Relationship Waiver..................................................... 7

3.5 Initiatives and Referenda. ........................................................................... 7

3.6 Compliance With Requirements of Other Governmental Entities. ............ 8

3.7 City's Police Power. .................................................................................... 9

3.8 Subsequent Approvals for the Project Site. ................................................ 9

3.9 Life of Approvals and City Permits............................................................ 9

3.10 Developer Obligations. ............................................................................. 10

3.11 City Obligations........................................................................................ 10 ARTICLE IV. COMMUNITY BENEFITS.................................................................................. 10 ARTICLE V. AMENDMENT OF AGREEMENT AND APPROVALS.................................... 12

5.1 Amendment or Cancellation Procedure. ................................................... 12

5.2 Minor Amendments to Project.................................................................. 12

5.3 Requirement for a Writing........................................................................ 13

5.4 Amendments to Development Agreement Legislation............................. 13

5.5 Amendment of Development Approvals. ................................................. 13

5.6 Effect of Termination on Developer's Obligations. .................................. 13 ARTICLE VI. ANNUAL REVIEW............................................................................................. 14

6.1 Time of Review......................................................................................... 14

6.2 Compliance Letter..................................................................................... 14

6.3 Determination of Good Faith Compliance................................................ 14

6.4 No Waiver................................................................................................. 15

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TABLE OF CONTENTS
Page
Page ii
ARTICLE VII. DEFAULT, REMEDIES, AND TERMINATION ............................................. 15

7.1 Notice of Breach. ...................................................................................... 15

7.2 Specific Performance Remedy for Breach................................................ 15

7.3 Termination by Mutual Consent. .............................................................. 16 ARTICLE VIII. ESTOPPEL CERTIFICATE.............................................................................. 16 ARTICLE IX. TRANSFERS, ASSIGNMENTS.......................................................................... 16

9.1 Agreement Runs With the Land. .............................................................. 16

9.2 Right to Assign. ........................................................................................ 17

9.3 Release Upon Assignment. ....................................................................... 17 ARTICLE X. MORTGAGEE PROTECTION............................................................................. 17

10.1 Mortgage Protection.................................................................................. 17

10.2 Mortgagee Not Obligated. ........................................................................ 17

10.3 Notice of Default to Mortgagee; Cure Rights........................................... 18

10.4 No Supersedure......................................................................................... 18 ARTICLE XI. INDEMNIFICATION .......................................................................................... 18

11.1 No Duty of City; Hold Harmless. ............................................................. 18

11.2 Indemnification......................................................................................... 18 ARTICLE XII. NOTICES ............................................................................................................ 19

12.1 Notices. ..................................................................................................... 19 ARTICLE XIII. MISCELLANEOUS .......................................................................................... 20

13.1 Cooperation in the Event of Third-party Legal Challenge. ...................... 20

13.2 Applicable Law and Venue....................................................................... 20

13.3 Severability. .............................................................................................. 20

13.4 Nondiscrimination..................................................................................... 20

13.5 Headings. .................................................................................................. 21

13.6 Agreement is Entire Understanding.......................................................... 21

13.7 Interpretation............................................................................................. 21

13.8 Recordation of Termination...................................................................... 21

13.9 Counterparts.............................................................................................. 21

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DEVELOPMENT AGREEMENT
This Development Agreement ("Agreement") is entered as of this ____ day of __________, 2022 by and between the City of East Palo Alto, a California municipal corporation (the "City"), and Columbia REIT - University Circle, LP, a Delaware Limited Partnership (the "Developer"), with reference to the following facts, purposes, and understandings:

RECITALS
A. Section 65864 et seq. of the California Government Code authorizes City to establish procedures for and to enter into binding development agreements with persons having legal or equitable interests in real property located within the City that is the subject of the development agreement.

B. The City's Municipal Code establishes the procedures for review and approval of development agreements in Chapter 18.108. This Agreement is consistent with the City's development agreement provisions.

C. Developer is the fee owner of that certain property consisting of approximately

11.84 acres of land located at 1900, 1950, and 2000 University Circle (Assessor's Parcel Nos. 063-680-020, 063-680-100, 063-680-130, 063-680-150, and 063-680-190) (the "Property") and more particularly described in Exhibit A, attached hereto and incorporated by this reference.

D. Developer desires to develop a portion of the Property, hereinafter referred to as the "Project Site" (defined below), in accordance with the provisions of this Agreement, the Development Approvals (defined below), and other applicable regulations of the City of East Palo Alto and other governmental agencies having jurisdiction over the Project Site.

E. On ____, 2022, City's Planning Commission held a duly noticed public hearing on this Agreement and (i) determined that this Agreement complies in all respects with CEQA, (ii) determined that this Agreement is consistent with the City's General Plan, and, (iii) recommended that the City Council approve this Agreement.

F. The following approvals, entitlements, and findings are being concurrently reviewed and approved by the City (under City Council Resolution No. __) with respect to the Project Site and constitute the "Development Approvals":
(1) The EIR and applicable provisions of the Mitigation, Monitoring, and Reporting Program ("MMRP"),
(2) Design review, and
(3) Conditional Use Permit for Parking Reduction
(4) Lot Split

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G. On ___________, 2022, the City examined the environmental effects of the Development Approvals in an Environmental Impact Report (State Clearning House # ___), comprised of a Draft Environmental Impact Report and Final Environmental Impact Report (the "EIR") prepared pursuant to CEQA. On ___, 2022, the City Council reviewed and certified as adequate and complete the EIR by Resolution No. ___ and adopted written findings and approved the MMRP.

H. On ___________, 2022, the City Council held a duly noticed public hearing on this Agreement and considered the Planning Commission's recommendations and testimony and information submitted by City staff, Developer, and members of the public, and found this Agreement to be consistent with the City's General Plan and introduced Ordinance No. ____, approving this Agreement.

I. On ___________, 2022, the City Council adopted Ordinance No. ____ enacting this Agreement.

J. The development of the Project will require ministerial approvals from the City, potentially including, but not limited to, encroachment permits, demolition permits, grading permits, building permits, and certificates of occupancy ("Subsequent Approvals").

AGREEMENT
NOW, THEREFORE, City and Developer agree as follows:

ARTICLE I.

DEFINITIONS

1.1 Definitions. In addition to the terms defined elsewhere in this Agreement, the following defined terms are used in this Agreement:

1.1.1 "Adopting Ordinance" shall mean City Council Ordinance No. ___ approving and adopting this Agreement.

1.1.2 "Agreement" shall mean this Development Agreement, as the same may be amended from time to time.

1.1.3 "Applicable Law" shall consist of the following:
(a) The General Plan of the City in effect as of the Effective Date; (b) The City's Municipal Code current as of the Effective Date; (c) The Development Approvals and their terms and conditions; (d) All other ordinances, resolutions, rules, regulations, standards, policies, conditions, and specifications applicable to the Project Site in effect on the Effective Date, except as provided in Sections 3.3 and 3.6.

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1.1.4 "CEQA" shall mean the California Environmental Quality Act (California Public Resources Code Sections 21000-21177) and the implementing regulations promulgated thereunder by the Secretary for Resources (California Code of Regulations, Title 14, section 15000 et seq.).

1.1.5 "City" shall mean the City of East Palo Alto, a municipal corporation, and any successor or assignee of the rights and obligations of the City of East Palo Alto hereunder.

1.1.6 "City Council" shall mean the governing body of the City.

1.1.7 "City Law" shall mean, individually, the ordinances, resolutions, rules, regulations, standards, policies, conditions, or specifications of the City.

1.1.8 "Compliance Letter" shall mean a letter submitted by Developer describing Developer's compliance with the terms of the Development Approvals and this Agreement.

1.1.9 "City Planning Commission" shall mean the duly appointed and constituted planning commission of the City.

1.1.10 "Developer" shall mean University Circle Investors, LLC and any successor or assignee to all or any portion of its right, title, and/or interest in and to ownership of all or a portion of the Project.

1.1.11 "Development Agreement Statute" shall mean California Government Code Sections 65864-65869.5, inclusive.

1.1.12 "Director" shall mean the City's Planning Division Manager.

1.1.13 "Effective Date" shall mean the date the Authorizing Ordinance becomes effective.

1.1.14 "General Plan" shall mean the City's 2035 General Plan adopted by the City Council on October 4, 2016, the final version of which was published in March 2017.

1.1.15 "Mortgage" shall mean the mortgage, deed of trust, sale and leaseback arrangement, or any other form of conveyance in which the Project Site, or a part or interest in the Project Site, is pledged as security and contracted for in good faith and for fair value.

1.1.16 "Mortgagee" shall mean the holder of a beneficial interest under a Mortgage or any successor or assignee of the Mortgagee.

1.1.17 "Project" shall mean an approximately 180,000 square-foot, six story office building above below-grade parking with net increase of 400 new structured parking spaces (a ratio of 2.5 spaces per 1,000 square feet), an approximately 2,800 square foot space along with an exclusive patio for community use, 14 surface parking spaces serving the community space, and water flow and pressure enhancements to ensure adequate fire suppression measures at the Project Site.

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1.1.18 "Property" is defined in Recital C.

1.1.19 "Project Site" shall mean that portion of the Property on which the Project will be constructed and operated, as more particularly described in Exhibit B, attached hereto and incorporated by this reference.

1.1.20 "Term" is defined in Section 2.3.

1.1.21 "Third Party Challenge" shall mean any legal action instituted by a third party or other governmental entity or official challenging the validity of any provision of this Agreement.

1.1.22 "Subsequent Approvals" is defined in Recital J.

1.2 Capitalized Terms. If any capitalized terms contained in this Agreement are not defined above, then any such terms shall have the meaning otherwise ascribed to them in this Agreement.

ARTICLE II.

GENERAL PROVISIONS

2.1 Developer Representations and Warranties.
(a) Developer represents and warrants that, as of the Effective Date of this Agreement, Developer is:
(i) The sole fee owner of the Project Site;
(ii) Duly organized and validly existing under the laws of the State of California;
(iii) Qualified and authorized to do business in the State of California and has duly complied with all requirements pertaining thereto; (iv) In good standing and has all necessary powers under the laws of the State of California to own property and in all other respects enter into and perform the undertakings and obligations of this Agreement.
(b) Developer further represents and warrants:
(i) That no approvals or consents of any persons are necessary for the execution, delivery or performance of this Agreement by Developer, except as have been obtained;
(ii) That the execution and delivery of this Agreement and the performance of the obligations of Developer have been duly authorized by all necessary actions and approvals required under any management and operating agreement for the limited liability company constituting Developer; and

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(iii) That this Agreement is a valid obligation of Developer enforceable in accordance with its terms.

2.2 Relationship of City and Developer.

It is understood that this Agreement is a contract that has been negotiated and voluntarily entered into by City and Developer and that the Developer is an independent party and not an agent or partner of City.

City and Developer hereby renounce the existence of any form of joint venture or partnership between them, and agree that nothing contained in this Agreement or in any document executed in connection with this Agreement shall be construed as making City and Developer joint venturers or partners.

2.3 Recording.

The Parties acknowledge that pursuant to Government Code Section 65864.5 and East Palo Alto Municipal Code Section 18.108.050.B the City Clerk must cause recordation of this Agreement with the County Recorder against the Project Site within ten (10) days after the Effective Date.

However, if the Lot Split has not been completed within this time period, preventing recordation of this Agreement, the City Clerk shall cause recordation of this Agreement within thirty (30) days of receipt of notice of Developer that the Lot Split has been completed.

2.4 Term.

The term of this Agreement (the "Term") shall commence upon the Effective Date and shall terminate seven (7) years following the Effective Date, unless sooner terminated or extended as hereinafter provided. Notwithstanding the above Term, if prior to the seventh (7th) anniversary of the Effective Date, the Developer submits to the City a complete application for a building permit for the Development, including construction drawings, the Term of this Agreement shall be automatically extended for five (5) additional years.

Notwithstanding the foregoing, if this Agreement or the Project defined herein is subject to litigation by a third party, the Term shall be tolled during such time and until the date upon which all such litigation is final and no longer subject to judicial review.

ARTICLE III.

DEVELOPMENT OF THE PROJECT SITE

3.1 Use of the Project Site and Applicable Law.

3.1.1 Subject to Agreement.

The Project Site is hereby made subject to the provisions of this Agreement. All development of, or on, the Project Site, or any portion thereof, shall be undertaken only in compliance with the provisions of this Agreement and with Applicable Law.

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3.1.2 Permitted Uses.

The permitted uses of the Project Site, the density or intensity of use, the maximum height and size of proposed buildings, and provisions for reservation or dedication of land for public purposes shall be governed by Applicable Law.

3.1.3 No Conflicting Enactments.

Except as and to the extent required by state or federal law, and subject to the provisions of Sections 3.3 and 3.7 below, the City shall not impose on the Project or Project Site any change in law that has any of the following effects on the rights provided by City Law and Applicable Law:

3.1.4 Reduces the maximum amount of development space permitted on the Project Site from that permitted by Applicable Law;

3.1.5 Changes any land use designation or permitted use of the Project Site from that shown in Applicable Law;

3.1.6 Changes any development standard for the Project Site including, but not limited to, height limitations and setbacks from that shown in the Applicable law;

3.1.7 Limits or controls the rate, timing, phasing or sequencing of the approval, development, or construction of all or any part of the Project Site except as set forth in the Applicable Law;

3.1.8 Limits or restricts any right or use specifically granted by the Development Approvals; or

3.1.9 Subjects the Project to further discretionary review.

3.2 Reservations of Authority.

The development of the Project will require Subsequent Approvals from the City.

Notwithstanding any other provision of this Agreement, and notwithstanding the provisions of Section 3.2, at the time Subsequent Approvals are applied for, the following regulations and provisions shall apply to those Subsequent Approvals:

3.2.1 Processing fees and charges of every kind and nature imposed by the City, including application, inspection, and monitoring fees, which are in force and effect within the jurisdiction of the City for the class of Subsequent Approvals being applied for.

3.2.2 All taxes, assessments, impact fees, other fees, or other monetary and nonmonetary exactions imposed by the City which are in force and effect within the jurisdiction of the City for the class of Subsequent Approvals being applied for.

3.2.3 Procedural regulations relating to hearing bodies, petitions, applications, notices, findings, records, hearings, reports, recommendations, appeals and any other matter of

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procedure, which are in force and effect within the jurisdiction of the City for the class of Subsequent Approvals being applied for.

3.2.4 Regulations governing construction standards and specifications including, without limitation, the City's building code, plumbing code, mechanical code, electrical code, fire code and grading code, all provisions of Title 15 of the East Palo Alto Municipal Code, and all other uniform construction codes which are in force and effect within the jurisdiction of the City for the class of Subsequent Approvals being applied for.

3.3 Subsequently Enacted Rules and Regulations.

The City may during the term of this Agreement apply such newer City Laws that are in force and effect within the jurisdiction of the City for the class of Subsequent Approvals being applied for and which are not in conflict with the terms of this Agreement or the Development Approvals. To the extent any changed City Law is in conflict with the terms of this Agreement or the Development Approvals, the terms of this Agreement or the Development Approvals, as applicable, shall prevail.

3.4 Nexus/Reasonable Relationship Waiver.

Developer consents to, and waives any rights it may have now or in the future, to challenge with respect to the Project or Development Approvals, the legal validity of, the conditions, requirements, policies, or programs required by this Agreement, the Development Approval or City Laws, including, without limitation, any claim that they constitute an abuse of police power, violate substantive due process, deny equal protection of the laws, effect a taking of property without payment of just compensation, or impose an unlawful tax. In the event Developer challenges any newer, subsequently enacted, City Law, as specified in Section 3.4, or any increased or new fee permitted under Section 3.3, then City shall have the right to withhold additional development approvals or permits until the matter is resolved; provided, however, Developer shall have the right to make payment or performance under protest, and thereby receive the additional approval or permit while the matter is in dispute

3.5 Initiatives and Referenda.

3.5.1 If any City Law is enacted or imposed by a citizen-sponsored initiative or referendum, or by the City Council directly or indirectly in connection with any proposed initiative or referendum, which City Law would conflict with this Agreement or the Development Approvals, such City Law shall not apply to the Project. The parties, however, acknowledge that the City's approval of this Agreement is a legislative action subject to referendum.

3.5.2 Without limiting the generality of any of the foregoing, no City-adopted moratorium or other limitation (whether relating to the rate, timing, phasing or sequencing of development) affecting subdivision maps, building permits, or other Subsequent Approvals shall apply to the Project. Developer agrees and understands that the City does not have authority or jurisdiction over another public agency's authority to grant a moratorium or impose any other limitation that may affect the Project.

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3.5.3 The timing, sequencing, and phasing of the development is solely the responsibility of Developer so long as it is consistent with Applicable Law. In particular, the parties desire to avoid the result of Pardee Construction Co. v. City of Camarillo (1984) 37 Cal.3d 465, where the failure of the parties therein to consider and expressly provide for the timing of the development resulted in a later adopted initiative restricting the timing of development to prevail over such parties' agreement. The parties therefore acknowledge that Developer shall have the right to develop the Project at such time as Developer deems appropriate so long as such development is consistent with Applicable Law.

3.5.4 The City shall cooperate with Developer and shall undertake such actions as may be necessary to ensure this Agreement remains in full force and effect.

3.6 Compliance With Requirements of Other Governmental Entities.

3.6.1 During the Term, Developer, at no cost to City, shall comply with lawful requirements of, and obtain all permits and approvals required by other local, regional, State and Federal agencies having jurisdiction over Developer's activities in furtherance of this Agreement.

Developer shall pay all required fees when due to Federal, State, regional, or other local governmental agencies other than the City and acknowledges that City does not control the amount of any such fees.

3.6.2 City shall cooperate with Developer in Developer's effort to obtain permits and approvals from Federal, State, regional, and other local governmental agencies, provided that same does not impose any costs on or require the City to incur any costs without compensation or reimbursement, or require the City to amend any of the City's policies, regulations, or ordinances.

3.6.3 As provided in California Government Code § 65869.5, this Agreement shall not preclude the application to the Project Site and Project of changes in laws, regulations, plans, or policies, to the extent that such changes are specifically mandated and required by changes in State or Federal laws or regulations. In the event changes in the law prevent or preclude compliance with one or more provisions of this Agreement, this Agreement shall be modified or suspended as may be necessary to comply with such State or Federal laws or regulations. The parties shall meet and confer in good faith in order to determine whether such provisions of this Agreement shall be modified or suspended as may be necessary to comply with changes in the law, and City and Developer shall agree to such action as may be reasonably required. It is the intent of the parties that any such modification or suspension be limited to that which is necessary and to preserve to the extent possible the original intent of the parties in entering into this Agreement. This Agreement shall remain in full force and effect to the extent it is not inconsistent with such laws or regulations. Nothing in this Agreement shall preclude the City or Developer from contesting by any available means (including administrative or judicial proceedings) the applicability to the Project Site or Project of any such State or Federal laws or regulations.

3.6.4 To the extent that any actions of Federal or State agencies (or actions of other governmental agencies, including City, required by Federal or State agencies' actions) have the effect of preventing, delaying, or modifying development of the Project Site or any portion

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thereof, City shall not in any manner be liable for any such prevention, delay, or modification.

Such actions include, but are not limited to, flood plain or wetlands designations and actions of Federal, State, or other governmental agencies that require the City to take actions as a result; the imposition of air quality or transportation measures or sanctions and actions of City or other governmental agencies required to be taken in order to be in compliance; or changes to CEQA and actions of City or other governmental agencies required to be taken as a result in order to be in compliance. As a condition to being able to proceed with development, Developer may be required, at its cost, to participate in such regional or local programs and to be subject to such development restrictions as may be necessary or appropriate by reason of actions of Federal, State or other governmental agencies (or action City is required to taken in response).

3.7 City's Police Power.

The parties acknowledge and agree that the limitations, reservations, and exceptions contained in this Agreement are intended to reserve to the City that part of its police power which cannot be limited by contract, and this Agreement shall be construed to reserve to the City that part of its police power which cannot be restricted by contract.

3.8 Subsequent Approvals for the Project Site.

3.8.1 Applications for Subsequent Approvals are anticipated to be submitted to the City by the Developer. Applications for Subsequent Approvals shall be processed and considered in a manner consistent with the rights granted by this Agreement and Applicable Law, including without limitation the Development Approvals.

3.8.2 The City has made a final policy decision that the development of the Project Site consistent with the Development Approvals, is in the best interests of the public health, safety, and general welfare. Accordingly, the City shall not use its authority in considering any application for a Subsequent Approval that is consistent with the Development Approvals to change the policy decisions reflected by the Development Approvals. Nothing herein shall limit the ability of the City to require the necessary reports, analysis, or studies to assist in determining whether the requested Subsequent Approvals are consistent with Applicable Law and this Agreement. City's review of the Subsequent Approvals shall be consistent with this Agreement, including without limitation Section 3.2 of this Agreement.

3.8.3 Any conditions, terms, restrictions, or requirements imposed by the City on Subsequent Approvals shall not prevent development of the Project Site for the uses and to the density and intensity of development included in the Development Approvals.

3.9 Life of Approvals and City Permits.

The terms of (a) any future tentative or parcel map (including vesting maps, map amendments, and lot line adjustments) which may be approved for the Project Site (as provided for in the Subdivision Map Act, Government Code Sections 66410 et seq.), or (b) the Development Approvals and Subsequent Approvals, shall automatically be extended for the longer of the duration of this Agreement (including any Extensions) or the term otherwise applicable to such Development Approval if this Agreement is no longer in effect.

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3.10 Developer Obligations.

In addition to any other obligations of Developer set forth herein, in consideration of City entering into this Agreement, Developer has agreed that if Developer commences development of the Project and proceeds to develop the Project Site, such development shall be in conformance with all of the terms, covenants, and requirements of this Agreement and Applicable Law, and Developer shall perform those specific obligations identified in the Development Approval. Developer shall pay when due any and all fees, impact fees, and costs which are lawfully imposed on all or any portion of the Project, whether imposed by City or other agencies. As a material inducement to City to enter into this Agreement, Developer further agrees that, as long as this Agreement is in effect:

3.10.1 The provisions of this Agreement shall govern and control the City Law to be applied to this development of the Project Site over any contrary or inconsistent provisions of the Development Agreement Statute. Developer waives the benefits of any Development Agreement Statute as it may be inconsistent or contrary to the provisions of this Agreement.

3.11 City Obligations.

In addition to any other obligations of City set forth herein, and in consideration of Developer entering into this Agreement, City provides to Developer the assurance that it can proceed with development of the Project for the Term pursuant to the terms and conditions of this Agreement and in accordance with Applicable Law. City acknowledges that the primary purpose of this Agreement is to effectuate the terms of the Development Approvals so that the Project is developed.

ARTICLE IV.

COMMUNITY BENEFITS

4.1 Developer shall provide the following benefits to the City, which are essential consideration to the City, without which the City would not have entered into this Agreement:

4.1.1 Payment for a security camera facing the U. S. 101 pedestrian overcrossing, which will be installed on the Property in a mutually agreed upon location that provides adequate view of the pedestrian overcrossing for security purposes. Such mutually agreed upon location shall not include installation on any of the Four Seasons Hotel buildings or the Four Seasons Hotel parcel located on the Property. The security camera will be procured, installed, operated and maintained by the City. Developer shall provide City reasonable access to the Property so that City may install and maintain the security camera.

4.1.2 A license agreement for pedestrian access through the Property, as shown on Exhibit C; in a form mutually agreed to by the parties.

4.1.3 The area on the ground floor in the eastern corner of the new building, labeled Community Function and shaded in blue on plan sheet A2 of the approved development plans, shall be space reserved for the benefit of the City and the East Palo Alto community and residents (the "Community Function Space").

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(a) The Community Function Space shall be approximately 2,800 square feet and will also include an additional outdoor patio of approximately 1,000 square feet.

The Developer shall pay for and construct the Community Function Space as a multi-use space appropriate for City and community groups to use for meetings, events, educational purposes, cultural celebrations, and similar gatherings. The Community Function Space shall be built out to include: finished flooring, drop down or open concept ceilings, bathroom for the exclusive use of guests of the community room, audio and visual equipment, furniture, fixtures and equipment, and other decorations appropriate for the purpose of the space. (b) The Developer shall provide fourteen (14) non-exclusive parking spaces adjacent to the Community Function Space for use of visitors. (c) The Community Function Space may also host art installations of a temporary or permanent nature, provided they do not interfere with the community meeting hosting orientation of the space.
(d) The Community Function Space shall be available for use by the community and City between the hours of 8am and 10pm free of charge for events that conform to the purposes specified in Section 4.1.3(a). Use of the space will be operated and managed by the Developer in consultation with the City.
(e) Reservation for the Community Function Space will be through an online reservation system on Developer's website, and also via a link to Developer's online reservation system on the City's website, via USPS mail, email, or in person requests at the property management office. Reservation priority will be given to the community and City up to ten (10) days before the requested time reservation. Inside of the ten (10) day period, and subject to the reasonable discretion of Developer, community groups, City, residents, tenants of Developer, the Four Seasons Hotel, and its guests and other groups may have access to the Community Function Space on a first come first served basis. In the event the City or a community group makes a request for a time when the Community Function Space is not available, Developer shall give the City or community group priority access to the nearest convenient available time slot. Should the City receive complaints or observe that the Community Function Space is not sufficiently available for community use, Developer and City shall meet to resolve the issues within seven (7) days of the City providing notice to the Developer.
(f) The Developer shall provide, operate, and pay for the reservation system, and all utility, janitorial, and routine maintenance and repair services to the Community Function Space.
(g) No fewer than ninety (90) days before the Developer requests final inspection of the Project, Developer shall demonstrate the functionality of the Community Function Space reservation system for City's approval, which shall not be unreasonably withheld.

4.1.4 Developer shall pay [$75,000] to the City for public art to be installed in the location and dimensions shown on Exhibit D. Developer shall provide payment at grading

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permit issuance. City shall allocate the funds to a local 501(c)(3) non-profit organization to, with the City, select the artwork to be installed and provide Developer a reasonable opportunity to review the content of the artwork. Developer shall provide City or its designee with all necessary access rights for installation, maintenance, and removal of the artwork in an agreement with standard terms and conditions. City shall obtain a California Art Protection Act (CAPA) and federal Visual Artist Rights Act (VARA) waivers reasonably acceptable to Developer for the artwork. City shall consider options for installing the artwork in such a way that it may be removed without damage to the artwork or the building in a manner consistent with CAPA and VARA.

4.1.5 Developer shall provide a minimum of forty-six (46) overflow parking spaces for residents of the Woodland Park housing development from the Effective Date through the seventh anniversary of the Certificate of Occupancy issued for Woodland Park Euclid Improvement project (Project No. Design Review Application GP19-01 et al), which is anticipated to construct approximately six hundred five (605) multifamily residential units.

4.1.6 Developer shall install improvements to the existing bus stop mid-block on Manahattan Avenue, near O'Connor Street, as shown in the approved development plans.

4.1.7 Developer shall install a new staircase providing direct access from Manhattan Avenue to the Property, as shown in the approved development plan.

4.1.8 Developer shall install landscape improvements along Manhattan Avenue.

4.1.9 Developer shall widen Woodland Avenue to add a third left-turn lane on eastbound Woodland Avenue at University Avenue for a total of four eastbound lanes, as shown in the approved Project plans.

ARTICLE V.

AMENDMENT OF AGREEMENT AND APPROVALS

5.1 Amendment or Cancellation Procedure.

City and Developer by mutual agreement may terminate or amend the terms of this Agreement, and the amendment or termination shall be accomplished in the manner provided under California law pertaining to development agreements and City of East Palo Alto Municipal Code Section 18.108.060, or any successor provisions thereto.

5.2 Minor Amendments to Project.

Upon the written application of Developer, and mutual consent of the parties, minor modifications and clarifications to the Project may be approved by the Director and submitted to the Planning Commission on the consent calendar, in conformance with East Palo Alto Municipal Code section 18.108.040.A.3. The Director, in consultation with the City Manager, shall determine whether a requested modification may be effectuated pursuant to this Section.

Such minor modifications and changes to the Project shall not be considered to be "amendments" pursuant to Section 5.1, above.

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5.3 Requirement for a Writing.

No amendment, minor amendment, or cancellation of this Agreement or any provision hereof shall be effective for any purpose unless adopted in the manner provided under California law and East Palo Alto Municipal Code Chapter 18.108 pertaining to development agreements and specifically set forth in a writing, which refers expressly to this Agreement and is signed by duly authorized representatives of the parties. The City Clerk shall record an appropriate notice of any amendment or cancellation with the County Recorder not later than ten (10) days after the effective date of the action effecting such amendment or cancellation, accompanied by a legal description of the Project Site.

5.4 Amendments to Development Agreement Legislation.

This Agreement has been entered into in reliance upon the provisions of the Development Agreement Statute, as those provisions existed at the date of execution of this Agreement. No amendment or addition to those provisions which would materially affect the interpretation or enforceability of this Agreement shall be applicable to this Agreement unless such amendment or addition is specifically required by the California State Legislature, or is mandated by a court of competent jurisdiction. If such amendment or change is permissive (as opposed to mandatory), this Agreement shall not be affected unless the parties mutually agree in writing, after following the procedures in Section 5.1, to amend this Agreement to permit such applicability.

5.5 Amendment of Development Approvals.

To the extent permitted by local, state, and federal law, any Development Approval may, from time to time, be amended or modified by submittal of an application from the Developer and following the procedures for such amendment or modification contained in the East Palo Alto Municipal Code. Upon any approval of such an amendment or modification, the amendment or modification shall automatically be deemed to be incorporated into the Applicable Law without any further procedure to amend this Agreement.

5.6 Effect of Termination on Developer's Obligations.

5.6.1 Notwithstanding any other provision to the contrary, termination or cancellation of this Agreement or termination of the rights of Developer as to the entire Project Site, or any part of the Project Site, shall not affect any requirement to comply with the Development Approvals, the terms and conditions of any other Subsequent Approval, nor any payments then due and owing to City, nor shall it affect the covenants of Developer specified in Section 5.6.2 below, to continue after the termination or cancellation of this Agreement.

Developer understands and agrees that the Development Approvals may be substantially modified in light of the circumstances resulting from the termination or cancellation of this Agreement or Developer's rights under this Agreement, and Developer shall have no rights to challenge such a modification by reason of this Agreement other than the rights, if any, Developer would have in the absence of this Agreement.

5.6.2 Notwithstanding anything in this Agreement to the contrary, the following provisions of this Agreement shall survive and remain in effect following termination or

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cancellation of this Agreement for so long as necessary to give them full force and effect with respect to claims or rights of City arising prior to termination or cancellation:
(a) Section 5.6 (Developer's obligations upon termination or cancellation);
(b) Section 7.2 (Remedies; limitation on damages);
(c) Section 11.2 (Indemnification); and
(d) Section 4.1.3 (Community Function Space).

ARTICLE VI.

ANNUAL REVIEW

City and Developer shall review all actions taken pursuant to the terms of this Agreement once annually, within sixty (60) days prior to each anniversary of the Effective Date, during each year of the Term unless the City and Developer agree in writing to conduct the review at another time.

Review of compliance with the terms of this Agreement shall be conducted by the Director.

Pursuant to East Palo Alto Municipal Code Section 18.108.070, Developer shall initiate the review by filing an application with the City and provide all the documents and information necessary for the City to complete the annual review and make a determination of whether Developer is in compliance.

6.2 Compliance Letter.

Before each anniversary of the Effective Date, Developer shall submit a letter ("Compliance Letter"), along with all necessary supporting documentation, to the Director describing Developer's compliance with the terms of the Development Approvals and this Agreement during the preceding year. The Compliance Letter shall include a statement that the Compliance Letter is submitted to the City pursuant to the requirements of Government Code Section 65865.1 and of the City's regulations on Development Agreements.

6.3 Determination of Good Faith Compliance.

Within thirty (30) days after receipt of the Compliance Letter, the Director shall determine whether, for the year under review, Developer has demonstrated good faith substantial compliance with the terms of this Agreement. If the Director finds and determines that Developer has complied substantially with the terms of this Agreement, or does not determine otherwise within thirty (30) days after delivery of the Compliance Letter, the annual review shall be deemed concluded and this Agreement shall remain in full force and effect. Upon its determination of compliance, the Developer may request a recordable certificate confirming Developer's compliance through the year under review. Developer may record the certificate with the San Mateo County Recorder's Office.

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If the Director initially determines the Compliance Letter to be inadequate in any respect, the Director shall provide notice to that effect to Developer and schedule a public hearing. If after a duly noticed public hearing, the City Council finds and determines, on the basis of substantial evidence, that Developer has not complied substantially in good faith with the terms of this Agreement for the year under review, the City Council shall give written notice thereof to Developer specifying the noncompliance. If Developer fails to cure the noncompliance within a reasonable period of time as established by the City Council, but in no event less than 60 days from the date of receipt of such notice, the City Council, in its discretion, may (a) grant additional time for Developer's compliance, or, following the hearing, modify this Agreement to the extent necessary to remedy or mitigate the noncompliance, (b) may modify this Agreement pursuant to the provisions of Section 8 below, or (c) terminate the Agreement pursuant to Article VI below.

6.4 No Waiver.

Failure of City to conduct an annual review shall not constitute a waiver by City of its rights to otherwise enforce the provisions of this Agreement nor shall Developer have or assert any defense to such enforcement by reason of any failure to conduct an annual review. City does not waive any claim of defect or breach by Developer if, following periodic review pursuant to this Article V, City does not propose to modify or terminate this Agreement.

ARTICLE VII.

DEFAULT, REMEDIES, AND TERMINATION

7.1 Notice of Breach.

Failure by either party to perform any material term or provision of this Agreement shall constitute a default hereunder, provided that the party alleging the default shall have given the other party advance written notice thereof and sixty (60) days within which to cure the condition, or, if the nature thereof is such that it cannot be cured within that time, the party receiving notice shall not be in default hereunder if the party promptly commences to perform its obligations hereunder and thereafter diligently completes performance. Written notice hereunder shall specify in detail the nature of the obligation to be performed by the party receiving notice.

7.2 Specific Performance Remedy for Breach.

It is acknowledged by the parties that City would not have entered into this Agreement if it were to be liable in damages under, or with respect to, this Agreement or the application thereof.

Developer and City have invested significant time and resources and performed extensive planning and processing of the Project in agreeing to the terms of this Agreement and will be investing more significant time and resources in implementing the Project in reliance upon the terms of this Agreement. It is not possible to determine the sum of money which would adequately compensate Developer or City for such efforts. City and Developer agree that damages would not be an adequate remedy if either City or Developer fails to carry out its obligations under this Agreement. Therefore, specific performance of this Agreement is necessary to compensate Developer if City fails to carry out its obligations under this Agreement

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or to compensate City if Developer fails to carry out its obligations under this Agreement.

Specific performance is the only remedy available to the parties under this Agreement.

7.3 Termination by Mutual Consent.

This Agreement may be voluntarily terminated in whole or in part by the mutual consent of the parties or their successors in interest, in the sole and absolute discretion of each as to its consent.

Such mutual consent to terminate shall be evidenced in writing.

ARTICLE VIII.

ESTOPPEL CERTIFICATE
Either party may, at any time, and from time to time, deliver written notice to the other party requesting such party to certify in writing that, to the knowledge of the certifying party, (a) this Agreement is in full force and effect and is a binding obligation of the parties, (b) this Agreement has not been amended or modified or, if so amended or modified, identifying the amendments or modifications, and (c) the requesting party is not in default in the performance of its obligations under this Agreement, or if in default, to describe the nature of any defaults. The party receiving a request under this Article VIII shall execute and return the certificate within thirty (30) days following receipt of the request. The Director shall be authorized to execute any certificate requested by Developer. Developer and City acknowledge that a certificate hereunder may be relied upon by transferees and Mortgagees. Developer shall pay the City's reasonable costs involved in providing such estoppel certificate.

ARTICLE IX.

TRANSFERS, ASSIGNMENTS

9.1 Agreement Runs With the Land.

9.1.1 This Agreement and all of its provisions, agreements, rights, powers, standards, terms, covenants and obligations, shall be binding upon the parties and their respective heirs, successors (by merger, consolidation, or otherwise) and assigns, devisees, administrators, representatives, lessees, and all other persons or entities acquiring the Project Site or any portion thereof, or any interest therein, whether by sale, operation of law, or in any manner whatsoever, and shall inure to the benefit of the parties and their respective heirs, successors (by merger, consolidation or otherwise) and assigns.

9.1.2 All of the provisions of this Agreement shall be enforceable during the Term as equitable servitudes and constitute covenants running with the land pursuant to applicable law, including, but not limited to Section 1468 of the Civil Code of the State of California. Each covenant to do or refrain from doing some act on the Project Site hereunder, (a) is for the benefit of the Project Site and is a burden upon the Project Site, (b) runs with the Project Site, and (c) is binding upon Developer and each successive owner during its ownership of the Project Site or any portion thereof, and each person or entity having any interest in the Project Site. Every person who now or hereafter owns or acquires any right, title or interest in or to any portion of the Project Site is and shall be conclusively deemed to have consented and

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agreed to every provision contained herein, whether or not any reference to this Agreement is contained in the instrument by which such person acquired an interest in the Project Site.

9.2 Right to Assign.

9.2.1 Developer shall have the right to assign its rights to develop the Project Site (by sale, transfer, or otherwise) to any person, business entity, or other similar entity ("Assignee"). Any such transfer shall be deemed to include an assignment of all rights, duties, and obligations created by this Agreement with respect to all or any portion of the Project Site.

9.3 Release Upon Assignment.

9.3.1 Upon the express written assumption by the Assignee of Developer's rights and interests under this Agreement (the "Assignment Agreement"), Developer shall be free from any and all liabilities accruing on or after the date of assignment with respect to those obligations assumed by the Assignee pursuant to the Assignment Agreement, except to the extent that Developer is in default with respect to any and all obligations at the time of the proposed transfer.

ARTICLE X.

MORTGAGEE PROTECTION

10.1 Mortgage Protection.

This Agreement shall be superior and senior to any lien placed upon the Project Site or any portion of the Project Site after the date of recording of this Agreement, including the lien of any deed of trust or mortgage ("Mortgage"). Notwithstanding the foregoing, no breach of this Agreement shall defeat, render invalid, diminish, or impair the lien of any Mortgage made in good faith and for value, but all of the terms and conditions contained in this Agreement (including but not limited to City's remedies to terminate the rights of Developer (and its successors and assigns) under this Agreement, to terminate this Agreement, and to seek other relief as provided in this Agreement) shall be binding upon and effective against any person or entity, including any deed of trust beneficiary or mortgagee ("Mortgagee") who acquires title to the Project Site, or any portion thereof, by foreclosure, trustee's sale, deed in lieu of foreclosure, or otherwise. Notwithstanding the foregoing and for the avoidance of doubt, any Mortgagee who takes title to the Project Site or any part of the Project Site shall be entitled to the benefits arising under this Agreement.

10.2 Mortgagee Not Obligated.

Notwithstanding the provisions of Section 10.1 above, no Mortgagee shall have any obligation or duty under this Agreement to construct or complete the construction of improvements on the Project Site, or to guarantee such construction or completion; provided, however, that a Mortgagee shall not be entitled to devote the Project Site to any uses or to construct any improvements on the Project Site other than those uses or improvements provided for or authorized by this Agreement, or otherwise under Applicable Law. City shall permit the Mortgagee to succeed to the rights and obligations of Developer under this Agreement. Upon (i)

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any such succession to the rights and obligations of Developer, and (ii) taking possession of the Project Site, Mortgagee agrees to take commercially reasonable efforts to promptly cure all continuing, non-monetary defaults by Developer hereunder that are reasonably susceptible of being cured.

10.3 Notice of Default to Mortgagee; Cure Rights.

If City receives a written notice from a Mortgagee, Developer, or any approved Assignee requesting a copy of any notice of default given Developer or any approved Assignee and specifying the address for service, then City shall deliver to the Mortgagee at Mortgagee's cost (or Developer's cost), concurrently with service to Developer, any notice given to Developer with respect to any claim by City the Developer is in default under this Agreement. Each Mortgagee shall have a further right, but not an obligation, to cure any such default within ten (10) business days after receiving any notice of default with respect to a monetary default and within thirty (30) days after receiving any notice of default with respect to a non-monetary default. If the Mortgagee can only remedy or cure a non-monetary default by obtaining possession of the Project Site, then the Mortgagee shall have the right, but not an obligation, to seek to obtain possession with diligence and continuity through a receiver or otherwise, and to remedy or cure the non-monetary default within thirty (30) days after obtaining possession or such longer period of time as is reasonably necessary to remedy or cure the default, provided the Mortgagee promptly commences to cure the non-monetary Default within thirty (30) days and diligently prosecutes the cure to completion.

10.4 No Supersedure.

Nothing in this Article X shall be deemed to supersede or release a Mortgagee or modify a Mortgagee's obligations under any subdivision improvement agreement or other obligation incurred with respect to the Project Site outside this Agreement, nor shall any provision of this Article X constitute an obligation of City to the Mortgagee, except as expressly set forth in this Agreement.

ARTICLE XI.

INDEMNIFICATION

11.1 No Duty of City; Hold Harmless.

It is specifically understood and agreed by the parties that the development contemplated by this Agreement is a private development, that City has no interest in or responsibility for or duty to third persons concerning any of said improvements, and that Developer shall have full power over and exclusive control of the Project Site subject only to the limitations and obligations of Developer under this Agreement.

11.2 Indemnification.

Developer shall indemnify, defend (with counsel approved by the City), and hold harmless City and its elected and appointed representatives, officers, agents, and employees from any loss, liability, fines, penalties, forfeitures, costs, and damages (whether in contract, tort, or strict

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liability, including but not limited to personal injury, death at any time, and property damage) and from any and all claims, demands, and actions in law or equity (including reasonable attorneys' fees and litigation expenses) directly or indirectly arising or alleged to have arisen out of or in any way related to: (a) the approval of this Agreement or the Development Approvals; (b) any development or use of the Project Site under this Agreement or the Development Approvals; and (c) any actions or inactions by the Developer or its contractors, subcontractors, agents, or employees in connection with the construction or improvement of the Project Site and the Project; excepting to the extent arising from the gross negligence, intentional acts, willful misconduct or arbitrary or capricious behavior of City, its elected and appointed representatives, officers, agents, employees, contractors or subcontractors.

This indemnification and hold harmless agreement applies to all damages and claims for damages suffered or alleged to have been suffered by reason of the operations referred to in this Section 11.2, regardless of whether or not City prepared, supplied, or approved plans or specifications for the Project Site, but does not apply to damages and claims for damages caused by City with respect to public improvements and facilities after City has accepted responsibility for them.

ARTICLE XII.

NOTICES

12.1 Notices.

Formal written notices, demands, correspondence and communications between City and Developer shall be sufficiently given if: (a) personally delivered; or (b) dispatched by next day delivery by a reputable carrier such as Federal Express or DHL to the offices of City and Developer indicated below, provided that a receipt for delivery is provided; or (c) if dispatched by certified mail, postage prepaid, to the offices of City and Developer indicated below. Such written notices, demands, correspondence, and communications may be sent in the same manner to such persons and addresses as either party may from time-to-time designate by notice as provided in this Section. A copy of the notice should be sent via e-mail as well to the email addresses provided in this Section.

CITY: City Manager
City of East Palo Alto
2415 University Avenue
East Palo Alto, CA 94303
email:

With copy to: City Attorney
City of East Palo Alto
2415 University Avenue
East Palo Alto, CA 94303
email:

DEVELOPER: David S. Dowdney

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Senior Vice President
Columbia Property Trust
650 California Street, Suite 200
San Francisco, CA 94108
With copy to : Sigrid R. Waggener, Esq.

Manatt, Phelps & Phillips, LLP
One Embarcadero Center, 30th Floor
San Francisco, CA 94111
ARTICLE XIII.

MISCELLANEOUS

13.1 Cooperation in the Event of Third-party Legal Challenge.

In the event of any legal action instituted by a third party or other governmental entity or official challenging the validity of any provision of this Agreement ("Third Party Challenge"), the parties shall mutually cooperate with each other relating to the Third Party Challenge.

13.1.1 Invalidity.

If any part of this Agreement is held by a court of competent jurisdiction to be invalid or unlawful, the parties shall: use their best efforts to cure any inadequacies or deficiencies identified by the court in a manner consistent with the express and implied intent of this Agreement, and then to adopt or re-enact such part of this Agreement as necessary or desirable to permit implementation of this Agreement.

13.2 Applicable Law and Venue.

This Agreement shall be construed and enforced in accordance with the laws of the State of California. Any action at law or in equity arising under this Agreement or brought by any Party for the purposes of enforcing, construing, or determining the validity of any provision of this Agreement shall be filed and tried in the County of San Mateo, or the United States District Court for the Northern District of California

13.3 Severability.

Except as otherwise provided herein, if any provision(s) of this Agreement is (are) held invalid, the remainder of this Agreement shall not be affected except as necessarily required by the determination of invalidity, and shall remain in full force and effect unless amended or modified by mutual consent of the parties.

13.4 Nondiscrimination.

Developer covenants by and for itself and any successors in interest that there shall be no discrimination against or segregation of any person or group of persons on account of race, color,

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creed, religion, sex, marital status, ancestry, or national origin in the development of the Project Site in furtherance of this Agreement. The foregoing covenant shall run with the land.

13.5 Headings.

The language in this Agreement in all cases shall be construed as a whole and in accordance with its fair meaning. Section and subsection headings in this Agreement are for convenience only and are not intended to be used in interpreting or construing the terms, covenants, or conditions of this Agreement.

13.6 Agreement is Entire Understanding.

This Agreement is executed in one original, which constitutes the entire understanding and agreement of the parties. The parties acknowledge and agree that neither of them has made any representation with respect to the subject matter of this Agreement or any representations inducing the execution and delivery hereof, except representations set forth herein, and each party acknowledges that it has relied on its own judgment in entering this Agreement. The parties further acknowledge that, except for those contained in Applicable Law, all statements or representations that heretofore may have been made by either of them to the other are void and of no effect, and that neither of them has relied thereon in its dealings with the other. To the extent that there is any conflict between the Applicable Law and this Agreement, this Agreement shall govern the parties' respective rights and obligations.

13.7 Interpretation.

Each party to this Agreement has had an opportunity to review the Agreement, confer with legal counsel regarding the meaning of the Agreement, and negotiate revisions to the Agreement.

Accordingly, neither party shall rely upon Civil Code Section 1654 in order to interpret any uncertainty in the meaning of the Agreement.

13.8 Recordation of Termination.

Upon completion of performance of the parties or termination of this Agreement, a written statement acknowledging such completion or termination shall be recorded by City in the Official Records of San Mateo County, California.

13.9 Counterparts.

This Agreement may be executed in counterparts, each of which shall be deemed to be an original, but the counterparts together shall constitute only one Agreement.

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IN WITNESS HEREOF, the parties have executed this Agreement as of the Effective Date.

CITY OF EAST PALO ALTO,
a municipal corporation
By: __________________________
Mayor
Dated: __________________________
[DEVELOPER]
a ______
By: __________________________
Dated: __________________________
ATTEST:
________________________________
City Clerk
Dated: __________________________
APPROVED AS TO FORM:
____________________________________
City Attorney
Dated: __________________________

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STATE OF CALIFORNIA )
)
COUNTY OF __________________ )
On ____________________, before me, ___________________________, Notary Public, 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.
______________________________________
Name: ______________________________
Notary Public
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.

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

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EXHIBIT A

LEGAL DESCRIPTION OF THE PROPERTY

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Project No. 20150084-50

BKF ENGINEERS
255 Shoreline Drive, Suite 200, Redwood City, CA 94065 | 650.482.6300

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EXHIBIT A

SUBJECT PARCEL DESCRIPTION
All that real property situate in the City of East Palo Alto, County of San Mateo, State of California, described as follows:

Being a portion of Parcel 1 as said parcel is shown on that certain “UNIVERSITY CIRCLE PARCEL MAP” in process with the City of East Palo Alto. Said parcel is also subject to future subdivision. See the plat attached hereto as sheet 2, Exhibit A.

This description is being provided as an exhibit for attachment to a Development Agreement. This is not being provided or prepared for conveyance of any title, easement, or interest of or over the land depicted hereon.

See referenced Parcel Map for particulars.

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U N I V E R S I T Y A V E N U E
PARCEL 1B
(SUBJECT OF FUTURE SUBDIVISION) W O O D L A N D A V E N U E PARCEL 1A

SUBJECT PARCEL
(SUBJECT OF FUTURE SUBDIVISION)
JOB NO.

BY APPR. DATE

SUBJECT
OF
255 SHORELINE DR.,
SUITE 200
REDWOOD CITY, CA 94065
(650) 482-6300
www.bkf.com

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-1

EXHIBIT B

PROJECT SITE

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EXHIBIT C

PEDESTRIAN ACCESS

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D–1

EXHIBIT D

ARTWORK LOCATION

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EAST PALO ALTO

CITY COUNCIL

STAFF REPORT
DATE: May 17, 2022
TO: Honorable Mayor and Members of the City Council
VIA: Patrick Heisinger, Interim City Manager
BY: James Colin, Executive Assistant
SUBJECT: Minutes of the 1/8/2022 - 3/22/2022 Meetings
Recommendation
Adopt the minutes of the 1/8/2022 - 3/22/2022 Meetings
Background
The City Council will consider adopting the minutes of the 1/8/2022 - 3/22/2022 Meetings Attachments

1. Draft Minutes 1-8-2022

2. Draft Minutes 1-18-2022

3. Draft Minutes 1-25-2022

4. Draft Minutes 2-1-2022

5. Draft Minutes 2-15-2022

6. Draft Minutes 3-1-2022

7. Draft Minutes 3-15-2022

8. Draft Minutes 3-22-2022

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EAST PALO ALTO CITY COUNCIL

SPECIAL MEETING MINUTES
EPA Government Center
2415 University Ave, First Floor – City Council Chamber East Palo Alto, CA 94303

1. CALL TO ORDER AND ROLL CALL
The meeting was called to order by Mayor Ruben Abrica at 8:30 AM Attendee Name Title Status Arrived
Carlos Romero Councilor Remote
Ruben Abrica Mayor Remote
Lisa Gauthier Vice Mayor Remote
Antonio Lopez Councilor Late 11:36 AM
Regina Wallace-Jones Councilor Remote

2. APPROVAL OF THE AGENDA
Motion: Carlos Romero
Second: Lisa Gauthier
Passed Unanimously.

3. PROCLAMATION COMMEMORATING REVEREND DR. MARTIN LUTHER KING, JR.

Lisa Gauthier: Discussed Martin Luther King Jr.’s ongoing legacy. YCS with other groups will be holding events.

Motion: Carlos Romero
Second: Lisa Gauthier
Passed Unanimously.

1. Proclamation of the City of East Palo Alto Commemorating the Contributions of the Reverend Dr. Martin Luther King, Jr., in the Fight for Equality

4. CITY COUNCIL PRIORITY SETTING FOR FISCAL YEAR 2022-2023 Jaime Fontes, City Manager provided introductory comments followed by Greg Larson's presentation.

Discussed by Councilmembers and Staff.

Input from Marie McKenzie on COVID-19 efforts.

1. City Council Priority Setting for Fiscal Year 2022-2023 Public Speakers:
- Q Smith

5. ADJOURNMENT
The meeting was adjourned at 10:09 pm

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EAST PALO ALTO CITY COUNCIL

REGULAR MEETING MINUTES
EPA Government Center
2415 University Ave, First Floor – City Council Chamber East Palo Alto, CA 94303

1. CALL TO ORDER AND ROLL CALL
The meeting was called to order by Mayor Ruben Abrica at 6:30 p.m.

Attendee Name Title Status Arrived
Carlos Romero Councilor Remote
Ruben Abrica Mayor Remote
Lisa Gauthier Vice Mayor Remote
Antonio Lopez Councilor Absent
Regina Wallace-Jones Councilor Remote

2. APPROVAL OF THE AGENDA
RESULT: APPROVE [UNANIMOUS]
MOTION BY: Romero
SECOND: Gauthier
AYES: Romero, Abrica, Gauthier, Wallace-Jones
ABSENT: Lopez

3. APPROVAL OF CONSENT CALENDAR
RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

AYES: Romero, Abrica, Gauthier, Wallace-Jones
ABSENT: Lopez

1. East Palo Alto Career Center’s Technical Advisory Committee RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

2. Amendment of Agreement with David Rosen & Associates for Financial Analysis Related to Housing
RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

3. Measure O Contract-Anti-Displacement Services Agreement, Clarifying Resolution RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

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4. Amendments to contracts with Raimi + Associates related to the Ravenswood Business District Specific Plan and Project Management Services CR: Question on cost and data runs related to traffic.

Both Patrick Heisinger and Amy Chen responded.

RESULT: APPROVE [UNANIMOUS]
MOTION BY: Romero
SECOND: Abrica

5. AB 361 Findings to Continue Virtual Public Meetings for the City Council and City Advisory Bodies
RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

6. City Council Consideration of an Agreement with Greg Larson to Provide Management-Related Services
RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

7. Proclamation Against Human Trafficking in The Bay Area Ruth Robinson from the San Mateo County Human Trafficking Program provided comments
Ruben Abrica: Read proclamation.

RESULT: APPROVE [UNANIMOUS]
MOTION BY: Abrica
SECOND: Romero

8. Quarterly COVID-19 Emergency Reporting
RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

9. Approve Compensation Adjustments for Non-Bargaining, Unrepresented Confidential Restricted Classific
RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

10. Request to increase contract and purchase order for Ricoh Digital Services RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

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11. Approval of a new leasing agreement with Shamrock Office Solutions for Citywide Copy Machines
Lisa Gauthier: Pointed out correction needed with numbers.

RESULT: APPROVE [UNANIMOUS]
MOTION BY: Gauthier
SECOND: Romero

12. November 2020 Cash Report
RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

4. PUBLIC COMMENT
- Shawneece Stevenson, Sequoia Union High School District - Chris Thomsen, Sequoia Union High School District
- Kelly
- Tereza Melakuova
- Sean Ripley
- Tim
- Gail Wilkerson
- Dennis Parker

5. INFORMATIONAL REPORTS

6. SPECIAL PRESENTATIONS

7. PUBLIC HEARINGS

1. Introduction of East Palo Alto Opportunity to Purchase Act ("EPA OPA") Ordinance Continue item to 1/25/2022
RESULT: APPROVE [UNANIMOUS]
MOTION BY: Romero
SECOND: Gauthier
AYES: Romero, Abrica, Gauthier, Wallace-Jones
ABSENT: Lopez

8. POLICY AND ACTION
City Manager Jaime M. Fontes provided a presentation

1. COVID-19 Vaccination Program Regular Update

9. COUNCIL REPORTS
Lisa Gauthier: Thanks for the MLK proclamation and YCS event.

Regina Wallace-Jones: Spoke on the passing of former Mayor RB Jones.

Ruben Abrica: Mentioned the situation in Tonga.

10. ADJOURNMENT The meeting was adjourned at 8:12 p.m.

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Packet Pg. 404 Attachment: Draft Minutes 1-18-2022 (2264 : Minutes of the 1/8/2022 - 3/22/2022 Meetings) East Palo Alto City Council January 25, 2022 Minutes Page 1 of 3

EAST PALO ALTO CITY COUNCIL

SPECIAL MEETING MINUTES
EPA Government Center
2415 University Ave, First Floor – City Council Chamber East Palo Alto, CA 94303

1. CALL TO ORDER AND ROLL CALL
The meeting was called to order by at 6:00 p.m.

Attendee Name Title Status Arrived
Carlos Romero Councilor Remote
Ruben Abrica Mayor Remote
Lisa Gauthier Vice Mayor Remote
Antonio Lopez Councilor Absent
Regina Wallace-Jones Councilor Remote

2. APPROVAL OF THE AGENDA
Motion: Carlos Romero Second: Lisa Gauthier
Passed Unanimously.

3. CLOSED SESSION
Note: Spanish interpreter was available.

A. PUBLIC COMMENT ON CLOSED SESSION ITEMS
Public Speakers
- Stanley Young, Rep for Union 21
- Janet Nunez Aguilar, Rep for 921
- Azalea Renfield, Rep for MEA
- Spencer Lawrence, Rep POA
B. ADJOURNMENT INTO CLOSED SESSION
C. CITY COUNCIL TO RECONVENE INTO OPEN SESSION
D. REPORT OUT OF CLOSED SESSION
No reportable action

4. SPECIAL PRESENTATIONS

1. Veolia Water Presentation
City Manager introduced Richard Perez and Dan McFarland, who provided a presentation.

Councilmembers discussed.

Public Speakers
- Mark Dinan
- Steward Hyland
- Jack Biederman

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Packet Pg. 405 Attachment: Draft Minutes 1-25-2022 (2264 : Minutes of the 1/8/2022 - 3/22/2022 Meetings) East Palo Alto City Council January 25, 2022 Minutes Page 2 of 3 - Dhirendra Maharaj

5. PUBLIC HEARINGS
City Manager introduced Rachel Horst, Nora Lake Brown, and Karen Camacho, who presented "Opportunity to Purchase" (OPA)
Councilmembers discussed.

1. Introduction of East Palo Alto Opportunity to Purchase Act ("EPA OPA") Ordinance Public Speakers
- Tamara Smith-Jones
- Gail Wilkerson
- Laura Rubio
- Kenia Najar
- Javanni Brown-Austin
- Stewart Hyland
- Q Smith
- Jennifer L
- Cristal Montes
- Sarah Hoffman
- Romain Tanière
- Rohin Ghosh
- Izamar Moya
- Fili
- Uriel Hernandez
- Brenda
- Magnus Larsson
- Iliana Nicholas
- Cristina
- Francisca Guzman
- Donna
- Duane Bay
- Federico Andrade
- Raquel Lima
- Julisa
- Mark Moulton
- Suzanne Moore
- Carol Cunningham
- David W
- Darren Cunningham
- Drake Diedrich
- Carol Li

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Packet Pg. 406 Attachment: Draft Minutes 1-25-2022 (2264 : Minutes of the 1/8/2022 - 3/22/2022 Meetings) East Palo Alto City Council January 25, 2022 Minutes Page 3 of 3 - Lourdes Best
- Eve
- Victor Liu
- Ofelia Bello
- Elena Kogan
- George Hunt
- Tuan N.
- Mauricio
- Julian
- Sean Ripley
- Dan
- Court Skinner
- Patricia Lopez
- Jeannie Llewellyn
- Al Jay
- Kimberly Carlton
- Vanessa Smith
- Nina Helmer
- Romanovskaia Anna
Motion: Carlos Romero Second: Lisa Gauthier continue the hearing to the 3/1 6:30 PM City Council meeting.

RESULT: CONTINUED [UNANIMOUS]
MOTION BY:

SECOND:

AYES: Romero, Abrica, Gauthier, Wallace-Jones
ABSENT: Lopez

6. ADJOURNMENT
The meeting was adjourned at p.m.

3.10.c
Packet Pg. 407 Attachment: Draft Minutes 1-25-2022 (2264 : Minutes of the 1/8/2022 - 3/22/2022 Meetings) East Palo Alto City Council February 1, 2022 Minutes Page 1 of 3

EAST PALO ALTO CITY COUNCIL

REGULAR MEETING MINUTES
EPA Government Center
2415 University Ave, First Floor – City Council Chamber East Palo Alto, CA 94303

1. CALL TO ORDER AND ROLL CALL
The meeting was called to order by Vice Mayor Ruben Abrica at 6:30 p.m.

Attendee Name Title Status Arrived
Carlos Romero Mayor Remote
Ruben Abrica Vice Mayor Remote
Lisa Gauthier Councilor Remote
Antonio Lopez Councilor Remote
Regina Wallace-Jones Councilor Remote

2. APPROVAL OF THE AGENDA
RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

AYES: Romero, Abrica, Gauthier, Lopez, Wallace-Jones

3. APPROVAL OF CONSENT CALENDAR
RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

AYES: Romero, Abrica, Gauthier, Lopez, Wallace-Jones

1. Black History Month Proclamation
Mayor read the proclamation.

Lisa Gauthier spoke on the topic.

Regina Wallace-Jones suggests giving the proclamation to Dr. Omowale Satterwhite, who is being inducted into Black Legends Hall of Fame and charter member of EPA.

Antonio Lopez also speaks on topic.

Members of the Public
- Q Smith
- Gail Wilkerson
- Renee Harris
RESULT: APPROVE [UNANIMOUS]
MOTION BY: Romero
SECOND: Wallace-Jones

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Packet Pg. 408 Attachment: Draft Minutes 2-1-2022 (2264 : Minutes of the 1/8/2022 - 3/22/2022 Meetings) East Palo Alto City Council February 1, 2022 Minutes Page 2 of 3

2. Issuing a Request for Proposals for Business License and Tax Administration Services
RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

3. Appointment of Interim City Attorney
RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

4. Amendment to Agreement with EPACANDO for Below Market Rate Housing Program Administration
RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

5. Selection of Recruitment Firms for the new Chief of Police and Additional Recruitments
RESULT: APPROVE [UNANIMOUS]
MOTION BY: Gauthier
SECOND: Abrica

4. CLOSED SESSION
Skip closed session.

A. PUBLIC COMMENT ON CLOSED SESSION ITEMS
B. ADJOURNMENT INTO CLOSED SESSION
C. RECONVENE INTO OPEN SESSION
D. REPORT OUT OF CLOSED SESSION

5. PUBLIC COMMENT
Public Speaker
- Rene Harris

6. INFORMATIONAL REPORTS
This item will be continued.

1. Waste Process Outreach

7. SPECIAL PRESENTATIONS - NONE

8. PUBLIC HEARINGS - NONE

9. POLICY AND ACTION

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Packet Pg. 409 Attachment: Draft Minutes 2-1-2022 (2264 : Minutes of the 1/8/2022 - 3/22/2022 Meetings) East Palo Alto City Council February 1, 2022 Minutes Page 3 of 3

1. Ravenswood Business District Specific Plan – Housing Locations and CEQA Scenarios
Patrick Heisinger introduced Amy Chen who introduced: Troy Reinhalter, Raimi + Associates and Matt Raimi, Raimi + Associates presented on this item.

Council discussed this topic.

Public Speakers: Patricia Lopez, Kim Diamond, Renee Harris, Juan Estrada, Quynh, Gail Wilkerson, Eileen McLaughlin, Jennifer Hetterly, Millie, Gita Dev, Duane Bay, Alicia Mckean, Ofelia Bello, Q Smith, Camellia Pittman
Staff report was filed and received. Direction provided by Council.

2. City Council Consideration of Potential Approaches Regarding Unhoused Residents
Rachel Horst and Patrick Heisinger provided a presentation.

Council discussed this topic.

Public Speakers
- Patricia Lopez
- Stewart Hyland
- Renee Harris

3. COVID-19 Vaccination Program Regular Update
Patrick Heisinger provided a presentation update..

Public Spakers
- Q Smith
- Renee Harris

10. COUNCIL REPORTS
- Councilmember Wallace-Jones made a comment on the Tongan community - Councilmember Gauthier commented on members of EPA who recently passed away. - Councilmember Lopez concurs with previous comments.
- Mayor Abrica mentions the departure (last meeting) for acting City Attorney Raphael Alvarado

11. ADJOURNMENT
The meeting was adjourned at 10:31 pm

3.10.d
Packet Pg. 410 Attachment: Draft Minutes 2-1-2022 (2264 : Minutes of the 1/8/2022 - 3/22/2022 Meetings) East Palo Alto City Council February 15, 2022 Minutes Page 1 of 5

EAST PALO ALTO CITY COUNCIL

REGULAR MEETING MINUTES
EPA Government Center
2415 University Ave, First Floor – City Council Chamber East Palo Alto, CA 94303

1. CALL TO ORDER AND ROLL CALL
The meeting was called to order by Vice Mayor Ruben Abrica at 6:30 p.m.

Attendee Name Title Status Arrived
Carlos Romero Mayor Present
Ruben Abrica Vice Mayor Present
Lisa Gauthier Councilor Present
Antonio Lopez Councilor Present
Regina Wallace-Jones Councilor Present

2. APPROVAL OF THE AGENDA
RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

AYES: Romero, Abrica, Gauthier, Lopez, Wallace-Jones

3. APPROVAL OF CONSENT CALENDAR
RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

AYES: Romero, Abrica, Gauthier, Lopez, Wallace-Jones

1. 2111 : Minutes of the May 4, 2021- July 27,2021 Meetings RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

2. Code of Ethics and Conduct for Elected and Appointed Officials - Advisory Bodies Review
RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

3. FY21-22 Q2 Treasury Report
RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

3.10.e
Packet Pg. 411 Attachment: Draft Minutes 2-15-2022 (2264 : Minutes of the 1/8/2022 - 3/22/2022 Meetings) East Palo Alto City Council February 15, 2022 Minutes Page 2 of 5

4. Authorize Exception of the Travel and Training Reimbursement Policy for a Planning Commission Member
RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

5. Amendment No. 4 to Agreement with Badawi & Associates RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

6. Mayoral Committee Appointments and Assignments
RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

7. Annual Classification Plan and Compensation Schedule for FY 2021-22 RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

8. CalRecycle Grant Applications
RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

9. AB 361 Findings to Continue Virtual Public Meetings for the City Council and City Advisory Bodies
RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

10. University Circle Parcel Map Clean Up and Easement Acceptance RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

11. Amendment to Agreement with Aquatic Science Center: San Francisco Estuary Institute
RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

12. Omowale Satterwhite Proclamation

3.10.e
Packet Pg. 412 Attachment: Draft Minutes 2-15-2022 (2264 : Minutes of the 1/8/2022 - 3/22/2022 Meetings) East Palo Alto City Council February 15, 2022 Minutes Page 3 of 5 RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

13. Update on Spanish Translation Services and Language Access Plan RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

4. CLOSED SESSION
Report out of closed session for a second time 12:12 AM A. PUBLIC COMMENT ON CLOSED SESSION ITEMS
B. ADJOURNMENT INTO CLOSED SESSION
C. RECONVENE INTO OPEN SESSION
D. REPORT OUT OF CLOSED SESSION
Interim City Attorney Valerie Armento reported no reportable action.

E. COUNCIL REPORTS

5. PUBLIC COMMENT
- Ramses Escobedo
- Patricia Lopez
- Jeff Poetsch
- Alicia Mckean
- Q Smith

6. INFORMATIONAL REPORTS
Presentation made by Batool Zaro Assistant Engineer.

1. Waste Process Outreach

7. SPECIAL PRESENTATIONS

8. PUBLIC HEARINGS

1. 990 Garden St. Inclusionary Housing Alternative Compliance Option Rachel Horst provided a presentation.

Public Comment:
- patricia lopez
- Owen B
- Diana L
- Q Smith
Motion: Lisa Gauthier Second: Carlos Romero

3.10.e
Packet Pg. 413 Attachment: Draft Minutes 2-15-2022 (2264 : Minutes of the 1/8/2022 - 3/22/2022 Meetings) East Palo Alto City Council February 15, 2022 Minutes Page 4 of 5 Approving Alternative compliance option wording
Extend meeting to 12:30 Motion: Carlos Romero Second: Ruben Abrica (Unanimous) RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

AYES: Romero, Abrica, Gauthier, Lopez, Wallace-Jones

9. POLICY AND ACTION

1. Mid-year Budget Amendment FY21-22
RESULT: CONTINUED [UNANIMOUS]
MOTION BY:

SECOND:

AYES: Romero, Abrica, Gauthier, Lopez, Wallace-Jones

2. Community Project Funding Requests
RESULT: CONTINUED [UNANIMOUS]
MOTION BY:

SECOND:

AYES: Romero, Abrica, Gauthier, Lopez, Wallace-Jones

3. Euclid Improvements (Woodland Park) Project Relocation Plan Recommendation Amy Chen provided a presentation Mike Kramer.

Public Speakers:
- Tony Romero
-America Rios
- gladis
- Susana
- mayra
- Teresa Morales
- patricia lopez
- Gabriel Manrique
- LAURA RUBIO
- Cecilia Gaona
- Ashley Coker
- Anthony W. Pratt
- Fabián Sánchez Coronado, CLSEPA
- Harriett Wycoff
- Michelle Trejo-Saldivar (CLSEPA)
- Q Smith

3.10.e
Packet Pg. 414 Attachment: Draft Minutes 2-15-2022 (2264 : Minutes of the 1/8/2022 - 3/22/2022 Meetings) East Palo Alto City Council February 15, 2022 Minutes Page 5 of 5 - Julian Garcia
- Marisela Ramos

4. COVID-19 Vaccination Program Regular Update

10. COUNCIL REPORTS

11. ADJOURNMENT
The meeting was adjourned at 12:12 AM

3.10.e
Packet Pg. 415 Attachment: Draft Minutes 2-15-2022 (2264 : Minutes of the 1/8/2022 - 3/22/2022 Meetings) East Palo Alto City Council March 1, 2022 Minutes Page 1 of 4

EAST PALO ALTO CITY COUNCIL

REGULAR MEETING MINUTES
EPA Government Center
2415 University Ave, First Floor – City Council Chamber East Palo Alto, CA 94303

1. CALL TO ORDER AND ROLL CALL
The meeting was called to order by Mayor Ruben Abrica at 6:30 p.m.

Attendee Name Title Status Arrived
Carlos Romero Councilor Remote
Ruben Abrica Mayor Remote
Lisa Gauthier Vice Mayor Remote
Antonio Lopez Councilor Remote
Regina Wallace-Jones Councilor Remote

2. APPROVAL OF THE AGENDA
RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

AYES: Romero, Abrica, Gauthier, Lopez, Wallace-Jones

3. APPROVAL OF CONSENT CALENDAR
RESULT: ADOPT [UNANIMOUS]
MOTION BY:

SECOND:

AYES: Romero, Abrica, Gauthier, Lopez, Wallace-Jones

1. Minutes of the September 7, 2021 Regular Meeting
RESULT: ADOPT [UNANIMOUS]
MOTION BY:

SECOND:

2. Contract Extension McNabb Construction
RESULT: ADOPT [UNANIMOUS]
MOTION BY:

SECOND:

3. University Avenue/101 Pedestrian Overcrossing Project, 100% Plans, Specifications, and Estimate
Pulled by Councilmember Romero requested more lights.

M: CR S:LG Unanimous

3.10.f
Packet Pg. 416 Attachment: Draft Minutes 3-1-2022 (2264 : Minutes of the 1/8/2022 - 3/22/2022 Meetings) East Palo Alto City Council March 1, 2022 Minutes Page 2 of 4 RESULT: ADOPT [UNANIMOUS]
MOTION BY:

SECOND:

4. Minimum Purchase Transfer from the City of Mountain View RESULT: ADOPT [UNANIMOUS]
MOTION BY:

SECOND:

5. Women's History and Culture Month Proclamation
RESULT: ADOPT [UNANIMOUS]
MOTION BY:

SECOND:

6. City Attorney Recruitment and Process Development
RESULT: ADOPT [UNANIMOUS]
MOTION BY:

SECOND:

4. CLOSED SESSION
A. PUBLIC COMMENT ON CLOSED SESSION ITEMS
B. ADJOURNMENT INTO CLOSED SESSION
C. RECONVENE INTO OPEN SESSION
D. REPORT OUT OF CLOSED SESSION
No reportable action.

5. PUBLIC COMMENT

6. INFORMATIONAL REPORTS
Michelle Daher provided a report.

1. EPA Draft Climate Action Plan CAP 2030

7. SPECIAL PRESENTATIONS

8. PUBLIC HEARINGS
Rachel Horst and Karen Camacho provided a report.

Public Comment:
-Maureen Larsson
-Julian
-Lionel
-Cristal Montes (she/her/ella)
- Ofelia Bello
- Q Smith

3.10.f
Packet Pg. 417 Attachment: Draft Minutes 3-1-2022 (2264 : Minutes of the 1/8/2022 - 3/22/2022 Meetings) East Palo Alto City Council March 1, 2022 Minutes Page
3 of 4
- Karl-Magnus Larsson
- Carol Cunningham - Zaineb Qazwini - Julisa - moana - Elena Kogan - Vanessa Smith (she/her) - Ingrid - Martha Hanks - Duane Bay, EPACANDO - Kenia Najar- Miranda - Stewart Hyland - Elena Savva - Keith Ogden - Grace - David W - Bob J - laura Rubio - Sarah Hoffman - Gene Gan - George - Carol Li - Nehel Khanani - Mark Dinan - Zoom user - Nina Helmer - Cristina - Vince - Mark Moulton - Darren Cunningham - Andy Wang - Court Skinner - Ilona Clark - Terri Vines - Romain Taniere - Angah Miessi - Tuan N. - Gail Wilkerson - Nikhil - Lidia Garcia

3.10.f
Packet Pg. 418 Attachment: Draft Minutes 3-1-2022 (2264 : Minutes of the 1/8/2022 - 3/22/2022 Meetings) East Palo Alto City Council March 1, 2022 Minutes Page 4 of 4 - Carol Wyatt
-
RA: Closed Public Hearing

1. Introduction of East Palo Alto Opportunity to Purchase Act ("EPA OPA") Ordinance Motion: Carlos Romero
Second: Lisa Gauthier
RESULT: ADOPT [UNANIMOUS]
MOTION BY:

SECOND:

AYES: Romero, Abrica, Gauthier, Lopez, Wallace-Jones

9. POLICY AND ACTION

1. Mid-year Budget Amendment FY21-22
Tomo Oku, Finance Director provided a presentation
Public Comment: Q Smith and Patricia Lopez
Motion: Antonio Lopez
Second: Wallace-Jones
RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

AYES: Romero, Abrica, Gauthier, Lopez, Wallace-Jones

2. Federal Community Project Funding Requests (Earmarks) Patrick Heisinger provided a presentation.

3. COVID-19 Vaccination Program Regular Update
Jaime M. Fontes, City Manager, provided a presentation.

10. COUNCIL REPORTS
Antonio Lopez provided a report regarding black history month event.

Regina Wallace-Jones provided a report regarding Mardi Gras celebration.

Lisa Gauthier provided a report regarding the Four Seasons Hotel.

11. ADJOURNMENT
The meeting was adjourned at 11:50 p.m.

3.10.f
Packet Pg. 419 Attachment: Draft Minutes 3-1-2022 (2264 : Minutes of the 1/8/2022 - 3/22/2022 Meetings) East Palo Alto City Council March 15, 2022 Minutes Page 1 of 5

EAST PALO ALTO CITY COUNCIL

REGULAR MEETING MINUTES
EPA Government Center
2415 University Ave, First Floor – City Council Chamber East Palo Alto, CA 94303

1. CALL TO ORDER AND ROLL CALL
The meeting was called to order by Vice Mayor Ruben Abrica at 6:47 p.m.

Attendee Name Title Status Arrived
Carlos Romero Mayor Remote
Ruben Abrica Vice Mayor Remote
Lisa Gauthier Councilor Remote
Antonio Lopez Councilor Remote
Regina Wallace-Jones Councilor Late 7:45 PM

2. APPROVAL OF THE AGENDA
RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

AYES: Romero, Abrica, Gauthier, Lopez
ABSENT: Wallace-Jones

3. APPROVAL OF CONSENT CALENDAR
RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

AYES: Romero, Abrica, Gauthier, Lopez
ABSENT: Wallace-Jones

1. Minutes of the November 10, 2021- December 22, 2021 Meetings RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

2. Water System Asset Management Plan
RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

3. AB 361 Findings to Continue Virtual Public Meetings for the City Council and City Advisory Bodies
RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

3.10.g
Packet Pg. 420 Attachment: Draft Minutes 3-15-2022 (2264 : Minutes of the 1/8/2022 - 3/22/2022 Meetings) East Palo Alto City Council March 15, 2022 Minutes Page 2 of 5

4. January Cash Report
RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

5. Council consideration of extension of 90-day due diligence period of library site acquistion
RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

6. 2021 Housing Element Annual Progress Report
RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

7. Application to the California State Library for the Building Forward Library Infrastructure Program
RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

8. Approving an Amendment to the Amended and Restated Water Supply Agreement RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

9. 12-Inch Transmission Water Main Project along University Avenue/Cooley Avenue funding strategy
RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

10. Proclamation of the City Of East Palo Alto Celebrating César E. Chavez Birthday, His Legacy and That of Farmworkers And the Work of the Chavez Family Vision Inc. Organization
RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

11. Proclamation of the City of East Palo Alto Celebrating The Month of April as National Poetry Month
RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

3.10.g
Packet Pg. 421 Attachment: Draft Minutes 3-15-2022 (2264 : Minutes of the 1/8/2022 - 3/22/2022 Meetings) East Palo Alto City Council March 15, 2022 Minutes Page 3 of 5

12. Proclamation Of the City of East Palo Alto Celebrating the Silver Jubilee of The Shree Sanatan Dharm Religious and Cultural Society of California and Congratulating Them for Their Work in The Community
RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

13. Letter Supporting Extension of AB 832
RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

4. CLOSED SESSION
A. PUBLIC COMMENT ON CLOSED SESSION ITEMS
B. ADJOURNMENT INTO CLOSED SESSION
C. RECONVENE INTO OPEN SESSION
Valerie Armento City Attorney no reportable action.

D. REPORT OUT OF CLOSED SESSION

5. PUBLIC COMMENT
Ramses Escobedo
Kevin Keating
Gail Wilkerson

6. INFORMATIONAL REPORTS- NONE

7. SPECIAL PRESENTATIONS - NONE

8. PUBLIC HEARINGS

1. First Source Hiring Ordinance
Rachel Horst provided a presentation.

RA: Opened Public Hearing
Public Speakers:

Gail Wilkerson
Adrienne
Q Smith
Millie
Amend Ordinance to include $250,000 minimum job threshold and have staff include changes in administrative guidelines and updating the procurement process.

3.10.g
Packet Pg. 422 Attachment: Draft Minutes 3-15-2022 (2264 : Minutes of the 1/8/2022 - 3/22/2022 Meetings) East Palo Alto City Council March 15, 2022 Minutes Page 4 of 5 Motion: Carlos Romero Waive first reading Second: Antonio Lopez Unanimous

9. POLICY AND ACTION

1. Issues Concerning the Light Tree Affordable Housing Project and the East Palo Alto Sanitary District
Patrick Heisinger provided a presentation.

Public Comment:
-Adrienne
- Jeff Poetsch
-Gail Wilkerson
Motion: Carlos Romero: Second: Antonio Lopez
RESULT: APPROVE [UNANIMOUS]
MOTION BY:

SECOND:

AYES: Romero, Abrica, Gauthier, Lopez, Wallace-Jones

2. Council consideration of a MOU with the County regarding the Beech St. Property Patrick Heisinger provided a presentation.

Motion: Antonio Lopez Second: Carlos Romero
RESULT: ADOPT [UNANIMOUS]
MOTION BY:

SECOND:

AYES: Romero, Abrica, Gauthier, Lopez, Wallace-Jones

3. Potential Ballot Measure for Affordable Housing Revenue Karen Camacho gave a presentation.

Public Comment:
- Magnus Larsson
- Adrienne
- Gail Wilkerson
- Ofelia Bello
- Q Smith
Bring back April 5th modification.

3.10.g
Packet Pg. 423 Attachment: Draft Minutes 3-15-2022 (2264 : Minutes of the 1/8/2022 - 3/22/2022 Meetings) East Palo Alto City Council March 15, 2022 Minutes Page 5 of 5 RESULT: CONTINUED [UNANIMOUS]
MOTION BY:

SECOND:

AYES: Romero, Abrica, Gauthier, Lopez, Wallace-Jones

4. CalPERS Prefunding
Tomohito Oku and Doug Pryor provided a presentation.

Motion: Carlos Romero Second: Antonio Lopez
RESULT: ADOPT [UNANIMOUS]
MOTION BY:

SECOND:

AYES: Romero, Abrica, Gauthier, Lopez, Wallace-Jones

5. City Council consideration of partnership with County to explore options for 2415 University ($25,000)
Patrick Heisinger provided a presentation.

Public Speaker:
- Gail Wilkerson
Motion: Lisa Gauthier Second: Regina Wallace Jones
RESULT: ADOPT [UNANIMOUS]
MOTION BY:

SECOND:

AYES: Romero, Abrica, Gauthier, Lopez, Wallace-Jones

6. COVID-19 Vaccination Program Regular Update
City Manager Jaime M. Fontes provided a presentation.

10. COUNCIL REPORTS

11. ADJOURNMENT
The meeting was adjourned at 11:08 p.m.

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Packet Pg. 424 Attachment: Draft Minutes 3-15-2022 (2264 : Minutes of the 1/8/2022 - 3/22/2022 Meetings) East Palo Alto City Council March 22, 2022 Minutes Page 1 of 1

EAST PALO ALTO CITY COUNCIL

STUDY SESSION MINUTES
EPA Government Center
2415 University Ave, First Floor – City Council Chamber East Palo Alto, CA 94303
I. CALL TO ORDER AND ROLL CALL
The meeting was called to order by Carlos Romero at 6:00 p.m.

Attendee Name Title Status Arrived
Carlos Romero Mayor Present
Ruben Abrica Vice Mayor Present
Lisa Gauthier Councilor Present
Antonio Lopez Councilor Present
Regina Wallace-Jones Councilor Present
II. APPROVAL OF THE AGENDA
Motion: Lisa Gauthier Second: Antonio Lopez
III. STUDY SESSION

1. 2160 : City’s Parks, Recreation, and Open Space Master Plan Cristina Bejerano and Mike Svetz, presented.

Public Speaker: Gail Wilkerson

2. 2159 : Proposed Specific Plan for Martin Luther King Jr. Park Derek McKee presented.

Public Comments:

John Pimentel
Gail Wilkerson
IV. STAFF INFORMATIONAL REPORT

1. Verbal Update on COVID-19 Response
City Manager Jaime M. Fontes presented.

V. ADJOURNMENT
The meeting was adjourned at 8:59 p.m.

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Packet Pg. 425 Attachment: Draft Minutes 3-22-2022 (2264 : Minutes of the 1/8/2022 - 3/22/2022 Meetings)

EAST PALO ALTO

CITY COUNCIL

STAFF REPORT
DATE: May 17, 2022
TO: Honorable Mayor and Members of the City Council
VIA: Patrick Heisinger, Interim City Manager
BY: James Colin, Executive Assistant
SUBJECT: Letter of Support for SB 893
Recommendation
By motion, authorize the Mayor to sign the attached letter, on behalf of City Council, to support Senator Josh Becker, Assembly Member Kevin Mullin, and Assembly Member Marc Berman’s Senate Bill 893 – Financial Assistance for Community College Students in Need.

Alignment with City Council Strategic Plan
This recommendation is primarily aligned with:

Priority No. 6: Create a Healthy and Safe Community
Background
SB 893
SB 893 was introduced by Senator Josh Becker on January 31, 2022. Existing law establishes the California Community Colleges, under the administration of the Board of Governors of the California Community Colleges, as one of the segments of public postsecondary education in this state. Existing law requires community college districts to charge students an enrollment fee of $46 per unit per semester.

This bill would authorize the San Mateo County Community College District to charge students an enrollment fee less than $46 per unit per semester. If the San Mateo County Community College District charges a fee rate less than $46 per unit per semester, the bill would require the governing board of the community college district to adopt a policy that establishes eligibility requirements for fee rate modifications, as specified, and a requirement to prepare a fiscal impact statement, including a 3-year projection of the fiscal impact of fee rate modifications on the community college district, as specified.

3.11 Packet Pg. 426
The bill would specify that the San Mateo County Community College District is not eligible for state reimbursement for the difference between the fee rate charged and the $46 per unit per semester enrollment fee. The bill would require the San Mateo County Community College District to only provide the fee rate modification to students who reside within the boundary of the community college district.

This bill would authorize the San Mateo County Community College District to use existing funds for the implementation of the California College Promise, and to provide assistance to students for the total cost of attendance. The bill would define total cost of attendance for a student attending a community college as including all items prescribed in a specified federal statute.

The bill would require the San Mateo County Community College District to only use local unrestricted general funds for purposes of implementing the California College Promise for students who reside within the boundary of the community college district.

This bill would make legislative findings and declarations as to the necessity of a special statute for the San Mateo County Community College District.

Analysis
A draft support letter from the City Council of the City of East Palo Alto is provided in Attachment 1.

Staff recommends that the City Council direct the City Manager to submit this letter on behalf of the City Council.

Next Steps
If directed, the City Manager will submit the letter, signed by the Mayor, on behalf of the City Council to the intended recipients.

Fiscal Impact
There is no fiscal impact associated with this staff report.

Public Notice
The public was provided notice by making the agenda and report available on the City’s website and at the San Mateo Co. Library located at 2415 University Avenue, East Palo Alto.

Environmental
The action being considered does not constitute a “Project” within the meaning of the California Environmental Quality Act (CEQA), pursuant to CEQA Guideline section 15378 (b)(5), in that it is a government administrative activity that will not result in direct

3.11 Packet Pg. 427
or indirect changes in the environment.

Attachments

1. SB 893 Letter of Support

3.11 Packet Pg. 428
February 14, 2022
The Honorable Josh Becker
Senator, 13th District
State Capitol, Sacramento, CA 95814
SUPPORT – SB 893 – FREE / REDUCED COST COLLEGE FOR SAN MATEO COUNTY COMMUNITY COLLEGE

STUDENTS USING EXISTING LOCAL REVENUES
Dear Senator Becker:

On behalf of the City of East Palo Alto City Council, I write to support your Senate Bill 893 which has the potential to reduce the cost of community college for thousands of San Mateo County residents attending the San Mateo County Community College District (SMCCCD).

SMCCCD serves approximately 45,000 students through three campuses: Cañada College in Redwood City, College of San Mateo, and Skyline College in San Bruno.

The total cost of enrollment – including tuition, fees, books, technology, transportation, food, rent and other living expenses – can exceed $15,000 per year for community college students.

SMCCCD’s Promise Scholars Program supports students through the completion of their post-secondary pathways. The program provides students with multi-year tuition support, individualized counseling support, textbook vouchers, and food and transportation incentives through the completion of their degree or certificate.

Unfortunately, California law currently prevents local community college districts from using their various local revenues to offset tuition and expenses for students. For example, SMCCCD can only fund 2,000 of the 6,000 eligible students for its Promise Scholars Program even though they have the local revenue to provide financial assistance for all eligible students.

Without the flexibility to use local funds, SMCCCD is unable to supplement the Promise Scholars program in its goal of making meaningful headway in supporting underserved communities and creating life-changing impacts on students.

By providing greater flexibility to the San Mateo County Community College District (SMCCCD) to use their existing local revenues to reduce costs for students furthering their education, SB 893 will make college free or more affordable for local students without financially impacting the state.

3.11.a
Packet Pg. 429 Attachment: SB 893 Letter of Support (2263 : Letter of Support for SB 893) SB 893 benefits the students, the district, and the state. By allowing SMCCCD to use local funds to support students’ basic needs and to have the flexibility to charge less than the currently required state fee rate of $46 per credit unit (including charging $0), SMCCCD can make attending college less financially burdensome for students in need of assistance. Further, by permitting SMCCCD to supplement the California Promise Program with local funds, the bill will increase the number of students eligible to participate in the program without any additional cost to the state.

SB 893 includes important safeguards including:
• The SMCCCD Board must establish a framework to determine eligibility and students must demonstrate financial need.
• Students must reside in San Mateo County to prevent competition with neighboring districts. • SMCCCD must publicly provide financial impact information showing that they have the funds to reduce fees for additional students and the District is prohibited from receiving reimbursement from the state.

SB 893’s flexibility to use unrestricted general fund dollars to support students will have significant impacts throughout the community and will allow the district to bridge inequities throughout San Mateo County by making college more accessible and affordable for students, particularly those in marginalized and underrepresented communities.

Sincerely,
______________________
Ruben Abrica
Mayor
City of East Palo Alto

3.11.a
Packet Pg. 430 Attachment: SB 893 Letter of Support (2263 : Letter of Support for SB 893)

EAST PALO ALTO

CITY COUNCIL

STAFF REPORT
DATE: May 17, 2022
TO: Honorable Mayor and Members of the City Council
VIA: Patrick Heisinger, Interim City Manager
BY: James Colin, Executive Assistant
Jeff Liu, Commander
SUBJECT: Creation of a military equipment use ordinance and use policy Recommendation
Interim Chief of Police, Jeff Liu will provide a presentation.

6.1 Packet Pg. 431

EAST PALO ALTO

CITY COUNCIL

STAFF REPORT
DATE: May 17, 2022
TO: Honorable Mayor and Members of the City Council
VIA: Patrick Heisinger, Interim City Manager
BY: Rachel Horst, Housing and Economic Development Manager Amy Chen, Community & Economic Development Director
SUBJECT: Special Presentation from Downtown Streets Team Recommendation
Receive the presentation.

Alignment with City Council Strategic Plan
This recommendation is primarily aligned with:

Priority No. 6: Create a Healthy and Safe Community
Background
On April 5, 2022, the City Council heard an update and received recommendations regarding the City's unhoused residents. The City Council directed staff to invite the Downtown Streets Team to provide a special presentation at an upcoming City Council meeting. City staff intends to return to City Council at the June 7, 2022 meeting to discuss solutions and strategies to assist unhoused residents. If there is City Council interest in pursuing a Downtown Streets Team program in East Palo Alto, staff may return with a refined cost estimate and draft agreement at an upcoming City Council meeting.

Attachments

1. Downtown Streets Team Presentation

7.1 Packet Pg. 432

7.1.a
Packet Pg. 433 Attachment: Downtown Streets Team Presentation (2261 : Special Presentation from PALO ALTO: 2005
- 2007
Urban Blight Homelessness

7.1.a
Packet Pg. 434 Attachment: Downtown Streets Team Presentation (2261 : Special Presentation from

WORST PART ABOUT BEING
HOMELESS?
The way people look down at me

7.1.a
Packet Pg. 435 Attachment: Downtown Streets Team Presentation (2261 : Special Presentation from

HOMELESSNESS IS

AN EXPERIENCE
NOT AN

IDENTITY

7.1.a
Packet Pg. 436 Attachment: Downtown Streets Team Presentation (2261 : Special Presentation from DST IS

BUILDING TEAMS
THAT

RESTORE DIGNITY,

HOPE AND

PURPOSE AND

PROVIDE A PATH

TO RECOVER FROM

HOMELESSNESS

7.1.a
Packet Pg. 437 Attachment: Downtown Streets Team Presentation (2261 : Special Presentation from

DST MODEL
§ Unhoused and people at-risk of homelessness (Team Members) volunteer to beautify their community
§ In return, they earn a non-cash basic needs stipend, case management, employment services and a support network

7.1.a
Packet Pg. 438 Attachment: Downtown Streets Team Presentation (2261 : Special Presentation from

COMMUNITY BEAUTIFICATION

BUSINESS DISTRICTS

RIPARIAN AREAS

ENCAMPMENT CLEANUPS AND OUTREACH

WEEDING/LANDSCAPING

HOT SPOTS

7.1.a
Packet Pg. 439 Attachment: Downtown Streets Team Presentation (2261 : Special Presentation from

BASIC NEEDS STIPEND
Survival mode Goal Setting Mode
Non-cash
Food
Storage
Transportation
Housing
Communication
Stepping stone into employment

7.1.a
Packet Pg. 440 Attachment: Downtown Streets Team Presentation (2261 : Special Presentation from TEAM

MEETING

7.1.a
Packet Pg. 441 Attachment: Downtown Streets Team Presentation (2261 : Special Presentation from

SUCCESS TEAM MEETING

7.1.a
Packet Pg. 442 Attachment: Downtown Streets Team Presentation (2261 : Special Presentation from LADDER OF SUCCESS 7.1.a
Packet Pg. 443 Attachment: Downtown Streets Team Presentation (2261 : Special Presentation from PEER TO PEER 7.1.a
Packet Pg. 444 Attachment: Downtown Streets Team Presentation (2261 : Special Presentation from

7.1.a
Packet Pg. 445 Attachment: Downtown Streets Team Presentation (2261 : Special Presentation from Sacramento
West Sacramento Novato
San Rafael
San Francisco
Redwood City
Palo Alto
Sunnyvale
Berkeley
Oakland
Hayward
Modesto
San Jose
Santa Cruz
Salinas

7.1.a
Packet Pg. 446 Attachment: Downtown Streets Team Presentation (2261 : Special Presentation from

FUNDING
DOWNTOWN ASSOCIATIONS (BIDs, PBIDs, CBDs)

PUBLIC WORKS

PARKS AND RECREATION

ENVIRONMENTAL SERVICES

WATER DISTRICTS

CDBG - ECONOMIC DEVELOPMENT

GENERAL FUNDS

HEAP/HHAP/HDAP

7.1.a
Packet Pg. 447 Attachment: Downtown Streets Team Presentation (2261 : Special Presentation from

LOCAL PARTNERSHIPS

REDWOOD CITY DST

WE HOPE/DIGNITY ON WHEELS
LifeMoves

JOB TRAIN

PEERY FOUNDATION/PHILANTHROPIC

VENTURES FOUNDATION

7.1.a
Packet Pg. 448 Attachment: Downtown Streets Team Presentation (2261 : Special Presentation from SERVING OVER 500+ PEOPLE A WEEK
7 MONTH AVERAGE TO EMPLOYMENT
9 MONTH AVERAGE TO HOUSING
REMOVING 5 BARRIERS PER TM
IT TAKES 8 BARRIERS TO GET INTO HOUSING/

EMOPLOYMENT

7.1.a
Packet Pg. 449 Attachment: Downtown Streets Team Presentation (2261 : Special Presentation from

7.1.a
Packet Pg. 450 Attachment: Downtown Streets Team Presentation (2261 : Special Presentation from

COMMUNITY BENEFITS

CLEANER/SAFER STREETS

COST EFFECTIVE SOLUTION

IMMEDIATE RESULTS

BEHAVIORAL INTERVENTION

CHANGES PERCEPTION

7.1.a
Packet Pg. 451 Attachment: Downtown Streets Team Presentation (2261 : Special Presentation from

COME TO A MEETING
EVERY THURSDAY @ NOON

ALL SAINTS CHURCH
555 WAVERLEY

PALO ALTO, CA
CONTACTS:

[email protected]
[email protected]
[email protected]

7.1.a
Packet Pg. 452 Attachment: Downtown Streets Team Presentation (2261 : Special Presentation from

EAST PALO ALTO

CITY COUNCIL

STAFF REPORT
DATE: May 17, 2022
TO: Honorable Mayor and Members of the City Council
VIA: Patrick Heisinger, Interim City Manager
BY: Greg Henry, Senior Management Analyst
SUBJECT: Pass-Through of San Francisco Public Utility Commission Wholesale Water Rate Increases
Recommendation
Adopt a Resolution authorizing the pass-through increase of $0.78, to be effective July 1, 2022, to the water usage charges in the rate schedule adopted by Resolution 5154 and directing staff to issue a notice of the change to all water service customers within the City of East Palo Alto water system no less than 30-days prior to increase.

Alignment with City Council Strategic Plan
This recommendation is primarily aligned with:

Priority #2: Enhance Economic Vitality
Priority #4: Improve Public Facilities and Infrastructure Priority #6: Create a Healthy and Safe Community
Background
The City’s wholesale water provider is the San Francisco Public Utility Commission (SFPUC).

SFPUC provides essentially all water used by the customers of the City’s water system.

As reviewed in the April 4, 2022 informational item, the City included a “pass-through” provision in the last Proposition 218 rate-setting process found in Resolution 5154 adopted July 16, 2019. This provision is codified in Government Code section 53756 and allows the City to adjust the retail water rate as needed to “pass-through” the cost increase of the wholesale water to our customers without another Proposition 218 process. Specifically, for each 1 cent increase by SFPUC, the retail rate of water is scheduled to increase by 1.2 cents.

Usage water rates from SFPUC and to the City’s customers are in terms of centum cubic feet (ccf) or a hundred cubic feet. There are 748 gallons per ccf. This represents a square 10 ft by 10 ft that is then a 1 foot deep.

9.1 Packet Pg. 453
On May 10, 2022, SFPUC approved an increase in the wholesale rate from $4.10 to $4.75 per ccf, a 65-cent increase (staff report attached). As described in Resolution 5154 (attached), the “pass-through” increase is 1.2 times that increase, (1.2)*($0.65) = $0.78. This increase will go into effect on July 1, 2022 and will be in addition to the planned increase in the water usage charge from $7.66 to $7.77. The approved water usage charge for July 1, 2023 will also be increased by $0.78. Below is the new Water Rate Schedule. The changes from the previous schedule are to “Water Usage Charges.”

Current
Water Rates
Effective
July 1 July 1
2022 2023
Water Usage Charges ($ per ccf)
Base $7.66 $8.55 $8.67
Monthly Single Family Residential Meter Chart
5/8” - 1” $17.79 $18.06 $18.33
Monthly All Other Meter Charge
5/8” $26.24 $26.63 $27.03
3/4” 39.35 39.94 40.54
1” 65.6 66.58 67.58
1-1/2” 131.19 133.16 135.16
2” 209.91 213.06 216.26
3” 393.57 399.47 405.46
4” & large 655.94 665.78 675.77

Monthly Fire Service & Emergency Intertie Charge
5/8” $5.25 $5.33 $5.41
3/4” 7.87 7.99 8.11
1” 13.12 13.32 13.52
1-1/2” 26.24 26.63 27.03
2” 41.98 42.61 43.25
3” 78.72 79.89 81.09
4” & larger 131.2 133.15 135.15
When SFPUC notified the City of the FY 2022-23 increase, it also included an expectation that rates will increase further in 2023 to $5.28/ccf in FY 2023-24. Staff will monitor this additional increase and will update the Council next year.

Analysis
This rate increase is necessary for the City’s water utility to cover the cost of operations, specifically the cost to purchase the water which is provided to customers.

Because the City is using the pass-through provision of Government Code section 53756.1, as opposed to prior instances where the City proposed to increase water rates, the City need not

9.1 Packet Pg. 454
follow the full Proposition 218 process. Instead, the City Council need only approve the rate increase by resolution and all customers must be notified by mailed notice. While this process won’t diminish the burden on customers, it will allow the City itself to respond quickly to this unanticipated and extreme rate increase by SFPUC.

Attached is the proposed English language letter which will go out to customers.

The City has limited control over the cost of water it receives. The City is simply a customer of SFPUC and does not currently have any other sources of water.

Fiscal Impact
On July 1, 2022, the water usage charge is scheduled to increase to $7.77 per ccf from the current rate of $7.66. With the additional pass-through rate of $0.78, the water usage charge will be $8.55 per ccf.

Public Notice
N/A
Environmental
The action being considered does not constitute a “Project” within the meaning of the California Environmental Quality Act (CEQA), pursuant to CEQA Guideline section 15378 (b)(5), in that it is a government administrative activity that will not result in direct or indirect changes in the environment.

Attachments

1. PassThrough Rate Incrase Resolution

2. Proposed Public Notice

3. Reso 5154 Water Svc Rates Increase

4. SFPUC Wholesale Water Rates Increase Staff Report

9.1 Packet Pg. 455
Vv
RESOLUTION NO. XX – 2022

A RESOLUTION OF THE CITY COUNCIL

OF THE CITY OF EAST PALO ALTO
AUTHORIZING THE PASS-THROUGH INCREASE OF $0.78, TO BE EFFECTIVE JULY 1, 2022,

TO THE WATER USAGE CHARGES IN THE RATE SCHEDULE ADOPTED VIA RESOLUTION 5154 AND DIRECTING STAFF TO ISSUE A NOTICE OF THE CHANGE TO ALL WATER

SERVICE CUSTOMERS WITHIN THE CITY OF EAST PALO ALTO WATER SYSTEM NO LESS THAN 30-DAY PRIOR TO INCREASE
WHEREAS, on May 10, 2022 the San Francisco Public Utility Commission (SFPUC) approved an increase in the wholesale water rate from $4.10 to $4.75; and WHEREAS, the City Council adopted a pass-through provision in Resolution 5154 increasing the approved Water Usage Charge by 1.2 cents for each 1 cent increase in the wholesale rate over $4.10; and
WHEREAS, before the pass-through rates will be effective, the City will follow the pass-through requirements as described in Government Code §53756.

NOW, THEREFORE, BE IT RESOLVED THAT THE CITY COUNCIL OF THE CITY OF EAST PALO ALTO HEREBY authorizes the pass-through increase of $0.78, to be effective July 1, 2022, to the water usage charges in the rate schedule adopted via Resolution 5154 and direct staff to issue a notice of the change to all water service customers within the City of East Palo Alto water system no less than 30-day prior to increase.

PASSED AND ADOPTED this 17
th day of May 2022, by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:

Ruben Abrica, Mayor
ATTEST: APPROVED AS TO FORM:

James Colin, City Clerk Valerie J. Armento, Interim City Attorney

9.1.a
Packet Pg. 456 Attachment: PassThrough Rate Incrase Resolution (2242 : Pass-Trhough Water Rate Increase) Public Notice

CITY OF EAST PALO ALTO

INCREASES TO WATER SERVICE RATES
The City of East Palo Alto is currently update water services rates. The City charges these rates to water service customers in order to fund the costs of providing safe and reliable water service.

On May 10, 2022 the San Francisco Public Utility Commission (SFPUC), the City’s water provider, approved a wholesale water rate increase from $4.10 to $4.75 (65 cents). As a result of the automatic adjustment calculation described below, this results in an increase of $0.78 of the previously approved water usage charges. The water usage charge effective July 1, 2022, is adjusted to $8.55 and the water usage charge effective July 1, 2023, is adjusted to $8.67.

Purpose of the Notice
You are receiving this notice because you are a customer of the City of East Palo Alto Water System. Customers pay for water services directly to the City’s water contractual water operator, at the rates adopted by the East Palo Alto City Council.

Updated Water Rate Schedule

Current
Water Rates Effective
July 1 July 1
2022 2023

WATER USAGE
CHARGES ($ per ccf)
Base $7.66 $8.55 $8.67
Monthly Single Family Residential Meter Chart
5/8" - 1" $17.79 $18.06 $18.33
Monthly All Other Meter Charge
5/8" $26.24 $26.63 $27.03
3/4" 39.35 39.94 40.54
1" 65.6 66.58 67.58
1-1/2" 131.19 133.16 135.16
2" 209.91 213.06 216.26
3" 393.57 399.47 405.46
4" & large 655.94 665.78 675.77

MONTHLY FIRE SERVICE & EMERGENCY INTERTIE CHARGE
5/8" $5.25 $5.33 $5.41
3/4" 7.87 7.99 8.11
1" 13.12 13.32 13.52
1-1/2" 26.24 26.63 27.03
2" 41.98 42.61 43.25
3" 78.72 79.89 81.09
4" & larger 131.2 133.15 135.15
Note: SFPUC Pass-Through Adjustment to be applied in future years based on actual SFPUC rate increases.
1 ccf is one hundred cubic feet or 748 gallons.

9.1.b
Packet Pg. 457 Attachment: Proposed Public Notice (2242 : Pass-Trhough Water Rate Increase) Automatic Adjustments
The rates approved by the City Council in Resolution 5141 are subject to an automatic adjustment. Pursuant to Government Code section 53756, notification of the amount of any automatic adjustment must occur at least 30 days before the adjustment goes into effect. The automatic adjustment is a wholesale water cost pass-through which will occur only in the event the SFPUC changes its wholesale water rate for the East Palo Alto system. For each 1 cent increase in the wholesale rate (over the current $4.10), the volumetric rate will be increased by 1.2 cents (over the rates shown in the rate schedule above),and rounded to the nearest cent.

9.1.b
Packet Pg. 458 Attachment: Proposed Public Notice (2242 : Pass-Trhough Water Rate Increase) RESOLUTION NO. 5154

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF EAST PALO ALTO INCREASING WATER SERVICE RATES ON JULY 16, 2019 AND THEREAFTER EACH JULY 1 ST THROUGH JULY 1, 2023, FOR ALL WATER SERVICE

CUSTOMERS WITHIN THE CITY OF EAST PALO ALTO SERVICE SYSTEM WHEREAS, American Water Enterprises leases the City of East Palo Alto's water system pursuant to a Lease Agreement with the City of East Palo Alto; and WHEREAS, the 2018 Rate Relief Request reflects that American Water Enterprise incurred an estimated shortfall of the contractually-agreed upon target return of$433,000 in Fiscal Year 2017-18, and is estimated to result in a shortfall of$525,000 in Fiscal Year 2018-19, thus supporting the need to increase water rates; and WHEREAS, the proposed rate changes will help ensure that A WE and the City meet the requirements under the Lease Agreement and that water rates are set at appropriate levels to fund the water system operations, and such operational costs were reviewed by staff and the rate consultant Bartle Wells; and
WHEREAS, the rate increases will help ensure the health and safety of the community while protecting the City's financial health; and WHEREAS, the City Council followed the procedural requirements of Proposition 218, Article XIIID, Section 6 of the California Constitution.

NOW, THEREFORE, BE IT RESOLVED THAT THE CITY COUNCIL OF THE CITY OF EAST PALO ALTO HEREBY accepts the foregoing and following recitals as true and correct:

1. The City Council hereby initiated proceedings to adopt a schedule of water rates through July 2023;

2. The City Clerk provided a notice of the proposed water rate increases in conformity with Proposition 218 on May 16,2019;

3. The City Council agendized a Public Hearing on the proposed water rate increases to take place at the July 2,2019 Council meeting, commencing at 7 :30 pm, in the City Council Chambers of City Hall, located at 2415 University Avenue, East Palo Alto California, but continued the matter to the July 16, 2019 City Council meeting;

4. The City Council held a Public Hearing on the proposed water rate increases on July 16,2019 at 7:30 pm, in the City Council Chambers of City Hall, located at 2415 University Avenue, East Palo Alto California;

9.1.c
Packet Pg. 459 Attachment: Reso 5154 Water Svc Rates Increase (2242 : Pass-Trhough Water Rate Increase)

5. The City Council considered all objections or protests, if any, to the proposed water rate increases, and all persons have been permitted to present written or oral testimony;

6. At the conclusion of the Public Hearing, all protests submitted were tabulated in conformity with the City's tabulation guidelines found in Exhibit A; and

7. At the conclusion of the Public Hearing, the City Council confirmed that a maj ority protest, that is written protests submitted in opposition to the proposed water rates by a majority (50% plus 1) of service customers, does not exist to warrant suspension of the proposed water service rates.

8. The City Staff Report dated and presented to the City Council on May 7, 2019, including the Bartle Wells report with the Notice and analysis therein, support the City Council's action to increase the water rates as set forth in this Resolution.

BE IT FURTHER RESOLVED THAT THE CITY COUNCIL OF THE CITY OF EAST PALO ALTO HEREBY ADOPTS:

1. The following water service rate schedule; and
~~ " ~
"
-~
, I~urre~t_ WATER USAGE CHARGES ($ per cd)
Base I $6.161 $7.40 I $7.55 $7.66 $7.77 $7.89
i I I

FIXED MONTHLY METER CHARGES
Single Family Residential
5/8" -1" I
$15.37 i $17.19 $17.53 $17.79 $18.06 $18.33
All Other
5/8" $23.82 $25.34 $25.85 $26.24 $26.63 $27.03
3/4" 35.81 38.01 38.77 39.35 39.94 40.54
1" 59.64 63.36 64.63 65.60 66.58 67.58
1-1/2" 119.12 126.72 129.25 131.19 133.16 135.16
2" 190.59 202.75 206.81 209.91 213.06 216.26
3" 357.35 380.15 387.75 393.57 399.47 405.46
4" & larger 595.59 1 633.58 646.25 655.94 665.78 675.77

MONTHLY FIRE SERVICE & EMERGENCY INTERTIE CHARGE
5/8" $4.76 $5.07 $5.17 $5.25 $5.33 $5.41
3/4" 7.16 7.60 7.76 7.87 7.99 8.11
1" 11.93 12.67 12.93 13.12 13.32 13.52
1-1/2" 23.82 25.34 25.85 26.24 26.63 27.03
2" 38.12 40.54 41.36 41.98 42.61 43.25
3" 71.47 76.02 77.55 78.72 79.89 81.09
4" & larger 119.12 126.70 129.25 131.20 133.15 135.15
Note: SFPUC Pass-Through Adjustment to be applied in future years based on actual SFPUC rate increases.

9.1.c
Packet Pg. 460 Attachment: Reso 5154 Water Svc Rates Increase (2242 : Pass-Trhough Water Rate Increase)

2. Automatic Wholesale Water Cost Pass-through Adjustments of 1.2 cents per each 1.0 cents increase in San Francisco Public Utilities Commission wholesale water rates, if any, over the current $4.10 through June 30, 2024.

PASSED AND ADOPTED this 16th day of July 2019, by the following vote:

AYES: MOODY, ABRICA, ROMERO
NOES: NONE
ABSENT: GAUTHIER
ABSTAIN: NONE
RECUSED: WALLACE-JONES
SIGNED:

APPROVED AS TO FORM:

9.1.c
Packet Pg. 461 Attachment: Reso 5154 Water Svc Rates Increase (2242 : Pass-Trhough Water Rate Increase) Exhibit A
Guidelines for the Submission and Tabulation of Protests When notice of a public hearing with respect to a service rate increase, such as for water or solid waste collection service, has been given by the City pursuant to Article XIIID, Section 6 of the California Constitution, the following shall apply:

Submission of Protests

1. Any property owner or customer/ratepayer may submit a written protest to the City Clerk, either by mail or delivery to EPA Government Center, 2415 University Avenue, East Palo Alto, CA 94303-1164 or by submitting the protest at the public hearing. Protests must be received by the end of the public hearing. No postmarks will be accepted.

2. Each protest must be in writing and must state that it is a protest (or indicate opposition to the proposed rates) and include the following information: (i) the name of the owner or customer/ratepayer submitting the record, (ii) the street address or assessor's parcel number of the parcel (or service location) for which the protest is submitted, and (iii) the signature of the person submitting the protest.

3. Email or facsimile protests cannot be accepted. Although the City Council welcomes input from the community during the public hearing on the proposed fees, oral comments at the public hearing will not qualify as a formal protest unless accompanied by a written protest.

4. If a parcel receiving service is owned by more than one record owner; if more than one name appears on the City's records as the customer/ratepayer for the parcel; or ifthe customer/ratepayer is not the record owner, any owner or customer/ratepayer may submit a protest, but only one protest will be counted per parcel and anyone protest submitted in accordance with these rules will be sufficient to count as a protest for that parcel.

5. A protest by a property owner that is a trust must be signed by the Trustee and identified as such with the signature (i.e., John Smith, Trustee for Smith Family Trust). Protests by property owners that are corporations, partnerships, or similar entities must be signed by a person authorized to execute documents on behalf of the property owner. A property owner that is not shown on the last equalized assessment roll for a parcel must accompany the protest with evidence of ownership.

6. Any person who submits a protest may withdraw it by submitting to the City Clerk a dated written request that the protest be withdrawn. The withdrawal of a protest must contain sufficient information to identify the affected parcel and the name of the record owner or record customer/ratepayer who submitted both the protest and the request that it be withdrawn.

7. A fee protest proceeding is not an election.

8. To ensure transparency and accountability in the fee protest tabulation, protests shall constitute disclosable public records from and after the time when they are opened by the City at the public hearing. Protests will be retained by the City for three years and then may be destroyed.

Tabulation of Protests

1. The City Clerk, or designee, shall determine the validity of all protests. The City Clerk shall not accept as valid any protest ifs/he determines that any of the following conditions exist:
a. The protest does not identify a parcel that will be subject to the proposed fees. b. The protest does not bear an original signature of a record owner or customer/ratepayer associated with the parcel.
c. The protest does not state its opposition to the proposed fees or is illegible.

9.1.c
Packet Pg. 462 Attachment: Reso 5154 Water Svc Rates Increase (2242 : Pass-Trhough Water Rate Increase) d. The protest has been altered in any way by someone other than the person who signed it. e. The protest was not received by the City Clerk before the close of the public hearing on the proposed fees.
f. A request to withdraw the protest was received by the City Clerk prior to the close of the public hearing on the proposed fees.
g. The protest or request for withdrawal is dated prior to the date of mailing of the notices of hearing on the proposed fees.

2. The City Clerk's decision that a protest is not valid shall constitute a final action of the City and shall not be subject to any internal appeal.

3. A majority protest exists if written protests are timely submitted and not withdrawn by owners or customers/ratepayers with respect to a majority (50.0% plus one) of the parcels subject to the proposed fee.

4. A majority protest also exists is written protests are timely submitted and not withdrawn by customers/ratepayers with respect to a majority (50.0% plus one) of the service locations (customer accounts) subject to the proposed fee.

5. At the conclusion of the public hearing, the City Clerk shall count all protests received, including those received during the public hearing, and shall report the results to the City Council upon completion. If review of the protests received demonstrates that the number received is manifestly less than one-half of the parcels served by the City with respect to the fee which is the subject ofthe protest, then the City Clerk may advise the Council of the absence of a majority protest without determining the validity of all protests.

6. If, at the conclusion of the public hearing, the Clerk determines that s/he will require additional time to count the protests, s/he shall so advise the Council, which may adjourn the meeting to allow the count to be completed on another day or days. If so, the Council shall declare the time and place of the count, which shall be conducted in a place where interested members of the public may observe the counting, and the Council shall declare the time at which its meeting shall be resumed to receive and act on the report ofthe Clerk.

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Packet Pg. 463 Attachment: Reso 5154 Water Svc Rates Increase (2242 : Pass-Trhough Water Rate Increase) Draft Public Notice

CITY OF EAST PALO ALTO

PROPOSED INCREASES TO WATER SERVICE RATES

NOTICE OF PUBLIC HEARING
7:30 p.m.

July 2,2019
City Council Chambers
2415 University Avenue, East Palo Alto
ATTACHMENT 2
The City of East Palo Alto is currently reviewing water services rates. The City charges these rates to water service customers in order to fund the costs of providing safe and reliable water service At the date, time and place set forth above, the City Council of the City of East Palo Alto will hold a public hearing regarding the proposed water rate increases rates described in this notice.

Purpose of the Notice
You are receiving this notice because you are a customer of the City of East Palo Alto Water System. Customers pay for water services directly to the City's water contractual water operator, at the rates adopted by the East Palo Alto City Council.

Proposed Water Rate Schedule
:0~ ~I~::~~~_~ "~~.~
" . Current
"""" - ~
WATER USAGE CHARGES ($ per cd) ! i I Base i $6.16 I $7.40 I $7.55 $7.66 1 l I

FIXED MONTHLY METER CHARGES
Single Family Residential
5/8" _1" $15.37 $17.19 $17.53 $17.79
All Other
5/8" $23.82 $25.34 $25.85 $26.24
3/4" 35.81 38.01 38.77 39.35
1" 59.64 63.36 64.63 65.60
1-1/2" 119.12 126.72 129.25 131.19
2" 190.59 202.75 206.81 209.91
3" 357.35 380.15 387.75 393.57
4" & larger 595.59 633.58 646.25 655.94
$7.77 $7.89
$18.06 $18.33
$26.63 $27.03

39.94 40.54

66.58 67.58
133.16 135.16
213.06 216.26
399.47 405.46
665.78 675.77

MONTHLY FIRE SERVICE & EMERGENCY INTERTIE CHARGE
5/8" $4.76 $5.07 $5.17 $5.25 $5.33 $5.41
3/4" 7.16 7.60 7.76
1" 11.93 12.67 12.93
1-1/2" 23.82 25.34 25.85
2" 38.12 40.54 41.36
3" 71.47 76.02 77.55

7.87 13.12

26.24 41.98

78.72 7.99

13.32 26.63

42.61 79.89

8.11 13.52

27.03 43.25

81.09 4" & larger 119.12 126.70 129.25 131.20 133.15 135.15 Note: SFPUC Pass-Through Adjustment to be applied in future years based on actual SFPUC rate increases.

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Packet Pg. 464 Attachment: Reso 5154 Water Svc Rates Increase (2242 : Pass-Trhough Water Rate Increase) ATTACHMENT 2
Basis of the Proposed Rates
Overall, three high-level trends have occurred resulting in a projected the operating deficit of the water service system. First, the City has not increased rates since 2015 and operating costs have risen over that time; second, the wholesale cost of water has increased significantly; third, water operations staffing levels have increased primarily due to regulatory requirements and system complexity (Gloria Way Well), and implementation of improved information technologies. The current rates do not cover the contractual cost of providing water service.

Automatic Adjustments
It is proposed that, for a period of five years, the rates approved by the City Council will be subject to an automatic adjustment. If approved these adjustments will be automatic with no further Council action. Pursuant to Government Code section 53756, notification of the amount of any automatic adjustment must occur at least 30 days before the adjustment goes into effect. The automatic adjustment is a wholesale water cost pass-through which will occur only in the event the SFPUC changes its wholesale water rate for the East Palo Alto system. For each 1 cent increase in the wholesale rate (over the current $4.10), the volumetric rate will be increased by 1.2 cents (over the rates shown in the rate schedule above) and rounded to the nearest cent.

Proposition 218 and the Rate Protest Process
Article XIII D, Section 6(b) of the California Constitution sets forth substantive requirements for property-related fees. In abbreviated description those requirements include that: (1) revenues derived shall not exceed the funds required to provide the service, (2) revenues shall not be used for any other purpose, (3) charges shall be proportiona" (4) a fee for service may only be imposed for services immediately available, and (5) no charge may be imposed for general governmental services.

You are invited to provide oral or written testimony at the public hearing. You also have the right to file a formal written protest against the proposed increases. A formal protest must be in writing, must be signed by the customer or property owner, must indicate the address, account number or assessors parcel number for which it is submitted, and must indicate that it is a water service rate protest. If the City Council receives protests with respect to a majority of the parcels served by the City Water Service System, or receives protests from a majority of customers, then it will not approve the increase. Protests may be mailed or delivered to the City at Water Service Rates, City Clerk, City of East Palo Alto, 2415 University Avenue, 2nd Floor, East Palo Alto, CA 94303, or may be presented at the hearing. Protests must be received by the close of public comment at the hearing in order to be counted. The City will follow its Procedures for the Acceptance and Tabulation of Written Protests (available at City Hall, 2415 University Avenue, 2nd Floor, East Palo Alto, from the City Clerk's Office) in handling and counting protests.

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Packet Pg. 465 Attachment: Reso 5154 Water Svc Rates Increase (2242 : Pass-Trhough Water Rate Increase) ATTACHMENT 2
Anuncio Publico

CITY OF EAST PALO ALTO

AUMENTOS PROPUESTOS A LAS TARIFAS DEL SERVICIO DE AGUA

NOTIFICACION DE AUDIENCIA PUBLICA
7:30 p.m.

Julio 2, 2019
Sala del Consejo de la Ciudad
2415 University Avenue, East Palo Alto
La ciudad de East Palo Alto en la actualidad esta revisando las tarifas del servicio de agua. La ciudad les cobra a los consumidores estas tarifas por el servicio de agua con el fin de financiar el costo de proveer un servicio de agua segura y confiable. En la fecha, hora y lugar establecido mas arriba, el Consejo de la Ciudad de East Palo Alto celebrara una audiencia publica en relacion con los aumentos de las tarifas de agua propuestos que son descritos en la notificacion.

Proposito de la Notificacion
Usted esta recibiendo este aviso porque usted es un cliente del Sistema de Agua de la Ciudad de East Palo Alto. Los consumidores pagan por el servicio de agua directamente al operador de agua contratado por la ciudad, segun las tarifas adoptadas por el Consejo de la Ciudad de East Palo Alto.

Programa para la Tari a de ua Pro uesta
~~~~ ~~ ~ ~ ~::I~-,;c7?~-~~W_
~ ~ ~
$' ~ ~" ~""~ctuales ~ - ; /' ?
" ~
~ ,
CARGOS paR usa DE AGUA ($ por cd)
Base $6.16 $7.40 $7.55 $7.66 $7.77 $7.89
Residencia Unifamiliar
5/8" -1" $15.37 $17.19 $17.53 $17.79 $18.06 $18.33
Todos los Demas i
5/8" $23.82 $25.34 $25.85 . $26.24 : $26.63 $27.03
3/4" 35.81 38.01 38.77 39.35 39.94 40.54
1" 59.64 63.36 64.63 65.60 66.58 ! 67.58
1-1/2" 119.12 ! 126.72 129.25 . 131.19 133.16 135.16
2" 190.59 202.75 206.81 : 209.91 213.06 , 216.26
3" 357.35 , 380.15 387.75 393.57 ' 399.47 405.46
4" & larger 595.59 ' 633.58 646.25 655.94 665.78 675.77 Cargos de Servicio Mensual de Bomberos & Interconexion de Emergencia 5/8" i i : $4.76 ! $5.07 i $5.17. $5.25 $5.33 $5.41
3/4" 7.16 , 7.60 7.76 ' 7.99 ! 8.11
1" 11.93 i 12.67 12.93 ! 13.32 13.52
1-1/2" 23.82 25.34 25.85 26.63 I 27.03
2" 38.12 40.54 41.36 i 43.25
3" 71.47 76.02 81.09 i
4" & larger 119.12 i 126.70 135.15
Nota: Ajuste de SFPUC a ser aplicado en afios futuros basados en el aumento de las tasas aetuales delSFPUC
1 eef es igual a 2831.5 litros

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Packet Pg. 466 Attachment: Reso 5154 Water Svc Rates Increase (2242 : Pass-Trhough Water Rate Increase) ATTACHMENT 2
Bases para las Tori/as Propuestas
En general, se han producido tres patrones de alto nivel dando como resultado un deficit operativo proyectado del sistema de servicios de agua. En primer lugar, la ciudad no ha aumentado las tasas desde el 2015 y los costos de operacion y funcionamiento han aumentado durante ese tiempo; en segundo lugar, el costa de mayoreo del agua aumento significativamente; y en tercer lugar, los niveles del personal de operaciones del agua han aumentado, principalmente debido a requisitos regulatorios y complejidad del sistema (pow de Gloria Way) y la implementacion de mejores tecnologfas de informacion. Las tarifas actuales no cubren los costos contractuales de la prestacion del servicio de agua.

Ajustes Automaticos
Se propone que por un perfodo de cinco anos, las tarifas aprobadas por el Concejo de la Ciudad estaran sujetas a un ajuste automatico. De aprobarse estos ajustes, seran automaticos sin ninguna otra accion del Consejo. En conformidad con la Ley de Gobierno Seccion 53756, la notificacion de la cantidad de cualquier ajuste automatico debe ocurrir por 10 menos 30 dfas antes de que la regulacion entre en efecto. EI ajuste automatico es el pase del costo de mayoreo del agua que ocurrira sola mente en el caso de la SFPUC cambie su tasa de agua al por mayor al sistema de East Palo Alto. Por cada 1 centavo de aumento de la tasa al mayoreo (por encima del $4.10 actual), la tasa volumetrica sera aumentada 1.2 centavos (por encima de las tasas de la lista de tasas mostradas arriba), y redondeadas al centavo mas cercano.

La Proposicion 218 y el Proceso de Protesta de Tasas
EI articulo XIII D, Seccion 6 (b) de la Constitucion de California establece requisitos sustanciales para las tasas relacionadas con la propiedad. En la descripcion abreviada, estos requisitos incluyen que: (1) los ingresos derivados no excederan los fondos requeridos para prestar el servicio, (2) los ingresos no se utilizaran para ningun otro proposito, (3) los cargos seran proporcionales, (4) una tarifa por servicio solo puede ser impuesta para los servicios inmediatamente disponibles, y (5) no se puede imponer ningun cargo por los servicios gubernamentales generales.

Se Ie invita a proporcionar un testimonio oral 0 escrito en la audiencia publica. Usted tambien tiene el derecho de presentar una protesta formal por escrito en contra de los aumentos propuestos. Una protesta formal debe ser hecha por escrito, debe estar firmada por el cliente 0 dueno de la propiedad, debe indicar la direccion, el numero de cuenta 0 el numero de parcela del asesor por el que se presenta, y debe indicar que se trata de una protesta por la tasa de servicio de agua. Si el Consejo de la Ciudad recibe protestas con relacion a la mayorfa de las parcelas servidas por el Sistema de Servicio de Agua de la Ciudad, 0 recibe protestas de la mayorfa de los consumidores, entonces no aprobara el aumento. Las protestas pueden enviarse por correo 0 entregarse en la ciudad a Water Service Rates, City Clerk, City of East Palo Alto, 2415 University Avenue, 2nd Floor, East Palo Alto, CA 94303, 0 pueden presentarse en la audiencia. Las protestas deben ser recibidas antes del cierre de los comentarios publicos en la audiencia para ser consideradas. La ciudad seguira los Procedimientos para la Aceptacion y Tabulacion de las Protestas Escritas (disponible en el Ayuntamiento, 2415 University Avenue, 22 piso, East Palo Alto, en la Oficina del Secreta rio Municipal) para el tratamiento y conteo de las protestas.

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Packet Pg. 467 Attachment: Reso 5154 Water Svc Rates Increase (2242 : Pass-Trhough Water Rate Increase) Fanongonongo ki he Kakai '0 e Kolo
KOLO 10 EAST PALO ALTO
KO E FOKOTU'U KE HIKI'A E TOTONGI'O E SEVESI VAl FAKAKOLO FANONGONONGO '0 E FAKATAHA FAKAKOLO
7:30 p.m.

Siulai 2, 2019
Loki Fakataha Fakakolo (City Council Chambers)
2415 University Avenue, East Palo Alto
ATTACHMENT 2
'Oku lalatanga ngaue 'a e Kala 'a East Pala Alta ki hana vakai'i fakalelei 'a e tatangi ki he sevesi 'a e vai 'a e kala. 'Oku tuku atu 'e he Kala 'a e ngaahi tatangi ka 'eni ki he kakai ma'u vai; ke fua'aki 'a e fakamale 'a hana takanaki 'a e sevesi vai 'aku malu rna falala'anga.

Fakatatau ki he 'aho, taimi rna e feitu'u 'aku tuku atu; 'oku fakaha heni 'e he Kosilio '0 e Kola '0 East Palo Alto, 'e fakahako ha fakataha fakahaloto fekau'aki mo e ngaahi fokotu'u ke hiki 'a e totangi '0 e sevesi vai 'a e kolo; 'a eni 'oku hiki atu 'i he tahi tala fakataha ko eni:

Taumu'a '0 e Tohi Fanongonongo ko eni
'Oku ke ma'u 'a e tohi fanongonango ko eni; he ko e tokotaha ma'u vai kae 'a e Kautaha Vai 'a e Kolo 'a East Palo Alto. 'Oku totongi hangatonu 'e he kau ma'u vai' 'a hanau mo'ua vai' ki he kautaha 'aku nau fakalele 'a e sevesi vai 'a e Kolo', '0 fakatatau ki he mahu'inga kua tu'utu'uni 'e he Kosilio '0 e Kalo '0 East Palo Alta.

Ko e taimi tepi/e '0 e teu hiki 'a e toton iVaI
Lahi '0 e Vai 'oku ngaue'aki {$ ki he cd (1 cd = 2831.5 lita» Kamata'anga $6.16 i $7.40 $7.55 $7.66 ! $7.77 $7.89
Ngaahi 'api taautaha
5/8" -1" $15.37 $17.19 $17.53 $17.79 $18.06 ' $18.33

ME'A KEHE KOTOA
5/8" $23.82 $25.34 $25.85 $26.24 $26.63 $27.03
3/4" 35.81 38.01 38.77 39.35 ! 39.94 ' 40.54
1" 59.64 ' 63.36 ' 64.63 66.58 67.58
1-1/2" 119.12 126.72 i 129.25 133.16 i 135.16
2" 190.59 202.75 206.81 213.06 216.26
3" 357.35 380.15 387.75 399.47 405.46
4" & larger 595.59 633.58 646.25 665.78 ' 675.77

FAKAMOLE FAKAMAHINA KI HE SEVESI TAMATE AFI & FAKATU'UTAMAKI , 5/8" $4.76 $5.07 • $5.17 $5.25 ! $5.33 • $5.41
3/4" 7.16 7.60 7.76 ,

7.87 7.99 8.11
1" 11.93 I 12.67 , 12.93 13.12 13.32 ' 13.52
1-1/2" 23.82 ' 25.34 25.85 26.24 26.63 27.03
2" 38.12 40.54 41.36 41.98 42.61 43.25
3" 71.47 76.02 77.55 78.72 79.89 81.09
4" & lahi ange 119.12 i 126.70 i 129.25 ! 131.20 135.15 Fakatokanga'i: 'E toki 'i ai pe 'a e /iliu 'i he kaha'u"oku 'i/o a ko e SFPUC Pass-Through Adjustment - 'e toki fakahoko pe ia '0 fakatatau ki ha hiki mei he SFPUC.

9.1.c
Packet Pg. 468 Attachment: Reso 5154 Water Svc Rates Increase (2242 : Pass-Trhough Water Rate Increase) ATTACHMENT 2
Makatu'unga '0 e fokotu'u ki he Hiki '0 e Totongr
'I hono fakama'opo'opo; ko e ngaahi me'a lalahi 'e tolu ne hoko '0 tupunga ai e fet6'aki mo e nounou 'i he patiseti ki hono fakalele '0 e sevesi ki he vai: 'Uluaki; kuo te'eki ke hiki 'e he Kolo '0 East Palo Alto 'a e totongi vai' talu mei he 2015, pea kuo hiki 'a e ngaahi fakamole ki he ngaue"i he vaha'a taimi ko eni; ua; kuo hiki lahi 'a e totongi fakapisinisi (wholesale) '0 e vai; tolu; kuo hiki mo e fakamole ki he kau ngaue'mo e tokolahi"o fakatatau ki he ngaahi tu'utu'uni fakalao mo e ngaahi faingata'a faka-sisitemi (Gloria Way Well), pea mo hono fakahoko '0 e ngaahi fakalelei ngaue faka-tekinolosia. Ko e tu'unga '0 e totongi 'i he taimi lolotonga; 'oku 'ikai te nau lava ke fua 'a e fakamole '0 hono fakahoko '0 e sevesi vai' '0 fakatatau ki he aleapau:

Ko e Ngaahi Liliu 'Otornetiki ('e fakahoko '0 'ikai toe a/ea'i) 'Oku fokotu'u atu heni, 'i he vaha'a taimi '0 e ta'u 'e nima, ko e ngaahi totongi ko 'eni 'e tali mo fakapaasi 'e he K6sili6 'a e Kolo; 'e fakahoko pe ia 'i hono taimi'pea 'e 'ikai toe fiema'u ke fakataha'i. Ka tali 'a e fokotu'u ko 'eni; 'e faklahoko 'otometiki pe 'a e ngaahi liliu ko 'eni'pea 'e 'ikai toe fiema'u ke alea'i 'e he K6sili6: Fakatatau ki he Lao mo e Tu'utu'uni Faka-Pule'anga vahe 53756, ko hono talaki '0 ha liliu 'otometiki 'e fanongonongo ia '0 'ikai toe si'isi'i hifo 'i he 'aho 'e 30 mei he 'aho 'e fakahoko ai 'a e liliu: Ko e liliu 'otometiki; ko ha liliu toki-'omi '0 makatu'unga 'i he totongi faka-pisinisi '0 e vai'{wholesale) 'e toki hoko ka fakafokifa kuo hiki 'e he SFPUC 'a e totongi 'oku 'omi ki he kautaha vai 'a East Palo Alto. Ko e hiki seniti 'e 1 kotoa ('ova he $4.10 he taimi lolotonga), 'e hiki leva 'a e totongi faka-voliume 'aki 'a e seniti 'e 1.2 (ova he totongi '0 ku ha atu he taimi tepile 'i 'olunga) pea 'e fika'i ki he lau seniti hoko:

Ko e Lao Tu'utu'uni fika 218 rno e Founga ki hono 'Eke'i '0 e Totongr 'I he Kupu XIII D, Vahe 6(b) '0 e KonisitUtone '0 Kalefonia', 'oku tuku mai ai ha ngaahi makatu'unga ki he totongi mo e mahu'inga fekau'aki mo e ngaahi koloa kelekele mo e 'api: Ko hono fakanounou eni '0 e ngaahi makatu'unga ko eni' pea 'oku kau ai 'a e: (1) ko e pa'anga 'e ma'u mai' 'e 'ikai ke hulu atu ia he mahu'inga 'oku fiema'u ke fakalele'aki 'a e sevesi ko ia; (2) ko e pa'anga hU mai"e 'ikai ngaue'aki ia ki ha me'a kehe, (3) ko e ngaahi totongi' 'e palanisi '0 fakatatau ki he ngaue', (4) 'e toki ngaue'aki 'a e totongi ki he ngaue (fee for service) ki ha ngaue pe 'e fakahoko '0 lava 'i he taimi pe ko ia', (5) 'e 'ikai ke 'atu ha totongi ke ne fua ha ngaue fakalakufua faka-pule'anga.
'Oku fakaafe'i atu koe ke ke lava ange mo ha'o fakamatala hiki tohi pe lea ki he fakataha faka'eke'eke 'oku teu ke fakahoko: 'Oku 'i ai foki mo ho'o totonu ke ke faile ha'o tohi ke fakafepaki'i 'a e teu hiki totongi ko 'eni: Kapau 'oku 'i ai ha fakahaloto ke fakafepaki, kuopau ke fou 'i ha faitohi, ke fakamo'oni nima ki ai 'a e tokotaha ma'u vai'pe tokotaha 'oku 'a'ana 'a e 'api; ke hiki mai ai 'a e tu'asila; fika '0 e 'akauni; pe fika lekooti '0 e lesisita 'api; pea ke fakahaa'i mahino mai 'i he tohi; ko e tohi fakafepaki '0 e hiki totongi '0 e sevesi vai: 'Okapau 'e ma'u 'e he K6sili6 '0 e Kolo; ha ngaahi fakahaloto fakafepaki 'oku tokolahi ange 'i he kau loto ki ai' mei he kau ma'u 'api 'i he vahenga 'oku sevesi 'e he kautaha vai 'a e Kolo; pe fakafepaki tokolahi mei he ko e kau kasitomaa; 'e 'ikai ke tali 'a e fokotu'u ke hiki 'a e totongi vai: Ko e ngaahi fakahahaloto fakafepaki ko eni; 'oku malava ke meili pe 'ave hangatonu ki he Kolo '0 East Palto - Sevesi Totongi Vai, City of East Palo Alto, 2415 University Avenue, 2nd Floor, East Palo Alto, CA 94303, pe ko ho'o lava ange pe mo ia ki he Fakataha Fakahaloto: Ko e ngaahi Fakahahaloto fakafepaki kotoa kuopau ke ma'u ange ia kimu'a 'i he tapuni 'a e Fakataha; kapau 'e fiema'u ke kau he lau: Kuopau ke muimui 'a e Kolo' ki he ngaahi tu'utu'uni mo e founga ngaue fakalao ki hono lau mo hono lekooti 'a e ngaahi tohi fakafepaki kotoa ('e ma'u mei 'ofisi '0 e City Hall, 2415 University Avenue, 2nd Floor, East Palo Alto, mei he 'Ofisi Lesisita 'a e Kolo) 'i hono tokangaekina mo e lau '0 e ngaahi fakafepaki fakahaloto:

9.1.c
Packet Pg. 469 Attachment: Reso 5154 Water Svc Rates Increase (2242 : Pass-Trhough Water Rate Increase) ATTACHMENT 2
Faaaliga Faasalalau
A'AI TUTOTONU 0 EAST PALO ALTO
FAUTUAINA IlE FA'ATElEINA 0 TOTONI TAUTUA OLE SUAVAI
FAASILASILAGA 0 LE TALOSAGA A LE MALO
7:30 p.m.
lulai 2, 2019
Aunofo a Ie A'ai
2415 University Avenue, East Palo Alto
010'0 i1oiloa nei e Ie A'ai tutotonu 0 East Palo Alto Ie fa'ateleina 0 Ie totoni tautua 0 Ie VaL 0 Ie tulaga tau faaofia 0 tatou rnaua i Ie auaunaga i Ie talosaga rno Ie Fa'arnasalaina 0 totonu Ie fa'arnatalaina rna Ie fa'aailigaina 0 Ie vaitai lie aso, tairni rna Ie lurnaga rno Ie tulaga, 0 Ie Pulega a Ie A'ai a East Palo Alto 0 Ie a faia se faarnasinoga faalauaitele e uiga i fua faatatau 0 Ie suavai ua faarnatalaina i lenei faaaliga.

Fa'amoemoega 0 Ie Faasilasilaga
010'0 e toe fa'aleleia lenei fa'aaliga ona 0 oe 0 se tagata fa'atau Vai i Ie Aai 0 East Palo Alto. Totogi tagata e totogia sa'o auaunaga tau suavai i Ie suavai , i fua faatatau 0 Ie Palernia 0 East Palo Alto.

Vaavaaia 0 Suavai Fua Faatatau
Tau fa'aaogaina vai fa'aaogaina ($ lie CCF (1 ccf = 2831.5 lita)) Fa'avae $6.16 $7.40 $7.55 $7.66 i $7.77 $7.89
Aiga Nofofua
5/8" -1" $15.37 $17.19 $17.53 $17.79 $18.06 $18.33
I isi tulaga uma
5/8" $23.82 $25.34 $25.85 i $26.24 $26.63 $27.03
3/4" 35.81 38.01 • 38.77 39.35 39.94 40.54
1" 59.64 63.36 64.63 65.60 66.58 67.58
1-1/2" 119.12 126.72 129.25 131.19 133.16 135.16
2" 190.59 202.75 206.81 209.91 213.06 216.26
3" 357.35 380.15 . 387.75 393.57 . 399.47 405.46
4" & larger 595.59 633.58 646.25 655.94 665.78 . 675.77 Puipuiga 0 Ie afi
5/8" $4.76 : $5.07 $5.17 . $5.25 i $5.33 $5.41
3/4" 7.16 7.60 ' 7.76 7.87 7.99 8.11
1" 11.93 12.67 12.93 13.12 13.32 13.52
1-1/2" 23.82 25.34 i 25.85 i 26.24 26.63 27.03
2" 38.12 40.54 41.36 . 41.98 42.61 43.25
3" 71.47 76.02 77.55 78.72 • 79.89 81.09
4" & larger 119.12 i 126.70 129.25 131.20 133.15 135.15

9.1.c
Packet Pg. 470 Attachment: Reso 5154 Water Svc Rates Increase (2242 : Pass-Trhough Water Rate Increase) ATTACHMENT 2
FAAMANATU: Pasia Ie SFPUC e ala i Ie Jetu'utu'unaiga e Ja'aaoga i tausaga olumanai e Ja'avae i luga 0 Ie Ja'ateleina 0 Ie Jua ole SFPUC
Fa'avae 0 Ie Fuafitaina 0 Tau
I Ie aotelega, e tolu tulaga maualuga na tutupu na mafua ai Ie fa'aitiitia 0 Ie fa'aauau 0 Ie fa'aaogaina 0 Ie suavai. Muamua, 0 Ie Aai ua Ie siitia Ie fuainumera talu mai Ie 2015 ma ua siitia Ie tau 0 galuega i lena taimi; lona lua, 0 Ie tau 0 Ie siisii 0 Ie suavai ua matua faateleina; lona tolu, 0 Ie fa'aleleia 0 Ie suavai ua maualuga tele ona 0 tulafono faatonutonu ma manaoga fa'apitoa (Gloria Way Well), ma Ie fa'atinoina 0 Ie fa'aleleia 0 tekinolosi fa'amatalaga. 0 fuainumera 0 10'0 i ai nei e Ie aofia ai Ie tau fa'atatau 0 Ie tu'uina atu 0 vai.

Suiga Fa'atonu
Ua fautuaina e faapea, mo se vaitaimi e lima tausaga, 0 fua faatatau ua faamaonia e Ie Aunofo a Ie Taulaga 0 Ie a noatia i se fetuutuunaiga vave. Afai e fa'amaonia nei fetuutuunaiga 0 Ie a aunoa ma Ie leai 0 se isi fa'atalatalanoaga. E tusa ai ma Ie Vaega Fa'avae a Ie Malo 53756, 0 Ie fa'asilasilaga 0 Ie aofaiga 0 so'o se fetuunaiga fa'apitoa e tatau ona tupu i Ie 30 aso a'o le'i amataina Ie fetuunaiga. 0 Ie fa'amautuina vave 0 se tau 0 Ie vai tele-e ala mai i Ie mea e tupu i Ie mea e tupu pe a suia e Ie SFPUC Ie tele 0 Ie vai mo Ie East Palo Alto. Mo Ie 1 pasene 0 Ie siitaga 0 Ie siitaga (luga atu 0 Ie $ 4.10), 0 Ie fua faatatau volumetric 0 Ie a siitia i Ie 1.2 sene (i luga 0 fua faatatau 0 100 faaalia i Ie fua faatatau 0 Ie fuainumera 0 100 i luga), ma faataamilo i Ie centene lata maio
Palosaga 218 rna Ie Talosaga 0 Ie Fa'atonu
Mataupu XIII D, 0 Ie Vaega 6 (b) 0 Ie Kalefonia 0 Faavae ua faatulaga mai ai tulaga manaomia mo pili 0 meatotino. lie otootoga o faamatalaga 0 na manaoga e aofia ai: (1) 0 tupe maua e Ie tatau ona sili atu nai 10 tupe e manaomia e tuuina atu ai Ie auaunaga, (2) 0 tupe maua e Ie tatau ona fa'aaogaina mo so'o se isi lava fa'amoemoe, (3) totogi e tatau ona tutusa, (4) mo Ie auaunaga e faatoa mafai ona tu'uina atu mo auaunaga 0 10'0 avanoa vave, ma (5) e leai se totogi e mafai ona tu'uina atu mo auaunaga lautele a Ie malo.

Ua vala'aulia oe e tu'uina atu molimau tu'ufofoga pe tusia i Ie fa'alogo lautele. E iai foi lau aia tatau e failaina ai se tetee tusitusia aloaia faasaga i Ie fa'atupulaia 0 Ie fa'atupulaia. 0 se tete'e aloaia e tatau ona faia i se tusitusiga, e tatau ona sainia e Ie tagata fa'atau po'o Ie tagata e ona Ie fanua, e tatau ona ta'u mai Ie tuatusi, numera 0 Ie numera po'o Ie numera 0 Ie faatonu 0 10'0 tu'uina atu, ma e tatau ona fa'aalia 0 Ie fa'aaogaina 0 Ie vai. Afai e maua e Ie Aunofo a Ie Taulaga ni faitioga e tusa ai ma Ie tele 0 vaega 0 10'0 fa'aogaina e Ie City Water Service System, pe maua foi tete'e mai Ie to'atele 0 tagata fa'atau, ona Ie faamaonia lea 0 Ie si'itia. 0 fa'amaoniga e mafai ona lafoina pe tu'uina atu i Ie City at Water Service Rates, City Clerk, City of East Palo Alto, 2415 University Ave, 2nd Floor, East Palo Alto, CA 94303, pe mafai foi ona tu'uina atu ile faamasinoga. 0 fa'amaoniga e tatau ona maua e ala i Ie tapunia 0 manatu lautele i Ie fa'alogo ina ia faitauina. 0 Ie a mulimuli Ie A'ai i ana faiga mo Ie taliaina ma Ie fa'amaonia 0 fa'amatalaga tusitusia (avanoa i Ie City Hall, 2415 University Avenue, 2nd Floor, East Palo Alto, mai Ie of is a 0 Ie failautusi 0 Ie taulaga i Ie tagofiaina ma Ie faitauina 0 faitioga.

Faaliliuga na tu'uina atu e pei 0 se
fa'aaIoaIo. FaamoIemoIe fa'aIagoIago
i Ie fa'aliliuga Peretania

9.1.c
Packet Pg. 471 Attachment: Reso 5154 Water Svc Rates Increase (2242 : Pass-Trhough Water Rate Increase) Erin Franks, Rates Administrator
May 10, 2022
SFPUC
FY 2022-23
Wholesale Water Rates
1 9.1.d
Packet Pg. 472 Attachment: SFPUC Wholesale Water Rates Increase Staff Report (2242 : Pass-Trhough Agenda
• Drivers of Wholesale Rate Increase
• FY 2022-23 Wholesale Water Rate
• FY 2022-23 Untreated Water Discount
• Historic and Projected Wholesale Rates
2 9.1.d
Packet Pg. 473 Attachment: SFPUC Wholesale Water Rates Increase Staff Report (2242 : Pass-Trhough Drivers of Wholesale Rate Increase

1. Using up the Balancing Account
• $87M Balancing Account owed to wholesale customers
as of end of FY 2020-21
• Using half in FY 2021-22 ($43M)
• Using remaining half in FY 2022-23 ($44M)

2. Reduced wholesale water sales due to
conservation
• Rebalanced rates to prevent volatility

3. Increase in costs
• Debt service
• Operations & Maintenance 3

9.1.d
Packet Pg. 474 Attachment: SFPUC Wholesale Water Rates Increase Staff Report (2242 : Pass-Trhough FY 2022-23 Rate Increase: 15.9%
• 5 years of stable rates; debt refinancing offset expense increases
• Wholesale sales volumes lower next 2 years: assumed
meeting water conservation budgets (113.7 MGD)
• Expenses increasing: debt service and operating
• Balancing Account projected to be repaid by year-end
FY 2022-23 Rates = ($302.6𝑀𝑀+(−$44.8𝑀𝑀+$14.1M))
113.7 𝑀𝑀𝑀𝑀𝑀𝑀
= $4.75/𝑐𝑐𝑐𝑐𝑐𝑐
𝑤𝑤𝑤𝑤𝑤𝑤𝑤𝑤𝑤𝑤𝑤𝑤𝑤𝑤𝑤𝑤𝑤 𝑠𝑠 𝑒𝑒𝑒𝑒 𝑒𝑒 + (−𝑏𝑏 𝑏𝑏 𝑏𝑏 𝑎𝑎 𝑎𝑎 𝑢𝑢 + 𝑎𝑎𝑎𝑎 𝑎𝑎𝑎𝑎 𝑎𝑎 ) 𝑤𝑤𝑤𝑤𝑤𝑤𝑤𝑤𝑤𝑤𝑤𝑤𝑤𝑤𝑤𝑤𝑤 𝑣𝑣
4 9.1.d
Packet Pg. 475 Attachment: SFPUC Wholesale Water Rates Increase Staff Report (2242 : Pass-Trhough FY 2022-23 Untreated Water Discount
• Discount applied to the Wholesale Water Rate for
Coastside County Water District (CCWD) purchases of
untreated SFPUC water
• Based on the unit cost of capital and operating expenses for the Harry Tracy Water Treatment Plant (HTWTP)
• Untreated Wholesale Water Rate discount factor for
wholesale customers receiving untreated water = $0.43
per ccf
5 9.1.d
Packet Pg. 476 Attachment: SFPUC Wholesale Water Rates Increase Staff Report (2242 : Pass-Trhough Historic and Projected Wholesale Rates
6 9.1.d
Packet Pg. 477 Attachment: SFPUC Wholesale Water Rates Increase Staff Report (2242 : Pass-Trhough

DEPARTMENT SFPUC Finance AGENDA NO. 10
MEETING DATE May 10, 2022

AGENDA ITEM
Public Utilities Commission
City and County of San Francisco
Adopt Wholesale Water Rates for Fiscal Year 2022-2023
Regular Calendar
Project Manager: Charles Perl
Summary of
Proposed
Commission Action:

Consider and adopt the proposed Wholesale Water Rates for Fiscal Year 2022-2023, which will become effective for meter readings on or after July 1, 2022. The San Francisco Public Utilities Commission developed the proposed rates in accordance with the terms of the Water Supply Agreement between the City and County of San Francisco and its Wholesale Customers, which was approved on April 28, 2009 by Commission Resolution No. 09-0069, and amended and restated on December 11, 2018 by Commission Resolution No. 18- 0212, with subsequent approval by the Wholesale Customers. This action constitutes the Approval Action for the purposes of the California Environmental Quality Act (CEQA) pursuant to Section

31.04(h) of the San Francisco Administrative Code. The Planning Department has determined that this action is exempt from the CEQA.

If the item is approved, the Commission will rely on that determination to make its decision.

Background and
Description of
Proposed Action:

Background
The San Francisco Public Utilities Commission (SFPUC) sells water to retail customers inside the City and County of San Francisco (CCSF), as well as 27 wholesale customers in Alameda County, San Mateo County, and Santa Clara County (“Wholesale Customers”), who in turn establish local utility rates for the retail water customers that they serve in their respective jurisdictions.

The SFPUC establishes water rates applicable to the Wholesale Customers (“Wholesale Water Rates”) in accordance with the terms of the Water Supply Agreement between CCSF and the Wholesale Customers, which was approved on April 28, 2009 by Commission Resolution No. 09-0069, and amended and restated on December 11, 2018 by Commission Resolution No. 18-0212, with subsequent approval by the Wholesale Customers (WSA).

The WSA requires the Commission to consider annual adjustments to the Wholesale Water Rates, which are based on projected wholesalerelated costs and water deliveries to the Wholesale Customers, in coordination with the SFPUC’s financial planning and budget processes. The WSA also sets forth specific procedures that the SFPUC must follow if it intends to increase Wholesale Water Rates during the ensuing fiscal year.

As required by WSA section 6.03.A, the SFPUC sent a written notice

9.1.d
Packet Pg. 478 Attachment: SFPUC Wholesale Water Rates Increase Staff Report (2242 : Pass-Trhough Water Rate Increase) Title: Wholesale Water Rates and Charges for FYE 2023
Meeting Date: May 10, 2022
of proposed adjustments to the Wholesale Water Rates for Fiscal Year (FY) 2022-2023 to all of the Wholesale Customers and the Bay Area Water Supply and Conservation Agency (BAWSCA), which
represents the Wholesale Customers, more than 30 days prior to this Commission meeting, on April 8, 2022. The SFPUC’s notice to the Wholesale Customers and BAWSCA included various required tables and schedules illustrating the calculation of the proposed increase in rates, including a revised Schedule W-25: Wholesale Use with LongTerm Contract (“Schedule W-25”), showing the rates that would be effective to the Wholesale Customers on or after July 1, 2022, more than 30 days after adoption by the Commission.

As discussed in further detail below, SFPUC Finance staff’s proposed adjustments include a new volumetric water rate of $4.75 per Ccf (1 Ccf = 748 gallons), based on the Wholesale Customers’ portion of the SFPUC Regional Water System’s capital and operating costs under the WSA, known as the Wholesale Revenue Requirement, the application of a Balancing Account repayment, and water sales assumptions. This new rate reflects a 15.9% increase from the current rate of $4.10 per Ccf. SFPUC Finance staff also proposes an increase in the Untreated Wholesale Water Rate Discount applicable to Coastside County Water District, the one Wholesale Customer that receives non-potable water from the SFPUC, rather than treated potable drinking water, and it treats at its own facilities.

In general, the WSA requires the Wholesale Customers to pay operating expenses and capital costs associated with the SFPUC’s “regional” assets, which serve both the Wholesale Customers and the SFPUC’s retail customers in San Francisco, based on proportional water use. The WSA allows the SFPUC to recover a portion of net annual debt service for new regional assets and to recover the Wholesale Customers’ share of revenue-funded regional capital costs.

The WSA also authorizes the SFPUC to collect the Wholesale Customers’ contribution to meet debt service coverage reserve requirements. Finally, the WSA directs the SFPUC to consider, when establishing Wholesale Water Rates, whether there is a positive balance in the Balancing Account maintained under the WSA (reflecting an amount that the SFPUC owes to the Wholesale Customers, based on actual costs incurred by the SFPUC and actual amounts of water used by wholesale and retail customers in previous fiscal years); the SFPUC may apply an amount from the Balancing Account to reduce Wholesale Water Rates for the immediately ensuing year.

Proposed Volumetric Water Rate Change
SFPUC Finance staff prepared an analysis of the SFPUC Water Enterprise’s projected revenues and revenue requirements for FY 2022-2023. Without the proposed adjustments, the current volumetric water rate applicable to the Wholesale Customers ($4.10 per Ccf) would generate $246.2 million in revenues, based on projected water deliveries, which the SFPUC would use to meet the costs of providing Wholesale Customer water service. As shown in the table below, however, the projected Wholesale Revenue Requirement for FY 2022-

9.1.d
Packet Pg. 479 Attachment: SFPUC Wholesale Water Rates Increase Staff Report (2242 : Pass-Trhough Water Rate Increase) Title: Wholesale Water Rates and Charges for FYE 2023
Meeting Date: May 10, 2022
2023, which includes the Wholesale Customers’ proportionate share of operating expenses, debt service on bonds sold to construct or acquire new regional assets, and revenue funding for new cash-funded regional assets, totals a significantly higher number – $271.9 million – even with the application of $44.8 million dollars from the Balancing Account.

To account for this difference, SFPUC Finance staff recommends increasing the volumetric water rate applicable to the Wholesale Customers on or after July 1, 2022 by 15.9%, to $4.75 per Ccf, as shown on the revised Schedule W-25 (attached). As noted, the proposed rate would collect less than the Wholesale Customers’ share of costs under the WSA because the SFPUC would apply $44.8 million in Balancing Account funds that the SFPUC owes to the Wholesale Customers due to overcollection in prior fiscal years. With the application of these funds, SFPUC Finance staff projects that the Balancing Account will be exhausted after FY 2022-2023, and future fiscal years will require additional Wholesale Water Rate increases in line with the change in the Wholesale Customers’ share of expenditures.

Projected Wholesale Revenue Requirement ($ millions)
FYE 2023
Operating Costs $131.7
Capital: Pre 2009 Assets (K-5) 0.0
Debt Service 154.5
Capital: Revenue Funded 16.5
Balancing Account -44.8
Debt Service Coverage 14.1
Total Requirement $271.9
Projected Wholesale Sales 113.7 MGD
Untreated Wholesale Water Rate Discount Factor
The SFPUC’s April 8, 2022 notice also informed the Wholesale Customers and BAWSCA of a proposed increase in the Untreated Wholesale Water Rate Discount Factor applicable to Coastside County Water District (CCWD) for FY 2022-2023. Unlike the SFPUC’s other Wholesale Customers, who receive treated potable drinking water from the SFPUC, CCWD receives non-potable water from the SFPUC, which it treats to drinking water standards at its own facilities.

As required by Section 8 of the individual water sales contract between the SFPUC and CCWD under the terms of the WSA, SFPUC Finance staff commissioned an independent analysis in 2010 to evaluate the cost of service for untreated water. The analysis showed that an untreated water rate classification should be applied to the Wholesale Water Rates for CCWD purchases of untreated SFPUC

9.1.d
Packet Pg. 480 Attachment: SFPUC Wholesale Water Rates Increase Staff Report (2242 : Pass-Trhough Water Rate Increase) Title: Wholesale Water Rates and Charges for FYE 2023
Meeting Date: May 10, 2022
water. The lower contract price of untreated water compared to treated water, which the SFPUC and the Wholesale Customers refer to as a “discount factor,” is based on the unit cost of capital and operating expenses for the SFPUC’s Harry Tracy Water Treatment Plant (“HTWTP”), which is not used to treat the “raw” water delivered to CCWD.

SFPUC Finance recommends increasing the discount factor applicable to CCWD in FY 2022-2023 to $0.43 per Ccf, an increase of $0.07 from the current rate, as shown on the revised Schedule W-25. The SFPUC calculated this discount factor by dividing the total projected costs and expenses for HTWTP in FY 2022-2023 by the total projected water deliveries to the Wholesale Customers in FY 2022- 2023. The proposed increase is due to lower projected water deliveries to the Wholesale Customers, which results in the excluded HTWTP costs and expenses being divided by a lower number.

Environmental
Review:

On April 26, 2022 the San Francisco Planning Department determined the Project to be statutorily exempt from environmental review under California Environmental Quality Act (CEQA) Section 21080(b)(8) and CEQA Guidelines Section 15273 (Rates, Tolls, Fares and Charges) (Case Number 2022-003582ENV) related to the
establishment, modification, structuring, restructuring, or approval of rates, tolls, fares, or other charges. The exemption can be found here:
https://sfpuc.sharefile.com/d-s95af129d1ceb42319096a059b205c2e9 This action constitutes the Approval Action for the purposes of CEQA pursuant to Section 31.04(h) of the San Francisco Administrative Code.

Result of Inaction: A delay or denial in approving this agenda item will result in no rate adjustment for the Wholesale Customers as of July 1, 2022, and a significant revenue loss to the Water Enterprise in FY 2022-2023.

Recommendation: SFPUC Finance recommends that the Commission adopt the attached resolution.

Attachments: 1. Schedule W-25: Wholesale Use with Long-Term Contract

2. FY 2022-2023 Wholesale Water Rates Notice (with enclosures)

9.1.d
Packet Pg. 481 Attachment: SFPUC Wholesale Water Rates Increase Staff Report (2242 : Pass-Trhough Water Rate Increase)

PUBLIC UTILITIES COMMISSION
City and County of San Francisco
Resolution No.

WHEREAS, The San Francisco Public Utilities Commission (SFPUC) sells water to retail customers inside the City and County of San Francisco (“San Francisco”) as well as 27 wholesale customers in Alameda County, San Mateo County, and Santa Clara County (“Wholesale Customers”), who in turn establish local utility rates for the retail water customers that they serve in their respective jurisdictions; and
WHEREAS, The SFPUC establishes water rates applicable to the Wholesale Customers (“Wholesale Water Rates”) in accordance with the Water Supply Agreement between San Francisco and the Wholesale Customers, which was approved by Commission Resolution No. 09- 0069 on April 28, 2009, and amended and restated by Commission Resolution No. 18-0212 on December 11, 2018, with subsequent approval by the Wholesale Customers (WSA); and WHEREAS, The SFPUC proposes to adjust the Wholesale Water Rates for Fiscal Year (FY) 2022-2023 to include a new volumetric water rate of $4.75 per Ccf, which is a 15.9% increase from the current rate of $4.10 per Ccf, and a new Untreated Wholesale Water Rate Discount Factor of $0.43 per Ccf, which is an increase of $0.07 from the current rate and applies only to Coastside County Water District, the only Wholesale Customer that receives non-potable water from the SFPUC; and
WHEREAS, As required by WSA section 6.03, the SFPUC sent a written notice of proposed adjustments to the Wholesale Water Rates for FY 2022-2023 to all of the Wholesale Customers and the Bay Area Water Supply and Conservation Agency (BAWSCA) on April 8, 2022, and the Commission held a public hearing on May 10, 2022 to consider the proposed adjustments, which would take effect on July 1, 2022, more than 30 days after their adoption; and WHEREAS, A copy of the WSA, and a copy of the SFPUC’s April 8, 2022 notice to the Wholesale Customers and BAWSCA, which included among its attachments a revised Schedule W-25: Wholesale Use With Long-Term Contract, showing the proposed Wholesale Water Rates effective July 1, 2022, are on file with the Secretary of the Commission and incorporated in this resolution by reference; and
WHEREAS, The Commission approved the WSA after reviewing the Final Program Environmental Impact Report for the Water System Improvement Program, and adopted and incorporated by reference the California Environmental Quality Act (“CEQA”) findings contained in Commission Resolution No. 08-0200 dated October 30, 2008, and made additional findings pursuant to CEQA; and
WHEREAS, On April 26, 2022 the San Francisco Planning Department determined the Project to be statutorily exempt from environmental review under CEQA Section 21080(b)(8) and CEQA Guidelines Section 15273 (Rates, Tolls, Fares and Charges) (Case Number 2022- 003582ENV) related to the establishment, modification, structuring, restructuring, or approval of rates, tolls, fares, or other charges; and
WHEREAS, This action constitutes the Approval Action for the purposes of the CEQA pursuant to Section 31.04(h) of the San Francisco Administrative Code; and

9.1.d
Packet Pg. 482 Attachment: SFPUC Wholesale Water Rates Increase Staff Report (2242 : Pass-Trhough Water Rate Increase) WHEREAS, This Commission is securing revenue for purposes of meeting estimated FY 2022-2023 “Regional” operating and capital costs consistent with Article 5 of the 2009 Water Supply Agreement, including: (1) employee wages and fringe benefits; (2) purchasing or leasing supplies, equipment or materials; (3) meeting financial reserve needs and requirements; and (4) obtaining funds for capital projects necessary to maintain service within the Commission's existing water service area; now, therefore, be it
RESOLVED, This Commission determines that an increase in the volumetric water rates applicable to the Wholesale Customers is required for Fiscal Year 2022-2023 and hereby adopts the proposed 15.9% increase, as enumerated in the revised Schedule W-25: Wholesale Use With Long-Term Contract, attached hereto and incorporated by reference herein, which shall be uniform to the nearest dollar on service charges, and establishes a $4.75 per 100 cubic feet commodity charge, for all water delivered to the Wholesale Customers, on or after July 1, 2022; and, be it
FURTHER RESOLVED, This Commission hereby adopts the proposed Fiscal Year 2022- 2023 Untreated Wholesale Water Rate Discount Factor, as enumerated in the revised Schedule W-25, which shall be uniform to the nearest dollar on service charges and establishes a $0.43 per 100 cubic feet rate discount factor, for all untreated water delivered to Coastside County Water District, on or after July 1, 2022, and this rate shall remain in place until replaced or amended.

I hereby certify that the foregoing resolution was adopted by the Public Utilities Commission at its meeting of May 10, 2022.

Secretary, Public Utilities Commission

9.1.d
Packet Pg. 483 Attachment: SFPUC Wholesale Water Rates Increase Staff Report (2242 : Pass-Trhough Water Rate Increase)

SAN FRANCISCO PUBLIC UTILITIES COMMISSION
SCHEDULE W-25: Wholesale Use with Long-Term Contract,
Effective July 1, 2022
(Adopted May 10, 2022 by Commission Resolution No. ________) For service to municipalities, water districts and others who, under long-term contracts, purchase water for resale:

First: A Monthly Service Charge base on the type and size of the meter:

Meter
Size
Disc/Compound
Meters
Crest Meters Magnetic
Meters
Turbine Meters
5/8 in. $11 - - -
3/4 in. $18 - - -
1 in. $30 - - -
1 1/2 in. $43 - - -
2 in. $79 - - -
3 in. $158 - - -
4 in. $318 $353 - $577
6 in. $476 $685 - $1,256
8 in. $635 $1,335 $2,265 $1,875
10 in. $793 $1,732 - $3,391
12 in. $953 $1,840 $5,159 -
16 in. $1,270 $5,628 - $7,215
18 in. - $6,133 - -
20 in. - $6,349 - -
The service charge for a battery of meters installed on one service in lieu of one meter or for a special type of meter, shall be based on the size of single or multiple standard type meters of equivalent capacity.

Second: A charge for water delivered based on one-month’s meter readings:
$2,069.10 per acre-foot or $4.75 per 100 cu. ft.

Third: An Untreated Wholesale Water Rate Discount Factor for Wholesale Customers receiving untreated water, based on one-month’s meter readings:
($187.31) per acre-foot or ($0.43) per 100 cu. ft.

9.1.d
Packet Pg. 484 Attachment: SFPUC Wholesale Water Rates Increase Staff Report (2242 : Pass-Trhough Water Rate Increase)

9.1.d
Packet Pg. 485 Attachment: SFPUC Wholesale Water Rates Increase Staff Report (2242 : Pass-Trhough Water Rate Increase) Services of the San Francisco Public Utilities Commission OUR MISSION: To provide our customers with high-quality, efficient and reliable water, power and sewer services in a manner that values environmental and community interests and sustains the resources entrusted to our care.
525 Golden Gate Avenue, 13th Floor
San Francisco, CA 94102
T 415.554.3155
F 415.554.3161
TTY 415.554.3488
April 8, 2022
Ms. Nicole Sandkulla
CEO/General Manager
Bay Area Water Supply & Conservation Agency
155 Bovet Road, Suite 650
San Mateo, CA 94402
Re: Fiscal Year 2022-23 Wholesale Water Rates Notice
Dear Ms. Sandkulla,
The San Francisco Public Utilities Commission (SFPUC) has determined that the Fiscal Year 2022-23 Wholesale Water Rates will be $4.75 per CCF, representing a $0.65 per CCF or 15.9% increase from the current rate for treated wholesale water effective July 1, 2022. As required by WSA Section

6.03.A, the SFPUC has scheduled a public hearing to consider the adoption of the wholesale water rate, as follows:

May 10, 2022, 1:30 PM
San Francisco City Hall
1 Dr. Carlton B. Goodlett Place, Room 400
San Francisco, CA 94102
Over the past five years, there were no wholesale rate changes – as the SFPUC optimized for rate stability and the spending down of the balancing account. As of June 30, 2021, there is $87 million in the balancing account that is owed to wholesale customers, of which SFPUC plans to fully repay the wholesale customers by the end of Fiscal Year 2022-23. To most accurately forecast the Fiscal Year 2021-22 year-end balancing account, the Fiscal Year 2022-23 rate was calculated based on actual Fiscal Year 2021-22 sales data through February of this year.

Since the Wholesale Customer Annual Meeting on February 17, 2022, several factors outside of our control have changed, presenting further financial challenges to the Water Enterprise. The rising interest rate environment has eliminated debt service savings that SFPUC planned to realize for Fiscal Year 2022-23 and beyond. Additionally, worsening drought conditions and further calls for conservation in the state are projected to lower revenues in the next two years as customers rise to the call for conservation. Finally, the SFPUC faces growing costs in this upcoming fiscal year, particularly debt service on previously issued bonds.

9.1.d
Packet Pg. 486 Attachment: SFPUC Wholesale Water Rates Increase Staff Report (2242 : Pass-Trhough Water Rate Increase) The SFPUC is required to generate sufficient revenues to pay operations and maintenance expenditures and debt service, and to meet SFPUC debt service coverage ratio policy minimums. While the financial picture has worsened for FY 2022-23, the SFPUC has maintained the projected wholesale rate increase of 15.9% presented at the Wholesale Customer Annual Meeting, and will continue to use various financial measures, including the spend down of the wholesale balancing account, to stabilize required rate increases.

Untreated Wholesale Water Rate Discount Factor
The Fiscal Year 2022-23 Untreated Wholesale Water Rate Discount will be $0.43 per CCF, an increase of $0.07 from the current rate, effective July 1, 2022. The discount factor is equal to the Harry Tracy Water Treatment Plant total projected cost. The discount is calculated by dividing the relevant cost by total wholesale water deliveries. The increase is primarily driven by lower wholesale volumes, which results in the excluded costs being divided by a lower number.

Fiscal Year 2022-23 Billing
As in prior years, the following charges, unrelated to the Wholesale Revenue Requirement, will be effective July 1, 2022:
• BAWSCA Bond Surcharge: The monthly bills include the February 2013 prepayment of the Pre-2009 Assets surcharge for the repayment of BAWSCA issued bonds. The amounts of the surcharge are proportionate to water consumption and have been adjusted accordingly. The SFPUC bills and collects the surcharge on behalf of BAWSCA and remits these amounts to the trustee.
• Late Fees: As part of the response to the current pandemic, the SFPUC waived late fees on past due balances through July 1, 2023.

After this time, late payment penalties as specified in Schedule W-44 will once again be in effect. The SFPUC encourages Wholesale customers to sign up for electronic billing and payment services to make timely payments and to avoid late fees. Please sign up with our SFPUC BillPay service at myaccount-water.sfpuc.org to receive and pay your bills online. If you have any questions, please contact customer assistance at (415) 551-3000.

Enclosures
Per WSA Section 6.03.A, supporting documents are required if there is a rate increase. We are attaching the following:
• Attachment N-1: Balancing Account/Rate Setting Calculation: A table showing the change in the Wholesale Revenue Requirement and how the wholesale rate was calculated
• Attachment N-3: Schedule of Projected Water Sales, Wholesale Revenue Requirements and Wholesale Rates: A schedule showing

9.1.d
Packet Pg. 487 Attachment: SFPUC Wholesale Water Rates Increase Staff Report (2242 : Pass-Trhough Water Rate Increase) projected Wholesale Customer water sales and rates for the proposed rate year and the following four fiscal years
• FY 2022-23 Calculation of Untreated Water Discount Factor • Schedule W-25: Wholesale Use with Long-Term Contract - Proposed Fiscal Year 2022-23 Wholesale Customer water rates
• Fiscal Year 2022-23 BAWSCA Bond Surcharge letter and schedule showing the bond surcharge for each member agency
If you have any questions, please contact me at 415-487-5227 or [email protected]
Sincerely,
Erin Franks
Rates Administrator
Enclosures
cc: Dennis Herrera, SFPUC, General Manager
Ronald Flynn, SFPUC, Chief of Staff
Steve Ritchie, SFPUC, Water Enterprise Assistant General Manager Charles Perl, SFPUC, Deputy CFO
Kristina Alagar Cordero, SFPUC, Director of Financial Planning Alison Kastama, SFPUC, BAWSCA Liaison
Catherine Malina, SF City Attorney
Christina Tang, BAWSCA, Finance Manager

9.1.d
Packet Pg. 488 Attachment: SFPUC Wholesale Water Rates Increase Staff Report (2242 : Pass-Trhough Water Rate Increase) Balancing Account / Rate-Setting Calculation Schedule N-1 Reference Section 6.03.A.3
Fiscal Year 2022-23
FY 2020-21 FY 2021-22 FY 2022-23

1. Actual Changes to Balancing Account for FY 2020-21
A. Balancing Account as of June 30, 2020 (unaudited) $ (63,393,776) B. Interest on Balancing Account and Coverage Reserve $ (1,139,197) C. Wholesale Revenues for Fiscal Year $ (275,113,885)
D. Wholesale Revenue Requirement for Fiscal Year $ 245,743,192 E. Net Change in Wholesale Revenue Coverage $ 2,431,211 F. Settlement Credits or Other Adjustments $ 4,382,469
G Balancing Account as of June 30, 2021 (unaudited) $ (87,089,986)

2. Projected Changes to Balancing Account for FY 2021-22 A. Balancing Account as of June 30, 2021 $ (87,089,986) B. Interest on Balancing Account and Coverage Reserve $ (617,562) C. Wholesale Revenues for Fiscal Year $ (246,152,161)
D. Wholesale Revenue Requirement for Fiscal Year $ 286,998,565 E. Settlement Credits or Other Adjustments $ -
F. Balancing Account as of June 30, 2022 $ (46,861,144) G. Net Change in Wholesale Revenue Coverage $ 2,278,271 H. Total Revenue Deficiency or (Surplus) $ (44,582,873)

3. Projected Changes to Balancing Account for FY 2022-23 A. Balancing Account as of June 30, 2022 $ (44,582,873) B. Interest on Balancing Account and Coverage Reserve $ (446,246) C. Wholesale Revenues for Fiscal Year $ (267,871,466)
D. Wholesale Revenue Requirement for Fiscal Year $ 302,588,214 E. Settlement Credits or Other Adjustments $ -
F. Balancing Account as of June 30, 2023 $ (10,312,372) G. Net Change in Wholesale Revenue Coverage $ 14,151,740 H. Total Revenue Deficiency or (Surplus) $ 3,839,368

9.1.d
Packet Pg. 489 Attachment: SFPUC Wholesale Water Rates Increase Staff Report (2242 : Pass-Trhough Water Rate Schedule of Projected Water Sales, Wholesale Revenue Requirements, and Wholesale Rates Schedule N-3 Reference Section 6.03.A.3
Fiscal Year 2022-23
FY 2021-22 FY 2022-23 FY 2023-24 FY 2024-25 FY 2025-26 FY 2026-27 Water Enterprise
Operations & Maintenance Expenses
Source of Supply $ 17,789,221 $ 18,273,114 $ 18,593,691 $ 19,432,883 $ 21,101,621 $ 21,712,498 Pumping $ - $ - $ - $ - $ - $ -
Treatment $ 35,859,193 $ 36,834,618 $ 37,480,831 $ 39,172,459 $ 42,536,271 $ 43,767,666 Transmission & Distribution $ 19,973,195 $ 20,516,496 $ 20,876,430 $ 21,818,649 $ 23,692,257 $ 24,378,131 Customer Services $ 243,983 $ 250,619 $ 255,016 $ 266,526 $ 289,413 $ 297,791 Total Operations & Maintenance Expenses $ 73,865,591 $ 75,874,848 $ 77,205,968 $ 80,690,517 $ 87,619,563 $ 90,156,086 Administrative & General Expenses
Countywide Cost Allocation Plan (COWCAP) $ 1,454,767 $ 1,494,338 $ 1,520,554 $ 1,589,182 $ 1,725,648 $ 1,775,604 SFPUC Bureaus $ 17,230,525 $ 17,699,222 $ 18,009,730 $ 18,822,566 $ 20,438,895 $ 21,030,587 Compliance Audit $ 108,405 $ 111,354 $ 113,307 $ 118,421 $ 128,590 $ 132,313 Other Administrative & General $ 8,313,398 $ 8,539,535 $ 8,689,349 $ 9,081,527 $ 9,861,375 $ 10,146,854 Total Administrative & General Expenses $ 27,107,095 $ 27,844,449 $ 28,332,941 $ 29,611,696 $ 32,154,508 $ 33,085,358 Property Taxes $ 1,582,139 $ 1,625,175 $ 1,653,687 $ 1,728,323 $ 1,876,737 $ 1,931,067 Capital Cost Recovery
Pre-2009 Assets (K-1 to K-4) $ - $ - $ - $ - $ - $ -
Pre-2009 Assets (K-5) $ - $ - $ - $ - $ - $ -
Debt Service on New Assets $ 159,474,548 $ 168,034,980 $ 167,208,108 $ 169,878,841 $ 175,167,792 $ 174,682,616 Revenue Credit for BABs Subsidy $ (14,203,277) $ (13,559,130) $ (13,119,799) $ (13,060,270) $ (12,972,112) $ (12,650,242) Revenue Funded Capital $ 13,553,940 $ 16,452,500 $ 16,255,000 $ 16,547,500 $ 16,835,000 $ 16,857,500 Total Capital Cost Recovery $ 158,825,211 $ 170,928,351 $ 170,343,309 $ 173,366,071 $ 179,030,681 $ 178,889,874 Hetch Hetchy Water & Power
Operations & Maintenance Expenses $ 21,897,738 $ 22,493,390 $ 22,888,006 $ 23,921,014 $ 25,975,156 $ 26,727,118 Administrative & General Expenses
Countywide Cost Allocation Plan (COWCAP) $ 346,990 $ 356,429 $ 362,682 $ 379,051 $ 411,600 $ 423,516 SFPUC Bureaus $ 3,623,344 $ 3,721,905 $ 3,787,200 $ 3,958,129 $ 4,298,021 $ 4,422,445 Other Administrative & General $ 4,164,223 $ 4,277,496 $ 4,352,539 $ 4,548,983 $ 4,939,613 $ 5,082,611 Total Administrative & General Expenses $ 8,134,557 $ 8,355,829 $ 8,502,421 $ 8,886,162 $ 9,649,234 $ 9,928,572 1 9.1.d
Packet Pg. 490 Attachment: SFPUC Wholesale Water Rates Increase Staff Report (2242 : Pass-Trhough Water Rate Increase) Schedule of Projected Water Sales, Wholesale Revenue Requirements, and Wholesale Rates Schedule N-3 Reference Section 6.03.A.3
Fiscal Year 2022-23
FY 2021-22 FY 2022-23 FY 2023-24 FY 2024-25 FY 2025-26 FY 2026-27 Property Taxes $ 208,557 $ 214,231 $ 217,989 $ 227,827 $ 247,391 $ 254,553 Capital Cost Recovery
Pre-2009 Assets (K-1 to K-4) $ - $ - $ - $ - $ - $ -
Pre-2009 Assets (K-5) $ - $ - $ - $ - $ - $ -
Debt Service on New Assets $ - $ - $ - $ - $ - $ -
Revenue Funded Capital $ - $ - $ - $ - $ - $ -
Total Capital Cost Recovery $ - $ - $ - $ - $ - $ -
Wholesale Revenue Requirement $ 286,998,565 $ 302,588,214 $ 304,312,964 $ 313,382,199 $ 331,070,256 $ 335,330,885 Balancing Account as of June 30 (Beginning of Year) $ (87,089,986) $ (44,582,873) $ 3,839,368 $ 12,058,757 $ 9,115,621 $ 3,446,599 Balancing Account Deferral $ 44,582,873 $ (3,839,368) $ (12,058,757) $ (9,115,621) $ (3,446,599) $ 2,562,368 Interest on Balancing Account and Coverage Reserve $ (617,562) $ (446,246) $ (215,621) $ (209,561) $ (226,713) $ (269,426) Settlement Credits and Other Adjustments $ - $ - $ - $ - $ - $ - Wholesale Debt Service Coverage Reserve $ 2,278,271 $ 14,151,740 $ (135,640) $ 1,110,517 $ 4,636,444 $ 78,583 Wholesale Revenues Before Rate Change
Volumetric Charges $ (241,838,161) $ (227,491,708) $ (263,673,236) $ (312,912,291) $ (336,835,009) $ (336,835,009) Excess Use Charges / Minimum Purchase $ - $ - $ - $ - $ - $ - Service Charges $ (4,314,000) $ (4,314,000) $ (4,314,000) $ (4,314,000) $ (4,314,000) $ (4,314,000) Total Wholesale Deficiency or (Credit) $ (0) $ 36,065,759 $ 27,755,078 $ - $ - $ - Wholesale Deficiency or (Credit) as a Percent of Volumetric Charges 0.0% 15.9% 10.5% 0.0% 0.0% 0.0%
Projected Water Sales (MGD) 120.9 MGD 113.7 MGD 113.4 MGD 122.1 MGD 131.5 MGD 131.5 MGD Projected Water Sales (CCF) 58,984,917 55,485,782 55,510,155 59,602,341 64,159,049 64,159,049 Wholesale Deficiency or Credit ($/CCF) $0.00 $0.65 $0.50 $0.00 $0.00 $0.00 Wholesale Rate ($/CCF) $4.10 $4.75 $5.25 $5.25 $5.25 $5.25 Projected Service Charge Revenues $ 4,314,000 $ 4,314,000 $ 4,314,000 $ 4,314,000 $ 4,314,000 $ 4,314,000 Projected Volume Charge Revenues $ 241,838,161 $ 263,557,466 $ 291,428,314 $ 312,912,291 $ 336,835,009 $ 336,835,009 Total Wholesale Revenues After Rate Change $ 246,152,161 $ 267,871,466 $ 295,742,314 $ 317,226,291 $ 341,149,009 $ 341,149,009 2 9.1.d
Packet Pg. 491 Attachment: SFPUC Wholesale Water Rates Increase Staff Report (2242 : Pass-Trhough Water Rate Increase) Calculation of Untreated Water Discount Rate for Coastside County Water District Rate-Setting for Fiscal Year 2022-23
Wholesale Share of HTWTP Expenses to be Removed
Operations & Maintenance $ 11,120,823
Cash Funded Capital $ -
Debt Service $ 12,917,533
Total HTWTP Expense to be Removed $ 24,038,355
Total Wholesale Water Consumption (CCF) 55,485,782
Untreated Water Rate Discount ($/CCF) $ 0.43
Untreated Water Rate Discount ($/acre foot) $ 187.31
Impact on Wholesale and Retail Customers
Untreated Water Rate Discount ($/CCF) $ (0.43)
Projected Coastside County Water District Annual Consumption (CCF) 512,085 Net Impact of Untreated Water Rate Discount $ (220,197) Wholesale Retail
Proportional Annual Use 65.81% 34.19%
Allocation of Untreated Water Rate Discount $ (144,911) $ (75,285) Projected Annual Treated Water Usage (CCF) 54,973,697 26,358,149 Average Wholesale Rate Impact ($/CCF) $ (0.0026) $ (0.0029)

9.1.d
Packet Pg. 492 Attachment: SFPUC Wholesale Water Rates Increase Staff Report (2242 : Pass-Trhough Water Rate Increase)

SAN FRANCISCO PUBLIC UTILITIES COMMISSION
Effective July 1, 2022
SCHEDULE W-25: Wholesale Use with Long-Term Contract
For service to municipalities, water districts and others who, under long-term contracts, purchase water for resale:

First: A Monthly Service Charge base on the type and size of the meter:

Second: A charge for water delivered based on one-month’s meter readings:
$2,069.10 per acre-foot or $4.75 per 100 cu. ft.

Third: An Untreated Wholesale Water Rate Discount Factor for Wholesale Customers receiving untreated water, based on one-month’s meter readings:
($187.31) per acre-foot or ($0.43) per 100 cu. ft.

9.1.d
Packet Pg. 493 Attachment: SFPUC Wholesale Water Rates Increase Staff Report (2242 : Pass-Trhough Water Rate Increase) 155 Bovet Road, Suite 650, ⚫ San Mateo, CA 94402 ⚫ ph 650 349 3000 ⚫ fx 650349 8395 ⚫ www.bawsca.org March 22, 2022
Ms. Erin Franks, Rate Administrator
San Francisco Public Utilities Commission
525 Golden Gate Avenue, 4th Floor
San Francisco, CA 94102
Subject: BAWSCA FY 2022-23 Bond Surcharge Schedule
Dear Erin:

Pursuant to Section 3.01 (a) of the Prepayment and Collection Agreement between the Bay Area Water Supply and Conservation Agency (BAWSCA) and the City and County of San Francisco (San Francisco), dated January 1, 2013 (Agreement), BAWSCA shall deliver a written schedule to San Francisco at least 45 days prior to the beginning of each fiscal year showing the amount of the surcharge that BAWSCA seeks to impose for such fiscal year.

Table 1 includes BAWSCA’s FY2022-23 annual and monthly bond surcharge for each member agency that was adopted by the BAWSCA Board on March 17, 2022. Pursuant to Section 3.02 (a) of the Agreement, San Francisco shall include the identified monthly surcharge in the first wholesale water bill for the largest amount delivered to BAWSCA’s member agencies each month, effective July 1, 2022.

As a heads up, BAWSCA expects to notify the SFPUC for a revised FY 2022-23 monthly surcharge schedule, as shown in Table 2, after BAWSCA’s settlement of the 2023A refunding bonds in January 2023. Assuming the settlement is completed on January 5, 2023, the monthly surcharges in Table 1 would be collected through the February 2023 billings and the reduced monthly surcharges would apply to the March – June 2023 billings, as shown in Table 2. The Agreement allows BAWSCA to revise bond surcharges as of the first day of the calendar month which is at least 45 days after notice of such reduction is provided by BAWSCA to SFPUC. If such notice is not provided to the SFPUC, the monthly surcharges stated in Table 1 will remain in effect.

If you have any questions about the billing of BAWSCA’s surcharges, please contact me at (650) 421-3448.

Sincerely,
Christina Tang
Finance Manager
Attachments:

Table 1. BAWSCA FY 2022-23 Bond Surcharges Effective July 1, 2022 Table 2. Revised BAWSCA FY 2022-23 Bond Surcharges Effective March 1, 2023

9.1.d
Packet Pg. 494 Attachment: SFPUC Wholesale Water Rates Increase Staff Report (2242 : Pass-Trhough Water Rate Increase) cc: Charles Perl, SFPUC
Kristina Cordero, SFPUC
Nicole Sandkulla, BAWSCA
Allison Schutte, BAWSCA Legal Counsel

9.1.d
Packet Pg. 495 Attachment: SFPUC Wholesale Water Rates Increase Staff Report (2242 : Pass-Trhough Water Rate Increase) Attachments
Table 1. BAWSCA FY 2022-23 Bond Surcharges Effective July 1, 2022 Agency
Annual
Bond
Surcharge
Monthly
Bond
Surcharge
Agency
Annual
Bond
Surcharge
Monthly
Bond
Surcharge
Alameda County WD $1,962,564 $163,547 Mid Pen WD $461,616 $38,468 Brisbane Water $73,668 $6,139 Millbrae $295,272 $24,606 Burlingame $522,816 $43,568 Milpitas $949,680 $79,140
Coastside County WD $307,044 $25,587 Mountain View $1,455,288 $121,274 CWS - Bear Gulch $2,497,308 $208,109 North Coast WD $500,688 $41,724 CWS - Mid Peninsula $2,369,496 $197,458 Palo Alto $1,726,200 $143,850 CWS - South SF $756,756 $63,063 Purissima Hills WD $382,824 $31,902 Daly City $610,404 $50,867 Redwood City $1,537,836 $128,153 East Palo Alto WD $256,368 $21,364 San Bruno $181,500 $15,125 Estero Municipal ID $779,532 $64,961 San Jose (North) $687,600 $57,300 Guadalupe Valley $20,256 $1,688 Santa Clara $571,392 $47,616 Hayward $2,561,736 $213,478 Stanford University $212,628 $17,719 Hillsborough $538,608 $44,884 Sunnyvale $1,825,332 $152,111 Menlo Park $519,240 $43,270 Westborough WD $130,620 $10,885 Total $24,694,272 $2,057,856
Table 2. Revised BAWSCA FY 2022-23 Bond Surcharges Effective March 1, 2023* Agency
Monthly
Surcharge
Jul 2022
- Feb 2023
Monthly
Surcharge
Mar 2023
- Jun 2023
Adjusted
Annual
Surcharge
Agency
Monthly
Surcharge
Jul 2022
- Feb 2023
Monthly
Surcharge
Mar 2023
- Jun 2023
Adjusted
Annual
Surcharge
Alameda County WD $163,547 $119,254 $1,785,392 Mid Pen WD $38,468 $26,312 $412,992 Brisbane Water $6,139 $4,179 $65,828 Millbrae $24,606 $15,954 $260,664 Burlingame $43,568 $28,157 $461,172 Milpitas $79,140 $54,141 $849,684 Coastside County WD $25,587 $18,772 $279,784 Mountain View $121,274 $84,440 $1,307,952 CWS - Bear Gulch $208,109 $152,516 $2,274,936 North Coast WD $41,724 $29,595 $452,172 CWS - Mid Peninsula $197,458 $136,762 $2,126,712 Palo Alto $143,850 $98,156 $1,543,424 CWS - South SF $63,063 $41,635 $671,044 Purissima Hills WD $31,902 $23,001 $347,220 Daly City $50,867 $34,058 $543,168 Redwood City $128,153 $88,239 $1,378,180 East Palo Alto WD $21,364 $14,269 $227,988 San Bruno $15,125 $10,659 $163,636 Estero Municipal ID $64,961 $44,899 $699,284 San Jose (North) $57,300 $37,700 $609,200 Guadalupe Valley $1,688 $755 $16,524 Santa Clara $47,616 $32,758 $511,960 Hayward $213,478 $145,701 $2,290,628 Stanford University $17,719 $11,418 $187,424 Hillsborough $44,884 $32,225 $487,972 Sunnyvale $152,111 $106,803 $1,644,100 Menlo Park $43,270 $29,529 $464,276 Westborough WD $10,885 $7,232 $116,008 Total $2,057,856 $1,429,119 $22,179,324
* Subject to the settlement of the 2023A Bonds on January 5, 2023 and notification thereof by BAWSCA to SFPUC

9.1.d
Packet Pg. 496 Attachment: SFPUC Wholesale Water Rates Increase Staff Report (2242 : Pass-Trhough Water Rate Increase)

EAST PALO ALTO

CITY COUNCIL

STAFF REPORT
DATE: May 17, 2022
TO: Honorable Mayor and Members of the City Council
VIA: Patrick Heisinger, Interim City Manager
BY: Patrick Heisinger, Interim City Manager
SUBJECT: Issues Concerning the Light Tree Affordable Housing Project and the East Palo Alto Sanitary District
Recommendation
It is recommended that the City Council:

1. Accept the report on the issues concerning the Light Tree Affordable Housing Project and the East Palo Alto Sanitary District;

2. Not accept the counter proposal proffered by the East Palo Alto Sanitary District regarding the Light Tree Affordable Housing Project; and

3. Authorize the Mayor to communicate the City’s position to the East Palo Alto Sanitary District.

Alignment with City Council Strategic Plan
This recommendation is primarily aligned with:

Priority No. 4: Improve Public Facilities and Infrastructure Background
On June 12, 2020, the East Palo Alto Sanitary District (EPASD) and Eden Housing/EPACANDO, the developer of the Light Tree Affordable Housing Project (Light Tree), entered into a Wastewater Service Agreement (WSA). The WSA (Attachment 1) outlined the roles and responsibilities of each party, respectively, as described in the table below:

Entity Obligation
Developer Make a payment totaling $2,486,585 to fund infrastructure costs, as well as capacity, permitting, and other administrative fees.

9.2 Packet Pg. 497
EPASD

1. Provide wastewater service to Light Tree within 18 months of receiving the Developer’s payment; and

2. Commit $2,000,000 to contribute to the cost of existing maintenance in need of upgrade.

On March 15, 2022, in recognition of significant delay, the City Council directed staff to send a letter to the EPASD affirming the City’s desire to enter into a Memorandum of Understanding (MOU) with EPASD to ensure that Light Tree is able to provide much needed affordable housing availability to the community by January 2023.

For more information about the March 15, 2022, item, please follow the link that is listed and embedded below:
http://eastpaloalto.iqm2.com/Citizens/Detail_LegiFile.aspx?Frame=&MeetingID=1804&MediaP osition=7649.173&ID=2142&CssClass=
On April 6, 2022, EPASD forwarded a letter that may be considered as a “counter proposal” to the City’s proposed approach. (Attachment 2)
Analysis
In the letter from EPASD, it appears that the methodology proposed by the City is considered to be acceptable to EPASD. However, the letter states, “The District will not be responsible for additional costs, if any, associated with serving the development.” Staff Perspective
The April 6, 2022, letter from EPASD describes a counter proposal in which EPASD agrees to comply with the above-referenced WSA terms, but requires that the City or developer pay all unanticipated costs, which are currently undefined and un-estimated. This uncertainty about proposed costs is a critical issue that other developers and property owners are struggling with, in regard to obtaining necessary services from EPASD. EPASD is contractually obligated to provide the necessary sewer infrastructure to support Light Tree, though EPASD is in noncompliance with the previously agreed-upon 18-month term. To date, a formal cost estimate, by a qualified engineer, for the services and improvements required for Light Tree has yet to be produced.

Staff Recommendation
Without an informed understanding of anticipated costs associated with EPASD service to Light Tree, the proposal in the letter from EPASD perpetuates an unacceptable level of uncertainty for both the City and developer. As such, staff recommends that the City Council not accept the proposal.

Staff further recommends that EPASD complete a traditional bid process for the Light Tree sewer project to obtain actual costs of the improvements, which will inform all stakeholders and facilitate potential solutions.

Fiscal Impact

9.2 Packet Pg. 498
There are no fiscal impacts associated with this report.

Public Notice
The public was provided notice by making the agenda and report available on the City’s website and on a bulletin board located at City Hall: 2415 University Avenue, East Palo Alto.

Attachments

1. Wastewater Service Agreement between EPASD and Eden Housing/EPACANDO for the Light Tree Affordable Housing Project

2. EPASD Letter Received on April 6, 2022

9.2 Packet Pg. 499
081503\11725962v6 1

WASTEWATER SERVICE AGREEMENT
This WASTEWATER SERVICE AGREEMENT (“Agreement”) is made and entered into on June 12, 2020 (“Effective Date”) by the EAST PALO ALTO SANITARY DISTRICT, a California sanitary district organized under the laws of the State of California (“District”), and LIGHT TREE TWO, L.P., a limited partnership (“Developer”) (individually, a “Party”, collectively, the “Parties”).

RECITALS
A. The District provides wastewater service to property within its service area.

B. Developer is under contract for the purchase of certain property within the District’s service area located at 1805 East Bayshore Road, in the City of East Palo Alto (“City”), CA 94303 as more particularly described on Exhibit A attached hereto and incorporated herein (the “Property”). The Property is currently developed with 94 residential units (the “Existing Units”), which are currently served by the District’s wastewater system (the “System”).

C. Developer is proposing to develop a 185-unit affordable housing project (the “Development”). The Development will refurbish the Existing Units and create 91 net new units (the “Net New Units”). As part of the Development process, and in order to obtain financing for the Development, Developer has requested that the District issue an unconditional will-serve letter to Developer as evidence of its commitment to provide wastewater service to the Net New Units of the Development (the “Will Serve Letter”), in substantially the form set forth in Exhibit B attached hereto.

D. The District acknowledges that it currently provides service to the Existing Units.

The Wastewater System (defined below) currently lacks sufficient capacity to provide wastewater service to the Net New Units. The estimated additional load that the Net New Units will add to the District’s system is 21840 gpd (“Additional Load”). Because the District currently provides service to the Existing Units, the Existing Units are not the subject of this Agreement.

E. Upon satisfaction of the terms and conditions set forth herein, including all financial obligations of Developer and at no expense to the District except as explicitly set forth herein, the District shall expand the System to accommodate the Additional Load (“Expansion”). For the purposes of this Agreement the term “Connection” shall mean connecting the Development’s Wastewater Systems (defined below) to the System, including but not limited to all inspections and certifications required for the Development to receive a Certificate of Occupancy from the City.

F. The improvements required for the Expansion (“System Expansion Improvements”), which includes downstream improvements necessary to provide service to the Developer, and the Developer’s share of their associated values are set forth on Exhibit C

9.2.a
Packet Pg. 500 Attachment: Wastewater Service Agreement between EPASD and Eden Housing/EPACANDO for the Light Tree Affordable Housing Project 081503\11725962v6 2
attached hereto and incorporated herein. The total cost of the Expansion including the Peak Dry Weather Flow Plus 10 year storm value shall be referred to as the “Expansion Cost”.

G. There are other planned and approved developments within the District’s service area (“Additional Development”) which may also add additional load to the System (“Third Party Loads”). The District is currently working with the developers of such Additional Development (“Third Party Developers”) to expand the System in order to accommodate such Third Party Loads (“Third Party Expansions”). To the extent that such Third Party Developers use any portion of the Expansion to meet their Third Party Loads or such Third Party Expansion connect to or build upon the Expansion, the Parties intend that such Third Party Developers shall pay their fair share of the Expansion Cost.

H. As an affordable housing developer, Developer is providing an important public service. The District is entering into this Agreement in recognition of the public benefit associated with the Development. The District acknowledges that as a sewer service provider, it has a duty to grant a priority for the provision of sewer services to developments that include housing units affordable to lower income households, pursuant to Government Code Section 65589.7(a), subject to availability of capacity. Health and Safety Code section 5410 et seq. further prohibits any person, including the District, from discharging sewage or other waste, or the effluent of treated sewage or other waste, in any manner which will result in contamination, pollution or a nuisance, including through overflow. Because insufficient capacity currently exists in the System to accommodate the Development, this Agreement is necessary to facilitate the Expansion and accommodate the Development. In addition, this Agreement provides a public benefit because the Development is currently the only exclusively affordable housing development currently requesting a will-serve letter from the District.

I. The total amount due from Developer under this Agreement, which sums shall be payable in accordance with the terms herein, shall be Two Million Four Hundred Eighty Six Five Hundred Eighty Five Dollars ($2,486,585.00), broken down in the table below. Capitalized terms not previously defined are defined in the Agreement below.

Payment Due Date Amount
System Expansion Payment (Section 4) Upon Receipt of Financing $1,894,600.00 Inspection Fees (Section 3) Upon Receipt of Financing $18,500.00 Permit Fees (Section 3) Upon Receipt of Financing $4,625.00 Capacity Fees (Section 3) Upon Receipt of Financing $551,460.00 Administrative Fee (Section 5) Upon Execution $17,400.00 Total $2,486,585.00

AGREEMENT

1. RECITALS. The Recitals set forth above are true and correct, and by this reference incorporated herein.

2. ISSUANCE OF “WILL SERVE” LETTER; COMPLETION OF SYSTEM EXPANSION IMPROVEMENTS.

9.2.a
Packet Pg. 501 Attachment: Wastewater Service Agreement between EPASD and Eden Housing/EPACANDO for the Light Tree Affordable Housing Project 081503\11725962v6 3
(a) A Will Service Letter is required for Developer to obtain its construction financing. Immediately upon full execution of this Agreement, the District shall provide the Developer with the Will Serve Letter stating that the District can and will furnish sewer service for the Net New Units. The Capacity Fees, the Inspection Fees, the Permit Fees and the System Expansion Payment (but not the Administrative Fee due under Section 5 hereof) (“Funds”) shall be due immediately upon receipt of the tax credit financing by Developer, which is currently contemplated to be August 1, 2020, as may be extended by Developer or Developer’s tax credit lender (“Financing Date”). The District’s obligations hereunder to build the System Expansion Improvements shall not commence until the Funds are actually received by the District and deposited into the applicable District fund as set forth for each fee below in Sections 3 and 4, and under no circumstances shall the District have any obligation to expend District funds from any source for the Expansion unless the Funds are actually received and deposited with the District. Should Developer fail to deposit the Funds required hereunder with the District by the Financing Date, the Will Serve Letter will be rescinded and will terminate, and neither Developer nor any other person shall have any right to rely upon such Will Serve Letter, unless the District’s General Manager shall have consented to an extension for deposit of the Funds.
(b) Upon deposit or payment of the Funds, the District commits to providing wastewater service to the Development and connecting the Development to the System within eighteen (18) months (“Completion Date”), subject to Section 2(c) below. For purposes of this Agreement, the Completion Date shall be the day that is five hundred forty eight (548) days after the initial deposit, in full, of the Funds, not including the date of deposit. (c) The Completion Date shall be extended for a period of time equal to the number of days during which the District (or any contractor or subcontractor of the District) is prevented from proceeding with the construction of the System Expansion Improvements by reason of force majeure. The term “force majeure” as used in this Section shall include acts of God, flooding, strikes, lockouts or other labor trouble, materially adverse weather conditions, fire or other casualty, epidemics, pandemics or outbreak of communicable disease, quarantines, governmental preemption in connection with a national emergency, any rule, order or regulation of any governmental agency or any department or subdivision thereof, or inability to secure materials or labor because of any such emergency, rule, order, regulation, war, civil disturbance, or other emergency, cause or event beyond the reasonable control of District. Should Developer receive more favorable terms than are set forth in this provision in Developer’s construction financing documents, such terms will automatically apply to the District and are deemed to be incorporated into this Agreement by this reference.

3. CAPACITY FEES, INSPECTION FEES, AND PERMIT FEES.
(a) Upon receipt of Developer’s tax credit financing, in accordance with Section 2 above, Developer shall pay to the District Five Hundred Fifty One Thousand Four Hundred and Sixty Dollars ($551,460.00) in satisfaction of the District’s standard capacity and connection fees applicable to the Connection of the Net New Units (“Capacity Fees”). Such amount is based on the 2018 Wastewater Capacity Charge Update, and shall be deposited in a the District’s fund created for deposit of capacity fees (“Capital Facilities Fund”), which is a restricted fund created and accounted for pursuant to the requirements of California Government

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Packet Pg. 502 Attachment: Wastewater Service Agreement between EPASD and Eden Housing/EPACANDO for the Light Tree Affordable Housing Project 081503\11725962v6 4
Code section 66013, and used in accordance with applicable law governing the District’s Capacity Fees.
(b) Upon receipt of Developer’s financing, in accordance with Section 2 above, Developer shall pay to the District Eighteen Thousand Five Hundred Dollars ($18,500) in satisfaction of the District’s standard inspection fees (“Inspection Fees”). Inspection Fees are calculated at the rate of One Hundred Dollars ($100) per equivalent dwelling unit. Inspection Fees may be deposited into the District’s general fund, or any other fund of the District at the District’s discretion, and used to cover the cost of inspections associated with the Development. (c) Upon receipt of Developer’s financing, in accordance with Section 2 above, Developer shall pay to the District Four Thousand Six Hundred Twenty Five Dollars ($4,625) in satisfaction of the District’s standard permitting fees (“Permit Fees” and, together with the Capacity Fees and Inspection Fees, “Fees”). Permit Fees are calculated at the rate of Twenty Five Dollars ($25) per equivalent dwelling unit. Permit Fees may be deposited into the District’s general fund or any other fund of the District, at the District’s discretion, and used to cover the cost of issuing permits to the Development.

4. SYSTEM EXPANSION PAYMENT.
(a) Developer’s Share of Construction Costs. In addition to the Fees described above, upon receipt of Developer’s financing, in accordance with Section 2 above, the Developer shall pay the a portion of the Expansion Cost which shall equal One Million Eight Hundred Ninety Four Thousand Six Hundred Dollars ($1,894,600.00) (“System Expansion Payment”). Developer’s System Expansion Payment is based on the District’s Conceptual Opinion of Probable Project Cost for PWWF Improvements, as shown on Exhibit C attached hereto and incorporated herein.
(b) The District currently deposits all capacity fees, including the Capacity Fees, into the Capital Facilities Fund, as required by law. The Capital Facilities Fund is a restricted fund, and revenues deposited therein may only be used for the purposes for which the Capital Facilities Fund was created, including capital facilities necessary to provide wastewater service. The District shall create a sub-account in the Capital Facilities Fund to be called the “Light Tree Apartment Fund” into which the System Expansion Payment shall be deposited. (c) The Light Tree Apartment Fund shall be fully funded by the System Expansion Payment upon receipt of financing by Developer. The District shall not be obligated to commence the System Expansion Improvements until the System Expansion Payment has been deposited into the Light Tree Apartment. Upon deposit of the System Expansion Payment into the Light Tree Apartment Fund, the District shall have the right to draw down from the Light Tree Apartment Fund for the System Expansion Improvements; provided, however, that the District shall only withdraw funds from the Light Tree Apartment Fund for costs immediately due and payable, excluding any Retention (as hereinafter defined), for the System Expansion Improvements, as evidenced by an invoice from a District contractor, subcontractor, or other person hired for the System Expansion Improvements (“Invoice”). The District shall make such Invoices available to Developer immediately prior to withdrawal from the Light Tree Apartment Fund.

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Packet Pg. 503 Attachment: Wastewater Service Agreement between EPASD and Eden Housing/EPACANDO for the Light Tree Affordable Housing Project 081503\11725962v6 5
(d) Developer shall have the right to review all Invoices and transactions from the Light Tree Apartment Fund to ensure the System Expansion Payment is used for the System Expansion Improvements. Developer shall further have the right to audit the Light Tree Apartment Fund at the sole cost and expense of Developer. Additionally, on the one year anniversary of the deposit of the System Expansion Payment into the Light Tree Apartment Fund, Developer may request (and District shall oblige) that the District provide a report as required under Government Code section 66013(d) to Developer with respect to the Light Tree Apartment Fund, provided that Developer provides District with at least 30 days’ notice for the preparation of such report.
(e) The District and Developer understand that the District will enter into agreements with other parties (“Contractors”) for the construction of the System Expansion Improvements (“Construction Agreements”). The District shall include in all Construction Agreements a requirement that the District withhold between five percent and ten percent (5% to 10%) of the total amount invoiced until the particular improvements subject to the Construction Agreement are substantially complete, in the mutual determination of the District and the Developer (“Retention”). Additionally, Developer shall select an inspector, subject to approval by the District’s General Manager, who shall remain at the site of the System Expansion Improvements. Such inspector shall review and certify all invoices prior to payment by the District. Costs for the inspector shall be paid from the System Expansion Payment deposited in the Light Tree Apartment Fund.
(f) Additional Developers’ Fair Share. The Parties intend that any Third Party Developers will pay for their fair share of the Expansion Costs. Developer may seek reimbursement from such Third Party Developers for any portion of their fair share of the Expansion Costs that Developer paid in the System Expansion Payment. To the extent that any Third Party Expansion is constructed after the Expansion and incorporates, uses, or builds upon the System Expansion Improvements, as determined by the District when analyzing the capacity needs of a Third Party Developer, the District shall facilitate a mechanism through any agreements with the Third Party Developers for connection, expansion and service for the Additional Development to reimburse the Developer for any Expansion Costs related to the Third Party Developer. Nothing contained herein shall create any liability for the District to reimburse Developer from District funds.

5. ADMINISTRATIVE FEE. Developer shall pay a sum of Seventeen Thousand Four Hundred Dollars ($17,400.00) to the District for the District’s legal and administrative costs in entering into this Agreement (“Administrative Fee”). The Administrative Fee shall be due immediately upon execution of this Agreement.

6. OVERPAYMENT OF FEES AND CHARGES.
(a) Unused System Expansion Payment. Upon completion of the System Expansion Improvements and payment of all costs related thereto, as determined by an independent third party auditor, the District shall promptly reimburse Developer for any amount of the System Expansion Payment exceeding Developer’s Fair Share of the System Expansion Improvements. The District shall reimburse Developer within thirty (30) days after the auditor’s determination.

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Packet Pg. 504 Attachment: Wastewater Service Agreement between EPASD and Eden Housing/EPACANDO for the Light Tree Affordable Housing Project 081503\11725962v6 6
(b) Third Party Developer Reimbursement. In the event that Third Party Developers’ fair share of the Expansion Costs reduce Developer’s Fair Share, the District shall cause the Third Party Developers to reimburse Developer directly for said overpayment as set forth in Section 4(f) above. Nothing contained in this Agreement shall require the District to make any payment to Developer from District funds except as provided above, nor shall there be any liability created on the part of the District for any Third Party Developer’s failure to reimburse Developer.
(c) Further Reimbursement. Nothing contained in this Agreement shall guarantee nor limit Developer’s ability to seek reimbursement for the cost of the System Expansion Improvement from any person seeking to connect to the District’s wastewater system and benefiting from the System Expansion Improvements.

7. CONNECTION TO DISTRICT’S WASTEWATER SYSTEM. The District shall initiate and complete all design, entitlement, permitting, construction and inspections to ensure the System Expansion Improvements shall be completed in a timely manner, in accordance with Section 2 of this Agreement. The District represents and warrants that, in addition to the System Expansion Payment, the District has sufficient funds to complete the Expansion.

8. INTERIOR PLUMBING; SIZING. The Developer is responsible for ensuring that lateral sewer pipes, building sewer pipes, interior plumbing fixtures or piping and all fixture units within the Development (together with any downstream improvements necessary to provide sufficient capacity to the Development, the “Wastewater Systems”) have sufficient capacity to provide sewer service. The District shall have no responsibility to inspect the Wastewater Systems of any building in the Development.

9. INDEMNIFICATION. To the fullest extent permitted by law, Developer, at its own expense, shall defend, indemnify and hold harmless the District, its agents, officers, officials, and employees from and against any and all claims, demands, actions, causes of action, suits, proceedings, costs, expenses, liabilities, judgments, awards, decrees, settlements, loss, damage or injury of any kind, in law or equity (collectively, “Claims”) brought against the District, its agents, officers, officials, and employees, that arise out of, pertain to, or are incident to the Will Serve Letter including, without limitation the payment of all expert witness fees, and attorneys’ fees and other related costs and expenses (“Indemnification Obligation”) but does not include any Claims asserted against the District that would have been brought regardless of the Will Serve Letter. The Indemnification Obligation will not require that Developer indemnify the District for District’s gross negligence or willful misconduct. The Developer’s obligation to indemnify shall not be restricted to insurance proceeds, if any, received by the District, its agents, officers, officials, and employees. The District shall have the right to appear and defend its interest with respect to any Claim through counsel selected by the District. Developer shall reasonably cooperate in all aspects of the litigation contemplated herein. The District acknowledges that other applicants for will serve letters may object to the costs or fees the District imposes and any challenges that arise out of such disputes will not trigger this indemnity obligation unless the later claimant bases its challenge in whole or in part on the District’s Will Serve Letter. The Developer’s indemnity to the District set forth in this Section 9: (i) does not include in its scope any claims regarding the District’s use or administration of the System Expansion Payment, Capacity Fees or Administrative Fee, and (ii) does not preclude any claims

9.2.a
Packet Pg. 505 Attachment: Wastewater Service Agreement between EPASD and Eden Housing/EPACANDO for the Light Tree Affordable Housing Project 081503\11725962v6 7
by the Developer regarding the District’s use or administration of the System Expansion Payment, Capacity Fees or Administrative Fee not according to the Agreement.

10. TERMINATION. This Agreement is not subject to termination, except by mutual agreement or as otherwise provided herein.

11. EXCLUSIVE REMEDY. The Parties acknowledge that none of the Parties would have entered into this Agreement if it were to be liable in damages under or with respect to all or any part of this Agreement. Accordingly, no Party shall sue the other for damages or monetary relief for any matter related to this Agreement. The Parties’ litigation remedies shall be limited to declaratory and injunctive relief, mandate, and specific performance. For purposes of this Agreement, the term “specific performance” shall include, without limitation, payment of all Indemnification Obligations pursuant to the provisions set forth in this Agreement.

12. COMPLETE AGREEMENT AND GOVERNING LAW. This Agreement represents the complete understanding between the Parties with respect to matters set forth herein. This Agreement shall be construed in accordance with the laws of the State of California.

13. SUCCESSORS AND ASSIGNS. The obligations specific herein shall be made and are binding on the successors in interest of the Parties, whether the succession is by agreement, by operation of law or by any other means.

14. THIRD PARTY BENEFICIARIES. Nothing in this Agreement, express or implied, is intended to or shall confer upon any person other than the Parties and their respective successors and permitted assigns, any legal or equitable right, benefit or remedy of any nature under or by reason of this Agreement.

15. SEVERABILITY. If any term, provision, covenant or condition of this Agreement is held to be invalid, void or otherwise unenforceable, to any extent, by any court of competent jurisdiction, the remainder of this Agreement shall not be affected thereby, and each term, provision, covenant or condition of this Agreement shall be valid and enforceable to the fullest extent permitted by law.

16. SURVIVAL. The Parties agree that this Agreement shall constitute a separate agreement from any other conditions set forth in the Will Serve Letter, and if the Will Serve Letter in part or in whole, is invalidated, rendered null or set aside by a court of competent jurisdiction, the Parties agree to be bound by the terms of this Agreement, which shall survive such invalidation, nullification or setting aside.

17. INTERPRETATION. The Parties have been advised by their respective attorneys, or if not represented by an attorney, represent that they had an opportunity to be so represented in the review of this Agreement. Any rule of construction to the effect that ambiguities are to be resolved against the drafting Party shall not be applied in interpreting this Agreement.

18. CAPTIONS AND HEADINGS. The captions and section headings used in this Agreement are inserted for convenience of reference only and are not intended to define, limit or affect the construction or interpretation of any term or provision hereof.

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19. JURISDICTION AND VENUE. Any action at law or in equity arising under this Agreement or brought by a party hereto for the purpose of enforcing, construing or determining the validity of any provision of this Agreement shall be filed in the Courts of San Mateo, State of California, and the parties hereto waive all provisions of law providing for the filing, removal or change of venue to any other court or jurisdiction.

20. COUNTERPARTS, FACSIMILE AND ELECTRONIC EXECUTION. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same document. To facilitate execution of this Agreement, the Parties may execute and exchange facsimile or electronic counterparts, and facsimile or electronic counterparts shall serve as originals.

21. REVISION OF AGREEMENT. This Agreement may, from time to time, be amended, revised, or supplemented by and with the consent of the Parties hereto and subject to the approval and ratification of their respective governing bodies. [SIGNATURES ON FOLLOWING PAGE]

9.2.a
Packet Pg. 507 Attachment: Wastewater Service Agreement between EPASD and Eden Housing/EPACANDO for the Light Tree Affordable Housing Project

9.2.a
Packet Pg. 508 Attachment: Wastewater Service Agreement between EPASD and Eden Housing/EPACANDO for the Light Tree Affordable Housing Project IN WITNESS WHEREOF, the Parties have by their duly authorized representatives executed this Agreement, among the East Palo Alto Sanitary District and Light Tree Two, L.P. as of the date first written above.

ATTEST:

Secretary
APPROVED AS TO FORM:

General Counsel
081503111725962v6 9

EAST PALO ALTO SANITARY

DISTRICT
By Nam_e_ : : _________ _
Title: __________ _
LIGHT TREE TWO, L.P.,
a California limited partnership
By: Light Tree Two LLC,
a California limited liability company,
its managing general partner
By:

By: Light Tree CANDO LLC,
California limited liability company,
its co-general partner
By: East Palo Alto Community
Alliance and Neighborhood Development
Organization, Inc.,
a California nonprofit public benefit
corporation, its sole member/manager
By: _______ _
Name: Its: --------

9.2.a
Packet Pg. 509 Attachment: Wastewater Service Agreement between EPASD and Eden Housing/EPACANDO for the Light IN WITNESS WHEREOF, the Parties have by their duly authorized representatives executed this Agreement, among the East Palo Alto Sanitary District and Light Tree Two, L.P. as of the date first written above.

ATTEST: EAST PALO ALTO SANITARY

DISTRICT
By:

APPR ED AS TO FORM:
ary
Name:

Title:

General Counsel
LIGHT TREE TWO, L.P.,
a California limited partnership
By: Light Tree Two LLC,
a California limited liability company,
its managing general partner
By: Eden Housing, Inc.,
a California nonprofit public benefit
corporation, its manager
By:

Name:

Its:

By: Light Tree CANDO LLC,
a California limited liability company,
its co-general partner
By: East Palo Alto Community
Alliance and Neighborhood Development
Organization, Inc.,
a California nonprofit public benefit
corporation, its sole member/manager
By:

Name:

Its:
081503\11725962v6 9

9.2.a
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9.2.a
Packet Pg. 511 Attachment: Wastewater Service Agreement between EPASD and Eden Housing/EPACANDO for the Light Tree Affordable Housing Project 081503\11725962v6 A-1
Exhibit A
Legal Description of the Property
Draft subdivision legal description for Light Tree Two:

Real Property in the City of East Palo Alto, County of San Mateo, State of California, described as follows:

PARCEL I:

PARCEL 1 OF THAT CERTAIN PARCEL MAP RECORDED ON ___________, 2020 AS MAP BOOK _____,
PAGE _______________, OFFICIAL RECORDS.

EXCEPTING THEREFROM ALL BUILDINGS AND IMPROVEMENTS SITUATED THEREON AS

RESERVED IN

THE DEED FROM LIGHT TREE HOUSING PARTNERS TO LIGHT TREE LAND LLC, RECORDED

DECEMBER
14, 1999, DOCUMENT NO. 1999-202825, SAN MATEO COUNTY RECORDS, WHICH BUILDING AND IMPROVEMENTS ARE AND SHALL REMAIN REAL PROPERTY.

PARCEL II:

ALL BUILDINGS AND IMPROVEMENTS SITUATED ON THE FOLLOWING DESCRIBED LAND AS

RESERVED

IN THE DEED FROM LIGHT TREE HOUSING PARTNERS TO LIGHT TREE LAND LLC, RECORDED DECEMBER 14, 1999,INSTRUMENT NO. 1999 202825, SAN MATEO COUNTY RECORDS, WHICH BUILDINGS AND IMPROVEMENTS ARE AND SHALL REMAIN REAL PROPERTY:

PORTION OF LOTS 14 AND 16, AS DESIGNATED ON THE MAP ENTITLED "MAP OF FABER

SUBDIVISION,
SAN MATEO COUNTY, CALIFORNIA", WHICH MAP WAS FILED IN THE OFFICE OF THE

RECORDER OF
THE COUNTY OF SAN MATEO, STATE OF CALIFORNIA, ON OCTOBER 23, 1912, IN BOOK 8 OF

MAPS AT
PAGE 31, MORE PARTICULARLY DESCRIBED AS FOLLOWS: BEGINNING AT A POINT ON THE

NORTHEASTERLY LINE OF THE LANDS DESCRIBED IN THE DEED FROM TSURUKO NAKANISHI AND
JOHN M. NAKANISHI, HER HUSBAND, TO THE STATE OF CALIFORNIA DATED SEPTEMBER 13, 1955, AND
RECORDED OCTOBER 24, 1955, IN BOOK 2900 OF OFFICIAL RECORDS OF SAN MATEO COUNTY AT
PAGE 258 (96987-M) DISTANT THEREON SOUTH 53° 3' 00" EAST 20.01 FEET, FROM THE

INTERSECTION
THEREOF WITH THE EASTERLY LINE OF CLARKE AVENUE (40 FEET WIDE) AS SHOWN ON THE ABOVE
MENTIONED MAP; SAID POINT ALSO BEING THE SOUTHEASTERLY CORNER OF THE EASEMENT FOR

ROAD PURPOSES AND ALL PUBLIC UTILITIES DESCRIBED IN DEED FROM TSURUKO NAKANISHI TO
COUNTY OF SAN MATEO, DATED MAY 2, 1963, AND RECORDED MAY 8, 1963, IN BOOK 4452 OF

OFFICIAL
RECORDS OF SAN MATEO AT PAGE 471 (90785-V); THENCE FROM SAID POINT OF BEGINNING ALONG
THE EASTERLY LINE OF SAID ROAD EASEMENT (90785-V), NORTHWESTERLY ON THE ARC OF A TANGENT CURVE TO THE RIGHT, HAVING A RADIUS OF 15 FEET, A CENTRAL ANGLE OF 52° 18' 52", A
DISTANCE OF 13.70 FEET (CALLED A CENTRAL ANGLE OF 52° 17', AN ARC LENGTH OF 13.69

FEET IN
SAID 90785-V), AND NORTH 1° 34' 08" WEST (CALLED SOUTH 1° 29' EAST IN SAID 90785-V), 77.56 FEET

TO THE NORTHERLY LINE OF THE LANDS DESCRIBED IN THE DEED FROM TSURUKO

NAKANISHI, A

9.2.a
Packet Pg. 512 Attachment: Wastewater Service Agreement between EPASD and Eden Housing/EPACANDO for the Light Tree Affordable Housing Project 081503\11725962v6
A-2

MARRIED WOMAN TO CLARKE AVENUE ASSOCIATES, A LIMITED PARTNERSHIP, DATED JUNE 11, 1964,
AND RECORDED JUNE 11, 1964 IN BOOK 4729 OF OFFICIAL RECORDS OF SAN MATEO COUNTY AT
PAGE 642 (31262-X); THENCE NORTH 87° 19‘ EAST ALONG THE NORTHERLY LINE OF THE LAST MENTIONED LANDS 504.20 FEET TO THE NORTHEASTERLY CORNER THEREOF; THENCE

ALONG THE

EASTERLY LINE OF THE LANDS DESCRIBED IN SAID DEED TO CLARKE AVENUE ASSOCIATES

AND THE
SOUTHERLY PROLONGATION OF SAID EASTERLY LINE SOUTH 1° 24' EAST 321.71 FEET TO THE NORTHERLY LINE OF SAID LOT 14; THENCE NORTH 87° 31' EAST ALONG THE LAST MENTIONED LINE

22.70 FEET TO THE DIVIDING LINE BETWEEN LOTS 14 AND 15, AS SHOWN ON THE MAP ABOVE MENTIONED; THENCE ALONG SAID DIVIDING LINE SOUTH 1° 29' EAST 180.45 FEET TO THE SAID

NORTHEASTERLY LINE OF THE LANDS DESCRIBED IN SAID DEED TO STATE OF CALIFORNIA, FIRST
ABOVE MENTIONED; THENCE NORTH 53° 53' WEST ALONG SAID NORTHEASTERLY LINE 658.47 FEET
TO THE POINT OF BEGINNING.

PARCEL III:

A LEASEHOLD AS DISCLOSED BY THAT CERTAIN MEMORANDUM OF GROUND LEASE

RECORDED
DECEMBER 14, 1999 AS INSTRUMENT NO. 1999-202826 OF OFFICIAL RECORDS AFFECTING THAT
CERTAIN LAND BEING DESCRIBED AS FOLLOWS:

PORTION OF LOTS 14 AND 16, AS DESIGNATED ON THE MAP ENTITLED "MAP OF FABER

SUBDIVISION,
SAN MATEO COUNTY, CALIFORNIA", WHICH MAP WAS FILED IN THE OFFICE OF THE

RECORDER OF
THE COUNTY OF SAN MATEO, STATE OF CALIFORNIA, ON OCTOBER 23, 1912, IN BOOK 8 OF

MAPS AT
PAGE 31, MORE PARTICULARLY DESCRIBED AS FOLLOWS:

BEGINNING AT A POINT ON THE NORTHEASTERLY LINE OF THE LANDS DESCRIBED IN THE

DEED FROM
TSURUKO NAKANISHI AND JOHN M. NAKANISHI, HER HUSBAND, TO THE STATE OF CALIFORNIA DATED
SEPTEMBER 13, 1955, AND RECORDED OCTOBER 24, 1955, IN BOOK 2900 OF OFFICIAL

RECORDS OF
SAN MATEO COUNTY AT PAGE 258 (96987-M) DISTANT THEREON SOUTH 53° 3' 00" EAST 20.01 FEET,
FROM THE INTERSECTION THEREOF WITH THE EASTERLY LINE OF CLARKE AVENUE (40 FEET WIDE)
AS SHOWN ON THE ABOVE MENTIONED MAP; SAID POINT ALSO BEING THE SOUTHEASTERLY CORNER

OF THE EASEMENT FOR ROAD PURPOSES AND ALL PUBLIC UTILITIES DESCRIBED IN DEED FROM
TSURUKO NAKANISHI TO COUNTY OF SAN MATEO, DATED MAY 2, 1963, AND RECORDED MAY 8, 1963,
IN BOOK 4452 OF OFFICIAL RECORDS OF SAN MATEO AT PAGE 471 (90785-V); THENCE FROM SAID
POINT OF BEGINNING ALONG THE EASTERLY LINE OF SAID ROAD EASEMENT (90785-V), NORTHWESTERLY ON THE ARC OF A TANGENT CURVE TO THE RIGHT, HAVING A RADIUS OF 15 FEET,
A CENTRAL ANGLE OF 52° 18' 52", A DISTANCE OF 13.70 FEET (CALLED A CENTRAL ANGLE OF 52° 17',

9.2.a
Packet Pg. 513 Attachment: Wastewater Service Agreement between EPASD and Eden Housing/EPACANDO for the Light Tree Affordable Housing Project 081503\11725962v6
A-3
AN ARC LENGTH OF 13.69 FEET IN SAID 90785-V), AND NORTH 1° 34' 08" WEST (CALLED SOUTH 1° 29'
EAST IN SAID 90785-V), 77.56 FEET TO THE NORTHERLY LINE OF THE LANDS DESCRIBED IN

THE DEED

FROM TSURUKO NAKANISHI, A MARRIED WOMAN TO CLARKE AVENUE ASSOCIATES, A LIMITED PARTNERSHIP, DATED JUNE 11, 1964, AND RECORDED JUNE 11, 1964 IN BOOK 4729 OF

OFFICIAL
RECORDS OF SAN MATEO COUNTY AT PAGE 642 (31262-X); THENCE NORTH 87° 19' EAST

ALONG THE
NORTHERLY LINE OF THE LAST MENTIONED LANDS 504.20 FEET TO THE NORTHEASTERLY CORNER
THEREOF; THENCE ALONG THE EASTERLY LINE OF THE LANDS DESCRIBED IN SAID DEED TO CLARKE

AVENUE ASSOCIATES AND THE SOUTHERLY PROLONGATION OF SAID EASTERLY LINE SOUTH 1° 24’
EAST 321.71 FEET TO THE NORTHERLY LINE OF SAID LOT 14; THENCE NORTH 87° 31' EAST

ALONG THE
LAST MENTIONED LINE 22.70 FEET TO THE DIVIDING LINE BETWEEN LOTS 14 AND 15, AS

SHOWN ON
THE MAP ABOVE MENTIONED; THENCE ALONG SAID DIVIDING LINE SOUTH 1° 29' EAST 180.45

FEET TO

THE SAID NORTHEASTERLY LINE OF THE LANDS DESCRIBED IN SAID DEED TO STATE OF

CALIFORNIA,
FIRST ABOVE MENTIONED; THENCE NORTH 53° 53' WEST ALONG SAID NORTHEASTERLY LINE 658.47
FEET TO THE POINT OF BEGINNING.

APN: 063-492-350

9.2.a
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Exhibit B
Form of Unconditional Will Serve Letter
[EAST PALO ALTO SANITARY DISTRICT LETTERHEAD]
June __, 2020
André Madeira
Senior Vice President
Light Tree Two, L.P., a California Limited Partnership
22645 Grand Street
Hayward, CA 94541
Subject: Will Serve Letter – 1805 East Bayshore Road, 185 (Existing and Net New) Units Dear Mr. Madeira:

This letter will serve as notice that your project at 1805 East Bayshore Road can be served by the East Palo Alto Sanitary District and can receive all available services from the District, pursuant to compliance with the District’s Code of General Regulations, and payment of all fees set forth in the Wastewater Service Agreement between the District and Light Tree Two, L.P., . We understand that Light Tree Two, L.P. is proposing to create 91 net new units.

We look forward to reviewing your project plans, when they become available. Furthermore, we look forward to ultimately issuing you a sewer connection permit, provided all District General Regulations are met. When plans are ready, please submit to the District for review in accordance with the District’s requirement that you submit an application for a permit for sewer connection. The plan check fee deposit is $800.00.

Please contact me at (650) 325-9021 if you have any questions.

Sincerely,
Sincerely,
____________________________________
Akintunde A. Okupe, M.B.A., P.E.

District General Manager and District Engineer

9.2.a
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Exhibit C
Conceptual Opinion of Probable Project Cost for PWWF Improvements Notes
(1) Reserved.
(2) Quantities rounded to nearest 10 feet.

9.2.a
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9.2.b
Packet Pg. 517 Attachment: EPASD Letter Received on April 6, 2022 (2251 : Issues Concerning the Light Tree Affordable Housing Project and the East Palo

9.2.b
Packet Pg. 518 Attachment: EPASD Letter Received on April 6, 2022 (2251 : Issues Concerning the Light Tree Affordable Housing Project and the East Palo

9.2.b
Packet Pg. 519 Attachment: EPASD Letter Received on April 6, 2022 (2251 : Issues Concerning the Light Tree Affordable Housing Project and the East Palo

EAST PALO ALTO

CITY COUNCIL

STAFF REPORT
DATE: May 17, 2022
TO: Honorable Mayor and Members of the City Council
VIA: Patrick Heisinger, Interim City Manager
BY: Elena Lee, Planning Manager
Amy Chen, Community & Economic Development Director
SUBJECT: Willow Village Draft Environmental Impact Report (Facebook/Meta Expansion) Recommendation
It is recommended that the City Council, by motion:

1. Receive the staff report regarding the Willow Village Draft Environmental Impact Report (DEIR);

2. Provide staff with direction regarding any proposed amendments or modifications to the attached DEIR comment letter (Attachment 1); and

3. Direct the Interim City Manager to send the attached DEIR comment letter to the City of Menlo Park to serve as the City’s official comments on the Willow Village DEIR.

Alignment with City Council Strategic Plan
This recommendation is primarily aligned with:

Priority No. 2: Enhance Economic Vitality
Priority No. 4: Improve Public Facilities and Infrastructure Priority No. 6: Create a Healthy and Safe Community
Background
The City of Menlo Park is considering a master plan for a 59-acre industrial site located on Willow Road between Hamilton Avenue and Ivy Drive and has released a Draft Environmental Impact Report (DEIR) as required by the California Environmental Quality Act (CEQA) as the lead agency. In addition to the main campus, the project also includes three parcels west of Willow Road, totaling 3.1 acres, for realignment of Hamilton Avenue for improved access.

The project site is located near the western border of East Palo Alto and Menlo Park, adjacent to the Kavanaugh, University Village and Palo Alto Park single family residential neighborhoods. A location map can be found in the attached Notice of Availability

9.3 Packet Pg. 520
(Attachment 3). The project is a multi-phase, mixed use development proposed by Peninsula Innovation Partners, LLC, a subsidiary of Meta Platforms, Inc. The Willow Village Master Plan Project includes demolition of all buildings and landscaping and construction of new buildings, establishment of various open space areas, and installation of infrastructure within a new Residential/Shopping District, Town Square District, and Campus District. Information on the project, including the DEIR and project plans, can be found on the City of Menlo Park project webpage: https://beta.menlopark.org/Government/Departments/CommunityDevelopment/Projects/Under-review/Willow-Village.

The Notice of Preparation (NOP) for this EIR was released for the on September 18, 2019, for a 30- day public review period and a public scoping meeting was held on October 7, 2019.

The City of East Palo Alto provided a scoping comment letter on October 17, 2019 (Attachment 2). The Notice of Availability (NOA) (Attachment 3) for this Draft EIR was released on April 8, 2022 with a 45-day public comment period set from April 8 through May 23, 2022. A public hearing for the Draft EIR was held before the Menlo Park Planning Commission on April 25, 2022.

The proposed project would consist of the following components:

1. Campus district including 1.6 million square feet of office and accessory uses, including meeting/collaboration space (a maximum of up to 1.25 million square feet of offices with balance for accessory uses, inclusive of meeting and collaboration space);

2. Up to 200,000 square feet of retail/non-office commercial uses, including a grocery store, pharmacy services, entertainment and restaurant uses;

3. A grocery store proximate to Willow Road at the intersection with Hamilton Avenue/Main Street;

4. Up to 1,730 multifamily housing units, including 308 below market rate units (260 inclusionary units or 15 percent, plus 48 units per the city’s commercial linkage fee/unit equivalency requirement);

5. A 193-room hotel and associated retail/dining, proximate to the Town Square;

6. A 3.5-acre publicly accessible park (proximate to Willow Road at Park Street), a dog park (in the southeastern portion of the main project site) and additional public open space;

7. A 1.5-acre publicly accessible town square;

8. A 2-acre publicly accessible elevated park extending over Willow Road providing access at the Hamilton Avenue Parcel North (Belle Haven Shopping Center);

9. A publicly-accessible, below grade tunnel for Meta intercampus trams, bicyclists and pedestrians connecting the project with the West and East campuses.

The approval of the proposed project would require the following actions:

1. Environmental Review to analyze potential environmental impacts and certify the EIR as legally compliant with CEQA;

2. General Plan Circulation Element and Zoning Map amendments to modify the locations of the public rights-of-way, new street connections, and paseos within the main project site;

3. Rezone of entire site from O-B (Office Bonus) and R-MU-B (Residential Mixed-Use, Bonus) to O-B(X) (Office Bonus, Conditional Development) and R-MU-B(X) (Residential Mixed-Use Bonus, Conditional Development) to allow for a conditional development permit (CDP) to develop the main project site through the master plan process and establish the development regulations;

4. Conditional Development Permit to develop the proposed project through the master plan provisions outlined in the Zoning Ordinance, utilize the bonus level development allowances (increased height, density, and intensity) in exchange for community amenities,

9.3 Packet Pg. 521
and outline the performance standards, development regulations (including adjustment requests), and project requirements for the implementation of the master plan;

5. Development Agreement for adequate regulations in exchange for vested rights and the provision of specific community amenities;

6. Architectural Control approval of the design of the individual buildings and associated site improvements;

7. Vesting Tentative Map to create new buildable parcels, dedicate public rights-of-way, identify public access easements, site infrastructure, and realign Hamilton Avenue;

8. Heritage Tree Removal Permits to remove 266 heritage trees on the main project site and 3 heritage trees on the Hamilton Avenue Parcels, and plant heritage tree replacements consistent with the City’s code requirements; and

9. Below Market Rate (BMR) Housing Agreement approval for on-site BMR units (inclusionary units and commercial linkage fee units) in accordance with the City’s BMR Ordinance.

Analysis
Due to the proximity of the project site to East Palo Alto, staff reviewed the EIR to analyze any potential impacts on the City. Staff’s concerns have been compiled and included in a Draft EIR comment letter for Council’s consideration. If directed by Council, staff will transmit the letter as the City’s formal response to the Notice of Availability.

East Palo Alto has severe traffic due to a significant increase in growth regionally because East Palo Alto is located within a commute corridor between the East Bay, the Dumbarton Bridge, US 101, as well as job centers such as Menlo Park and Palo Alto. The proposed project would add significant office, commercial and residential square footage, which likely will increase traffic and congestion and other impacts. The project site is also located near three of East Palo Alto’s predominately single-family neighborhoods: Kavanaugh, University Village and Palo Alto Park.

CEQA Overview
An overview of the EIR process is provided in Table 1 below. EIR preparation begins with initial project review, circulation of a Notice of Preparation (NOP) and scoping. Following the NOP, preparation of a Draft EIR commences. Once completed, the Draft EIR is required under State law to be circulated for public review for a minimum of 45 days. This is followed by preparation of a Final EIR, based on comments received during the public DEIR review. The City of Menlo Park would be required to respond to the City of East Palo Alto’s Draft EIR comments in the Final EIR. The Final and Draft EIR document, along with the required project entitlements, would be reviewed prior to any decision on the project. In this case, the Menlo Park City Council must certify the EIR before taking any action on the application.

Table 1: EIR Process Overview
Activity Purpose Public Participation Opportunity
1 Notice of
Preparation
(NOP)
Communicates to the public,
agencies, and organizations an
EIR is being prepared. Also
serves to solicit input on the
scope and content of the
environmental information to be
Public Meeting(s). A scoping
meeting informs the public that the
City is evaluating a project under
CEQA and allows the City to solicit
public comment and identify possible
impacts.

9.3 Packet Pg. 522
included in the EIR.
2 Draft EIR
(DEIR)
The DEIR is the first iteration of
environmental analyses
collecting the project description,
identification of impacts,
technical studies, mitigation
measures and alternatives
DEIR includes publication of NOP
public comments.
3 Notice of
Availability
(NOA)
An NOA signals that the DEIR is
available for public review and
comment for no less than 45
days. The NOA also identifies
where the DEIR may be
reviewed and how to submit
comments on the DEIR.

Public Comment. The NOA is
typically circulated to nearby
property owners and occupants,
posted at the site, posted on the
city's project website, and filed with
the State Clearinghouse. The public
may submit comments at any time
during the 45- day public comment
period.

Public Hearing. A public meeting is
held to solicit comments from the
Planning Commission and the public
on the Draft EIR during the public
comment period.
4 Final EIR A Final EIR includes responses
to public comments received
after release of the DEIR and
any additional relevant project
information.

FEIR includes comments and
responses to DEIR public
comments.
5 Certification A certification is an official
position taken by the City
Council indicating that the EIR
has complied with CEQA for the
identified project.

Public Hearing. The decisionmaking body certifies the EIR at a Public Hearing with a portion of the
meeting is dedicated to public
comment.

The Willow Village Draft EIR analyzed the following topics:
• Aesthetics
• Air quality
• Biological resources
• Cultural and Tribal cultural resources
• Energy
• Geology and soils
• Greenhouse Gas emissions
• Hazards and hazardous materials
• Land use and planning
• Noise Population and housing
• Public services
• Transportation
• Utilities and service systems
• Hydrology and water quality
This project level Draft EIR tiers off the ConnectMenlo Program EIR, which was prepared for

9.3 Packet Pg. 523
the Menlo Park General Plan Update. The project level Draft EIR will provide the additional analysis not anticipated in the program EIR.

Staff identified specific concerns regarding the analysis in the Draft EIR. The concerns focused upon the following topics:
• Proximity to East Palo Alto Residential Neighborhoods and potential negative impacts on residents
• Proximity to the Ravenswood Priority Development Area and the Ravenswood/Four Corners Specific Plan Update and potential impacts
• Worsening the Jobs Housing Ratio
• Cumulative Impacts
• Aesthetics
• Construction and Air Quality
• Construction and Noise/Vibration impacts
• Population and Housing
• Public Services
• Transportation
• Utilities and Service Systems
• Hydrology
Staff’s detailed concerns are provided in the draft letter, which is included as Attachment 1 to this staff report.

Project Considerations and Concerns
Since its incorporation in 1983, the City has struggled to achieve economic growth and financial sustainability, especially in comparison to other nearby communities. To address this reality, the City’s leadership has ensured a strong focus on actions that strengthen the City’s economic profile, with the ultimate goal of improving the lives and enhancing the well-being of East Palo Alto residents.

Staff is concerned that the Project may result in unintended financial consequences for the City of East Palo Alto. For example, it is expected that the Project will include a large grocery store, which is a beneficial amenity for the Belle Haven neighborhood and Menlo Park as a whole, but it is unclear how this store will benefit East Palo Alto. If a significant number of residents shop at this new store, the few smaller grocery stores in East Palo Alto may experience negative impacts to their businesses, and the City will receive decreased sales tax revenues.

In addition, increased traffic created by East Palo Alto residents traveling to the new store will only worsen current traffic concerns.

Staff is also concerned that the East Palo Alto Police Department could be impacted by an increase in calls for service, which would require the City of East Palo Alto to fund more police officers during a time when the City has a significant budget deficit.

The Facebook/Meta expansion is located just feet away from the Cesar Chavez Ravenswood Middle School, which already experiences traffic congestion during common drop-off and pickup hours. Staff hopes that Facebook/Meta and the City of Menlo Park will develop strategies to ensure that the Project does not impact the students, staff, and other community members connected to the middle school campus. It is not that long ago a tragic schoolgirl fatality

9.3 Packet Pg. 524
occurred in this area.

The greatest areas of concern for staff are the related issues of traffic and air quality, resulting from increased vehicle travelling through East Palo Alto to access to future Project. Staff hopes that Facebook/Meta and the City of Menlo Park will acknowledge these realities and partner with the City of East Palo Alto to consider necessary infrastructure projects that may be of mutual benefit.

The City of East Palo Alto has a critical need for emergency-access water storage locations.

As such, staff hopes that Facebook/Meta and Menlo Fire will collaborate to determine if water storage may be included in the Project’s design, thus offering support to East Palo Alto residents during a potential emergency.

In conclusion, the City values its relationship with the City of Menlo Park and Facebook/Meta, yet many aspects of the Project raise concerns that may impact the City of East Palo Alto’s goal of achieving financial self-sufficiency and economic growth for our residents. However, an effective partnership between the City of Menlo Park, Facebook/Meta, and the City of East Palo Alto may successfully mitigate these concerns, thus ensuring that all three entities thrive in the future. The City would be eager to engage in these discussions.

Next Steps
If directed, the Interim City Manager will transmit the EIR comment letter to the City of Menlo Park. The City of Menlo Park is required to respond to all EIR comments in the Final EIR. A release date for the Final EIR has not been identified. However, the City will receive a notice of the availability of the Final EIR because it had received the NOA for the Draft EIR. Upon release, staff will review the Final EIR.

Fiscal Impact

There are no fiscal impacts associated with this City Council update regarding the information described in the staff report.

Public Notice
The public was provided notice by making the agenda and report available on the City’s website and on a bulletin board located at City Hall: 2415 University Avenue, East Palo Alto.

Environmental

Pursuant to California Environmental Quality Act (CEQA) Guidelines section 15378(b)(5), the adoption of an ordinance of general policy does not constitute a “project” in that it is a governmental organizational or administrative activity that will not result in direct or indirect changes in the environment.

Attachments

1. Draft City Letter to Menlo Park

2. EPA NOP Comment Letter

3. Menlo Park NOA Willow Village Draft EIR

9.3 Packet Pg. 525

CITY OF EAST PALO ALTO
Office of the City Manager
May 20, 2022
Kyle Perata, Acting Planning Manager
Community Development Department
City of Menlo Park
701 Lauren Street
Menlo Park, CA 94025
Subject: Notice of Availability for the Facebook Willow Master Plan Project Dear Mr. Perata:

This letter is provided in response to the Notice of Availability (NOA) for the Facebook Willow Master Plan Project. Thank you for providing an opportunity to comment. East Palo Alto values its relationship with Menlo Park and we hope to continue to work cooperatively on the many issues common to both of our communities.

The City commented on the Notice of Preparation on October 17, 2019, and incorporates those comments by reference.

Proximity to East Palo Alto Residential Neighborhoods
The project site is in very close proximity to East Palo Alto residences, specifically three single family residential neighborhoods: Kavanaugh, University Village and Palo Alto Park. In some instances, the residences are within 300 feet of the site. Given the size of the project and the five-year construction time period, the City requests that equal consideration be given to these neighborhoods as Menlo Park neighborhoods. In some cases, these East Palo Alto neighborhoods would be more impacted by this project. The City has concerns about various impacts (described below) as well as air quality, biological resources, energy, geology and soils, greenhouse gas emissions, hazards and hazardous materials, and hydrology and water quality.

Proximity to the Ravenswood Priority Development Area and the Ravenswood/Four Corners Specific Plan Update
The project site is located less than 2,000 feet from the Ravenswood Business District (RBD), which is a priority development area and an important jobs center for East Palo Alto. The City is in the process of updating the Specific Plan, which may include increasing the amount of both nonresidential and residential square footage. The Notice of Preparation for the update was released on May 9, 2022; however, the update has

9.3.a
Packet Pg. 526 Attachment: Draft City Letter to Menlo Park (2248 : Willow Village Draft Environmental Impact Report (Facebook/Meta Expansion)) been in process, including multiple public hearings, since mid-2020. While the Draft EIR includes the four projects proposed for the RBD area, the text does not acknowledge or discuss the RBD Specific Plan update. The Draft EIR should explicitly include in its analysis the RBD Specific Plan Update. Given the importance of the RBD area for East Palo Alto, that it is a designated priority development area and the pending update, the City is very concerned about the potential impact of the Willow Village project on the ability to develop the RBD area. Specifically, traffic impacts from the Willow Village would directly impact the RBD area.

Jobs Housing Ratio
The City of East Palo Alto provides a significant amount of housing stock in Silicon Valley. East Palo Alto has more housing units than jobs, the lowest market rate prices in the region, and approximately 30% (or 2,405 of 7,759 units) of the total housing units are currently registered (non-exempt) in the Rent Stabilization Program. The City is concerned that the proposed development of a significant amount of nonresidential square footage would exacerbate the existing housing crisis in East Palo Alto.

Cumulative Impacts
The Draft EIR tiers off the ConnectMenlo EIR prepared for the General Plan update.

ConnectMenlo did not include East Palo Alto projects in the cumulative scenario due to a water moratorium that paused projects in East Palo Alto during the preparation of the DEIR. This DEIR includes a list-based approach for the cumulative analysis. The list used for the cumulative analysis is incomplete. It does not include two projects that were approved but not yet constructed (Clarum University and Sobrato Phase II) nor the RBD Specific Plan Update. Clarum University, located at 2331 University, was approved for the construction of a 47,594 square foot four-story mixed-use building with retail space and parking on the ground level and 33 residential dwelling units on the levels above the ground floor. The Sobrato Phase II project was approved for the demolition of two existing buildings and construction of an eight-story structure with approximately 231,883 square feet of office space and a five-story, 284,094-square-foot parking structure. The City respectfully requests that the DEIR analyze these three projects for cumulative and traffic impacts.

Aesthetics
The Aesthetics analysis included the viewsheds from two locations within the City of East Palo Alto. The DEIR included a photosimulation which simulated potential views from the Kavanaugh View shed, one of three single family neighborhoods located within 300 feet of the project site. The photosimulation clearly shows the project will significantly alter middle ground views. Buildings over 70 feet in height would clearly be visible from the neighborhood. Although there are no identified scenic vistas, the project would change the character of the area with a significantly taller structures both for the project and cumulatively. The Draft EIR should be revised to incorporate mitigation to reduce the impacts on the viewshed to a less than significant impact.

9.3.a
Packet Pg. 527 Attachment: Draft City Letter to Menlo Park (2248 : Willow Village Draft Environmental Impact Report (Facebook/Meta Expansion)) Construction and Air Quality
The DEIR identifies three significant unavoidable impacts for air quality. There are a significant number of sensitive receptors within the three East Palo Alto single-family neighborhoods near the perimeter of the project site. The DEIR states that extended construction hours are proposed over the five-year construction period. Work is proposed between 7:00 a.m. to 10:00 p.m. Monday through Saturday. Construction is also proposed on Sunday from 8:00 a.m. to 6:00 p.m. Although it is recognized that air quality issues are beyond the control of any one jurisdiction, the City is significantly concerned about the extended construction hours and five-year time period and the potential impact on East Palo Alto residents and sensitive receptors.

Mitigation Measures AQ 1.1, AQ 2b2 require that prior to the issuance of a building permit that the applicant provide a supplemental analysis by a qualified air quality specialist that the construction would not create air quality impacts that exceed Bay Area Air Quality Management District regulations and CEQA guidelines. Due to the potential direct impacts on East Palo Alto residents, the City requests that the mitigation measure also require submittal of the construction air quality analysis that includes analysis for East Palo Alto impacts be submitted for East Palo Alto review.

Construction and Noise/Vibration impacts
The DEIR identifies three significant unavoidable impacts related to noise and vibration. As described above, there are three neighborhoods in the City of East Palo Alto that will be directly impacted. The City is significantly concerned due to the proximity of East Palo neighborhoods to the project.

Noise 1.1 and 2a require a construction noise control plan and a noise and vibration analysis to assess and mitigate potential noise and vibration impacts. The plan and analysis should be evaluated to prevent noise impacts on East Palo Alto neighborhoods. Activities that cannot comply with the noise limit of 60dBA at the residential or noise sensitive land use or exceed maximum level of 0.2 in/sec for vibrations should not be permitted. The City also requests to review the noise control plan and noise/vibration analysis prior to the issuance of a building permit.

Settlement Agreement
Pursuant to Section 2.6 of the Menlo Park General Plan Settlement Agreement, when the preparation of an EIR is required, concurrent with the preparation of the EIR, Menlo Park will conduct a Housing Needs Assessment (HNA). The scope of the HNA, to the extent possible, shall include an analysis of the multiplier effect for indirect and induced employment by the development project and its relationship to the regional housing needs market and displacement. The DEIR includes a HNA in the appendix. The discussion in the DEIR should be consistent with all relevant terms of the Settlement Agreement. The City requests that a summary of the required analysis be incorporated into the DEIR

9.3.a
Packet Pg. 528 Attachment: Draft City Letter to Menlo Park (2248 : Willow Village Draft Environmental Impact Report (Facebook/Meta Expansion)) Population and Housing
According to the DEIR main report and Housing Needs Assessment Appendix, the growth in units from the Proposed Project is estimated to result in a housing unit deficit of 815 regionally. The DEIR notes that because ABAG and MTC Plan Bay Area Projections 2040 incorporate growth under ConnectMenlo, cumulative impacts related to population and housing are less than significant. The ABAG/MTC housing projections are based on all future housing development, not concurrent development (to the Proposed Project), within Menlo Park and in the region. The regional balancing of jobs and housing from the Proposed Project and other similar projects will only occur if neighboring jurisdictions, including East Palo Alto, but also Palo Alto, Redwood City, and other cities within the commute area keep up with planned housing production, the evidence for which is lacking.

Of particular concern in the Housing Needs Assessment is the estimated number of Extremely-Low, Very-Low, and Low-Income units included in the net decrease in available housing in the region as a result of the Proposed Project: 127 Extremely Low, 270 Very Low, and 727 Low. Given that lower-income housing units have been, and continue to be, produced at much lower levels than above-moderate housing, with most jurisdictions in the region not meeting their lower-income Regional Housing Needs Allocations (RHNA), the deficit from this Proposed Project deserves particular attention.

Since not all new employees will seek housing in Menlo Park, it is estimated that induced employment from the Proposed Project will lead to employees seeking housing elsewhere, with an additional 26 employee households ultimately living in East Palo Alto.

This very low number, particularly in combination with findings of the HNA that, “on balance, the analysis suggests the proposed Project would likely, at most, represent a minor contributing factor to the substantial pre-existing displacement pressures in East Palo Alto and Belle Haven,” should be viewed with scrutiny to ensure that it is accurate.

Public Services
East Palo Alto has significant concerns regarding the ability to provide public safety services. Traffic is already having an impact for public safety services post pandemic.

Since returning to “normal” following the pandemic, and people returning to work, traffic has increased during commute hours, thus creating congestion throughout the city with traffic coming from Highway 84 to SR 101 in the morning and from SR 101 to Highway 84 in the afternoon. The traffic typically lasts for approximately 3 hours during the morning and afternoon. However, commuter traffic doesn’t remain on University Avenue. The traffic spills into our neighborhoods which isn’t fair to our residents who live and work in this area, as they must negotiate and navigate through traffic just to get home, pick up children from school or just conduct their daily lives.

During the afternoon, commuters use Pulgas Avenue, Clarke Avenue and Cooley Avenue as a cut through to Bay Road. They also use Euclid Avenue, to Glen Way via Runnymede Street to Bay Road as a cut through, and Dumbarton Avenue to Bay Road during the afternoon. The City already have narrow streets due to a high volume of parked vehicles and it is already difficult to navigate through these streets during peak commute times

9.3.a
Packet Pg. 529 Attachment: Draft City Letter to Menlo Park (2248 : Willow Village Draft Environmental Impact Report (Facebook/Meta Expansion)) while performing normal patrol duties. When an emergency occurs during commute times, getting the necessary emergency apparatus to the scene when time is of the essence always is a difficult task because of heavy traffic. There have been at least two occasions when a life flight (helicopter) had to be requested to transport trauma patients to Stanford Hospital (less than 5 miles away), because the commute traffic was so congested an ambulance couldn’t get to the scene soon enough. Willow Village Project will add to the traffic congestion and traffic issues we already have with our existing commute traffic. With the potential of increased traffic resulting from this project, this will negatively impact our ability to provide efficient public safety services in a timely manner and thus negatively impact the safety and security of our residents.

TDM and TMA
The City understands that the project will be required to prepare and implement a Transportation Demand Management program designed to reduce the number of vehicular trips. As noted above, traffic impacts are a regional issue that extend beyond individual city borders. The City of East Palo Alto recently adopted a TDM ordinance requiring that average daily trips be reduced by 40% and has been exploring the formation of a Transportation Management Association (TMA). There is an economy of scale for TDM measures and TMAs. The City requests that the project applicant be required to consult with the City of East Palo Alto to find opportunities to pool resources where feasible to reduce vehicular trips. This can include the formation of a TMA or measures such as coordinating or sharing shuttles or rideshare programs. This would benefit both the City of East Palo Alto and Menlo Park.

Transportation
East Palo Alto’s General Plan identifies a vision for University Avenue which is to transform it from a regional cut-through corridor to a mixed-use boulevard with high density housing and multi-model transportation options. The goal is to reduce traffic volumes, reduce traffic speeds, make the area desirable for pedestrians with wide sidewalks, streetscape improvements such as signage and street trees, and add multimodal transportation options. The proposed Willow Village project will add a significant amount of traffic onto University Avenue - intersections will be beyond acceptable levels of service; there will be congestion during AM/PM peak hour, significant impacts at interchanges. These issues can be mitigated by design and construction of the University Avenue Improvements project (Grand Corridor) in East Palo Alto. Improvements along University Avenue will be vital and should be constructed alongside the Willow Village project.

Impacts at Kavanaugh Drive/O’Brien Drive should be studied further and a traffic signal/roundabout analysis should be performed. Any necessary improvements to this intersection should be a part of the Willow Village project.

Modification of existing dead-end cul-de-sacs into through streets will increase cut through traffic onto University Avenue. This will impact both O'Brien Drive, Kavanaugh Drive, Gloria Way, and Bay Road. Traffic safety and traffic calming improvements along these roads should be a part of the Willow Village project. These improvements may

9.3.a
Packet Pg. 530 Attachment: Draft City Letter to Menlo Park (2248 : Willow Village Draft Environmental Impact Report (Facebook/Meta Expansion)) include roundabouts at intersections, radar speed feedback signs, lighting, ADA improvements, signage and striping, and bulb-outs.

In order to enforce traffic related impacts in the City of East Palo Alto, a traffic enforcement officer should be budgeted for the City of East Palo Alto for a few years upon project completion to ensure effectiveness of traffic controls.

The EIR should clearly identify show all of the fair-share calculation formulas for affected East Palo intersections.

Because several Menlo Park streets adjacent to the proposed project have restricted parking and Kavanaugh street in East Palo Alto does not, there is concern that overflow parking will spill into East Palo Alto streets. The applicant shall work with the City of East Palo Alto to address potential solutions to prohibit overflow parking onto City of East Palo Alto city-streets, primarily within the Kavanagh Drive/Gloria Way neighborhoods.

In order to ensure bike trail connectivity from the proposed project onto the Bay Trail as well as other trails in East Palo Alto, an analysis of bike trail connectivity should be performed and bike trails should be striped as a part of this project.

Cut through traffic along City of East Palo Alto city streets is a major potential concern with the implementation of this project. A cut-through traffic analysis should be performed and measures should be implemented to discourage cut through traffic within City of East Palo Alto neighborhood streets. Measures can include signage in both cities of Menlo Park as well as East Palo Alto.

Utilities and Service Systems
Because the Kavanaugh Drive/Gloria Way neighborhoods in East Palo Alto are adjacent to the proposed project site, these streets should be improved aesthetically.

Undergrounding of power lines in these neighborhoods can significantly improve aesthetics in and around the proposed project site.

There are drainage issues in the vicinity of the proposed project site that can be improved.

Primarily, at the north end of Ralmar Avenue to 1170 O’Brien Drive, Menlo Park. There is occasional flooding of Ralmar street in East Palo Alto due to an inadequate drainage system. Collaboration is needed between Menlo Park and East Palo Alto to ensure a storm drain system can be constructed through 1170 O’Brien Drive to avoid flooding in the City of East Palo Alto.

Hydrology
A detailed hydrology plan would show existing and proposed storm drain systems and drainage areas around the vicinity of the proposed project. This information would be useful to verify whether any of the storm drain systems in the City of East Palo Alto would be impacted. This information should be shared with the City of East Palo Alto when available.

9.3.a
Packet Pg. 531 Attachment: Draft City Letter to Menlo Park (2248 : Willow Village Draft Environmental Impact Report (Facebook/Meta Expansion)) Project Considerations and Concerns
Since its incorporation in 1983, the City has struggled to achieve economic growth and financial sustainability, especially in comparison to other nearby communities. To address this reality, the City’s leadership has ensured a strong focus on actions that strengthen the City’s economic profile, with the ultimate goal of improving the lives and enhancing the well-being of East Palo Alto residents.

The Facebook/Meta expansion is located just feet away from the Cesar Chavez Ravenswood Middle School, which already experiences traffic congestion during common drop-off and pick-up hours. Staff hopes that Facebook/Meta and the City of Menlo Park will develop strategies to ensure that the Project does not impact the students, staff, and other community members connected to the middle school campus.

It is not that long ago a tragic schoolgirl fatality occurred in this area.

The City of East Palo Alto has a critical need for emergency-access water storage locations. As such, staff hopes that Facebook/Meta and Menlo Fire will collaborate to determine if water storage may be included in the Project’s design, thus offering support to East Palo Alto residents during a potential emergency.

9.3.a
Packet Pg. 532 Attachment: Draft City Letter to Menlo Park (2248 : Willow Village Draft Environmental Impact Report (Facebook/Meta Expansion)) Sincerely,
Patrick Heisinger
Interim City Manager

9.3.a
Packet Pg. 533 Attachment: Draft City Letter to Menlo Park (2248 : Willow Village Draft Environmental Impact Report (Facebook/Meta Expansion)) City of East Palo Alto
Office of the City Manager
2415 University Ave. Phone: (650) 853-3100 www.cityofepa.org East Palo Alto, CA 94303 Fax: (650) 853-3115 [email protected] October 17, 2019
Kyle Perata, Principal Planner
Community Development Department
City of Menlo Park
701 Lauren Street
Menlo Park, CA 94025
Subject: Notice of Preparation for the Facebook Willow Master Plan Project Dear Mr. Perata:

This letter is provided in response to the Notice of Preparation (NOP) for the Facebook Willow Master Plan Project. I want to emphasize that East Palo Alto values its relationship with Menlo Park, and we hope to continue to work cooperatively on the many issues common to both of our communities.

Traffic
First, East Palo Alto is a city that is severely impacted by regional cut through traffic.

To adequately analyze the potential impact of the proposed project, please add the following intersections to the Transportation Impact Analysis (TIA):

1. University Avenue and State Highway 84/Bayfront Expressway

2. University Avenue and Adams Drive

3. University Avenue and O’Brien Drive

4. University Avenue and Notre Dame Avenue

5. University Avenue and Kavanaugh Drive

6. University Avenue and Purdue Avenue

7. University Avenue and Bay Road

8. University Avenue and Willow Road

9. University Avenue and Runnymede Street

10. University Avenue and Bell Street

11. University Avenue and Donohoe Street

12. University Avenue/Highway 101 Southbound on-off ramp

13. University Avenue and Woodland Avenue

14. Donohoe Street and Cooley Avenue

15. Donohoe Street and Capital (Northbound Highway 101 off ramp)

9.3.b
Packet Pg. 534 Attachment: EPA NOP Comment Letter (2248 : Willow Village Draft Environmental Impact Report (Facebook/Meta Expansion))

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East Palo Alto City CouncilMay 17, 2022

East Palo Alto City Council
May 17, 2022