Agenda packet — Foster City City Council, November 20, 2023 (part 1 of 2)

CITY OF FOSTER CITY/
ESTERO MUNICIPAL IMPROVEMENT DISTRICT
FOSTER CITY COUNCIL CHAMBERS
620 FOSTER CITY BOULEVARD
FOSTER CITY, CALIFORNIA
MEMBERS OF THE PUBLIC THAT WISH TO ATTEND AND/OR PARTICIPATE IN A MEETING MAY DO SO IN PERSON OR BY JOINING THE ZOOM MEETING HTTPS://FOSTERCITY ORG.ZOOM.US/J/82592136594 PUBLIC COMMENTS WILL BE ACCEPTED BOTH IN PERSON AND VIA ZOOM MEETING. ANY EMAILS SENT TO [email protected] WILL BE PROVIDED TO THE CITY COUNCIL PRIOR TO THE MEETING.

To Attend the Meeting in Person:

Location: 620 Foster City Blvd, Foster City, California, 94404 To Provide Public Comment in Person:

Members of the public wishing to speak will be asked to fill out a Request to Speak Form. Forms will be accepted until the staff presentation on an agenda item ends, or until the public comment period on non agenda items is closed. For special meetings, public comment is limited to item(s) on the agenda only.

To Observe the Meeting via Teleconference/Video Conference:

To access the meeting by computer / smartphone, go to: https://fostercityorg.zoom.us/j/82592136594 To dialin via phone:
16694449171 or
14086380968
And enter Webinar ID: 825 9213 6594
To Participate in the Meeting by Providing Public Comment via Teleconference/Video Conference:

During the Meeting: Live verbal public comments may be made by members of the public joining the meeting via Zoom. Zoom access information is provided above. Use the “raise hand” feature (for those joining by phone, press *9 to “raise hand”) during the public comment period for the agenda item you wish to address. The Zoom Host will call on people to speak by name provided or last 4 digits of phone number for dialin attendees. Please clearly state your full name for the record at the start of your public comment.

Before the Meeting: Written public comments for the record may be submitted in advance by 4:00 p.m. the day of the meeting by email to: [email protected] and will be made part of the written record but will not be read verbally at the meeting. Written public comments submitted by email should adhere to the following:

Clearly indicate the Agenda Item No. or specify “Public” in the Subject Line for items not on the agenda Include the submitter’s full name (Recommended but not required) Written public comments received by 4:00 p.m. the day of the meeting will be provided in their entirety to the City Council prior to the meeting and will be made part of the written record but will not be read verbally at the meeting.

Written public comments will be posted to the City’s website for review prior to the meeting.

AGENDA
Monday, November 20, 2023 6:30 PM
REGULAR MEETING AS CITY COUNCIL/EMID BOARD OF

DIRECTORS

1. CALL TO ORDER

2. PLEDGE OF ALLEGIANCE

3. ROLL CALL
Councilmembers/ex officio EMID Directors Sam Hindi, Stacy Jimenez, Art Kiesel, Patrick Sullivan, and Mayor/President Jon Froomin

4. PUBLIC
Government Code Section 54954.2 E (3) precludes the City Council from discussing or acting upon any topic initially presented during the “Public” portion of the agenda.

Information may be received, placed on a future agenda, or referred to the appropriate City staff. FCMC 2.08.240 Addressing the Council. "...Each person desiring to address the Council shall step up to the public rostrum after being recognized to speak by the presiding officer, shall state his/her name and address for the record, state the subject he/she wishes to discuss, state who he/she is representing if he/she represents an organization or other persons and, unless further time is granted by majority vote of the Council, shall limit his/her remarks to three minutes. The City Council may vary the time limit for any speaker, if it deems this necessary." Speakers may join the Zoom meeting via the meeting link and using the “raise hand” feature and the Zoom host will call on people.

5. CITY/EMID CONSENT CALENDAR
All matters listed under Consent Calendar are considered to be routine by the City Council/EMID Board of Directors and will be enacted by one motion unless removed by a member of the Council/Board, staff, or public. There will be no separate discussion on these items unless a citizen or a Council/Board member so requests.

This section includes minutes, ordinances for adoption, resolutions for adoption, and other business as needed. If discussion is required, that item will be removed from the Consent Calendar and will be considered separately after approval of the remaining items on the Consent Calendar. Vote may be by roll call.

5.1. City/EMID Regular Meeting Minutes of November 6, 2023

5.2. A Resolution of the City Council of the City of Foster City Authorizing the Mayor to Execute a Master Services Agreement with Flock Safety to Retain an Existing Annual Fee Through FY 2728 for All Existing Automated License Plate Reader Equipment and Services
a) Staff Report
b) Adopt Resolution

5.3. A Resolution of the City Council of the City of Foster City Authorizing the Police Department to Purchase a OneYear Maintenance Renewal from Intrado to Maintain the Existing Dispatch Customer Premise Equipment (CPE); and Authorizing Appropriation of $18,714.75 from the General Fund to Account 00106304214246
a) Staff Report
b) Adopt Resolution

6. PUBLIC HEARINGS

6.1. A Public Hearing to Consider Adopting Ordinance and Resolution Approving Collection Rate Increases for Solid Waste, Recyclables, and Organic Materials for Calendar Years 2024 Through 2028 and Finding that the City’s Franchise Fees Included in the Solid Waste Rates are Justified a) Staff Report
b) Open Public Hearing
c) Receive Public Testimony
d) Close Public Hearing
e) Action – An Uncodified Ordinance of the City of Foster City Approving Solid Waste Rates for a Fouryear Period of Calendar Years 2025 Through 2028, Increasing the Monthly Residential Collection Rates by No More Than $4.74 in Rate Year 2025, $4.98 in Rate Year 2026, $4.19 in Rate Year 2027, and $4.35 in Rate Year 2028 and Increasing Fees for Unscheduled Services Up to 6.0% Per Year From Rate Years 2025 Through 2028
i) Introduce Ordinance by title only, by motion waive further reading ii) By motion pass ordinance to second reading
f) Action A Resolution of the City Council of the City of Foster City Finding that the City’s Franchise Fees Included in the Solid Waste Rates are Justified and Approving Increases to the 2023 Monthly Residential Solid Waste Collection Rates by No More Than $5.40 Per Account in Rate Year 2024 and Approving Increases to 2024 Charges for Unscheduled Services by 5.465% Over 2023

6.2. A Public Hearing to Hear and Consider Comments Regarding Amendments to Title 17, “Zoning” Chapter 17.90 Below Market Rate Inclusionary Housing Program and Finding the Amendments Exempt from The California Environmental Quality Act (CEQA) Pursuant To CEQA Guideline Section 15061(B)(3)
a) Staff Report
b) Open Public Hearing
c) Receive Public Testimony
d) Close Public Hearing
e) Action – An Ordinance of the City of Foster City Making Text Amendments to Title 17, “Zoning” of the Foster City Municipal Code Chapter 17.90, “Below Market Inclusionary Housing Program” and Finding the Amendments Exempt from the California Environmental Quality Act Pursuant to CEQA Guideline Section 15061(B)(3) – RZ20230008
i) Introduce Ordinance by title only, by motion waive further reading ii) By motion pass ordinance to second reading

7. NEW BUSINESS

7.1. Interview and Consideration of Appointments of Three Members to New Full Terms from January 1, 2024 through December 31, 2026 on the Parks and Recreation Committee. Applicants Listed in Alphabetical Order are: Ofer Yizhar Barnea, Sirish Bindal, Eric Corpuz, Lisa Fong, Khalaf Hirmina, Andelina Jovanovic, and Edlyn Yuen
a) Staff Report
b) Interview Applicants
c) Take Action By Minute Order

7.2. Consideration of Establishing Local Campaign Contribution Limits and Voluntary Campaign Expenditure Limits
a) Staff Report
b) Action – By Minute Order, Provide Policy Direction

8. REPORTS

8.1. Wastewater Treatment Plant Master Plan Improvements Project (CIP 455 652) Clean Water Program – Third Quarter Progress Update a) Staff Report
b) Action By Minute Order, Receive and Accept Report

8.2. Report on Fiscal Year 202324 1st Quarter Financial Update a) Staff Report
b) Action By Minute Order, Receive and Accept Report

9. RESOLUTIONS FOR ADOPTION

9.1. A Resolution of the City Council of the City of Foster City Approving an Agreement with Peninsula Clean Energy to Participate in Their Public EV Fleets (“Gov EV”) Program and Authorizing the City Manager to Execute the Customer Participation Agreement with Peninsula Clean Energy and Finding the Approval of the Agreement Exempt from the California Environmental Quality Act (CEQA) Pursuant to CEQA Guidelines Section 15061(B)(3)) a) Staff Report
b) Action – Adopt Resolution

10. COMMUNICATIONS

10.1. City/District Warrants of Demands were Processed and Issued on October 31, 2023, and November 3, 2023, and ACH were processed on November 3, 2023
a) Information Item Only
b) No Action Required

11. CITY/DISTRICT MANAGER REPORTS, COUNCIL/BOARD STATEMENTS AND REQUESTS, AND COUNCIL LIAISON REPORTS
City/District Manager and Council/EMID Board Members report on their various assignments and liaison roles and Council/EMID Board requests for scheduling future items.

12. CLOSED SESSION

12.1. Conference With Legal Counsel — Existing Litigation (Paragraph (1) of subdivision (d) of Section 54956.9) Name of case: (Foster City Marina, LLC v. City of Foster City et al. San Mateo Superior Court Case No. 22CIV 03526)

12.2. Report Out from Closed Session

13. ADJOURNMENT
The public is invited to attend.

Any attendee wishing special accommodations at the meeting should contact the City Clerk’s Department at (650) 2863250 or [email protected] at least 48 hours in advance of the meeting.

The City has a procedure for receiving and swiftly resolving requests for reasonable accommodation for individuals with disabilities, consistent with the federal Americans with Disabilities Act of 1990 (42 U.S.C. Sec. 12132), and resolving any doubt in favor of accessibility.

That procedure for receiving and resolving requests for accommodation is available at the City Clerk’s Office. All meetings are conducted in a manner consistent with applicable civil rights and nondiscrimination laws.

Any writings or documents provided to a majority of the City Council or EMID Board regarding any item on this agenda after the agenda packet was distributed will be made available for public inspection in the City Clerk Department at City Hall located at 610 Foster City Boulevard during normal business hours and at the meeting.

City Council meetings on FCTV on Comcast Channel 27 and AT&T Channel 99:

LIVE every 1st and 3rd Monday of the month
REPLAY next day at 1:00 pm (that week only)
REPLAY Saturday at 5:00 pm (only on Saturday the week the actual meeting occurs) City Council meetings on https://www.fostercity.org/community/page/fctvlivestream:

STREAMED LIVE every 1st and 3rd Monday of the month
City Council meetings ondemand:
https://www.fostercity.org/agendasandminutes

1 CITY OF FOSTER CITY/
ESTERO MUNICIPAL IMPROVEMENT DISTRICT
FOSTER CITY COUNCIL CHAMBERS
620 FOSTER CITY BOULEVARD
FOSTER CITY, CALIFORNIA
MEMBERS OF THE PUBLIC THAT WISH TO ATTEND AND/OR PARTICIPATE IN A MEETING MAY DO SO IN PERSON OR BY JOINING THE ZOOM MEETING HTTPS://FOSTERCITY ORG.ZOOM.US/J/82592136594 PUBLIC COMMENTS WILL BE ACCEPTED BOTH IN PERSON AND VIA ZOOM MEETING. ANY EMAILS SENT TO [email protected] WILL BE PROVIDED TO THE CITY COUNCIL PRIOR TO THE MEETING.

To Attend the Meeting in Person:

Location: 620 Foster City Blvd, Foster City, California, 94404 To Provide Public Comment in Person:

To Observe the Meeting via Teleconference/Video Conference:

Written public comments will be posted to the City’s website for review prior to the meeting.

AGENDA
Monday, November 20, 2023 6:30 PM
REGULAR MEETING AS CITY COUNCIL/EMID BOARD OF

DIRECTORS

1. CALL TO ORDER

2. PLEDGE OF ALLEGIANCE

3. ROLL CALL
Councilmembers/ex officio EMID Directors Sam Hindi, Stacy Jimenez, Art Kiesel, Patrick Sullivan, and Mayor/President Jon Froomin

4. PUBLIC
Government Code Section 54954.2 E (3) precludes the City Council from discussing or acting upon any topic initially presented during the “Public” portion of the agenda.

5.1. City/EMID Regular Meeting Minutes of November 6, 2023

6. PUBLIC HEARINGS

7. NEW BUSINESS

7.2. Consideration of Establishing Local Campaign Contribution Limits and Voluntary Campaign Expenditure Limits
a) Staff Report
b) Action – By Minute Order, Provide Policy Direction

8. REPORTS

8.2. Report on Fiscal Year 202324 1st Quarter Financial Update a) Staff Report
b) Action By Minute Order, Receive and Accept Report

9. RESOLUTIONS FOR ADOPTION

10. COMMUNICATIONS

10.1. City/District Warrants of Demands were Processed and Issued on October 31, 2023, and November 3, 2023, and ACH were processed on November 3, 2023
a) Information Item Only
b) No Action Required

12. CLOSED SESSION

12.2. Report Out from Closed Session

13. ADJOURNMENT
The public is invited to attend.

Any attendee wishing special accommodations at the meeting should contact the City Clerk’s Department at (650) 2863250 or [email protected] at least 48 hours in advance of the meeting.

City Council meetings on FCTV on Comcast Channel 27 and AT&T Channel 99:

STREAMED LIVE every 1st and 3rd Monday of the month
City Council meetings ondemand:
https://www.fostercity.org/agendasandminutes

2 CITY OF FOSTER CITY/
ESTERO MUNICIPAL IMPROVEMENT DISTRICT
FOSTER CITY COUNCIL CHAMBERS
620 FOSTER CITY BOULEVARD
FOSTER CITY, CALIFORNIA
MEMBERS OF THE PUBLIC THAT WISH TO ATTEND AND/OR PARTICIPATE IN A MEETING MAY DO SO IN PERSON OR BY JOINING THE ZOOM MEETING HTTPS://FOSTERCITY ORG.ZOOM.US/J/82592136594 PUBLIC COMMENTS WILL BE ACCEPTED BOTH IN PERSON AND VIA ZOOM MEETING. ANY EMAILS SENT TO [email protected] WILL BE PROVIDED TO THE CITY COUNCIL PRIOR TO THE MEETING.

To Attend the Meeting in Person:

Location: 620 Foster City Blvd, Foster City, California, 94404 To Provide Public Comment in Person:

To Observe the Meeting via Teleconference/Video Conference:

Written public comments will be posted to the City’s website for review prior to the meeting.

AGENDA
Monday, November 20, 2023 6:30 PM
REGULAR MEETING AS CITY COUNCIL/EMID BOARD OF

DIRECTORS

1. CALL TO ORDER

2. PLEDGE OF ALLEGIANCE

3. ROLL CALL
Councilmembers/ex officio EMID Directors Sam Hindi, Stacy Jimenez, Art Kiesel, Patrick Sullivan, and Mayor/President Jon Froomin

4. PUBLIC
Government Code Section 54954.2 E (3) precludes the City Council from discussing or acting upon any topic initially presented during the “Public” portion of the agenda.

5.1. City/EMID Regular Meeting Minutes of November 6, 2023

6. PUBLIC HEARINGS

7. NEW BUSINESS

7.2. Consideration of Establishing Local Campaign Contribution Limits and Voluntary Campaign Expenditure Limits
a) Staff Report
b) Action – By Minute Order, Provide Policy Direction

8. REPORTS

8.2. Report on Fiscal Year 202324 1st Quarter Financial Update a) Staff Report
b) Action By Minute Order, Receive and Accept Report

9. RESOLUTIONS FOR ADOPTION

10. COMMUNICATIONS

10.1. City/District Warrants of Demands were Processed and Issued on October 31, 2023, and November 3, 2023, and ACH were processed on November 3, 2023
a) Information Item Only
b) No Action Required

12. CLOSED SESSION

12.2. Report Out from Closed Session

13. ADJOURNMENT
The public is invited to attend.

Any attendee wishing special accommodations at the meeting should contact the City Clerk’s Department at (650) 2863250 or [email protected] at least 48 hours in advance of the meeting.

City Council meetings on FCTV on Comcast Channel 27 and AT&T Channel 99:

STREAMED LIVE every 1st and 3rd Monday of the month
City Council meetings ondemand:
https://www.fostercity.org/agendasandminutes

3 CITY OF FOSTER CITY/
ESTERO MUNICIPAL IMPROVEMENT DISTRICT
FOSTER CITY COUNCIL CHAMBERS
620 FOSTER CITY BOULEVARD
FOSTER CITY, CALIFORNIA
MEMBERS OF THE PUBLIC THAT WISH TO ATTEND AND/OR PARTICIPATE IN A MEETING MAY DO SO IN PERSON OR BY JOINING THE ZOOM MEETING HTTPS://FOSTERCITY ORG.ZOOM.US/J/82592136594 PUBLIC COMMENTS WILL BE ACCEPTED BOTH IN PERSON AND VIA ZOOM MEETING. ANY EMAILS SENT TO [email protected] WILL BE PROVIDED TO THE CITY COUNCIL PRIOR TO THE MEETING.

To Attend the Meeting in Person:

Location: 620 Foster City Blvd, Foster City, California, 94404 To Provide Public Comment in Person:

To Observe the Meeting via Teleconference/Video Conference:

Written public comments will be posted to the City’s website for review prior to the meeting.

AGENDA
Monday, November 20, 2023 6:30 PM
REGULAR MEETING AS CITY COUNCIL/EMID BOARD OF

DIRECTORS

1. CALL TO ORDER

2. PLEDGE OF ALLEGIANCE

3. ROLL CALL
Councilmembers/ex officio EMID Directors Sam Hindi, Stacy Jimenez, Art Kiesel, Patrick Sullivan, and Mayor/President Jon Froomin

4. PUBLIC
Government Code Section 54954.2 E (3) precludes the City Council from discussing or acting upon any topic initially presented during the “Public” portion of the agenda.

5.1. City/EMID Regular Meeting Minutes of November 6, 2023

6. PUBLIC HEARINGS

7. NEW BUSINESS

7.2. Consideration of Establishing Local Campaign Contribution Limits and Voluntary Campaign Expenditure Limits
a) Staff Report
b) Action – By Minute Order, Provide Policy Direction

8. REPORTS

8.2. Report on Fiscal Year 202324 1st Quarter Financial Update a) Staff Report
b) Action By Minute Order, Receive and Accept Report

9. RESOLUTIONS FOR ADOPTION

10. COMMUNICATIONS

10.1. City/District Warrants of Demands were Processed and Issued on October 31, 2023, and November 3, 2023, and ACH were processed on November 3, 2023
a) Information Item Only
b) No Action Required

12. CLOSED SESSION

12.2. Report Out from Closed Session

13. ADJOURNMENT
The public is invited to attend.

Any attendee wishing special accommodations at the meeting should contact the City Clerk’s Department at (650) 2863250 or [email protected] at least 48 hours in advance of the meeting.

City Council meetings on FCTV on Comcast Channel 27 and AT&T Channel 99:

STREAMED LIVE every 1st and 3rd Monday of the month
City Council meetings ondemand:
https://www.fostercity.org/agendasandminutes

4 CITY OF FOSTER CITY/
ESTERO MUNICIPAL IMPROVEMENT DISTRICT
FOSTER CITY COUNCIL CHAMBERS
620 FOSTER CITY BOULEVARD
FOSTER CITY, CALIFORNIA
MEMBERS OF THE PUBLIC THAT WISH TO ATTEND AND/OR PARTICIPATE IN A MEETING MAY DO SO IN PERSON OR BY JOINING THE ZOOM MEETING HTTPS://FOSTERCITY ORG.ZOOM.US/J/82592136594 PUBLIC COMMENTS WILL BE ACCEPTED BOTH IN PERSON AND VIA ZOOM MEETING. ANY EMAILS SENT TO [email protected] WILL BE PROVIDED TO THE CITY COUNCIL PRIOR TO THE MEETING.

To Attend the Meeting in Person:

Location: 620 Foster City Blvd, Foster City, California, 94404 To Provide Public Comment in Person:

To Observe the Meeting via Teleconference/Video Conference:

Written public comments will be posted to the City’s website for review prior to the meeting.

AGENDA
Monday, November 20, 2023 6:30 PM
REGULAR MEETING AS CITY COUNCIL/EMID BOARD OF

DIRECTORS

1. CALL TO ORDER

2. PLEDGE OF ALLEGIANCE

3. ROLL CALL
Councilmembers/ex officio EMID Directors Sam Hindi, Stacy Jimenez, Art Kiesel, Patrick Sullivan, and Mayor/President Jon Froomin

4. PUBLIC
Government Code Section 54954.2 E (3) precludes the City Council from discussing or acting upon any topic initially presented during the “Public” portion of the agenda.

5.1. City/EMID Regular Meeting Minutes of November 6, 2023

6. PUBLIC HEARINGS

7. NEW BUSINESS

7.2. Consideration of Establishing Local Campaign Contribution Limits and Voluntary Campaign Expenditure Limits
a) Staff Report
b) Action – By Minute Order, Provide Policy Direction

8. REPORTS

8.2. Report on Fiscal Year 202324 1st Quarter Financial Update a) Staff Report
b) Action By Minute Order, Receive and Accept Report

9. RESOLUTIONS FOR ADOPTION

10. COMMUNICATIONS

10.1. City/District Warrants of Demands were Processed and Issued on October 31, 2023, and November 3, 2023, and ACH were processed on November 3, 2023
a) Information Item Only
b) No Action Required

12. CLOSED SESSION

12.2. Report Out from Closed Session

13. ADJOURNMENT
The public is invited to attend.

Any attendee wishing special accommodations at the meeting should contact the City Clerk’s Department at (650) 2863250 or [email protected] at least 48 hours in advance of the meeting.

City Council meetings on FCTV on Comcast Channel 27 and AT&T Channel 99:

STREAMED LIVE every 1st and 3rd Monday of the month
City Council meetings ondemand:
https://www.fostercity.org/agendasandminutes

5 CITY OF FOSTER CITY/
ESTERO MUNICIPAL IMPROVEMENT DISTRICT
FOSTER CITY COUNCIL CHAMBERS
620 FOSTER CITY BOULEVARD
FOSTER CITY, CALIFORNIA
MEMBERS OF THE PUBLIC THAT WISH TO ATTEND AND/OR PARTICIPATE IN A MEETING MAY DO SO IN PERSON OR BY JOINING THE ZOOM MEETING HTTPS://FOSTERCITY ORG.ZOOM.US/J/82592136594 PUBLIC COMMENTS WILL BE ACCEPTED BOTH IN PERSON AND VIA ZOOM MEETING. ANY EMAILS SENT TO [email protected] WILL BE PROVIDED TO THE CITY COUNCIL PRIOR TO THE MEETING.

To Attend the Meeting in Person:

Location: 620 Foster City Blvd, Foster City, California, 94404 To Provide Public Comment in Person:

To Observe the Meeting via Teleconference/Video Conference:

Written public comments will be posted to the City’s website for review prior to the meeting.

AGENDA
Monday, November 20, 2023 6:30 PM
REGULAR MEETING AS CITY COUNCIL/EMID BOARD OF

DIRECTORS

1. CALL TO ORDER

2. PLEDGE OF ALLEGIANCE

3. ROLL CALL
Councilmembers/ex officio EMID Directors Sam Hindi, Stacy Jimenez, Art Kiesel, Patrick Sullivan, and Mayor/President Jon Froomin

4. PUBLIC
Government Code Section 54954.2 E (3) precludes the City Council from discussing or acting upon any topic initially presented during the “Public” portion of the agenda.

5.1. City/EMID Regular Meeting Minutes of November 6, 2023

6. PUBLIC HEARINGS

7. NEW BUSINESS

7.2. Consideration of Establishing Local Campaign Contribution Limits and Voluntary Campaign Expenditure Limits
a) Staff Report
b) Action – By Minute Order, Provide Policy Direction

8. REPORTS

8.2. Report on Fiscal Year 202324 1st Quarter Financial Update a) Staff Report
b) Action By Minute Order, Receive and Accept Report

9. RESOLUTIONS FOR ADOPTION

10. COMMUNICATIONS

10.1. City/District Warrants of Demands were Processed and Issued on October 31, 2023, and November 3, 2023, and ACH were processed on November 3, 2023
a) Information Item Only
b) No Action Required

12. CLOSED SESSION

12.2. Report Out from Closed Session

13. ADJOURNMENT
The public is invited to attend.

Any attendee wishing special accommodations at the meeting should contact the City Clerk’s Department at (650) 2863250 or [email protected] at least 48 hours in advance of the meeting.

City Council meetings on FCTV on Comcast Channel 27 and AT&T Channel 99:

STREAMED LIVE every 1st and 3rd Monday of the month
City Council meetings ondemand:
https://www.fostercity.org/agendasandminutes

6 CITY OF FOSTER CITY/

ESTERO MUNICIPAL IMPROVEMENT DISTRICT

REGULAR MEETING OF November 6, 2023

MINUTES

CALL TO ORDER OF CITY COUNCIL/EMID BOARD OF DIRECTORS

The Regular Meeting of November 6, 2023 of the City Council of the City of Foster City, sitting as said Council and as ex officio the Board of Directors of the Estero Municipal Improvement District (EMID), was called to order at 6: 30 p.m. by Mayor/President Froomin.

This meeting was held as a hybrid meeting.

ROLL CALL

The Communications Director/City Clerk/Recording Secretary called the roll:

PRESENT:

Councilmembers/ex officio Directors Sam Hindi, Stacy Jimenez, Art Kiesel, Patrick Sullivan, and Mayor/President Jon Froomin.

ABSENT: None.

STAFF PRESENT: Stefan Chatwin , City/District Manager ; Benjamin Stock , City Attorney/District Legal Counsel; Marlene Subhashini, Assistant City Manager; Sofia Mangalam, Community Development Director; Edmund Suen, Finance Director; Diane Pitman, Administrative Services Director; Derek Schweigart, Parks and Recreation Director; Sofia Mangalam, Community Development Director; Andrew
Brozyna, Public Works Director; Tracy Avelar , Police Chief ; Rob Lasky, IT Manager; Laura Galli, Engineering Manager; Tiffany Oren, Recreation Manager; Francine Magno, Senior Civil Engineer; Ryan Marquez, Senior Civil Engineer; Austin Walsh, Communications Manager; Katherine Mendoza, Deputy City Clerk; Shuli Chen, Video Technician; and Communications Director/City Clerk, Priscilla Schaus.

SPECIAL PRESENTATIONS

PROCLAMATION RECOGNIZING NOVEMBER 2023 AS “ NATIVE AMERICAN HERITAGE MONTH.”

Councilmember Kiesel presented the proclamation recognizing November 2023 as “Native American Heritage Month.”

5.1 5.1 Minutes

7 PROCLAMATION RECOGNIZING NOVEMBER 2023 AS “ FAMILY COURT AWARENESS MONTH.”

Councilmember Jimenez presented the proclamation recognizing November 2023 as “Family Court Awareness Month” to Joan, Family Court Awareness Month Advocate.

PRESENTATION OF CERTIFICATES TO INAUGURAL CLASS OF CIVICS ACADEMY.

Mayor Froomin presented the Certificates of Recognition to the Inaugural Class of Civics Academy.

PUBLIC

The following people addressed the City Council via email:

1. Shankar Kenkre addressed the City Council regarding current world issues.

2. Sam Hindi addressed the City Council regarding current world issues.

CONSENT CALENDAR

Motion by Vice Mayor/Vice President Sullivan, seconded by Councilmember/Director Hindi, and carried unanimously, 5-0-0, approving the following items on the City/District Consent Calendar:

City/EMID Consent Calendar

1. City/EMID Regular Meeting Minutes of October 16, 2023;

2. City Resolution No. 2023- 101, “ A Resolution of the City Council of the City of Foster City Reappointing Paul Norton as the Foster City Representative to the Board of Trustees of the San Mateo County Mosquito and Vector Control District to a Four-Year Term From January 1, 2024 Through December 31, 2027;”

3. City Resolution No. 2023- 102, “A Resolution of the City Council of the City of Foster City Repealing City Resolution No. 2015- 50 and Changing the Candidate Statement Deposit Amount to $900 and Including All Language Translations as Required by Law;”

4. City Resolution No. 2023- 103, “ A Resolution of the City Council of the City of Foster City Authorizing the Execution of a Task Order with BKF Engineers for On- Call Civil Engineering Services in the Amount of $144,868 to Provide Roadway Assessment, Design Services, and Bid/Construction Support for CIP 301- 716 Street Rehabilitation and Parks Pathway Restoration (2023- 2024); Appropriation in the Amount of $678,247.48 from Fund 301 to the Existing Project Budget 301- 0910-716-4251; and Finding the Approval Exempt from the California Environmental Quality Act (CEQA) Pursuant to CEQA Guidelines §15061(B)(3) and 15301(C)—Existing Facilities;”

5. City Resolution No. 2023- 104, “ A Resolution of the City Council of the City of Foster City Authorizing the Submittal of Individual Grant Applications to the Department of Resources Recycling and Recovery (CalRecycle) for All Grant

5.1 5.1 Minutes

8 Programs for Which City of Foster City is Eligible and Authorizing the City Manager or His Designee to Execute All Grant Documents, Including but Not Limited to, Applications, Grant Agreements, Amendments and Requests for Payments for a Period of Five Year s; and Finding Approval E xempt Under the California Environmental Quality Act (CEQA) Guidelines § 15061(B)(3);”

6. City Resolution No. 2023- 105, “ A Resolution of the City Council of the City of Foster City Authorizing the Appropriation of All Funding Received From the FY 2022-2023 Local Assistance Grant Program to Account Number 141- 0910-431-

42.51; and Finding Approval Exempt Under the California Environmental Quality Act (CEQA) Guidelines § 15061(B)(3);”

7. City Resolution No.2023-106, “A Resolution of the City Council of the City of Foster City Approving a Construction Services Agreement for CIP 405- 660 Water Tanks & Facilities Improvement Project and CIP 301- 690 Seismic Improvements at the Lagoon Pump Station with Manito Construction Inc. in the Amount of $4,353,252; Establishing Construction Contingencies for CIP 405-660 and CIP 301-690 in the Amounts of $640,000 and $13,000 Respectively; Authorizing Execution of Contract Amendment No. 4 with Consor, Inc. i n the Amount of $121,270 for Construction Support Services for CIP 405- 660; Establishing a Contract Contingency in the Amount of $40,000 for CIP 405- 660 for the Professional Services Agreement with Consor Inc.; Appropriation of $100,000 from Fund 409 to CIP 405-660; Substitution of $1 Million Dollars in Project Funding from Fund 405, with Funding from Fund 409; and Finding the Project Exempt from CEQA Under Section 15301(B);” and

8. EMID Resolution No. 3748, “A Resolution of the Board of Directors of the Estero Municipal Improvement District Approving a Construction Services Agreement for CIP 405 -660 Water Tanks & Facilities Improvement Project and CIP 301- 690 Seismic Improvements at the Lagoon Pump Station with Manito Construction Inc. in the Amount of $4,353,252; Establishing Construction Contingencies for CIP 405- 660 and CIP 301- 690 in the Amounts of $640,000 and $13,000 Respectively; Authorizing Execution of Contract Amendment No. 4 with Consor, Inc. in the Amount of $121,270 for Construction Support Services for CIP 405- 660; Establishing a Contract Contingency in the Amount of $40,000 for CIP 405-660 for the Professional Services Agreement with Consor Inc.; Appropriation of $100,000 from Fund 409 to CIP 405-660; Substitution of $1 Million Dollars in Project Funding from Fund 405, with Funding from Fund 409; and Finding the Project Exempt from CEQA Under Section 15301(B).”

ITEM REMOVED FROM CONSENT CALENDAR

SUPPLEMENTAL APPROPRIATION OF $60,000 FROM GENERAL PLAN MAINTENANCE FUND 128 TO ACCOUNT 128 -0838-419-42-51 FOR CONSULTING

SERVICES FOR CONTINUED ASSISTANCE WITH HOUSING ELEMENT
CERTIFICATION. CITY RESOLUTION NO. 2023-107.

Without objection from the City Council, Mayor Froomin removed this item from the Consent Calendar at the request of Vice Mayor Sullivan.

5.1 5.1 Minutes

9 Discussion ensued.

Motion by Councilmember Hindi , seconded by Vice Mayor Sullivan, and carried unanimously, 5- 0-0, adopting City Resolution No. 2023- 107, “A Resolution of the City Council of the City of Foster City Recommending City Council Approving a Supplemental Appropriation of $60,000 from General Plan Maintenance Fund 128 to Account 128-0838- 419-42-51 for Consulting Services for Continued Assistance with Housing Element Certification and Implementation and Finding the Request Exempt from the California Environmental Quality Act Pursuant to CEQA Guideline Section 15061(B)(3).”

NEW BUSINESS

DRAFT 2024 STATE LEGISLATIVE PLATFORM AND POLICY. MINUTE ORDER NO.1945.

Assistant City Manager Subhashini presented the staff report.

Evan Adams addressed the City Council via teleconference.

Discussion ensued.

Motion by Mayor Froomin, seconded by Councilmember Jimenez , and carried unanimously, 5-0-0, adopting Minute Order No. 1945, and providing policy direction that the City Council would provide their individual feedback on the draft 2024 State Legislative Platform and Policy regarding items they are opposed to and other suggestions to staff. Staff would gather the feedback and bring a red-lined policy back to the City Council for review, discussion, and adoption at the December 18 meeting.

Discussion ensued.

Motion by Councilmember Jimenez, seconded by Vice Mayor Sullivan, and carried 4-1- 0, Councilmember Kiesel voted “no,” to reconsider the previous motion.

Discussion ensued.

Motion by Mayor Froomin, seconded by Councilmember Jimenez, and carried unanimously, 5-0-0, adopting Minute Order No. 1945, and providing policy direction that the City Council would provide their individual feedback on the draft 2024 State Legislative Platform and Policy regarding items they are opposed to and other suggestions to staff. Staff would gather the feedback and bring a red-lined policy back to the City Council for review, discussion, and adoption at the December 18 meeting.

REPORTS

RECREATION CENTER REBUILD PROJECT (CIP 301-778) UPDATE ON PROPOSED

RECREATION CENTER TEMPORARY FACILITIES AND OPERATIONS PLAN DURING NEW RECREATION CENTER CONSTRUCTION. MINUTE ORDER NO. 1946.

5.1 5.1 Minutes

10 Recreation Manager Oren presented the staff report.

Discussion ensued.

Motion by Mayor Froomin, seconded by Vice Mayor Sullivan, and carried unanimously, 5-0-0, adopting Minute Order No. 194 6, receiving and accepting the Recreation Center Rebuild Project (CIP 301- 778) Update on Proposed Recreation Center Temporary Facilities and Operations Plan During New Recreation Center Construction, and providing policy direction to move forward with implementing the proposed temporary facilities and operations plan with rented modular buildings and restroom trailer at the tennis courts during the anticipated two-year Recreation Center Rebuild Construction Project.

REPORT ON FISCAL YEAR 2022 -23 4TH QUARTER FINANCIAL UPDATE . MINUTE ORDER NO. 1947.

Finance Director Suen presented the staff report.

Discussion ensued.

Motion by Councilmember Hindi, seconded by Councilmember Kiesel , and carried unanimously, 5-0-0, adopting Minute Order No. 194 7, to receive and accept the Report on Fiscal Year 2022-23 4th Quarter Financial Update.

RESOLUTIONS FOR ADOPTION

CONTRACT AMENDMENT NO. 3 WITH REGIONAL GOVERNMENT SERVICES

AUTHORITY (RGS) INCREASING THE CURRENT CONTRACT AMOUNT IN AN AMOUNT NOT -TO-EXCEED $57,000 AND EXTENDING SERVICES FOR AN ADDITIONAL SIX MONTHS, FROM JANUARY 1, 2024 THROUGH JUNE 30, 2024 .

CONTRACT AMENDMENT NO. TWO (2) TO THE AGREEMENT WITH WILSEY HAM IN THE AMOUNT NOT-TO-EXCEED $75,647, AMENDING THE FEE SCHEDULE AND EXTENDING THE CONTRACT TERM TO DECEMBER 31, 2024 FOR ON- CALL SURVEY SUPPORT SERVICES. AUTHORIZATION FOR A ONE TIME INCREASE TO

CITY MANAGER APPROVAL AUTHORITY ASSOCIATED WITH CONTRACT CHANGE ORDER THIRTY SEVEN (CCO 37), IN AN AMOUNT UP TO $50,000, AS NECESSARY, IN ORDER TO COMPLETE CHANGE WORK . FOR THE LEVEE PROTECTION PLANNING AND IMPROVEMENTS PROJECT (CIP 327-657) . CITY RESOLUTION NO. 2023-108. CITY RESOLUTION NO. 2023-109. CITY RESOLUTION NO. 2023-110.

Public Works Director Brozyna presented the combined staff reports for the three agenda items regarding the Levee Protection Planning and Improvements Project (CIP 327-657).

Discussion ensued.

5.1 5.1 Minutes

11 Motion by Councilmember Kiesel, seconded by Mayor Froomin, and carried unanimously, 5-0-0, adopting City Resolution No. 2023- 108, “A Resolution of the City of Foster City Authorizing Contract Amendment No. 3 with Regional Government Services Authority (RGS) Increasing the Current Contract Amount in an Amount Not-to-Exceed $57,000 and Extending Services for an Additional Six Months, Fr om January 1, 2024 Through June 30, 2024 for the Levee Protection Planning and Improvements Project (CIP 327- 657) (CEQA Statu s: Environmental Impact Report was Prepared for the Levee Protection Planning and Improvements Project (State Clearinghouse No. 2016012012)).”

Motion by Councilmember Hindi, seconded by Vice Mayor Sullivan, and carried unanimously, 5- 0-0, adopting City Resolution No. 2023- 109, “A Resolution of the City Council of the City of Foster City Authorizing the Mayor to Execute Contract Amendment No. Two (2) to the Agreement with Wilsey Ham in the Amount Not -to-Exceed $75,647, Amending the Fee Schedule and Extending the Contract Term to December 31, 2024 for On-Call Survey Support Services for the Levee Protection Planning and Improvements Project (CIP 327-657) and Approving a Contingency of $10,000 for Contract Amendment No. 2 (CEQA Status: Environmental Impact Report was Prepared for the Levee Protection Planning and Improvements Project (State Clearinghouse No. 2016012012)).”

Motion by Vice Mayor Sullivan , seconded by Councilmember Jimenez , and carried unanimously, 5- 0-0, adopting City Resolution No. 2023- 110, “A Resolution of the City Council of the City of Foster City Providing Authorization for a One Time Increase to City Manager Approval Authority Associated With Contract Change Order Thirty Seven (CCO 37), in an Amount Up to $50,000, as Necessary, in Order t o Complete Change Work for the Levee Protection Planning and Improvements Project (CIP 327-657).”

COMMUNICATIONS

CITY/DISTRICT WARRANT OF DEMANDS. NO ACTION TAKEN.

City/District Warrants of Demands were Processed and Issued on October 12, 2023.

CITY/DISTRICT MANAGER REPORTS, COUNCIL/BOARD STATEMENTS AND

REQUESTS, AND COUNCIL LIAISON REPORTS

Councilember/Director Kiesel stated he attended the Council of Cities meeting in South San Francisco on October 27.

Councilmember/Director Jimenez stated she attended an event hosted for high school biotechnology students at Gilead Sciences on October 24. Also on October 24, she met with Crystal Conway, the new Chamber of Commerce Managing Director . On October 25, she attended the Foster City Police Department Badge Pinning Ceremony and expressed her appreciation for the work that they do for the community. She attended a Senior Fraud Prevention Seminar hosted by Congressman Mullin on October 30. On October 28, she attended the Halloween Spooktacular Festival hosted by the Parks and Recreation department and thanked Recreation Coordinator Koval for her work . She

5.1 5.1 Minutes

12 attended the San Mateo County AAPI Alliance’s Diwali Celebration event on November 3 and Baybasi’s Diwali Celebration event on November 4.

Councilmember/Director Hindi stated he attended the San Mateo County Housing Endowment and Regional Trust (HEART) Board meeting on October 25. On October 26, he attended the Peninsula Clean Energy B oard meeting. On October 30, he attended Congressman Mullin’s Senior Fraud Prevention Seminar. He attended the Chamber Open House event where he met the new Chamber of Commerce Managing Director on October 24. On November 3, he attended the San Mateo County AAPI Alliance’s Diwali Celebration event.

Vice Mayor/Vice President Sullivan stated he attended the Foster City Police Department Badge Pinning Ceremony on October 25. On October 26, he attended the City/ County Association of Governments (C/CAG) Bicycle and Pedestrian Advisory Committee meeting at the San Mateo County Transit District Office. On October 27, he attended the Council of Cities meeting in South San Francisco. He attended the Halloween Spooktacular Festival on October 28. He stated he was invited to visit the Verkada headquarters in San Mateo on October 30. On November 2, he attended the Pl anning Commission meeting.

Mayor/President Froomin stated that on October 24, he attended the Gilead Sciences event and the Chamber Open House. On October 25, he attended the Foster City Police Department Badge Pinning Ceremony. He participated in the South Bayside Waste Management Authority (SBWMA) board meeting on October 26, where he was appointed to the SBWMA Finance Committee and Ad Hoc Committees . He stated he had an opportunity to speak with a 5
th grade class at Foster City Elementary School. On October 27, he attended the Council of Cities meeting. He wished everyone a happy Diwali and Veteran’s Day . He ended his statements in honor of th ose who served in the Armed Forces and in remembrance of those who defended our freedom.

CLOSED SESSION

Mayor/President Froomin recessed the meeting into Closed Session for:

1. Conference With Legal Counsel —Existing Litigation
(Paragraph (1) of subdivision (d) of Section 54956.9)
Daniel Strambi v. City of Foster City, State of California Workers’ Compensation Appeals Board, Case No. ADJ12075922; and

2. Report out from Closed Session.

Meeting recessed into Closed Session at 8:54 p.m. and reconvened at 9:05 p.m.

City Attorney/District Legal Counsel Benjamin Stock reported that no action was taken in Closed Session.

ADJOURNMENT

5.1 5.1 Minutes

13 Hearing no objection from the City Council/EMID Board, Mayor/President Froomin adjourned the meeting. Meeting adjourned at 9:05 p.m.

5.1 5.1 Minutes

14 DATE: November 20, 2023

TO: Mayor and Members of the City Council
VIA: Stefan Chatwin, City Manager

FROM: Tracy Avelar, Police Chief
DEPARTMENT: Police
SUBJECT: AUTHORIZING A MULTI-YEAR CONTRACT WITH FLOCK

SAFETY TO MAINTAIN EXISTING ANNUAL FEES THROUGH FY
2027-2028 FOR ALL EXISTING AUTOMATIC LICENSE PLATE

READER EQUIPMENT AND SERVICES

RECOMMENDATION
It is recommended that the City Council review the contract between the Foster City Police Department (FCPD) and Flock Safety (Flock) and approve the attached resolution authorizing the Mayor to execute the Master Services Agreement, resulting in fixed annual fees from Flock through the duration of the multi-year contract, terminating June 30, 2028 for Automatic License Plate Reader (ALPR) equipment and services.

EXECUTIVE SUMMARY
Flock is offering the FCPD a renewal of the services through a new multi-year Master Services Agreement with a start date of 12/31/2023 and termination date of 6/30/2028.

Entering into the multi-year agreement will secure current annual fees with Flock through the duration of the contract term for all existing ALPR equipment and services.

No changes to ALPR equipment and services will be experienced by the FCPD in response to the signed contract.

Flock has increased their annual per camera rates by 20%, which will not impact the FCPD for all existing cameras if the proposed contract is approved. Any ALPR cameras added to the system after signing the contract will be added at the new higher rate.

5.2 5.2 Staff Report

15 BACKGROUND
At the March 15, 2021 City Council meeting, the Council approved an Agreement with Flock Group, Inc. for the licensing of twenty ALPR and adopted the City’s ALPR Policy pursuant to Civil Code section 1798.90.55(A). In November of 2021, the FCPD deployed 20 Flock ALPR cameras. The ALPR system has proven to be an invaluable tool for the FCPD. The system serves as a force multiplier; FCPD officers and dispatchers are alerted to vehicles of interest while in Foster City, saved camera data is accessed to investigate and solve crimes committed in the community, and the FCPD partners with numerous other law enforcement agencies using the Flock system to solve crimes through shared Flock information.

ANALYSIS
Numerous successes have been achieved through the use of the Flock ALPR system, which may not have been possible without the technology. These successes have included the apprehension of people immediately following a crime committed in or near Foster City, investigations leading to the identification and apprehension of people responsible for crimes committed in the recent past, and the sharing of Flock information with other law enforcement agencies that has led to identifications and arrests of people responsible for crimes in Foster City.

The successes achieved with the Flock system have positively impacted the Foster City community and have assisted the FCPD in their efforts to maintain the safety and security of Foster City. It is expected that the Flock ALPR system will continue to be a valuable tool for the FCPD over the next several years and that the Foster City community will continue to benefit from this tool.

Approving the attached resolution will authorize the City to enter into the Master Service Agreement contract with Flock for continued licensing of the existing twenty ALPR cameras for an annual fee of $50,000 (except for year 1 which shall be prorated) for a contract term from 12/31/2023 – 6/30/2028, as discussed in more detail below. The annual fee each year includes data storage, maintenance of cameras, performance monitoring, and advice about optimal usage of ALPRs from Flock. Pursuant to the terms of the Agreement, Flock may monitor the City’s use of the ALPR systems and may prohibit the use of its services if it believes the City is violating the law or a third party right. Flock will indemnify the City for certain claims or liabilities, including alleged copyright violations but only up to the amount of fees paid by the City in the prior 12 months. Flock may institute new fees with notice sixty (60) days before the end of a term. This purchase is exempt from the bidding requirements pursuant to Foster City

5.2 5.2 Staff Report

16 Municipal Code Section 3.04.110 B because the services/product can only be obtained from one vendor.

California Environmental Quality Act
Purchase of the multi-year contract from Flock Safety is not subject to review under the California Environmental Quality Act (CEQA) pursuant to Public Resources Code Section 21000, et seq. and the CEQA Guidelines (14 Cal. Code Regs. §§ 15000 et. seq.), including without limitation, Public Resources Code section 21065 and California Code of Regulations 15378 as this is not a “project” that may cause a direct, or reasonably foreseeable indirect, physical change in the environment.

FISCAL IMPACT
The FCPD is currently paying an annual fee of $2,500 per camera, resulting in a total annual fee of $50,000 for all 20 existing Flock ALPR cameras. This annual fee includes all ALPR equipment and services.

Flock has increased their annual per camera fee to $3,000, a 20% increase. The FCPD will not incur this fee increase if the proposed multi-year contract is approved.

Over the life of the proposed multi-year contract, the FCPD will continue to pay an annual fee of $50,000, resulting in a contract total of $225,000. If the FCPD does not enter into the proposed contract, the City would need to pay an annual fee of $60,000, resulting in a total of $270,164 paid for the period of time indicated in the contract. A savings of $45,164 will be realized through the proposed Flock contract.

The FCPD’s current annual term runs July 1 – June 30 each year. The annual fee of $50,000 has already been paid for 7/1/2023 – 6/30/2024. To align with the FCPD’s current invoice date of July 1 of each year, the first portion of the multi-year contract will be 12/31/2023 – 6/30/2024; fees have already been paid for this period as part of the current term, which will be applied to fully cover the first portion of the new contract.

The remaining four years of the proposed contract will be July 1 – June 30.

Indicated in the Flock “Renewal Order Form” is a $1,300 charge for year 1 of the contract. The charge is for repair services provided by Flock in August 2023, which Flock had not received payment for at the time the quote was created. Foster City Finance confirmed payment was made on 10/31/2023, which will result in the FCPD owing nothing for year 1 of the contract.

CITY COUNCIL VISION, MISSION, AND VALUE/PRIORITY AREA
Public Safety and Social Equity

5.2 5.2 Staff Report

17 ATTACHMENTS:

Attachment 1 – Resolution
Attachment 2 – Agreement

5.2 5.2 Staff Report

18 1
4 0
6 RESOLUTION NO. _________

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF FOSTER CITY

AUTHORIZING THE MAYOR TO EXECUTE A MASTER SERVICES AGREEMENT WITH FLOCK SAFETY TO RETAIN AN EXISTING ANNUAL FEE THROUGH FY 27-28

FOR ALL EXISTING AUTOMATED LICENSE PLATE READER EQUIPMENT AND

SERVICES

CITY OF FOSTER CITY
WHEREAS, on March 15, 2021, the City Council adopted Resolution No. 2021- 34 authorizing an agreement with Flock Safety for the licensing and maintenance of twenty (20) Automated License Plate Readers in the amount $13,334 for the initial term of two (2) months, followed by $50,000 for the renewal terms of twelve (12) months; and WHEREAS, the Foster City Police Department can retain the existing annual fee paid to Flock Safety for existing automated license plate reader equipment and services through the proposed contract term of December 31, 2023 – June 30, 2028; and WHEREAS, Flock Safety has increased annual fees by 20%, which will not impact the Foster City Police Department through the duration of the proposed contract; and WHEREAS, fees paid to Flock Safety during the contract term will total $270,164 if the contract is not entered into and $225,000 if the contract is entered into, a total savings of $45,164; and
WHEREAS, no changes in equipment and services will be experienced as a result of entering into the proposed contract.

NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Foster City does hereby authorizes the Mayor to execute a Master Services Agreement, with Flock Safety LLC to enter into the multi-year contract beginning December 31, 2023 and terminating June 30, 2028.

PASSED AND ADOPTED as a resolution of the City Council of the City of Foster City at the regular meeting held on the 20th day of November, 2023, by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:

5.2 Attachment 1 - Resolution

19 1
4 0
6 JON FROOMIN, MAYOR
ATTEST:

PRISCILLA SCHAUS, CITY CLERK

5.2 Attachment 1 - Resolution

20 Flock Safety + CA - Foster City PD
______________
Flock Group Inc.
1170 Howell Mill Rd, Suite 210
Atlanta, GA 30318
______________
MAIN CONTACT:

Jaime Alfaro
[email protected]
2067144430
Created Date: 10/31/2023

5.2 Attachment 1 - Agreement

21 Renewal Order Form
Bill To: 1030 E Hillsdale Blvd Foster City, California 94404 Ship To: 1030 East Hillsdale Boulevard Foster City, California 94404
Billing Company Name: CA - Foster City PD Subscription Term: 54 Months Billing Contact Name: Payment Terms: Net 30 from receipt of invoice.

Accounts Payable Email: Retention Period: 30 Days
Accounts Payable Phone: Billing Frequency: Annual
Tax Exemption: Not Tax Exempt
Hardware and Software Products
Annual recurring amounts over subscription term
Item Cost Quantity Total
Flock Safety Platform $50,000.00
Flock Safety Flock OS
FlockOS ™ Included 1 Included
Flock Safety LPR Products
Flock Safety Falcon ® Included 20 Included
Subtotal Year 1: $25,000.00
Annual Recurring Subtotal: $50,000.00
Discounts: $45,164.40
Estimated Tax: $0.00
Contract Total: $225,000.00
Taxes shown above are provided as an estimate. Actual taxes are the responsibility of the Customer. This is not an invoice.

Special Terms:

Contract Start Date: 12/31/2023 | Contract End Date: 6/30/2028 Year 1: 12/31/2023 - 6/30/2024 (prorated)
Year 2: 7/1/2024 - 6/30/2025
Year 3: 7/1/2025 - 6/30/2026
Year 4: 7/1/2026 - 6/30/2027
Year 5: 7/1/2027 - 6/30/2028
Estimated credit INV-19079 $25,000.00 (based on above contract dates) Amount due from INV-20294 $1,300.00
Invoice Year 1: $1,300.00 (with net credit applied)
Invoice Years 2-5: $50,000.00
All credits are estimates based on contract start of 12/31/2023. (650) 286-3300
[email protected]

5.2 Attachment 1 - Agreement

22 Billing Schedule Amount (USD)
Year 1
At Contract Signing $25,000.00
Annual Recurring after Year 1 $50,000.00
Contract Total $225,000.00
*Tax not included
Discounts Applied Amount (USD)
Flock Safety Platform $45,164.40
Flock Safety Add-ons $0.00
Flock Safety Professional Services $0.00

5.2 Attachment 1 - Agreement

23 Product and Services Description
Flock Safety Platform Items Product Description Terms
Flock Safety Falcon ®
An infrastructure-free license plate reader camera that utilizes Vehicle Fingerprint® technology to capture vehicular attributes.

The Term shall commence upon first installation and validation of Flock Hardware.

One-Time Fees Service Description
Installation on existing
infrastructure
One-time Professional Services engagement. Includes site & safety assessment, camera setup & testing, and shipping & handling in accordance with the Flock Safety Advanced Implementation Service Brief.

Professional Services -
Standard Implementation Fee
One-time Professional Services engagement. Includes site and safety assessment, camera setup and testing, and shipping and handling in accordance with the Flock Safety Standard Implementation Service Brief.

Professional Services -
Advanced Implementation Fee
One-time Professional Services engagement. Includes site & safety assessment, camera setup & testing, and shipping & handling in accordance with the Flock Safety Advanced Implementation Service Brief.

FlockOS Features & Description
Package: Essentials
FlockOS Features Description
Community Cameras (Full Access) Access to all privately owned Flock devices within your jurisdiction that have been shared with you.

Unlimited Users Unlimited users for FlockOS
State Network (LP Lookup Only) Allows agencies to look up license plates on all cameras opted in to the statewide Flock network.

Nationwide Network (LP Lookup Only) Allows agencies to look up license plates on all cameras opted in to the nationwide Flock network.

Time & Location Based Search Search full, partial, and temporary plates by time at particular device locations License Plate Lookup Look up specific license plate location history captured on Flock devices Vehicle Fingerprint Search
Search footage using Vehicle Fingerprint™ technology. Access vehicle type, make, color, license plate state, missing / covered plates, and other unique features like bumper stickers, decals, and roof racks.

Flock Insights/Analytics page Reporting tool to help administrators manage their LPR program with device performance data, user and network audits, plate read reports, hot list alert reports, event logs, and outcome reports.

ESRI Based Map Interface
Flock Safety’s maps are powered by ESRI, which offers the ability for 3D visualization, viewing of floor plans, and layering of external GIS data, such as City infrastructure (i.e., public facilities, transit systems, utilities), Boundary mapping (i.e., precincts, county lines, beat maps), and Interior floor plans (i.e., hospitals, corporate campuses, universities) Real-Time NCIC Alerts on Flock ALPR Cameras Alert sent when a vehicle entered into the NCIC crime database passes by a Flock camera Unlimited Custom Hot Lists Ability to add a suspect’s license plate to a custom list and get alerted when it passes by a Flock camera
Community Cameras (Full Access) Access to all privately owned Flock devices within your jurisdiction that have been shared with you.

Unlimited Users Unlimited users for FlockOS
State Network (LP Lookup Only) Allows agencies to look up license plates on all cameras opted in to the statewide Flock network.

Nationwide Network (LP Lookup Only) Allows agencies to look up license plates on all cameras opted in to the nationwide Flock network.

Time & Location Based Search Search full, partial, and temporary plates by time at particular device locations License Plate Lookup Look up specific license plate location history captured on Flock devices Vehicle Fingerprint Search Search footage using Vehicle Fingerprint™ technology. Access vehicle type, make, color, license plate state, missing / covered plates, and other unique features like bumper stickers, decals, and

5.2 Attachment 1 - Agreement

24 roof racks.

ESRI Based Map Interface
Flock Safety’s maps are powered by ESRI, which offers the ability for 3D visualization, viewing of floor plans, and layering of external GIS data, such as City infrastructure (i.e., public facilities, transit systems, utilities), Boundary mapping (i.e., precincts, county lines, beat maps), and Interior floor plans (i.e., hospitals, corporate campuses, universities) Real-Time NCIC Alerts on Flock ALPR Cameras Alert sent when a vehicle entered into the NCIC crime database passes by a Flock camera Unlimited Custom Hot Lists Ability to add a suspect’s license plate to a custom list and get alerted when it passes by a Flock camera
Direct Share - Surrounding Jurisdiction (Full Access) Access to all Flock devices owned by law enforcement that have been directly shared with you.

Have ability to search by vehicle fingerprint, receive hot list alerts, and view devices on the map.

Direct Share - Surrounding Jurisdiction (Full Access) Access to all Flock devices owned by law enforcement that have been directly shared with you.

Have ability to search by vehicle fingerprint, receive hot list alerts, and view devices on the map.

5.2 Attachment 1 - Agreement

25 By executing this Order Form, Customer represents and warrants that it has read and agrees to all of the terms and conditions contained in the Master Services Agreement attached. The Parties have executed this Agreement as of the dates set forth below.

FLOCK GROUP, INC. Customer: CA - Foster City PD

By:
\FSSignature2\
By:
\FSSignature1\
Name:
\FSFullname2\
Name:
\FSFullname1\
Title:
\FSTitle2\
Title:
\FSTitle1\
Date:
\FSDateSigned2\
Date:
\FSDateSigned1\

PO Number:

5.2 Attachment 1 - Agreement

26 Master Services Agreement

This Master Services Agreement (this “Agreement”) is entered into by and between Flock Group, Inc. with a place of business at 1170 Howell Mill Road NW Suite 210, Atlanta, GA 30318 (“Flock”) and the entity identified in the signature block (“Customer”) (each a “Party,” and together, the “Parties”) on this the 31 day of October 2023. This Agreement is effective on the date of mutual execution (“Effective Date”). Parties will sign an Order Form (“Order Form”) which will describe the Flock Services to be performed and the period for performance, attached hereto as Exhibit A. The Parties agree as follows:

RECITALS

WHEREAS, Flock offers a software and hardware situational awareness solution through Flock’s technology platform that upon detection is capable of capturing audio, video, image, and recording data and provide notifications to Customer (“Notifications”);

WHEREAS, Customer desires access to the Flock Services (defined below) on existing devices, provided by Customer, or Flock provided Flock Hardware (as defined below) in order to create, view, search and archive Footage and receive Notifications, via the Flock Services;

WHEREAS, Customer shall have access to the Footage in Flock Services. Pursuant to Flock’s standard Retention Period (defined below) Flock deletes all Footage on a rolling thirty (30) day basis, except as otherwise stated on the Order Form. Customer shall be responsible for extracting, downloading and archiving Footage from the Flock Services on its own storage devices; and

AGREEMENT

NOW, THEREFORE, Flock and Customer agree that this Agreement, and any Order Form, purchase orders, statements of work, product addenda, or the like, attached hereto as

5.2 Attachment 1 - Agreement

27 exhibits and incorporated by reference, constitute the complete and exclusive statement of the Agreement of the Parties with respect to the subject matter of this Agreement, and replace and supersede all prior agreements, term sheets, purchase orders, correspondence, oral or written communications and negotiations by and between the Parties.

1. DEFINITIONS
Certain capitalized terms, not otherwise defined herein, have the meanings set forth or cross- referenced in this Section 1.

1.1 “Anonymized Data” means Customer Data permanently stripped of identifying details and any potential personally identifiable information, by commercially available standards which irreversibly alters data in such a way that a data subject (i.e., individual person or entity) can no longer be identified directly or indirectly.

1.2 “Authorized End User(s)” means any individual employees, agents, or contractors of Customer accessing or using the Services, under the rights granted to Customer pursuant to this Agreement.

1.3 “Customer Data” means the data, media and content provided by Customer through the Services. For the avoidance of doubt, the Customer Data will include the Footage.

1.4. “Customer Hardware” means the third-party camera owned or provided by Customer and any other physical elements that interact with the Embedded Software and the Web Interface to provide the Services.

1.5 “Embedded Software” means the Flock proprietary software and/or firmware integrated with or installed on the Flock Hardware or Customer Hardware.

1.6 “Flock Hardware” means the Flock device(s), which may include the pole, clamps, solar panel, installation components, and any other physical elements that interact with the Embedded Software and the Web Interface, to provide the Flock Services as specifically set forth in the applicable product addenda.

1.7 “Flock IP” means the Services, the Embedded Software, and any intellectual property or proprietary information therein or otherwise provided to Customer and/or its Authorized End Users. Flock IP does not include Footage (as defined below).

1.8 “Flock Network End User(s)” means any user of the Flock Services that Customer authorizes access to or receives data from, pursuant to the licenses granted herein.

5.2 Attachment 1 - Agreement

28 1.9 “Flock Services” means the provision of Flock’s software and hardware situational awareness solution, via the Web Interface, for automatic license plate detection, alerts, audio detection, searching image records, video and sharing Footage.

1.10 “Footage” means still images, video, audio and other data captured by the Flock Hardware or Customer Hardware in the course of and provided via the Flock Services.

1.11 “Hotlist(s)” means a digital file containing alphanumeric license plate related information pertaining to vehicles of interest, which may include stolen vehicles, stolen vehicle license plates, vehicles owned or associated with wanted or missing person(s), vehicles suspected of being involved with criminal or terrorist activities, and other legitimate law enforcement purposes.

Hotlist also includes, but is not limited to, national data (i.e., NCIC) for similar categories, license plates associated with AMBER Alerts or Missing Persons/Vulnerable Adult Alerts, and includes manually entered license plate information associated with crimes that have occurred in any local jurisdiction.

1.12 “Installation Services” means the services provided by Flock for installation of Flock Services.

1.13 “Retention Period” means the time period that the Customer Data is stored within the cloud storage, as specified in the product addenda.

1.14 “Vehicle Fingerprint™” means the unique vehicular attributes captured through Services such as: type, make, color, state registration, missing/covered plates, bumper stickers, decals, roof racks, and bike racks.

1.15 “Web Interface” means the website(s) or application(s) through which Customer and its Authorized End Users can access the Services.

5.2 Attachment 1 - Agreement

29 2. SERVICES AND SUPPORT

2.1 Provision of Access. Flock hereby grants to Customer a non-exclusive, non-transferable right to access the features and functions of the Flock Services via the Web Interface during the Term, solely for the Authorized End Users. The Footage will be available for Authorized End Users to access and download via the Web Interface for the data retention time defined on the Order Form (“Retention Period”). Authorized End Users will be required to sign up for an account and select a password and username (“User ID”). Customer shall be responsible for all acts and omissions of Authorized End Users, and any act or omission by an Authorized End User which, including any acts or omissions of authorized End user which would constitute a breach of this agreement if undertaken by customer. Customer shall undertake reasonable efforts to make all Authorized End Users aware of all applicable provisions of this Agreement and shall cause Authorized End Users to comply with such provisions. Flock may use the services of one or more third parties to deliver any part of the Flock Services, (such as using a third party to host the Web Interface for cloud storage or a cell phone provider for wireless cellular coverage).

2.2 Embedded Software License. Flock grants Customer a limited, non-exclusive, non- transferable, non-sublicensable (except to the Authorized End Users), revocable right to use the Embedded Software as it pertains to Flock Services, solely as necessary for Customer to use the Flock Services.

2.3 Support Services. Flock shall monitor the Flock Services, and any applicable device health, in order to improve performance and functionality. Flock will use commercially reasonable efforts to respond to requests for support within seventy-two (72) hours. Flock will provide Customer with reasonable technical and on-site support and maintenance services in-person, via phone or by email at [email protected] (such services collectively referred to as “Support Services”).

2.4 Upgrades to Platform. Flock may make any upgrades to system or platform that it deems necessary or useful to (i) maintain or enhance the quality or delivery of Flock’s products or services to its agencies, the competitive strength of, or market for, Flock’s products or services, such platform or system’s cost efficiency or performance, or (ii) to comply with applicable law.

Parties understand that such upgrades are necessary from time to time and will not diminish the quality of the services or materially change any terms or conditions within this Agreement.

5.2 Attachment 1 - Agreement

30 2.5 Service Interruption. Services may be interrupted in the event that: (a) Flock’s provision of the Services to Customer or any Authorized End User is prohibited by applicable law; (b) any third-party services required for Services are interrupted; (c) if Flock reasonably believe Services are being used for malicious, unlawful, or otherwise unauthorized use; (d) there is a threat or attack on any of the Flock IP by a third party; or (e) scheduled or emergency maintenance (“Service Interruption”). Flock will make commercially reasonable efforts to provide written notice of any Service Interruption to Customer, to provide updates, and to resume providing access to Flock Services as soon as reasonably possible after the event giving rise to the Service Interruption is cured. Flock will have no liability for any damage, liabilities, losses (including any loss of data or profits), or any other consequences that Customer or any Authorized End User may incur as a result of a Service Interruption. To the extent that the Service Interruption is not caused by Customer’s direct actions or by the actions of parties associated with the Customer, the time will be tolled by the duration of the Service Interruption (for any continuous suspension lasting at least one full day). For example, in the event of a Service Interruption lasting five (5) continuous days, Customer will receive a credit for five (5) free days at the end of the Term.

2.6 Service Suspension. Flock may temporarily suspend Customer’s and any Authorized End User’s access to any portion or all of the Flock IP or Flock Service if (a) there is a threat or attack on any of the Flock IP by Customer; (b) Customer’s or any Authorized End User’s use of the Flock IP disrupts or poses a security risk to the Flock IP or any other customer or vendor of Flock; (c) Customer or any Authorized End User is/are using the Flock IP for fraudulent or illegal activities; (d) Customer has violated any term of this provision, including, but not limited to, utilizing Flock Services for anything other than the Permitted Purpose; or (e) any unauthorized access to Flock Services through Customer’s account (“Service Suspension”). Customer shall not be entitled to any remedy for the Service Suspension period, including any reimbursement, tolling, or credit. If the Service Suspension was not caused by Customer, the Term will be tolled by the duration of the Service Suspension.

2.7 Hazardous Conditions. Flock Services do not contemplate hazardous materials, or other hazardous conditions, including, without limit, asbestos, lead, toxic or flammable substances. In the event any such hazardous materials are discovered in the designated locations in which Flock is to perform services under this Agreement, Flock shall have the right to cease work immediately.

5.2 Attachment 1 - Agreement

31 3. CUSTOMER OBLIGATIONS

3.1 Customer Obligations. Flock will assist Customer Authorized End Users in the creation of a User ID. Authorized End Users agree to provide Flock with accurate, complete, and updated registration information. Authorized End Users may not select as their User ID, a name that they do not have the right to use, or any other name with the intent of impersonation. Customer and Authorized End Users may not transfer their account to anyone else without prior written permission of Flock. Authorized End Users shall not share their account username or password information and must protect the security of the username and password. Unless otherwise stated and defined in this Agreement, Customer shall not designate Authorized End Users for persons who are not officers, employees, or agents of Customer. Authorized End Users shall only use Customer-issued email addresses for the creation of their User ID. Customer is responsible for any Authorized End User activity associated with its account. Customer shall ensure that Customer provides Flock with up to date contact information at all times during the Term of this agreement. Customer shall be responsible for obtaining and maintaining any equipment and ancillary services needed to connect to, access or otherwise use the Flock Services. Customer shall (at its own expense) provide Flock with reasonable access and use of Customer facilities and Customer personnel in order to enable Flock to perform Services (such obligations of Customer are collectively defined as “Customer Obligations”).

3.2 Customer Representations and Warranties. Customer represents, covenants, and warrants that Customer shall use Flock Services only in compliance with this Agreement and all applicable laws and regulations, including but not limited to any laws relating to the recording or sharing of data, video, photo, or audio content.

4. DATA USE AND LICENSING

4.1 Customer Data. As between Flock and Customer, all right, title and interest in the Customer Data, belong to and are retained solely by Customer. Customer hereby grants to Flock a limited, non-exclusive, royalty-free, irrevocable, worldwide license to use the Customer Data and perform all acts as may be necessary for Flock to provide the Flock Services to Customer. Flock does not own and shall not sell Customer Data.

4.2 Customer Generated Data. Flock may provide Customer with the opportunity to post, upload, display, publish, distribute, transmit, broadcast, or otherwise make available, messages,

5.2 Attachment 1 - Agreement

32 text, illustrations, files, images, graphics, photos, comments, sounds, music, videos, information, content, ratings, reviews, data, questions, suggestions, or other information or materials produced by Customer (“Customer Generated Data”). Customer shall retain whatever legally cognizable right, title, and interest in Customer Generated Data. Customer understands and acknowledges that Flock has no obligation to monitor or enforce Customer’s intellectual property rights of Customer Generated Data. Customer grants Flock a non-exclusive, irrevocable, worldwide, royalty-free, license to use the Customer Generated Data for the purpose of providing Flock Services. Flock does not own and shall not sell Customer Generated Data.

4.3 Anonymized Data. Flock shall have the right to collect, analyze, and anonymize Customer Data and Customer Generated Data to the extent such anonymization renders the data non- identifiable to create Anonymized Data to use and perform the Services and related systems and technologies, including the training of machine learning algorithms. Customer hereby grants Flock a non-exclusive, worldwide, perpetual, royalty-free right to use and distribute such Anonymized Data to improve and enhance the Services and for other development, diagnostic and corrective purposes, and other Flock offerings. Parties understand that the aforementioned license is required for continuity of Services. Flock does not own and shall not sell Anonymized Data.

5. CONFIDENTIALITY; DISCLOSURES

5.1 Confidentiality. To the extent required by any applicable public records requests, each Party (the “Receiving Party”) understands that the other Party (the “Disclosing Party”) has disclosed or may disclose business, technical or financial information relating to the Disclosing Party’s business (hereinafter referred to as “Proprietary Information” of the Disclosing Party).

Proprietary Information of Flock includes non-public information regarding features, functionality and performance of the Services. Proprietary Information of Customer includes non-public data provided by Customer to Flock or collected by Flock via Flock Services, which includes but is not limited to geolocation information and environmental data collected by sensors. The Receiving Party agrees: (i) to take the same security precautions to protect against disclosure or unauthorized use of such Proprietary Information that the Party takes with its own proprietary information, but in no event less than commercially reasonable precautions, and (ii) not to use (except in performance of the Services or as otherwise permitted herein) or divulge to any third person any

5.2 Attachment 1 - Agreement

33 such Proprietary Information. The Disclosing Party agrees that the foregoing shall not apply with respect to any information that the Receiving Party can document (a) is or becomes generally available to the public; or (b) was in its possession or known by it prior to receipt from the Disclosing Party; or (c) was rightfully disclosed to it without restriction by a third party; or (d) was independently developed without use of any Proprietary Information of the Disclosing Party.

Nothing in this Agreement will prevent the Receiving Party from disclosing the Proprietary Information pursuant to any judicial or governmental order, provided that the Receiving Party gives the Disclosing Party reasonable prior notice of such disclosure to contest such order. At the termination of this Agreement, all Proprietary Information will be returned to the Disclosing Party, destroyed or erased (if recorded on an erasable storage medium), together with any copies thereof, when no longer needed for the purposes above, or upon request from the Disclosing Party, and in any case upon termination of the Agreement. Notwithstanding any termination, all confidentiality obligations of Proprietary Information that is trade secret shall continue in perpetuity or until such information is no longer trade secret.

5.2 Usage Restrictions on Flock IP. Flock and its licensors retain all right, title and interest in and to the Flock IP and its components, and Customer acknowledges that it neither owns nor acquires any additional rights in and to the foregoing not expressly granted by this Agreement.

Customer further acknowledges that Flock retains the right to use the foregoing for any purpose in Flock’s sole discretion. Customer and Authorized End Users shall not: (i) copy or duplicate any of the Flock IP; (ii) decompile, disassemble, reverse engineer, or otherwise attempt to obtain or perceive the source code from which any software component of any of the Flock IP is compiled or interpreted, or apply any other process or procedure to derive the source code of any software included in the Flock IP; (iii) attempt to modify, alter, tamper with or repair any of the Flock IP, or attempt to create any derivative product from any of the foregoing; (iv) interfere or attempt to interfere in any manner with the functionality or proper working of any of the Flock IP; (v) remove, obscure, or alter any notice of any intellectual property or proprietary right appearing on or contained within the Flock Services or Flock IP; (vi) use the Flock Services for anything other than the Permitted Purpose; or (vii) assign, sublicense, sell, resell, lease, rent, or otherwise transfer, convey, pledge as security, or otherwise encumber, Customer’s rights. There are no implied rights.

5.2 Attachment 1 - Agreement

34 5.3 Disclosure of Footage. Subject to and during the Retention Period, Flock may access, use, preserve and/or disclose the Footage to law enforcement authorities, government officials, and/or third parties, if legally required to do so or if Flock has a good faith belief that such access, use, preservation or disclosure is reasonably necessary to comply with a legal process, enforce this Agreement, or detect, prevent or otherwise address security, privacy, fraud or technical issues, or emergency situations.

6. PAYMENT OF FEES

6.1 Billing and Payment of Fees. Customer shall pay the fees set forth in the applicable Order Form based on the billing structure and payment terms as indicated in the Order Form. If Customer believes that Flock has billed Customer incorrectly, Customer must contact Flock no later than thirty (30) days after the closing date on the first invoice in which the error or problem appeared to receive an adjustment or credit. Customer acknowledges and agrees that a failure to contact Flock within this period will serve as a waiver of any claim. If any undisputed fee is more than thirty (30) days overdue, Flock may, without limiting its other rights and remedies, suspend delivery of its service until such undisputed invoice is paid in full. Flock shall provide at least thirty (30) days’ prior written notice to Customer of the payment delinquency before exercising any suspension right.

6.2 Notice of Changes to Fees. Flock reserves the right to change the fees for subsequent Renewal Terms by providing sixty (60) days’ notice (which may be sent by email) prior to the end of the Initial Term or Renewal Term (as applicable).

6.3 Late Fees. If payment is not issued to Flock by the due date of the invoice, an interest penalty of 1.0% of any unpaid amount may be added for each month or fraction thereafter, until final payment is made.

6.4 Taxes. Customer is responsible for all taxes, levies, or duties, excluding only taxes based on Flock’s net income, imposed by taxing authorities associated with the order. If Flock has the legal obligation to pay or collect taxes, including amount subsequently assessed by a taxing authority, for which Customer is responsible, the appropriate amount shall be invoice to and paid by Customer unless Customer provides Flock a legally sufficient tax exemption certificate and Flock shall not charge customer any taxes from which it is exempt. If any deduction or

5.2 Attachment 1 - Agreement

35 withholding is required by law, Customer shall notify Flock and shall pay Flock any additional amounts necessary to ensure that the net amount that Flock receives, after any deduction and withholding, equals the amount Flock would have received if no deduction or withholding had been required.

7. TERM AND TERMINATION

7.1 Term. The initial term of this Agreement shall be for the period of time set forth on the Order Form (the “Term”). Following the Term, unless otherwise indicated on the Order Form, this Agreement will automatically renew for successive renewal terms of the greater of one year or the length set forth on the Order Form (each, a “Renewal Term”) unless either Party gives the other Party notice of non-renewal at least thirty (30) days prior to the end of the then-current term.

7.2 Termination. Upon termination or expiration of this Agreement, Flock will remove any applicable Flock Hardware at a commercially reasonable time period. In the event of any material breach of this Agreement, the non-breaching Party may terminate this Agreement prior to the end of the Term by giving thirty (30) days prior written notice to the breaching Party; provided, however, that this Agreement will not terminate if the breaching Party has cured the breach prior to the expiration of such thirty (30) day period (“Cure Period”). Either Party may terminate this Agreement (i) upon the institution by or against the other Party of insolvency, receivership or bankruptcy proceedings, (ii) upon the other Party's making an assignment for the benefit of creditors, or (iii) upon the other Party's dissolution or ceasing to do business. In the event of a material breach by Flock, and Flock is unable to cure within the Cure Period, Flock will refund Customer a pro-rata portion of the pre-paid fees for Services not received due to such termination.

7.3 Survival. The following Sections will survive termination: 1, 3, 5, 6, 7, 8.3, 8.4, 9, 11.1 and

11.6. 5.2
Attachment 1 - Agreement

36 8. REMEDY FOR DEFECT; WARRANTY AND DISCLAIMER

8.1 Manufacturer Defect. Upon a malfunction or failure of Flock Hardware or Embedded Software (a “Defect”), Customer must notify Flock’s technical support team. In the event of a Defect, Flock shall make a commercially reasonable attempt to repair or replace the defective Flock Hardware at no additional cost to the Customer. Flock reserves the right, in its sole discretion, to repair or replace such Defect, provided that Flock shall conduct inspection or testing within a commercially reasonable time, but no longer than seven (7) business days after Customer gives notice to Flock.

8.2 Replacements. In the event that Flock Hardware is lost, stolen, or damaged, Customer may request a replacement of Flock Hardware at a fee according to the reinstall fee schedule (https://www.flocksafety.com/reinstall-fee-schedule). In the event that Customer chooses not to replace lost, damaged, or stolen Flock Hardware, Customer understands and agrees that (1) Flock Services will be materially affected, and (2) that Flock shall have no liability to Customer regarding such affected Flock Services, nor shall Customer receive a refund for the lost, damaged, or stolen Flock Hardware.

8.3 Warranty. Flock shall use reasonable efforts consistent with prevailing industry standards to maintain the Services in a manner which minimizes errors and interruptions in the Services and shall perform the Installation Services in a professional and workmanlike manner. Services may be temporarily unavailable for scheduled maintenance or for unscheduled emergency maintenance, either by Flock or by third-party providers, or because of other causes beyond Flock’s reasonable control, but Flock shall use reasonable efforts to provide advance notice in writing or by e-mail of any scheduled service disruption.

8.4 Disclaimer. THE REMEDY DESCRIBED IN SECTION 8.1 ABOVE IS CUSTOMER’S SOLE REMEDY, AND FLOCK’S SOLE LIABILITY, WITH RESPECT TO DEFECTS.

FLOCK DOES NOT WARRANT THAT THE SERVICES WILL BE UNINTERRUPTED OR ERROR FREE; NOR DOES IT MAKE ANY WARRANTY AS TO THE RESULTS THAT MAY BE OBTAINED FROM USE OF THE SERVICES. EXCEPT AS EXPRESSLY SET FORTH IN THIS SECTION, THE SERVICES ARE PROVIDED “AS IS” AND FLOCK

DISCLAIMS ALL WARRANTIES, EXPRESS OR IMPLIED, INCLUDING, BUT NOT

LIMITED TO, IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A

5.2 Attachment 1 - Agreement

37 PARTICULAR PURPOSE AND NON-INFRINGEMENT. THIS DISCLAIMER ONLY

APPLIES TO THE EXTENT ALLOWED BY THE GOVERNING LAW OF THE STATE MENTIONED IN SECTION 11.6.

8.5 Insurance. Flock will maintain commercial general liability policies as stated in Exhibit B.

8.6 Force Majeure. Parties are not responsible or liable for any delays or failures in performance from any cause beyond their control, including, but not limited to acts of God, changes to law or regulations, embargoes, war, terrorist acts, pandemics (including the spread of variants), issues of national security, acts or omissions of third-party technology providers, riots, fires, earthquakes, floods, power blackouts, strikes, supply chain shortages of equipment or supplies, financial institution crisis, weather conditions or acts of hackers, internet service providers or any other third party acts or omissions.

9. LIMITATION OF LIABILITY; INDEMNITY

9.1 Limitation of Liability. NOTWITHSTANDING ANYTHING TO THE CONTRARY,

FLOCK, ITS OFFICERS, AFFILIATES, REPRESENTATIVES, CONTRACTORS AND

EMPLOYEES SHALL NOT BE RESPONSIBLE OR LIABLE WITH RESPECT TO ANY

SUBJECT MATTER OF THIS AGREEMENT OR TERMS AND CONDITIONS RELATED

THERETO UNDER ANY CONTRACT, NEGLIGENCE, STRICT LIABILITY, PRODUCT LIABILITY, OR OTHER THEORY: (A) FOR LOSS OF REVENUE, BUSINESS OR BUSINESS INTERRUPTION; (B) INCOMPLETE, CORRUPT, OR INACCURATE DATA; (C) COST OF PROCUREMENT OF SUBSTITUTE GOODS, SERVICES OR TECHNOLOGY; (D)

FOR ANY INDIRECT, EXEMPLARY, INCIDENTAL, SPECIAL OR CONSEQUENTIAL DAMAGES; (E) FOR ANY MATTER BEYOND FLOCK’S ACTUAL KNOWLEDGE OR

REASONABLE CONTROL INCLUDING REPEAT CRIMINAL ACTIVITY OR INABILITY TO CAPTURE FOOTAGE; OR (F) FOR ANY AMOUNTS THAT, TOGETHER WITH

AMOUNTS ASSOCIATED WITH ALL OTHER CLAIMS, EXCEED THE FEES PAID

AND/OR PAYABLE BY CUSTOMER TO FLOCK FOR THE SERVICES UNDER THIS AGREEMENT IN THE TWELVE (12) MONTHS PRIOR TO THE ACT OR OMISSION THAT

GAVE RISE TO THE LIABILITY, IN EACH CASE, WHETHER OR NOT FLOCK HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. THIS LIMITATION OF

5.2 Attachment 1 - Agreement

38 LIABILITY OF SECTION ONLY APPLIES TO THE EXTENT ALLOWED BY THE GOVERNING LAW OF THE STATE REFERENCED IN SECTION 10.6.

NOTWITHSTANDING ANYTHING TO THE CONTRARY, THE FOREGOING

LIMITATIONS OF LIABILITY SHALL NOT APPLY (I) IN THE EVENT OF GROSS

NEGLIGENCE OR WILLFUL MISCONDUCT, OR (II) INDEMNIFICATION OBLIGATIONS.

9.2 Responsibility. Each Party to this Agreement shall assume the responsibility and liability for the acts and omissions of its own employees, officers, or agents, in connection with the performance of their official duties under this Agreement. Each Party to this Agreement shall be liable for the torts of its own officers, agents, or employees.

9.3 Flock Indemnity. Flock shall indemnify and hold harmless Customer, its agents and employees, from liability of any kind, including claims, costs (including defense) and expenses, on account of: (i) any copyrighted material, patented or unpatented invention, articles, device or appliance manufactured or used in the performance of this Agreement; or (ii) any damage or injury to property or person directly caused by Flock’s installation of Flock Hardware, except for where such damage or injury was caused solely by the negligence of the Customer or its agents, officers or employees. Flock’s performance of this indemnity obligation shall not exceed the fees paid and/or payable for the services rendered under this Agreement in the preceding twelve (12) months.

10. INSTALLATION SERVICES AND OBLIGATIONS

10.1 Ownership of Hardware. Flock Hardware is owned and shall remain the exclusive property of Flock. Title to any Flock Hardware shall not pass to Customer upon execution of this Agreement, except as otherwise specifically set forth in this Agreement. Except as otherwise expressly stated in this Agreement, Customer is not permitted to remove, reposition, re-install, tamper with, alter, adjust or otherwise take possession or control of Flock Hardware. Customer agrees and understands that in the event Customer is found to engage in any of the foregoing restricted actions, all warranties herein shall be null and void, and this Agreement shall be subject to immediate termination for material breach by Customer. Customer shall not perform any acts which would interfere with the retention of title of the Flock Hardware by Flock. Should Customer default on any payment of the Flock Services, Flock may remove Flock Hardware at

5.2 Attachment 1 - Agreement

39 Flock’s discretion. Such removal, if made by Flock, shall not be deemed a waiver of Flock’s rights to any damages Flock may sustain as a result of Customer’s default and Flock shall have the right to enforce any other legal remedy or right.

10.2 Deployment Plan. Flock shall advise Customer on the location and positioning of the Flock Hardware for optimal product functionality, as conditions and locations allow. Flock will collaborate with Customer to design the strategic geographic mapping of the location(s) and implementation of Flock Hardware to create a deployment plan (“Deployment Plan”). In the event that Flock determines that Flock Hardware will not achieve optimal functionality at a designated location, Flock shall have final discretion to veto a specific location, and will provide alternative options to Customer.

10.3 Changes to Deployment Plan. After installation of Flock Hardware, any subsequent requested changes to the Deployment Plan, including, but not limited to, relocating, re- positioning, adjusting of the mounting, removing foliage, replacement, changes to heights of poles will incur a fee according to the reinstall fee schedule located at (https://www.flocksafety.com/reinstall-fee-schedule). Customer will receive prior notice and confirm approval of any such fees.

10.4 Customer Installation Obligations. Customer is responsible for any applicable supplementary cost as described in the Customer Implementation Guide, attached hereto as Exhibit C (“Customer Obligations”). Customer represents and warrants that it has, or shall lawfully obtain, all necessary right title and authority and hereby authorizes Flock to install the Flock Hardware at the designated locations and to make any necessary inspections or maintenance in connection with such installation.

10.5 Flock’s Obligations. Installation of any Flock Hardware shall be installed in a professional manner within a commercially reasonable time from the Effective Date of this Agreement. Upon removal of Flock Hardware, Flock shall restore the location to its original condition, ordinary wear and tear excepted. Flock will continue to monitor the performance of Flock Hardware for the length of the Term. Flock may use a subcontractor or third party to perform certain obligations under this agreement, provided that Flock’s use of such subcontractor or third party shall not release Flock from any duty or liability to fulfill Flock’s obligations under this Agreement.

11. MISCELLANEOUS

5.2 Attachment 1 - Agreement

40 11.1 Compliance With Laws. Parties shall comply with all applicable local, state and federal laws, regulations, policies and ordinances and their associated record retention schedules, including responding to any subpoena request(s).

11.2 Severability. If any provision of this Agreement is found to be unenforceable or invalid, that provision will be limited or eliminated to the minimum extent necessary so that this Agreement will otherwise remain in full force and effect.

11.3 Assignment. This Agreement is not assignable, transferable or sublicensable by either Party, without prior consent. Notwithstanding the foregoing, either Party may assign this Agreement, without the other Party's consent, (i) to any parent, subsidiary, or affiliate entity, or (ii) to any purchaser of all or substantially all of such Party's assets or to any successor by way of merger, consolidation or similar transaction.

11.4 Entire Agreement. This Agreement, together with the Order Form(s), the reinstall fee schedule (https://www.flocksafety.com/reinstall-fee-schedule), and any attached exhibits are the complete and exclusive statement of the mutual understanding of the Parties and supersedes and cancels all previous or contemporaneous negotiations, discussions or agreements, whether written and oral , communications and other understandings relating to the subject matter of this Agreement, and that all waivers and modifications must be in a writing signed by both Parties, except as otherwise provided herein. None of Customer’s purchase orders, authorizations or similar documents will alter the terms of this Agreement, and any such conflicting terms are expressly rejected. Any mutually agreed upon future purchase order is subject to these legal terms and does not alter the rights and obligations under this Agreement, except that future purchase orders may outline additional products, services, quantities and billing terms to be mutually accepted by Parties. In the event of any conflict of terms found in this Agreement or any other terms and conditions, the terms of this Agreement shall prevail. Customer agrees that Customer’s purchase is neither contingent upon the delivery of any future functionality or features nor dependent upon any oral or written comments made by Flock with respect to future functionality or feature.

11.5 Relationship. No agency, partnership, joint venture, or employment is created as a result of this Agreement and Parties do not have any authority of any kind to bind each other in any respect whatsoever. Flock shall at all times be and act as an independent contractor to Customer.

5.2 Attachment 1 - Agreement

41 11.6 Governing Law; Venue. This Agreement shall be governed by the laws of the state in which the Customer is located. The Parties hereto agree that venue would be proper in the chosen courts of the State of which the Customer is located. The Parties agree that the United Nations Convention for the International Sale of Goods is excluded in its entirety from this Agreement.

11.7 Special Terms. Flock may offer certain special terms which are indicated in the proposal and will become part of this Agreement, upon Customer’s prior written consent and the mutual execution by authorized representatives (“Special Terms”). To the extent that any terms of this Agreement are inconsistent or conflict with the Special Terms, the Special Terms shall control.

11.8 Publicity. Flock has the right to reference and use Customer’s name and trademarks and disclose the nature of the Services in business and development and marketing efforts.

11.9 Feedback. If Customer or Authorized End User provides any suggestions, ideas, enhancement requests, feedback, recommendations or other information relating to the subject matter hereunder, Agency or Authorized End User hereby assigns to Flock all right, title and interest (including intellectual property rights) with respect to or resulting from any of the foregoing.

11.10 Export. Customer may not remove or export from the United States or allow the export or re-export of the Flock IP or anything related thereto, or any direct product thereof in violation of any restrictions, laws or regulations of the United States Department of Commerce, the United States Department of Treasury Office of Foreign Assets Control, or any other United States or foreign Customer or authority. As defined in Federal Acquisition Regulation (“FAR”), section

2.101, the Services, the Flock Hardware and Documentation are “commercial items” and according to the Department of Defense Federal Acquisition Regulation (“DFAR”) section 252.2277014(a)(1) and are deemed to be “commercial computer software” and “commercial computer software documentation.” Flock is compliant with FAR Section 889 and does not contract or do business with, use any equipment, system, or service that uses the enumerated banned Chinese telecommunication companies, equipment or services as a substantial or essential component of any system, or as critical technology as part of any Flock system. Consistent with DFAR section 227.7202 and FAR section 12.212, any use, modification, reproduction, release, performance, display, or disclosure of such commercial software or commercial software documentation by the U.S. Government will be governed solely by the terms of this Agreement and will be prohibited except to the extent expressly permitted by the terms of this Agreement.

5.2 Attachment 1 - Agreement

42 11.11 Headings. The headings are merely for organization and should not be construed as adding meaning to the Agreement or interpreting the associated sections.

11.12 Authority. Each of the below signers of this Agreement represent that they understand this Agreement and have the authority to sign on behalf of and bind the Parties they are representing.

11.13 Conflict. In the event there is a conflict between this Agreement and any applicable statement of work, or Customer purchase order, this Agreement controls unless explicitly stated otherwise.

11.14 Morality. In the event Customer or its agents become the subject of an indictment, contempt, scandal, crime of moral turpitude or similar event that would negatively impact or tarnish Flock’s reputation, Flock shall have the option to terminate this Agreement upon prior written notice to Customer.

11.15 Notices. All notices under this Agreement will be in writing and will be deemed to have been duly given when received, if personally delivered; when receipt is electronically confirmed, if transmitted by email; the day after it is sent, if sent for next day delivery by recognized overnight delivery service; and upon receipt to the address listed on the Order Form (or, if different, below), if sent by certified or registered mail, return receipt requested.

11.16 Non-Appropriation. Notwithstanding any other provision of this Agreement, all obligations of the Customer under this Agreement which require the expenditure of funds are conditioned on the availability of funds appropriated for that purpose. Customer shall have the right to terminate this Agreement for non appropriation with thirty (30) days written notice without penalty or other cost.

5.2 Attachment 1 - Agreement

43 FLOCK NOTICES ADDRESS:
1170 HOWELL MILL ROAD, NW SUITE 210
ATLANTA, GA 30318
ATTN: LEGAL DEPARTMENT
EMAIL: [email protected]

Customer NOTICES ADDRESS:

ADDRESS:

ATTN:

EMAIL:

5.2 Attachment 1 - Agreement

44 EXHIBIT B

INSURANCE

Required Coverage. Flock shall procure and maintain for the duration of this Agreement insurance against claims for injuries to persons or damages to property that may arise from or in connection with the performance of the services under this Agreement and the results of that work by Flock or its agents, representatives, employees or subcontractors. Insurance shall be placed with insurers with a current A. M. Best rating of no less than “A” and “VII”. Flock shall obtain and, during the term of this Agreement, shall maintain policies of professional liability (errors and omissions), automobile liability, and general liability insurance for insurable amounts of not less than the limits listed herein. The insurance policies shall provide that the policies shall remain in full force during the life of the Agreement. Flock shall procure and shall maintain during the life of this Agreement Worker's Compensation insurance as required by applicable State law for all Flock employees.

Types and Amounts Required. Flock shall maintain, at minimum, the following insurance coverage for the duration of this Agreement:
(i) Commercial General Liability insurance written on an occurrence basis with minimum limits of One Million Dollars ($1,000,000) per occurrence and Two Million Dollars ($2,000,000) in the aggregate for bodily injury, death, and property damage, including personal injury, contractual liability, independent contractors, broad-form property damage, and product and completed operations coverage;
(ii) Umbrella or Excess Liability insurance written on an occurrence basis with minimum limits of Ten Million Dollars ($10,000,000) per occurrence and Ten Million Dollars ($10,000,000) in the aggregate;
(iii) Professional Liability/Errors and Omissions insurance with minimum limits of Five Million Dollars ($5,000,000) per occurrence and Five Million Dollars ($5,000,000) in the aggregate;
(iv) Commercial Automobile Liability insurance with a minimum combined single limit of One Million Dollars ($1,000,000) per occurrence for bodily injury, death, and property coverage, including owned and non-owned and hired automobile coverage; and

5.2 Attachment 1 - Agreement

45 (v) Cyber Liability insurance written on an occurrence basis with minimum limits of Five Million Dollars ($5,000,000).

5.2 Attachment 1 - Agreement

46 4
9 5
DATE: November 20, 2023

TO: Mayor and Members of the City Council
VIA: Stefan Chatwin, City Manager

FROM: Tracy Avelar, Police Chief
DEPARTMENT: Police
SUBJECT: PURCHASE MAINTENANCE RENEWAL FOR POLICE

DISPATCH CUSTOMER PREMISE EQUIPMENT AND
AUTHORIZING THE APPROPRIATION OF $18,714.75 FROM
THE GENERAL FUND BALANCE TO ACCOUNT NO. 001-0630-
421-4246 FOR FY 2023-2024

RECOMMENDATION
It is recommended that City Council approve the attached resolution (Attachment 1) authorizing the Foster City Police Department (FCPD) to purchase a one-year maintenance renewal from Intrado to maintain the existing Customer Premise Equipment (CPE) for the agency’s dispatch center and authorizing an appropriation of $18,714.75 from the General Fund to Account 001-0630-421-4246 for FY 2023-2024.

EXECUTIVE SUMMARY
The existing CPE was purchased and installed in 2014 and included a five-year maintenance agreement with Intrado. Since the expiration of the five-year maintenance agreement, the FCPD has annually renewed it because Intrado is the sole source provider of maintenance service for the existing CPE. Because of Intrado’s sole source status, bidding has been dispensed as allowed by Section 3.04.110 B of the Foster City Municipal Code. The FCPD has utilized one-year maintenance agreements, and this is year 10. Utilizing one-year maintenance agreements is the preferred method to obtain service because of the imminent implementation of the cloud based, NextGen 9-1-1 (NG9-1-1) system. NG9-1-1 is developed and will be deployed by the Cal OES 9-1-1 branch. However, delays have occurred in the deployment of NG9-1-1, so the FCPD

5.3 5.3 Staff Report

47 4
9 5
continues to use its current CPE. The renewal of this Intrado maintenance agreement allows the support of the current CPE until the NG9-1-1 system is ready for deployment. The one-year Intrado maintenance agreement cost $18,714.75. The cost of the agreement is reimbursed fully by the Cal OES; a Commitment to Fund document has been provided to confirm reimbursement (Attachment 3). Reimbursement is often provided within 30 days of the purchase.

BACKGROUND/ANALYSIS
CPE equipment is used to receive, and process calls made into the 9-1-1 system.

Some of the uses of the existing CPE include:
•Receive wireless and landline 9-1-1 calls into the dispatch center. •A text-to-9-1-1 system is in place to receive 9-1-1 text messages into the dispatch center.
•Identify the location of a person calling 9-1-1.
•Identify the location of calls into the 9-1-1 system that were dropped, abandoned by the caller, or misrouted.
•Provide the agency with reporting and analysis information to examine and understand historical activity involving the 9-1-1 system.

The existing CPE was purchased and installed in 2014. According to the Cal OES 9-1-1 Branch, the recommended life of a CPE system is five years, which is when replacement CPE systems are recommended. When purchased by this agency, the existing CPE included five years of maintenance from Intrado. Since the expiration of the five-year maintenance agreement, the FCPD has annually renewed it because Intrado is the sole source provider of service for the existing CPE. Because of Intrado’s sole source status, bidding has been dispensed as allowed by Section 3.04.110 B of the Foster City Municipal Code. Maintenance for years 6, 7, 8, and 9 have been purchased annually.

The Cal OES 9-1-1 Branch is working on a cloud-based 9-1-1 system that will take the place of the existing 9-1-1 system. The new system is referred to as NextGen 9-1-1 (NG9-1-1). Cal OES is working closely with vendors, such as Intrado, to make this system available as soon as possible; however, unsatisfactory performance when vendors test their CPE using the NG9-1-1 system have caused substantial delays in the release of NG9-1-1.

Development of the NG9-1-1 system has been ongoing for several years. Because of the significant improvements and capabilities expected of the NG9-1-1 system when compared to the existing 9-1-1 system, the FCPD made the decision to retain the existing 9-1-1 system and CPE until the NG9-1-1 system is available. With the regular maintenance and service that Intrado has provided, the existing CPE has continued to serve the agency and community well. This is expected to continue through year 10.

Until the NG9-1-1 is available, the existing CPE must be maintained and serviced regularly, and expeditiously when problems arise. The agency’s CPE is essential and is

5.3 5.3 Staff Report

48 4
9 5
heavily relied upon to provide necessary services to the community. Intrado has maintained the existing CPE for nine years; there have been no issues with Intrado’s service that would cause concern with renewing our agreement with Intrado for an additional year of maintenance and service. Included in the maintenance renewal from Intrado is software protection, remote technical support, on-site support, and hardware protection service. As the maintenance period began on 9/04/2023, Intrado confirmed the existing maintenance plan would continue uninterrupted as we work toward making payment.

Currently, NG9-1-1 deployment is behind schedule. The State has not provided an exact deployment time, but the FCPD will continue with the Intrado CPE maintenance service until final Implementation.

California Environmental Quality Act
Purchase of the one-year maintenance renewal from Intrado is not subject to review under the California Environmental Quality Act (CEQA) pursuant to Public Resources Code Section 21000, et seq. and the CEQA Guidelines (14 Cal. Code Regs. §§ 15000 et. seq.), including without limitation, Public Resources Code section 21065 and California Code of Regulations 15378 as this is not a “project” that may cause a direct, or reasonably foreseeable indirect, physical change in the environment.

FISCAL IMPACT
If approved, $18,714.75 will be appropriated to account No. 001-0630-421-4246 in the FCPD budget from the City’s General Fund. This purchase will be initially funded by the City and will be reimbursed to the City by the Cal OES 9-1-1 Branch. A Commitment to Fund document (Attachment 3) was provided by the Cal OES 9-1-1 Branch.

CITY COUNCIL VISION, MISSION, AND VALUE/PRIORITY AREA
Public Safety and Social Equity
ATTACHMENTS:

Attachment 1 – Resolution
Attachment 2 – Quote from Intrado for a maintenance renewal period of 9/04/2023- 9/03/2024
Attachment 3 – Form TD-288: Commitment to Fund document from the Cal OES 9-1-1 Branch

5.3 5.3 Staff Report

49 RESOLUTION NO. _________

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF FOSTER CITY

AUTHORIZING THE POLICE DEPARTMENT TO PURCHASE A ONE-YEAR

MAINTENANCE RENEWAL FROM INTRADO TO MAINTAIN THE EXISTING DISPATCH CUSTOMER PREMISE EQUIPMENT (CPE); AND AUTHORIZING APPROPRIATION OF $18,714.75 FROM THE GENERAL FUND TO ACCOUNT 001- 0630-421-4246.

CITY OF FOSTER CITY
WHEREAS, on November 18, 2013, the City Council adopted Resolution No. 2013-86 authorizing the Foster City Police Department to accept a 9-1-1 equipment purchase funding allotment of $154,000 from the State of California, and to enter into a contract for the purchase, installation, and maintenance of replacement 9-1-1 telephone communications equipment from Intrado in the amount not to exceed $154,000; and WHEREAS, the Department is interested in purchasing a maintenance renewal plan for the existing CPE; and
WHEREAS, the Department dispatch center relies on the CPE to receive wireless calls, landline calls, and text messages into the police dispatch 9-1-1 system; and
WHEREAS, the Department CPE provides reporting and analysis information to examine and understand historical 9-1-1 system activity; and WHEREAS, Intrado will provide the purchased maintenance and service of their existing CPE as they have done for the previous nine years; and WHEREAS, the maintenance renewal period will be September 4, 2023 – September 3, 2024, and will include software protection, remote technical support, on- site support, and hardware protection service; and
WHEREAS, CPE is essential equipment and is heavily relied upon to provide necessary services to the community; and
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Foster City does hereby authorizes the purchase of a maintenance renewal plan from Intrado to maintain and service the existing police CPE for a total cost of $18,714.75, of which $18,714.75 will be reimbursed to the City by the California Office of Emergency Services 9-1-1 Branch.

BE IT FURTHER RESOLVED, the City Council authorizes appropriation of $18,714.75 from the General Fund to Account 001-0630-421-4246 for a total cost of $18,714.75

5.3 Attachment 1 - Resolution

50 PASSED AND ADOPTED as a resolution of the City Council of the City of Foster City at the regular meeting held on the 20TH day of November 2023, by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:

JON FROOMIN, MAYOR
ATTEST:

PRISCILLA SCHAUS, CITY CLERK

5.3 Attachment 1 - Resolution

51 The terms and conditions available at https://www.intrado.com/legal‐privacy/terms/call‐handling as of the date of this Quote will apply to this Quote, unless the parties have entered into a separate mutually executed agreement, or Customer is purchasing under a cooperative purchasing agreement. The terms of this Quote will govern any conflict with the above‐mentioned terms, and Customer’s issuance of a purchase order for any or all of the items described in this Quote will constitute acknowledgement and acceptance of such terms. No additional terms in Customer’s purchase order will apply. This document contains confidential and proprietary information of Intrado, and such information may not be used or disclosed without prior written consent.

Company Name: Intrado Life & Safety Solutions Corporation Maintenance Renewal: Year 10 ‐ Sept 4, 2023 to Sept 3, 2024 for

Foster City, CA
(Direct Sale)
Quote Number: 74070
Version: 2
July 31, 2023

5.3 Attachment 2 - Quote from Intrado for a maintenance renewal period of 9/04/2023- 9/03/2024

July 31, 2023

Summary ‐ Foster City PD

Item Price

Maintenance $18,714.75

Total:

$18,714.75

Year Systems Professional
Services
Recurring
Services
Maintenance
Services
Totals
Year 9 $18,714.75 $18,714.75
Totals $18,714.75 $18,714.75

Configuration Parameters ‐ Foster City PD

Item# Description Qty Selling Price Total

Software Protection and Remote Tech Support

950999/PRO1/1 Software Protection and Remote
Technical Support ‐ /Position ‐ Year 10
3 $944.32 $2,832.96

Subtotal $2,832.96

On‐Site Maintenance

950999/ONS1‐1/1 On‐Site Maintenance, (per position /
year for 1 to 10 positions) ‐ Year 10
3 $4,721.61 $14,164.83

Subtotal $14,164.83

Hardware Protection

950999/HPSA1/1 Hardware Protection Stand Alone
System ‐ /Position ‐ Year 10
3 $572.32 $1,716.96

Subtotal $1,716.96

Total $18,714.75

5.3 Attachment 2 - Quote from Intrado for a maintenance renewal period of 9/04/2023- 9/03/2024

July 31, 2023

Notes
1 Quote provides pricing for Year 10 of the following maintenance services:

‐Software Protection & Remote Tech Support
‐Hardware Protection
‐On‐Site Maintenance

Effective dates 04‐Sep‐2023 to 03‐Sep‐2024

Previous quote 71731v2

Intrado will bill quarterly. With 30‐day notice of cancellation, the final invoice will be adjusted to remove any unused time.

Intrado will continue to honor the SLA’s in the CalOES contract for usual support and hardware protection (Full hardware upgrade is not included).

Bridge Maintenance (Year 8 and beyond)
Software Protection & Remote Technical Support Services cover only Intrado Application support.

Out of warranty workstation and server Hardware and or Operating System support is not covered under Software Protection & Remote Technical Support Services.

Intrado will make best efforts, but not responsible for sourcing replacement parts for any of the out of warranty system Hardware components.

In addition, if Intrado determines that any failure(s) have been caused in whole or in part by out of warranty hardware, any associated help desk, technician, and or engineering service costs related with the diagnostics of the failure condition will be invoiced to the customer at published rates.

2 Software Protection and Remote Technical Support is a coverage requirement with the purchase and ownership of Intrado CPE system equipment.

Software Protection and Remote Technical Support cannot be deleted from quotes or system orders.

Once a Software Protection and Remote Technical Support service contract is established for the site during system initial purchase, all items subsequently added to the site will not require an additional contract, but the acquisition of additional positions will increase the price of the services. a. For sites with one year coverage contracts, the increased price will be reflected in the quote at the next c o n t r a c t r e n e w a l p o i n t .
b. For sites with multi‐year agreements, the customer will be required to retract the remaining years of the original purchase order and issue a new purchase order for the remaining period covering the original system and n e w p o s i t i o n s .

If a contract for Software Protection and Remote Technical Support expires without renewal, causing a lapse in coverage, the customer’s access to the Support Center will be discontinued and a notification of services termination will be issued. Reinstatement of the lapsed coverage will require the following from the customer:

a) Payment in full for the lapsed period at the prevailing per‐seat rate

b) Purchase of a new maintenance agreement (one‐year or five‐ y e a r )

c) System Recertification fees in the form of a Class A inspection at $1,500.00 per day plus related travel and e x p e n s e c h a r g e s .

5.3 Attachment 2 - Quote from Intrado for a maintenance renewal period of 9/04/2023- 9/03/2024

July 31, 2023

Software Protection
This offering provides for the availability of software product updates. Installation and training (if needed) are not included. Intrado will publish periodic software release bulletins to customers which announce important product updates for Intrado software. Customers may then request the new update from Intrado based on applicability of the release to customer’s system. Customer is responsible for installation of all these releases, unless the On‐Site Maintenance Service is purchased. If On‐Site Maintenance has not been purchased and the customer prefers to have Intrado deploy a new release, Intrado will dispatch appropriate personnel to perform the upgrade on a mutually agreed upon date at Intrado’s then current prices for s u c h s e r v i c e s .

Remote Technical Support
Support is provided by associates who specialize in the diagnosis and resolution of system performance issues.

Remote Technical Support is available 24/7 through both a toll free hotline and a secure customer Internet portal.

All service inquiries are tracked by a state‐of‐the‐art CRM trouble ticket system that can be queried by customers through the online portal to obtain the most up‐to‐date status on their issues.

3 On‐site Support Services are primarily designed to assist with issues that require system expertise in troubleshooting and restoration at the customer’s location.

On‐site Support Services include travel costs and time and labor related to the service incident. Also included in the service are quarterly on‐site preventative and routine maintenance reviews (four per year) of the customer’s Intrado system. These maintenance visits can include the installation of routine updates to software. Training, configuration changes, reprogramming and system upgrade labor are not included in this offering, but are available for purchase.

On‐Site Support Services options include the designation of a technician dedicated specifically to the customer’s deployment(s), or alternately a non‐dedicated resource available for use with other customers. Intrado may engage third‐party vendors to provide the On‐Site Support Services.

4 Hardware Protection Service provides for the replacement of any non‐operating Intrado provided hardware component, with the exception of monitors. This offering only provides for the replacement of the hardware item.

Installation services and training (if needed) are not included. This service does not cover items where warranty has been voided due to abuse, Force Majeure or other actions.

When the Intrado Technical Support Center concludes that an item is non‐operational, a fully functioning new or refurbished unit will be shipped to the customer. This unit will then become the property of the customer and will restore the functionality of the non‐working item, but it may not be the exact same model as the original. The shipment of the replacement item will include a pre‐printed shipping label used for the return of the nonworking item from the customer.

5.3 Attachment 2 - Quote from Intrado for a maintenance renewal period of 9/04/2023- 9/03/2024

July 31, 2023

Terms

VENDOR NAME
Intrado Life & Safety Solutions Corporation
Include quote number
and customer EIN/Tax Identification Number
on P.O.

SUBMIT P.O.

erd‐[email protected]

PRICING All prices are in USD
Taxes, if applicable, are extra.

Handling and Shipping charges are extra unless specified on the quote.

SHIPPING TERMS FCA (Montreal), INCOTERMS 2010
INVOICING If Intrado is not performing Installation, software and equipment will be deemed accepted when Intrado has completed its shipping obligations. If Intrado is performing Installation, then Customer will provide Intrado with a written notice of acceptance or rejection, based on a Severity Level 1 or 2 failure (as defined in the Maintenance and Support terms), within ten calendar days after Intrado’s notice of System Cutover (“Notification Date”), which acceptance will not be unreasonably withheld or conditioned. If Customer does not accept software and equipment, it will notify Intrado in writing within ten calendar days of the Notification Date, and will specify the Severity Level 1 or 2 failure.

Intrado will use commercially reasonable efforts to promptly diagnose and correct all identified failures, and the acceptance process will be repeated until acceptance occurs. If Customer fails to provide written notice of rejection as stated above within the time stated above, acceptance will be deemed to have occurred. “System Cutover” will mean the first date that software and equipment is used for live call‐taking or dispatching. If software and/or equipment are being installed at multiple sites, the above acceptance process will apply to each site. The date of acceptance of the first site will be referred to as “Final Acceptance.” Services will be deemed accepted when performed. If installation is not purchased, then all fees will be invoiced on shipment. If installation is purchased, Customer will be invoiced according to the following terms:
• 30% on acceptance of Customer’s Order
• 30% on shipment
• 30% on System Cutover
• 10% on Final Acceptance

DELIVERY TBD
VALIDITY Quote expires on February 07, 2024.

However, part numbers beginning with Q, such as QXXXXX, constitute unique third‐party components. These components, including model and price, (i) may be subject to change at any time; and (ii) are non‐cancellable, non‐refundable, and non‐exchangeable at any time.

COPYRIGHT The information contained in this document is proprietary to Intrado Life & Safety Solutions Corporation and is offered solely for the purpose of evaluation.

5.3 Attachment 2 - Quote from Intrado for a maintenance renewal period of 9/04/2023- 9/03/2024

July 31, 2023

Optional Signature Page
Customer can purchase the products and services in this Quote by:

‐ Issuing a purchase order for the Total Amount of the quote OR
‐ By signing below

Intrado Quote Number: 74070 Version: 2 Date Issued: July 31, 2023

Total Purchase Amount (Not including Optional Products or Services): $18,714.75

Please check one: Bill the Total Amount Upfront: ______ Bill Quarterly: _______

ACCEPTED AND AGREED:

Customer is committing to the Total Purchase Amount listed above.

Customer Entity Name: Foster City, CA

Signature: ____________________________________________

Printed Name: ________________________________________

Title: __________________________________________________

Date Signed: __________________________________________

By signing above, Customer acknowledges and agrees with the terms of the box checked below:

______ A customer purchase order is required to pay any invoice relating to this quote. Customer acknowledges that Intrado will not ship any equipment or software, or commence any services, until it has received customer’s corresponding purchase order.

X A customer purchase order is NOT required to pay any invoice relating to this quote. The signature above authorizes Intrado to ship, provide services, and invoice customer.

The terms and conditions available at https://www.intrado.com/legal‐privacy/terms/call‐handling as of the date of this Quote will apply to this Quote, unless the parties have entered into a separate mutually executed agreement, or Customer is purchasing under a cooperative purchasing agreement. The terms of this Quote will govern any conflict with the above‐mentioned terms, and Customer’s issuance of a purchase order for any or all of the items described in this Quote will constitute acknowledgement and acceptance of such terms. No additional terms in Customer’s purchase order will apply. This document contains confidential and proprietary information of Intrado, and such information may not be used or disclosed without prior written consent.

5.3 Attachment 2 - Quote from Intrado for a maintenance renewal period of 9/04/2023- 9/03/2024

57 State of California, California 9-1-1 Emergency Communications Office (9-1-1 Office) COMMITMENT TO FUND 9-1-1 EQUIPMENT AND SERVICES
TD-288 (Rev. 12/06)
Public Agency: Foster City Police Department Contractor Name:

Address: 1030 E. Hillsdale Blvd Mailing Address:

City, State, Zip: Foster city, CA 94404 City, State, Zip PSAP Manager: Capt. Martin Ticas Representative: Valorie Taylor E-mail Address: [email protected] E-Mail Address: [email protected] Phone Number: (650) 286-3318 Phone Number: (512) 754-1903 Type of Funding Request:
( ) 9-1-1 Equipment ( ) 9-1-1 Network ( ) Training
( ) 9-1-1 Education ( ) County Coordinator Expense ( ) 7-Digit Phone Lines ( X ) Maintenance
Quantity Service/
Eqmt. ID# Unit Cost Installation Monthly
Cost
Total Recurring
Cost
Total Non-
Recurring Cost
- -
12 1,559.56 18,714.75 -
- -
- -
- -
- -
- -
- -
- -
- -
18,714.75 -
TD-288 expiration date: Fiscal Year: 2023/24
All invoices shall refer to tracking number: 25686R Account Name: 4107 / 702.14 APPROVED BY Date
(916) 894-5020
INTRADO QUOTE# 74070v2
VIPER SYSTEM / (3) POS

MAINTENANCE
This Form To Be Completed By The State 9-1-1 Office Only The State of California's monetary obligation under this agreement in subsequent fiscal years is subject to, and contingent upon, availability of funds in the State Emergency Telephone Account. Please be advised that this commitment to fund does not constitute a binding purchase order agreement.

REVISION:

N/A
9/04/2023 - 9/03/2024
18,714.75$
Subtotal
Description
Description of Equipment and Services to be funded: INTRADO to provide monthly maintenance of VIPER Power911 system; (2) positions; per Quote#74070v2; YR-10 service-period: 9/04.2023-9/03/2024. PSAP may cancel service, giving INTRADO 30 days written notice; cancelation shall occur upon subsequent CPE replacement. PAYMENT PROCESSING:

Foster City PD shall pay INTRADO directly for service, then seek reimbursement in arrears of payment from state via the CA911 Branch TD290-Reimbursement Claim form process; complete/submit TD290 to state with copy of vendor invoice and agency proof-of-payment (copy of canceled check and/or detailed accounting ledger may be accepted); include TD288-State Tracking#25686 on TD290 form. PAYMENT ROUTE: PSAP REIMBURSEMENT Purchase/Service Information: Include equipment or service description, quantity, part number, unit cost, installation cost, monthly cost, tax and total cost. Attach contractors quote or PSAP purchase order, where applicable.

INTRADO Life & Safety
Solutions Corp.

Foster City PD (YR-10) maintenance corrected/increased by three cents. The TD288 cell entry under monthly cost (@1,559.5625) did not calculate (round up) to reflect $1,559.75, rather reflected $1,559.72.

ERD-
ORDERMANAGEMENTTEAM@INT
RADO.COM
Other:

THERESA FRYER JANEE DABROWSKI
YEAR-9 SERVICE PERIOD
RECOMMENDED FOR APPROVAL BY Telephone Number
Tax and Surcharge

TOTAL APPROVED
DocuSign Envelope ID: 78E42228-7332-475D-BCA5-646DF626EE24 10/24/2023

5.3 Attachment 3 - Form TD-288: Commitment to Fund document from the Cal OES 9-1-1 Branch

58 DATE: November 20, 2023

TO: Mayor and Members of the City Council
VIA: Stefan Chatwin, City Manager

FROM: Andrew Brozyna, Public Works Director/City Engineer ‘Andra Lorenz, Principal Management Analyst
DEPARTMENT: Public Works
SUBJECT: CONSIDER APPROVING COLLECTION RATE INCREASES FOR

SOLID WASTE, RECYCLABLES, AND ORGANIC MATERIALS
FOR CALENDAR YEARS 2024 THROUGH 2028 AND FINDING
THAT THE CITY’S FRANCHISE FEES INCLUDED IN THE SOLID

WASTE RATES ARE JUSTIFIED

RECOMMENDATION
It is recommended that the City Council hold a Public Hearing to consider the proposed collection rates for solid waste, recyclables, and organic materials and, if a majority protest is not received, adopt the attached ordinance and resolution that will collectively:

1. Accept and adopt the HF&H Study attached as Exhibit A to the resolution and find and determine that the City’s franchise fees included in the solid waste rates are justified by the City’s costs of service and the value of City right of ways used for solid waste services;

2. Increase the 2023 monthly residential collection rates by no more than $5.40 per account in Rate Year 2024, $4.74 in Rate Year 2025, $4.98 in Rate Year 2026, $4.19 in Rate Year 2027 and $4.35 in Rate Year 2028; and

3. Increase 2024 charges for Unscheduled Services (optional services requested by customers above the base service level) by 5.465% over 2023, and annually thereafter based on actual indexed factors up to a maximum not to exceed 6.0% per year.

EXECUTIVE SUMMARY

6.1 6.1 Staff Report

59 During 2023, the City contracted with HF&H Consultants, LLC (“HF&H”) to review and analyze the solid waste rates and to review the City’s franchise fees to determine the amounts the City is entitled to charge for its solid waste related services and the use of its public rights of way for solid waste services. The HF&H Study is attached as Exhibit A to the resolution, providing the basis to find and determine that the City’s franchise fees included in the solid waste rates are justified by the City’s costs of service and the value of City right of ways used for solid waste services.

On October 2, 2023, the City Council considered collection rates for solid waste, recyclables, and organic materials for Rate Years 2024 through 2028. Per Minute Order No. 1942 (Attachment 3), the City Council directed staff to proceed with public notification procedures in accordance with Proposition 218 to increase residential Solid Waste rates for 2024 by no more than $5.40 per account over 2023 rates.

Further, the Proposition 218 notice provided for the approval of maximum increases of $4.74 in Rate Year 2025, $4.98 in Rate Year 2026, $4.19 in Rate Year 2027 and $4.35 in Rate Year 2028. Approving rates for a five-year period will allow for the planned and orderly implementation of rate adjustments over the term to ensure that revenue requirements are met and balances remain at acceptable levels. The Proposition 218 notice is attached to this report (Attachment 4).

Finally, an increase of 5.465% for 2024 over 2023 fees is required for Unscheduled Services, which are optional services provided to customers above the base service level upon customers’ request and paid by the requesting customer. In years 2025 through 2028, adjustments to Unscheduled Services fees will be based on actual indexed factors up to a maximum not to exceed 6.0% per year.

In previous years, the City has been able to approve rates by resolution. This year staff is recommending that the City Council approve 2024 rates by resolution and rates for years 2025 through 2028 by uncodified ordinance due to potential new requirements of the Taxpayer Protection and Government Accountability Act (“TPGAA”), which is an initiative that is on the statewide ballot in 2024 that, if adopted, will require all fees and rates to be adopted by ordinance. The rates for 2024 may be adopted by resolution because the TPGAA will not take effect until 12 months after the TPGAA is adopted, and therefore, will not impact 2024 rates.

BACKGROUND
The City of Foster City entered into a franchise agreement with Recology San Mateo County for collection of solid waste, recyclables, and organic materials effective January 1, 2011, and an Amended and Restated Franchise agreement that went into effect on January 1, 2021. The cost for the collection and disposal of solid waste, recyclables, and organic materials in a manner that complies with State law is paid through the rates by the customers receiving the services. The City Council annually approves rates to be

6.1 6.1 Staff Report

60 charged for solid waste, recycling, and compost collection sufficient to cover the costs of the program.

ANALYSIS
The total annual revenue requirement for the solid waste and recycling program is calculated based upon the following components:

1. Collection Costs (Recology Compensation)

2. Disposal and Processing Costs (processing, disposal, commodity sales, and organics processing)

3. Shortfall/Surplus Fund Balances
An analysis of the Solid Waste program by the South Bayside Waste Management Authority (SBWMA) demonstrated that projected expenses will exceed projected revenue without a rate adjustment. Commercial rates are adequate to meet their cost of service, while residential rates need to be increased in order to meet the cost of service.

Therefore, the City’s rate consultant and City staff recommend that the City Council approve a five-year rate adjustment plan that judiciously uses the City’s positive balancing account to smooth in cost increases while increasing base residential rates by no more than $5.40 per account in Rate Year 2024. Setting these rates would utilize approximately $23,000 from the City’s positive balancing account in Rate Year 2024 with the remainder collected through rates. Note that the amount required from the balancing account in 2024 is lower than what was projected at the City Council meeting in October 2023, because of the release of one-time rate stabilization funds by the SBWMA.

If a $5.40 increase to residential rates is approved, Foster City’s rate for a 32-gallon container (the most commonly subscribed size) would increase from $27.52 to $32.92 per month, which is the second lowest among SBWMA member agencies compared to approved 2023 rates (Attachment 5).

Adoption of Five-Year Rates
Staff recommends that the City Council approve multi-year rates for a number of reasons.

First and foremost, approval of multi-year rates allows the City Council to make a plan on the use of the positive balancing account to smooth rates over the five-year term while fine tuning the alignment of rates between account types (i.e., residential and commercial). Secondly, approving multi-year rates reduces the costs, including staff time, associated with implementing annual Proposition 218 notice processes. Finally, approving multi-year rates allows for customers to plan their budgets over a longer term.

If the City Council does approve five-year rates, the consultant and staff recommend maximum increases per month per account of $4.74 in Rate Year 2025, $4.98 in Rate Year 2026, $4.19 in Rate Year 2027 and $4.35 in Rate Year 2028. The full list of proposed

6.1 6.1 Staff Report

61 rates is included in the Proposition Notice shown as Attachment 4. This plan utilizes rate stabilization funds in each year, but leaves a positive balance through the five year term.

Finally, in addition to the base rates, the City annually approves fees for “on demand” services charged by Recology. Since these costs are charged on a usage basis and are paid for directly by the customers who request them, they are not included in Recology’s “base compensation.”
Per the Franchise Agreement, the contractor’s fees for Unscheduled Services are adjusted each year based on the cost to provide the service. For 2024 the calculated increase is 5.465%. In years 2025 through 2028, adjustments to Unscheduled Services fees will be based on actual indexed factors up to a maximum not to exceed 6.0% per year.

In accordance with the requirements of Proposition 218, if a majority of affected parcels (3,647 or more) file written protests, the proposed rate changes will not be approved. As of October 31, 2023, two (2) protests had been received. If fewer than 3,647 are received by the end of the public hearing, the City can proceed with approving the new base rates and rates for unscheduled services.

New Process – Adoption by Ordinance
In previous years, the City has been able to approve rates by resolution. This year staff is recommending that the City Council approve 2024 rates by resolution and rates for years 2025 through 2028 by uncodified ordinance. While the best practice is to approve all rates by resolution, the Taxpayer Protection and Government Accountability Act (“TPGAA”), which is an initiative that is on the statewide ballot in 2024 and, if adopted, will apply retroactively to any fees or rates adopted after January 1, 2022, requires all fees and rates to be adopted by ordinance. As such, the City Attorney has recommended adoption of the rates for years 2025 through 2028 by ordinance, in order to avoid having to readopt the rates in the event the TPGAA passes. The rates for 2024 may be adopted by resolution because the TPGAA’s prohibition on rates adopted by ordinance after January 1, 2022, will not take effect until 12 months after the TPGAA is adopted, and therefore, it will not impact 2024 rates. Moreover, the 2024 rates need to be adopted by resolution so that they can take effect by January 1, 2024. This is important because the ordinance process is lengthier and, if 2024 rates were adopted by ordinance, the rate recommendation would need to be adjusted to account for revenue collection that could not take place at the start of January 2024.

Fee Study Findings
During 2023, the City contracted with HF&H to review and analyze the solid waste rates and to review the City’s franchise fees to determine the amounts the City is entitled to charge for its solid waste related services and the use of its public rights of way for solid waste services. HF&H provided the City with a Memorandum analyzing the Proposed 2024 Solid Waste Rates on September 15, 2023 (“HF&H Study”), attached to the

6.1 6.1 Staff Report

62 resolution as Exhibit A, which determined that the sum of the costs of service provided by the City in relation to solid waste services and the reasonable fee for the use of the City’s public rights of way for container placement was greater than the total, annual franchise fees included in the solid waste rates for each rate year from 2024 through 2028.

CEQA
The City Council’s action is not a project pursuant to CEQA Guidelines section 15378(b) (4) because the City is authorizing maximum rates to be charged to fund on-going solid waste collection and processing services and as such, the action involves a funding mechanism or fiscal activity within the meaning of the CEQA Guidelines.

FISCAL IMPACT
Solid waste collection service costs in Foster City are covered by the solid waste rates paid by residents and businesses. The costs of these services do not impact the City budget or the General Fund.

CITY COUNCIL VISION, MISSION, AND VALUE/PRIORITY AREA
Innovation and Sustainability
City Council Operations and Improved Community Engagement

ATTACHMENTS
Attachment 1 – Uncodified Ordinance
Ordinance Exhibit A – 2025-2028 Base Rates
Attachment 2 – Resolution
Resolution Exhibit A – HF&H Study
Resolution Exhibit B – 2024 Base Rates
Attachment 3 – Minute Order No. 1942
Attachment 4 – Notice of Intent to Increase Collection Rates for The Rate Year 2024 For Solid Waste, Recyclables, And Organic Materials Collection in The City of Foster City (Proposition 218 Notice)
Attachment 5 – Comparison of Current Rates of SBWMA Agencies Attachment 6 – Mailing Confirmation

6.1 6.1 Staff Report

63 ORDINANCE NO.____________

AN UNCODIFIED ORDINANCE OF THE CITY OF FOSTER CITY APPROVING SOLID WASTE RATES FOR A FOUR-YEAR PERIOD OF CALENDAR YEARS 2025 THROUGH 2028, INCREASING THE MONTHLY RESIDENTIAL COLLECTION RATES BY NO MORE THAN $4.74 IN RATE YEAR 2025, $4.98 IN RATE YEAR 2026, $4.19 IN RATE YEAR 2027, AND $4.35 IN RATE YEAR 2028 AND INCREASING FEES FOR UNSCHEDULED SERVICES UP TO 6.0% PER YEAR FROM RATE YEARS 2025 THROUGH 2028

CITY OF FOSTER CITY
WHEREAS, On October 2, 2023, the City Council considered information related to the solid waste, recyclable, and organic materials collection and processing program relative to rates for the five-year period from 2024 through 2028; and WHEREAS, per Minute Order 1942, the City Council directed staff to proceed with the public notification procedures set forth in Article XIII D, Section 6 of the California Constitution (Proposition 218) to increase residential Solid Waste rates for rate years 2025 through 2028; and
WHEREAS, the Proposition 218 notice provided for the approval of maximum increases of $4.74 in Rate Year 2025, $4.98 in Rate Year 2026, $4.19 in Rate Year 2027 and $4.35 in Rate Year 2028 in order to allow for the planned and orderly implementation of rate adjustments over the five year term; and
WHEREAS, an increase of 5.465% for 2024 over 2023 fees is required for Unscheduled Services, and in years 2025 through 2028, adjustments to Unscheduled Services fees will be based on actual indexed factors, but will not exceed 6.0%; and WHEREAS, the collection rate increases are necessary to meet current and projected future costs for solid waste, recyclable, and organic materials collection services; and
WHEREAS, the City Council’s action is not a project pursuant to CEQA Guidelines section 15378(b) (4) because the City is authorizing maximum rates to be charged to fund on-going solid waste services, and as such, the action involves a funding mechanism or fiscal activity within the meaning of the CEQA Guidelines; and WHEREAS, on October 6, 2023, notices were mailed to 7,295 residential and commercial customers in Foster City, pursuant to Government Code section 53755; and WHEREAS, a public hearing was held in accordance with the requirements of Proposition 218, the City did not receive protests from a majority of the parcels receiving

6.1 Attachment 1 - Uncodified Ordinance

64 solid waste, recyclable, and organic materials collection services, and per Proposition 218, may proceed with the proposed rate adjustment; and WHEREAS, the City Council has chosen as a matter of policy to follow the procedures set forth in Article XIII D of the California Constitution, nothing in this Resolution shall be interpreted as an admission by the City that the provisions of Article XIII D apply to the actions taken herein; and
WHEREAS, to the extent that this rate authorization results in the imposition of any fees, rates, or charges for services or facilities in connection with the City’s solid waste system, those charges are adopted pursuant to California Health and Safety Code section 5471.

THE CITY COUNCIL OF THE CITY OF FOSTER CITY DOES ORDAIN AS FOLLOWS:

Section 1. The foregoing Recitals are true and correct and are incorporated herein by this reference.

Section 2. The City Council does hereby find and determine based upon the aforementioned Record as follows:
a) The Public Hearing was properly noticed and conducted in accordance with State law and the Foster City Municipal Code; and
b) The adoption of solid waste rates is necessary for the collection of sufficient revenue to provide solid waste services to the Foster City community.

Section 3. That the City of Foster City Solid Waste Rates are hereby approved as presented in the attached Exhibit A.

Section 4. That the City of Foster City Fees for Unscheduled Services are hereby approved as presented in the attached Exhibit B.

Section 5. The rates and fees adopted by this uncodified ordinance may be amended by ordinance or resolution of the City Council.

Section 6. Severability. If any section, subsection, sentence, clause, or phrase of this chapter is held to be invalid or unconstitutional including by any court with jurisdiction, such decision shall not affect the validity of the remaining portions of this article. The City Council declares that it would have passed this article, and each section, subsection, clause, or phrase thereof, irrespective of the fact that any one or more other sections, subsections, clauses, or phrases may be declared invalid or unconstitutional.

Section 7. Taking Effect. This ordinance shall take effect thirty (30) days following its final passage.

6.1 Attachment 1 - Uncodified Ordinance

65 Section 8. Posting. Within fifteen (15) days after the adoption of this Ordinance, the City Clerk shall have it posted in three (3) public places designated by the City Council.

This ordinance was introduced and read on the 20 th day of November, 2023, and passed and adopted on the ____ day of ______, by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:

JON FROOMIN, MAYOR
ATTEST:

PRISCILLA SCHAUS, CITY CLERK

6.1 Attachment 1 - Uncodified Ordinance

66 EXHIBIT A
City of Foster City
Residential Rates
(Refuse, Organics, and Recycling)
Rate Years 2025-2028
Qty Frequency
per week Size 2025 Rate 2026 Rate 2027 Rate 2028 Rate
1 1 20 gal 27.32$ 32.30$ 36.49$ 40.84$ 1 1 32 gal 37.66$ 42.64$ 46.83$ 51.18$ 1 1 64 gal 65.16$ 70.14$ 74.33$ 78.68$ 1 1 96 gal 92.69$ 97.67$ 101.86$ 106.21$

6.1 Ordinance Exhibit A - 2025-2028 Base Rates

67 City of Foster City
Commercial Cart Rates
Rate Years 2025-2028
Total
Gal. Qty Size
(gallons)
Freq.
per week 2025 Rate 2026 Rate 2027 Rate 2028 Rate
20 gallon
20 1 20 1 17.18$ 17.18$ 17.18$ 17.18$ 32 gallon
32 1 32 1 27.52$ 27.52$ 27.52$ 27.52$ 64 1 32 2 57.99$ 57.99$ 57.99$ 57.99$ 96 1 32 3 91.55$ 91.55$ 91.55$ 91.55$ 64 2 32 1 56.65$ 56.65$ 56.65$ 56.65$ 96 3 32 1 87.53$ 87.53$ 87.53$ 87.53$ 288 3 32 3 274.61$ 274.61$ 274.61$ 274.61$ 128 4 32 1 116.73$ 116.73$ 116.73$ 116.73$ 160 5 32 1 145.89$ 145.89$ 145.89$ 145.89$ 192 6 32 1 175.08$ 175.08$ 175.08$ 175.08$ 11,136 174 32 2 10,386.37$ 10,386.37$ 10,386.37$ 10,386.37$ 7,488 234 32 1 6,828.64$ 6,828.64$ 6,828.64$ 6,828.64$ 8,832 276 32 1 8,052.96$ 8,052.96$ 8,052.96$ 8,052.96$ 8,864 277 32 1 8,082.14$ 8,082.14$ 8,082.14$ 8,082.14$ 8,896 278 32 1 8,111.79$ 8,111.79$ 8,111.79$ 8,111.79$ 8,928 279 32 1 8,140.98$ 8,140.98$ 8,140.98$ 8,140.98$ 8,960 280 32 1 8,170.16$ 8,170.16$ 8,170.16$ 8,170.16$ 17,920 560 32 1 16,340.30$ 16,340.30$ 16,340.30$ 16,340.30$

6.1 Ordinance Exhibit A - 2025-2028 Base Rates

68 City of Foster City
Commercial Cart Rates
Rate Years 2025-2028
64 gallon
64 1 64 1 56.65$ 56.65$ 56.65$ 56.65$ 128 1 64 2 119.36$ 119.36$ 119.36$ 119.36$ 192 1 64 3 183.06$ 183.06$ 183.06$ 183.06$ 256 1 64 4 249.41$ 249.41$ 249.41$ 249.41$ 320 1 64 5 318.43$ 318.43$ 318.43$ 318.43$ 128 2 64 1 116.73$ 116.73$ 116.73$ 116.73$ 256 2 64 2 238.74$ 238.74$ 238.74$ 238.74$ 384 2 64 3 366.12$ 366.12$ 366.12$ 366.12$ 512 2 64 4 498.83$ 498.83$ 498.83$ 498.83$ 640 2 64 5 636.93$ 636.93$ 636.93$ 636.93$ 768 2 64 6 780.31$ 780.31$ 780.31$ 780.31$ 896 2 64 7 929.02$ 929.02$ 929.02$ 929.02$ 192 3 64 1 175.09$ 175.09$ 175.09$ 175.09$ 448 7 64 1 408.47$ 408.47$ 408.47$ 408.47$ 896 7 64 2 835.67$ 835.67$ 835.67$ 835.67$ 1,344 7 64 3 1,281.53$ 1,281.53$ 1,281.53$ 1,281.53$ 1,792 7 64 4 1,746.02$ 1,746.02$ 1,746.02$ 1,746.02$ 2,240 7 64 5 2,229.22$ 2,229.22$ 2,229.22$ 2,229.22$ 2,688 7 64 6 2,731.08$ 2,731.08$ 2,731.08$ 2,731.08$ 3,136 7 64 7 3,251.60$ 3,251.60$ 3,251.60$ 3,251.60$

6.1 Ordinance Exhibit A - 2025-2028 Base Rates

69 City of Foster City
Commercial Cart Rates
Rate Years 2025-2028
96 gallon
96 1 96 1 87.53$ 87.53$ 87.53$ 87.53$ 192 1 96 2 179.06$ 179.06$ 179.06$ 179.06$ 288 1 96 3 274.61$ 274.61$ 274.61$ 274.61$ 480 1 96 5 477.68$ 477.68$ 477.68$ 477.68$ 192 2 96 1 175.08$ 175.08$ 175.08$ 175.08$ 384 2 96 2 358.11$ 358.11$ 358.11$ 358.11$ 576 2 96 3 549.18$ 549.18$ 549.18$ 549.18$ 768 2 96 4 748.30$ 748.30$ 748.30$ 748.30$ 960 2 96 5 955.36$ 955.36$ 955.36$ 955.36$ 1,152 2 96 6 1,170.46$ 1,170.46$ 1,170.46$ 1,170.46$ 1,344 2 96 7 1,393.54$ 1,393.54$ 1,393.54$ 1,393.54$ 288 3 96 1 262.58$ 262.58$ 262.58$ 262.58$ 480 5 96 1 437.64$ 437.64$ 437.64$ 437.64$ 576 6 96 1 525.20$ 525.20$ 525.20$ 525.20$ 1,152 6 96 2 1,074.44$ 1,074.44$ 1,074.44$ 1,074.44$ 1,728 6 96 3 1,647.67$ 1,647.67$ 1,647.67$ 1,647.67$ 2,304 6 96 4 2,244.92$ 2,244.92$ 2,244.92$ 2,244.92$ 2,880 6 96 5 2,866.16$ 2,866.16$ 2,866.16$ 2,866.16$ 3,456 6 96 6 3,511.40$ 3,511.40$ 3,511.40$ 3,511.40$ 4,032 6 96 7 4,180.64$ 4,180.64$ 4,180.64$ 4,180.64$ 2,016 7 96 3 1,922.29$ 1,922.29$ 1,922.29$ 1,922.29$ 2,304 8 96 3 2,196.93$ 2,196.93$ 2,196.93$ 2,196.93$ 5,184 18 96 3 4,943.05$ 4,943.05$ 4,943.05$ 4,943.05$ 5,472 19 96 3 5,217.68$ 5,217.68$ 5,217.68$ 5,217.68$

6.1 Ordinance Exhibit A - 2025-2028 Base Rates

70 City of Foster City
Commercial Bin Rates
Rate Years 2025-2028
1 - YARD
Total
Yards Qty Size
(yards)
Freq.
per week 2025 Rate 2026 Rate 2027 Rate 2028 Rate
1 1 1 1 131.95$ 131.95$ 131.95$ 131.95$ 2 1 1 2 265.98$ 265.98$ 265.98$ 265.98$ 3 1 1 3 402.16$ 402.16$ 402.16$ 402.16$ 4 1 1 4 540.34$ 540.34$ 540.34$ 540.34$ 5 1 1 5 680.61$ 680.61$ 680.61$ 680.61$ 6 1 1 6 823.05$ 823.05$ 823.05$ 823.05$ 7 1 1 7 967.49$ 967.49$ 967.49$ 967.49$

6.1 Ordinance Exhibit A - 2025-2028 Base Rates

71 City of Foster City
Commercial Bin Rates
Rate Years 2025-2028
2 - YARD
Total
Yards Qty Size
(yards)
Freq.
per week 2025 Rate 2026 Rate 2027 Rate 2028 Rate
2 1 2 1 263.92$ 263.92$ 263.92$ 263.92$ 4 1 2 2 531.99$ 531.99$ 531.99$ 531.99$ 6 1 2 3 804.29$ 804.29$ 804.29$ 804.29$ 8 1 2 4 1,080.69$ 1,080.69$ 1,080.69$ 1,080.69$ 10 1 2 5 1,361.23$ 1,361.23$ 1,361.23$ 1,361.23$ 12 1 2 6 1,693.60$ 1,693.60$ 1,693.60$ 1,693.60$ 14 1 2 7 1,990.39$ 1,990.39$ 1,990.39$ 1,990.39$ 4 2 2 1 527.85$ 527.85$ 527.85$ 527.85$ 8 2 2 2 1,063.99$ 1,063.99$ 1,063.99$ 1,063.99$ 12 2 2 3 1,656.09$ 1,656.09$ 1,656.09$ 1,656.09$ 16 2 2 4 2,224.71$ 2,224.71$ 2,224.71$ 2,224.71$ 20 2 2 5 2,801.65$ 2,801.65$ 2,801.65$ 2,801.65$ 24 2 2 6 3,485.08$ 3,485.08$ 3,485.08$ 3,485.08$ 28 2 2 7 4,094.92$ 4,094.92$ 4,094.92$ 4,094.92$ 6 3 2 1 791.75$ 791.75$ 791.75$ 791.75$ 12 3 2 2 1,643.48$ 1,643.48$ 1,643.48$ 1,643.48$ 18 3 2 3 2,484.14$ 2,484.14$ 2,484.14$ 2,484.14$ 24 3 2 4 3,434.95$ 3,434.95$ 3,434.95$ 3,434.95$ 30 3 2 5 4,324.77$ 4,324.77$ 4,324.77$ 4,324.77$ 36 3 2 6 5,227.60$ 5,227.60$ 5,227.60$ 5,227.60$ 42 3 2 7 6,142.40$ 6,142.40$ 6,142.40$ 6,142.40$ 8 4 2 1 1,055.70$ 1,055.70$ 1,055.70$ 1,055.70$ 16 4 2 2 2,191.29$ 2,191.29$ 2,191.29$ 2,191.29$ 24 4 2 3 3,410.07$ 3,410.07$ 3,410.07$ 3,410.07$ 32 4 2 4 4,579.92$ 4,579.92$ 4,579.92$ 4,579.92$ 40 4 2 5 5,766.36$ 5,766.36$ 5,766.36$ 5,766.36$ 48 4 2 6 6,970.13$ 6,970.13$ 6,970.13$ 6,970.13$ 56 4 2 7 8,189.86$ 8,189.86$ 8,189.86$ 8,189.86$ 10 5 2 1 1,319.60$ 1,319.60$ 1,319.60$ 1,319.60$ 20 5 2 2 2,739.14$ 2,739.14$ 2,739.14$ 2,739.14$ 30 5 2 3 4,262.60$ 4,262.60$ 4,262.60$ 4,262.60$ 40 5 2 4 5,724.90$ 5,724.90$ 5,724.90$ 5,724.90$ 50 5 2 5 7,207.94$ 7,207.94$ 7,207.94$ 7,207.94$

6.1 Ordinance Exhibit A - 2025-2028 Base Rates

72 City of Foster City
Commercial Bin Rates
Rate Years 2025-2028
60 5 2 6 8,712.67$ 8,712.67$ 8,712.67$ 8,712.67$ 70 5 2 7 10,237.31$ 10,237.31$ 10,237.31$ 10,237.31$

6.1 Ordinance Exhibit A - 2025-2028 Base Rates

73 City of Foster City
Commercial Bin Rates
Rate Years 2025-2028
3 - YARD
Total
Yards Qty Size
(yards)
Freq.
per week 2025 Rate 2026 Rate 2027 Rate 2028 Rate
3 1 3 1 395.88$ 395.88$ 395.88$ 395.88$ 6 1 3 2 797.98$ 797.98$ 797.98$ 797.98$ 9 1 3 3 1,206.44$ 1,206.44$ 1,206.44$ 1,206.44$ 12 1 3 4 1,668.54$ 1,668.54$ 1,668.54$ 1,668.54$ 15 1 3 5 2,101.22$ 2,101.22$ 2,101.22$ 2,101.22$ 18 1 3 6 2,540.40$ 2,540.40$ 2,540.40$ 2,540.40$ 21 1 3 7 3,071.18$ 3,071.18$ 3,071.18$ 3,071.18$ 6 2 3 1 791.75$ 791.75$ 791.75$ 791.75$ 12 2 3 2 1,643.48$ 1,643.48$ 1,643.48$ 1,643.48$ 18 2 3 3 2,484.14$ 2,484.14$ 2,484.14$ 2,484.14$ 24 2 3 4 3,434.95$ 3,434.95$ 3,434.95$ 3,434.95$ 30 2 3 5 4,324.77$ 4,324.77$ 4,324.77$ 4,324.77$ 36 2 3 6 5,227.60$ 5,227.60$ 5,227.60$ 5,227.60$ 42 2 3 7 6,142.40$ 6,142.40$ 6,142.40$ 6,142.40$ 9 3 3 1 1,187.63$ 1,187.63$ 1,187.63$ 1,187.63$ 18 3 3 2 2,465.21$ 2,465.21$ 2,465.21$ 2,465.21$ 27 3 3 3 3,836.32$ 3,836.32$ 3,836.32$ 3,836.32$ 36 3 3 4 5,152.39$ 5,152.39$ 5,152.39$ 5,152.39$ 45 3 3 5 6,487.15$ 6,487.15$ 6,487.15$ 6,487.15$ 54 3 3 6 7,841.40$ 7,841.40$ 7,841.40$ 7,841.40$ 63 3 3 7 9,213.58$ 9,213.58$ 9,213.58$ 9,213.58$ 12 4 3 1 1,631.04$ 1,631.04$ 1,631.04$ 1,631.04$ 24 4 3 2 3,384.82$ 3,384.82$ 3,384.82$ 3,384.82$ 36 4 3 3 5,115.10$ 5,115.10$ 5,115.10$ 5,115.10$ 48 4 3 4 6,869.89$ 6,869.89$ 6,869.89$ 6,869.89$ 60 4 3 5 8,649.53$ 8,649.53$ 8,649.53$ 8,649.53$ 72 4 3 6 10,455.20$ 10,455.20$ 10,455.20$ 10,455.20$ 84 4 3 7 12,284.79$ 12,284.79$ 12,284.79$ 12,284.79$ 15 5 3 1 2,038.77$ 2,038.77$ 2,038.77$ 2,038.77$ 30 5 3 2 4,231.01$ 4,231.01$ 4,231.01$ 4,231.01$ 45 5 3 3 6,393.62$ 6,393.62$ 6,393.62$ 6,393.62$ 60 5 3 4 8,587.38$ 8,587.38$ 8,587.38$ 8,587.38$

6.1 Ordinance Exhibit A - 2025-2028 Base Rates

74 City of Foster City
Commercial Bin Rates
Rate Years 2025-2028
105 5 3 7 15,355.98$ 15,355.98$ 15,355.98$ 15,355.98$ 18 6 3 1 2,446.56$ 2,446.56$ 2,446.56$ 2,446.56$ 36 6 3 2 5,077.21$ 5,077.21$ 5,077.21$ 5,077.21$ 54 6 3 3 7,672.63$ 7,672.63$ 7,672.63$ 7,672.63$ 72 6 3 4 10,304.83$ 10,304.83$ 10,304.83$ 10,304.83$ 90 6 3 5 12,974.31$ 12,974.31$ 12,974.31$ 12,974.31$ 108 6 3 6 15,682.79$ 15,682.79$ 15,682.79$ 15,682.79$ 126 6 3 7 18,427.19$ 18,427.19$ 18,427.19$ 18,427.19$ 21 7 3 1 2,939.96$ 2,939.96$ 2,939.96$ 2,939.96$ 42 7 3 2 5,923.41$ 5,923.41$ 5,923.41$ 5,923.41$ 63 7 3 3 8,951.40$ 8,951.40$ 8,951.40$ 8,951.40$ 84 7 3 4 12,022.27$ 12,022.27$ 12,022.27$ 12,022.27$ 105 7 3 5 15,136.70$ 15,136.70$ 15,136.70$ 15,136.70$ 126 7 3 6 18,296.59$ 18,296.59$ 18,296.59$ 18,296.59$ 147 7 3 7 21,498.39$ 21,498.39$ 21,498.39$ 21,498.39$ 24 8 3 1 3,359.96$ 3,359.96$ 3,359.96$ 3,359.96$ 48 8 3 2 6,769.63$ 6,769.63$ 6,769.63$ 6,769.63$ 72 8 3 3 10,230.20$ 10,230.20$ 10,230.20$ 10,230.20$ 96 8 3 4 13,739.76$ 13,739.76$ 13,739.76$ 13,739.76$ 120 8 3 5 17,299.08$ 17,299.08$ 17,299.08$ 17,299.08$ 144 8 3 6 20,910.39$ 20,910.39$ 20,910.39$ 20,910.39$ 168 8 3 7 24,569.58$ 24,569.58$ 24,569.58$ 24,569.58$ 27 9 3 1 3,779.94$ 3,779.94$ 3,779.94$ 3,779.94$ 54 9 3 2 7,615.83$ 7,615.83$ 7,615.83$ 7,615.83$ 81 9 3 3 11,508.98$ 11,508.98$ 11,508.98$ 11,508.98$ 30 10 3 1 4,199.92$ 4,199.92$ 4,199.92$ 4,199.92$ 60 10 3 2 8,462.04$ 8,462.04$ 8,462.04$ 8,462.04$ 90 10 3 3 12,787.75$ 12,787.75$ 12,787.75$ 12,787.75$ 120 10 3 4 17,174.71$ 17,174.71$ 17,174.71$ 17,174.71$ 150 10 3 5 21,623.86$ 21,623.86$ 21,623.86$ 21,623.86$ 180 10 3 6 26,137.98$ 26,137.98$ 26,137.98$ 26,137.98$ 210 10 3 7 30,712.00$ 30,712.00$ 30,712.00$ 30,712.00$ 66 11 3 2 9,308.25$ 9,308.25$ 9,308.25$ 9,308.25$

6.1 Ordinance Exhibit A - 2025-2028 Base Rates

75 City of Foster City
Commercial Bin Rates
Rate Years 2025-2028
36 12 3 1 5,039.88$ 5,039.88$ 5,039.88$ 5,039.88$ 72 12 3 2 10,154.46$ 10,154.46$ 10,154.46$ 10,154.46$ 108 12 3 3 15,345.30$ 15,345.30$ 15,345.30$ 15,345.30$ 144 12 3 4 20,609.63$ 20,609.63$ 20,609.63$ 20,609.63$ 180 12 3 5 25,948.60$ 25,948.60$ 25,948.60$ 25,948.60$ 216 12 3 6 31,365.59$ 31,365.59$ 31,365.59$ 31,365.59$ 252 12 3 7 36,854.39$ 36,854.39$ 36,854.39$ 36,854.39$ 45 15 3 1 6,299.90$ 6,299.90$ 6,299.90$ 6,299.90$ 90 15 3 2 12,693.04$ 12,693.04$ 12,693.04$ 12,693.04$ 135 15 3 3 19,181.61$ 19,181.61$ 19,181.61$ 19,181.61$ 138 23 3 2 19,462.70$ 19,462.70$ 19,462.70$ 19,462.70$ 150 25 3 2 21,155.07$ 21,155.07$ 21,155.07$ 21,155.07$

6.1 Ordinance Exhibit A - 2025-2028 Base Rates

76 City of Foster City
Commercial Bin Rates
Rate Years 2025-2028
4 - YARD
Total
Yards Qty Size
(yards)
Freq.
per week 2025 Rate 2026 Rate 2027 Rate 2028 Rate
4 1 4 1 527.85$ 527.85$ 527.85$ 527.85$ 8 1 4 2 1,063.99$ 1,063.99$ 1,063.99$ 1,063.99$ 12 1 4 3 1,656.09$ 1,656.09$ 1,656.09$ 1,656.09$ 16 1 4 4 2,224.71$ 2,224.71$ 2,224.71$ 2,224.71$ 20 1 4 5 2,801.65$ 2,801.65$ 2,801.65$ 2,801.65$ 24 1 4 6 3,485.08$ 3,485.08$ 3,485.08$ 3,485.08$ 8 2 4 1 1,055.69$ 1,055.69$ 1,055.69$ 1,055.69$ 16 2 4 2 2,190.84$ 2,190.84$ 2,190.84$ 2,190.84$ 24 2 4 3 3,409.94$ 3,409.94$ 3,409.94$ 3,409.94$ 40 2 4 5 5,766.36$ 5,766.36$ 5,766.36$ 5,766.36$ 12 3 4 1 1,631.04$ 1,631.04$ 1,631.04$ 1,631.04$ 24 3 4 2 3,384.82$ 3,384.82$ 3,384.82$ 3,384.82$ 36 3 4 3 5,115.10$ 5,115.10$ 5,115.10$ 5,115.10$ 48 3 4 4 6,869.87$ 6,869.87$ 6,869.87$ 6,869.87$ 60 3 4 5 8,649.53$ 8,649.53$ 8,649.53$ 8,649.53$ 72 3 4 6 10,455.20$ 10,455.20$ 10,455.20$ 10,455.20$ 84 3 4 7 12,284.79$ 12,284.79$ 12,284.79$ 12,284.79$ 16 4 4 1 2,174.70$ 2,174.70$ 2,174.70$ 2,174.70$ 32 4 4 2 4,513.09$ 4,513.09$ 4,513.09$ 4,513.09$ 48 4 4 3 6,820.15$ 6,820.15$ 6,820.15$ 6,820.15$ 64 4 4 4 9,159.84$ 9,159.84$ 9,159.84$ 9,159.84$ 80 4 4 5 11,532.74$ 11,532.74$ 11,532.74$ 11,532.74$ 96 4 4 6 13,940.24$ 13,940.24$ 13,940.24$ 13,940.24$ 112 4 4 7 16,379.74$ 16,379.74$ 16,379.74$ 16,379.74$ 48 6 4 2 6,769.63$ 6,769.63$ 6,769.63$ 6,769.63$

6.1 Ordinance Exhibit A - 2025-2028 Base Rates

77 City of Foster City
Commercial Bin Rates
Rate Years 2025-2028
6 - YARD
Total
Yards Qty Size
(yards)
Freq.
per week 2025 Rate 2026 Rate 2027 Rate 2028 Rate
6 1 6 1 791.75$ 791.75$ 791.75$ 791.75$ 12 1 6 2 1,643.48$ 1,643.48$ 1,643.48$ 1,643.48$ 18 1 6 3 2,484.14$ 2,484.14$ 2,484.14$ 2,484.14$ 24 1 6 4 3,434.95$ 3,434.95$ 3,434.95$ 3,434.95$ 30 1 6 5 4,324.77$ 4,324.77$ 4,324.77$ 4,324.77$ 36 1 6 6 5,227.60$ 5,227.60$ 5,227.60$ 5,227.60$ 42 1 6 7 6,142.40$ 6,142.40$ 6,142.40$ 6,142.40$ 24 2 6 2 3,384.92$ 3,384.92$ 3,384.92$ 3,384.92$ 36 2 6 3 5,115.10$ 5,115.10$ 5,115.10$ 5,115.10$ 48 2 6 4 6,869.89$ 6,869.89$ 6,869.89$ 6,869.89$ 60 2 6 5 8,649.53$ 8,649.53$ 8,649.53$ 8,649.53$ 72 2 6 6 10,455.20$ 10,455.20$ 10,455.20$ 10,455.20$ 84 2 6 7 12,284.79$ 12,284.79$ 12,284.79$ 12,284.79$ 54 3 6 3 7,672.63$ 7,672.63$ 7,672.63$ 7,672.63$ 72 3 6 4 10,304.83$ 10,304.83$ 10,304.83$ 10,304.83$ 90 3 6 5 12,974.33$ 12,974.33$ 12,974.33$ 12,974.33$ 108 3 6 6 15,682.79$ 15,682.79$ 15,682.79$ 15,682.79$ 126 3 6 7 18,427.17$ 18,427.17$ 18,427.17$ 18,427.17$ 8 - YARD
Total
Yards Qty Size
(yards)
Freq.
per week 2025 Rate 2026 Rate 2027 Rate 2028 Rate
8 1 8 1 1,119.98$ 1,119.98$ 1,119.98$ 1,119.98$ 16 1 8 2 2,256.64$ 2,256.64$ 2,256.64$ 2,256.64$ 24 1 8 3 3,409.94$ 3,409.94$ 3,409.94$ 3,409.94$ 32 1 8 4 4,579.92$ 4,579.92$ 4,579.92$ 4,579.92$ 40 1 8 5 5,766.57$ 5,766.57$ 5,766.57$ 5,766.57$ 16 2 8 1 2,239.95$ 2,239.95$ 2,239.95$ 2,239.95$ 32 2 8 2 4,513.26$ 4,513.26$ 4,513.26$ 4,513.26$

6.1 Ordinance Exhibit A - 2025-2028 Base Rates

78 MATERIAL TYPE 2025 Rate 2026 Rate 2027 Rate 2028 Rate PER YARD, PER PULL - TRASH 112.83$ 112.83$ 112.83$ 112.83$ PER YARD, PER PULL - ORGANICS 84.62$ 84.62$ 84.62$ 84.62$ City of Foster City

COMPACTOR RATES
Rate Years 2025-2028

6.1 Ordinance Exhibit A - 2025-2028 Base Rates

79 MATERIAL TYPE 2025 Rate 2026 Rate 2027 Rate 2028 Rate Backyard Collection Service—Single Family Dwelling
Return Trip Cost—Single Family Dwelling (Request to provide collection service after the regularly scheduled collection day) On-Call Bulky Item Collection
Distance charge—MFD and Commercial Accounts
Container Relocation Service
Extra Pick-Up Cost—MFD and Commercial Accounts
Additional Targeted Recyclable Materials or Organic Materials Cart Rental or Purchase
Collection of Contaminated Targeted Recyclable Materials or Organic Materials Container
Key Service
Lock Purchase
Overage Fee
Overage Bags
Container Cleaning
Dirty Cart Replacement
City of Foster City

FEES FOR UNSCHEDULED SERVICES
Rate Years 2025-2028
Fee increases for Unscheduled Services are based on
indexed factors identified in Attachment K to the
Franchise Agreement with Recology San Mateo
County, not to exceed an increase of 6% annually. The
Franchise Agreement can be found here:
www.fostercity.org/swfranchiseagreement

6.1 Ordinance Exhibit A - 2025-2028 Base Rates

80 RESOLUTION NO.____________

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF FOSTER CITY FINDING THAT THE CITY’S FRANCHISE FEES INCLUDED IN THE SOLID WASTE RATES ARE JUSTIFIED AND APPROVING INCREASES TO THE 2023 MONTHLY RESIDENTIAL SOLID WASTE COLLECTION RATES BY NO MORE THAN $5.40 PER ACCOUNT IN RATE YEAR 2024 AND APPROVING INCREASES TO 2024 CHARGES FOR UNSCHEDULED SERVICES BY 5.465% OVER 2023.

CITY OF FOSTER CITY
WHEREAS, the City contracted with HF&H Consultants, LLC (“HF&H”) to analyze the solid waste rates and to review the City’s franchise fees to determine the amounts the City is entitled to charge for its solid waste related services and the use of its public rights of way for solid waste services: and
WHEREAS, HF&H provided the City with a Memorandum analyzing the Proposed 2024 Solid Waste Rates on September 15, 2023 (“HF&H Study”), attached hereto as Exhibit A, which determined that the sum of the costs of service provided by the City in relation to solid waste services and the reasonable fee for the use of the City’s public rights of way for container placement was greater than the total, annual franchise fees included in the solid waste rates for each rate year from 2024 through 2028; and WHEREAS, pursuant to the HF&H Study, the City’s franchise fees, included in the solid waste rates, comply with Article XIII C, Section 1 of the California Constitution; and WHEREAS, On October 2, 2023, the City Council considered information related to the solid waste, recyclable, and organic materials collection and processing program relative to rates for 2024, and
WHEREAS, per Minute Order 1942, the City Council directed staff to proceed with the public notification procedures set forth in Article XIII D, Section 6 of the California Constitution (Proposition 218) to increase residential Solid Waste rates for 2024 by no more than $5.40 per account over 2023 rates; and
WHEREAS, the Proposition 218 notice provided for the approval of maximum increases of $4.74 in Rate Year 2025, $4.98 in Rate Year 2026, $4.19 in Rate Year 2027 and $4.35 in Rate Year 2028 in order to allow for the planned and orderly implementation of rate adjustments over the five year term; and
WHEREAS, an increase of 5.465% for 2024 over 2023 fees is required for Unscheduled Services; and

6.1 Attachment 2 - Resolution

81 WHEREAS, the collection rate increases are necessary to meet current and projected future costs for solid waste, recyclable, and organic materials collection services; and
WHEREAS, the City Council’s action is not a project pursuant to CEQA Guidelines section 15378(b) (4) because the City is authorizing maximum rates to be charged to fund on-going solid waste services, and as such, the action involves a funding mechanism or fiscal activity within the meaning of the CEQA Guidelines; and WHEREAS, on October 6, 2023, notices were mailed to 7,295 residential and commercial customers in Foster City, pursuant to Government Code section 53755; and WHEREAS, a public hearing was held in accordance with the requirements of Proposition 218, the City did not receive protests from a majority of the parcels receiving solid waste, recyclable, and organic materials collection services, and per Proposition 218, may proceed with the proposed rate adjustment; and WHEREAS, the City Council has chosen as a matter of policy to follow the procedures set forth in Article XIII D of the California Constitution, nothing in this Resolution shall be interpreted as an admission by the City that the provisions of Article XIII D apply to the actions taken herein; and
WHEREAS, to the extent that this rate authorization results in the imposition of any fees, rates, or charges for services or facilities in connection with the City’s solid waste system, those charges are adopted pursuant to California Health and Safety Code section 5471.

NOW, THEREFORE, BE IT RESOLVED that the City Council accepts and adopts the HF&H Study as attached hereto as Exhibit A and finds and determines that the City’s franchise fees included in the solid waste rates are justified by the City’s costs of service and the value of City right of ways used for solid waste services; and BE IT FURTHER RESOLVED that the City Council of the City of Foster City does hereby approve the following as attached hereto as Exhibit B, effective January 1, 2024:
1 Increasing the 2023 monthly residential collection rates by no more than $5.40 per account in rate year 2024; and
2 Increasing 2024 charges for unscheduled services by 5.465% over 2023.

6.1 Attachment 2 - Resolution

82 PASSED AND ADOPTED as a resolution of the City Council of the City of Foster City at the regular meeting held on the 20th day of November, 2023, by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:

JON FROOMIN, MAYOR
ATTEST:

PRISCILLA SCHAUS, CITY CLERK

6.1 Attachment 2 - Resolution

83 Managing Tomorrow’s Resources Today

590 Ygnacio Valley Road, Suite 105 Robert D. Hilton, Emeritus Walnut Creek, California 94596 John W. Farnkopf, PE
Telephone: 925/977-6950 Laith B. Ezzet, CMC
www.hfh-consultants.com Richard J. Simonson
Marva M. Sheehan, CPA
Robert C. Hilton

4886-3549-0431 v1

MEMORANDUM

Date: September 15, 2023
To: ‘Andra Lorenz, Principal Management Analyst, City of Foster City From: Rick Simonson, Senior Vice President, HF&H
Copy to: Megan A. Burke, Partner, Burke, Williams & Sorenson Subject: Proposed 2024 Solid Waste Rates

This technical memorandum reports the results of our analysis to update the City of Foster City’s (City’s) solid waste rates.

BACKGROUND
The City is a member of the South Bayside Waste Management Authority Joint Powers Authority (SBWMA). Under the SBWMA Joint Powers Authority Agreement, each member agency sets its own solid waste rates for residential and commercial customers. Each of the eleven SBWMA member agencies has a franchise agreement with Recology of San Mateo County (Recology) for residential and commercial solid waste, residential recycling, and residential green waste collections. The current franchise agreement runs from January 1, 2021, through December 31, 2035. Recology provides service to approximately 6,740 residential accounts and 415 commercial accounts in the City.

In addition, a contract w ith South Bay Industries (SBI) provides for operations at the Shoreway Environmental Center (SEC), which is owned the SBWMA. The Shoreway facility serves as a regional solid waste and recycling facility for the receipt, handling and transfer of refuse, rec yclable, and organic materials collected by Recology.

For the annual contractors’ compensation review process, staff reviews the various cost components attributable to its solid waste services, which in turn determines the revenue required from its customers for subsequent rate years. Each member of the SBWMA has specific rates that will apply to their respective service areas. The rates are then applied based on the garbage cart/bin size of the customer and frequency of collection services. All customers are billed by Recology for all solid waste costs.

6.1 Resolution Exhibit A - HF&H Study

84 Managing Tomorrow’s Resources Today

MEMORANDUM

Page 2 of 6 ends

4886-3549-0431 v1 FC_Memorandum_091523.docx
Rates are developed to cover costs for the following components:
• Recology's compensation to collect and deliver materials to the SEC. • Tipping (disposal and processing) fees at the SEC.
• City fees, including the franchise fee paid by Recology and street sweeping fees.

Annual Revenue Reconciliation/Balancing Account
Annually, revenues collected are compared to Recology’s SBWMA-approved compensation for services to the City. If actual revenues collected exceed the approved compensation, the excess revenue is held by Recology in a balancing account. When actual revenues collected are less than all solid waste costs (including Recology’s approved compensation), the City’s balancing account is decreased. As of December 31, 2022, the City has a positive balancing account with Recology of $629,035. The balancing account can go negative if sufficient revenues are not collected. However, any negative balance will accrue interest at the current prime interest rate plus one percent. At the expiration of the franchise agreement, the City will owe Reco logy if the balancing account is negative or Recology will owe the City if the balancing account is positive.

Study Purpose and Objectives
The purpose of this solid waste rate study is to conduct a comprehensive analysis of the City’s solid waste rates, in cluding documentation of the analysis, underlying assumptions, and the rationale for the recommended rates.

This study has several key objectives:
• Determine the revenue requirement (expenses) which the City’s solid waste rates need to cover , including Recology’s compensation, tipping fees at the SEC, and City fees, while maintaining an adequate balancing account balance with Recology;
• Determine the cost of service attributable to each customer based upon the type and size of container serving the account and the subscribed service level; and, • Conduct a preliminary analysis of the City’s franchise fees to determine the amounts the City is entitled to charge for its services and the use of its public right of ways.

These objectives are met by applying industry best practices and by complying with all applicable laws.

ANALYSIS
A spreadsheet model was developed to derive revenue requirements for the five-year period of calendar years (CY) 2024-2028. The revenue requirements represent the costs that must be cove red by revenue

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85 Managing Tomorrow’s Resources Today

MEMORANDUM

Page 3 of 6 ends

4886-3549-0431 v1 FC_Memorandum_091523.docx
from rates and other sources. For this study, we have relied on Recology’s 2024 compensation application (which was audited by the SBWMA), the SBWMA’s estimate of 2024 tip fees for the processing of material at the SEC, and the City’s existing fees. With the assumption of inflationary increases, the five -year projection of the City’s revenue requirement is shown in Table 1.

Table 1. 5-Year Revenue Requirement Projections

Recology Collection Costs
Recology's collection costs are identified in their annual compensation report and were calculated in accordance with the Franchise Agreement with the City. Recology’s final 2024 compensation is scheduled for approval at the SBWMA’s September Board meeting. Recology’s costs were estimated to increase annually by 4% in 2025-2028.

Disposal and Processing Fees
Disposal and processing fees at the Shoreway Environmental Center for 2024 we re estimated by the SBWMA based on projected volumes collected within the City and the per-ton tip fees by material typeset by SBWMA . Like Recology’s collection costs, the SBWMA’s 2025 -2028 tipping fees are projected to increase by 4.0% each year.

City Expenses
City expenses are made up of the City’s street sweeping contract and franchise fees. In 2024, the City’s street sweeping contract is $131,000 and is anticipated to increase by 3.5% annually . Franchise fees are levied by the City on Recology pursuant to the Franchise Agreement. The franchise fee is an obligation of Recology’s, paid out of the total revenues received by Recology for services provided to residents and businesses.

Based on preliminary analysis, HF&H found the current franchise fees from now through the end of the rate period are less than the City is entitled to charge for its services and the use of its public right of ways.

Table 2 provides a summary of the cost of the services the City provides under the franchise agreement with Recology.
2024 2025 2026 2027 2028
R
ecology Collection Costs $4,480,793 $4,667,866 $4,854,581 $5,048,764 $5,250,715 Disposal & Processing Fees 2,856,803 2,971,075 3,089,918 3,213,514 3,342,055 City Expenses 497,880 517,532 537,555 558,356 579,964
Total Revenue Requirement $7,835,475 $8,156,473 $8,482,054 $8,820,634 $9,172,734

6.1 Resolution Exhibit A - HF&H Study

86 Managing Tomorrow’s Resources Today

MEMORANDUM

Page 4 of 6 ends

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Table 2. City Services Provided under the Franchise Agreement

In addition to the services provided by the City, HF&H analyzed a reasonable fee that the City could charge for the use of its public rights-of-way. On-street collection requires temporary placement of containers in the public right-of-way. The access to containers afforded to Recology personnel serves as a temporary encroachment to on-street parking.

Based on preliminary calculations, we have determined that the City could charge at least $380,000 for the use of public right of ways to place containers for the purpose of solid waste collection. This amount was determined by using the $180 per square foot land value in Foster City, calculated by the Commercial Linkage Fee Nexus Study, prepared by Economic & Planning Systems, Inc. in January 2022, and applying that land value to the square footage of public right of way used for solid waste containers throughout the City. Several additional assumptions were employed to calculate the rental value of the encroachment area of the solid waste containers placed in the right -of-way: 1) a rental realization rate value of 26; 2) weekly solid waste collection occurs once per week; 3) the encroachment area of the containers, including the mandatory 2 feet of spacing between containers specified by Recology, is 33.60 square feet; and 4) all 7,082 accounts have the authorization under the franchise agreement to place containers in the street for collection. The resulting public right of way rental value for solid waste containers was $380,000.

This calculation represents a very conservative estimate of the value of the City’s public right of ways. This area of the law is currently evolving, and as such, we recommend that the City revisit its fran chise fee calculations in five years to determine if a higher fee is warranted.

Collectively, the sum of the cost of services provided by the City is $404,585 and the reasonable fee for the use of public right of ways for container placement is $380,000, equaling a total minimum value of $784,723. The projected franchise fees range from $497,880 to $579,964 through the rate period. Thus, the City’s franchise fee is less than the total amount of justified fees throughout the rate period.

Revenue Projections
HF&H annualized 2023 revenues received through June to estimate annual revenues for 2024 at current rates. Tables 3 and 4 provide an overview of 2023 revenue projections and the projected revenue shortfall Services Provided Expense
Trash Capture/Street Sweeping $145,367
C
ontract Admin & Enforcement $205,200
Legal Support $20,000
Street Tree Trimming $4,354
Government Facility Allocation $29,664
Total $404,585

6.1 Resolution Exhibit A - HF&H Study

87 Managing Tomorrow’s Resources Today

MEMORANDUM

Page 5 of 6 ends

4886-3549-0431 v1 FC_Memorandum_091523.docx
if rates are not increased over the next five years. Collectively, the City faces a cumulative shortfall of more than $6.2 million through 2028.

Table 3. 2023 Annual Revenue Projections

Table 4. Projected Revenue Shortfalls 2024-2028

The projected 2024 shortfall of $600,498 would require a revenue increase of 8.3%. Instead of increasing existing rates by this figure, a phased approach is proposed to provide more gradual increases over the five-year period. Table 5 provides the recommended revenue increases and corresponding annual shortfalls that would be absorbed by the balancing account with Recology.

Table 5. Recommended Revenue Increases and Revised Shortfalls 2024-2028

Cost-of-Service Analysis
HF&H conducted a cost-of-service analysis by service level and customer. The analysis determined that the rates charged to commercial/multi-family customers and roll-off customers are currently sufficient to meet their cost of service. However, r esidential customers are not meeting their cost of service. As a result, increases to r esidential rates are recommended to reduce the revenue shortfall and to move residential rates towards alignment with the cost of service.

Customer Class
Revenue at
Current Rates
Residential $2,422,456
C
ommercial, Multi-Family $4,176,894
Roll-off $635,628
Total $7,234,978
2024 2025 2026 2027 2028
P
roj. Revenue at Current Rates $7,234,978 $7,234,978 $7,234,978 $7,234,978 $7,234,978 Net Revenue Requirement ($7,835,475) ($8,156,473) ($8,482,054) ($8,820,634) ($9,172,734) Surplus/(Shortfall) ($600,498) ($921,495) ($1,247,076) ($1,585,657) ($1,937,756) 2024 2025 2026 2027 2028
P
roposed Revenue Increase 6.0% 5.0% 5.0% 4.0% 4.0%
Revenue with Increase $7,669,076 $8,052,530 $8,455,156 $8,793,363 $9,145,097 Net Revenue Requirement ($7,835,475) ($8,156,473) ($8,482,054) ($8,820,634) ($9,172,734) Surplus/(Shortfall) ($166,399) ($103,943) ($26,898) ($27,272) ($27,636)

6.1 Resolution Exhibit A - HF&H Study

88 Managing Tomorrow’s Resources Today

MEMORANDUM

Page 6 of 6 ends

4886-3549-0431 v1 FC_Memorandum_091523.docx

RECOMMENDATION
Table 5 provides the recommended five-year schedule of rate increases to residential rates. The increases reduce the revenue shortfall that will be absorbed temporarily by the Recology balancing account and reduce the gap between current revenues and the cost of service.

Table 6. Recommended Residential Rate Increases 2024-2028

It is not recommended that rates for solid waste, recycling, or organics services to commercial/multi- family and roll-off customers be increased during 2024-2028.

Absent these necessary increases, the City will build a balancing account deficit that must be paid off by the end of the franchise agreement in 2035. We recommend the City increase rates, as indicated in Table 6, to avoid any balancing account deficit and the corresponding interest that would accrue.

Residential Bundled Service Current Rates 2024 Rates 2025 Rates 2026 Rates 2027 Rates 2028 Rates 20 Gallons $17.18 $22.58 $27.32 $32.30 $36.49 $40.84
32 Gallons $27.52 $32.92 $37.66 $42.64 $46.83 $51.18
64 Gallons $55.02 $60.42 $65.16 $70.14 $74.33 $78.68
96 Gallons $82.55 $87.95 $92.69 $97.67 $101.86 $106.21

6.1 Resolution Exhibit A - HF&H Study

89 Quantity Size Rate
1 20 gal 22.58$
1 32 gal 32.92$
1 64 gal 60.42$
1 96 gal 87.95$

EXHIBIT B
City of Foster City
Residential Rates including Refuse,
Organics, and Recycling
Rate Year 2024

6.1 Resolution Exhibit B - 2024 Base Rates

90 Total
Gal. Qty Size Volume Frequency
per week Rate
20 1 20 gallon 1 17.18$
32 1 32 gallon 1 27.52$
64 1 32 gallon 2 57.99$
96 1 32 gallon 3 91.55$
64 2 32 gallon 1 56.65$
96 3 32 gallon 1 87.53$
288 3 32 gallon 3 274.61$
128 4 32 gallon 1 116.73$
160 5 32 gallon 1 145.89$
192 6 32 gallon 1 175.08$
11,136 174 32 gallon 2 10,386.37$
7,488 234 32 gallon 1 6,828.64$
8,832 276 32 gallon 1 8,052.96$
8,864 277 32 gallon 1 8,082.14$
8,896 278 32 gallon 1 8,111.79$
8,928 279 32 gallon 1 8,140.98$
8,960 280 32 gallon 1 8,170.16$
17,920 560 32 gallon 1 16,340.30$
City of Foster City
20 gallon
32 gallon
Rate Year 2024
Commercial Cart Rates

6.1 Resolution Exhibit B - 2024 Base Rates

91 City of Foster City
Rate Year 2024
Commercial Cart Rates
64 1 64 gallon 1 56.65$
128 1 64 gallon 2 119.36$
192 1 64 gallon 3 183.06$
256 1 64 gallon 4 249.41$
320 1 64 gallon 5 318.43$
128 2 64 gallon 1 116.73$
256 2 64 gallon 2 238.74$
384 2 64 gallon 3 366.12$
512 2 64 gallon 4 498.83$
640 2 64 gallon 5 636.93$
768 2 64 gallon 6 780.31$
896 2 64 gallon 7 929.02$
192 3 64 gallon 1 175.09$
448 7 64 gallon 1 408.47$
896 7 64 gallon 2 835.67$
1,344 7 64 gallon 3 1,281.53$
1,792 7 64 gallon 4 1,746.02$
2,240 7 64 gallon 5 2,229.22$
2,688 7 64 gallon 6 2,731.08$
3,136 7 64 gallon 7 3,251.60$
64 gallon

6.1 Resolution Exhibit B - 2024 Base Rates

92 City of Foster City
Rate Year 2024
Commercial Cart Rates
96 1 96 gallon 1 87.53$
192 1 96 gallon 2 179.06$
288 1 96 gallon 3 274.61$
480 1 96 gallon 5 477.68$
192 2 96 gallon 1 175.08$
384 2 96 gallon 2 358.11$
576 2 96 gallon 3 549.18$
768 2 96 gallon 4 748.30$
960 2 96 gallon 5 955.36$
1,152 2 96 gallon 6 1,170.46$
1,344 2 96 gallon 7 1,393.54$
288 3 96 gallon 1 262.58$
480 5 96 gallon 1 437.64$
576 6 96 gallon 1 525.20$
1,152 6 96 gallon 2 1,074.44$
1,728 6 96 gallon 3 1,647.67$
2,304 6 96 gallon 4 2,244.92$
2,880 6 96 gallon 5 2,866.16$
3,456 6 96 gallon 6 3,511.40$
4,032 6 96 gallon 7 4,180.64$
2,016 7 96 gallon 3 1,922.29$
2,304 8 96 gallon 3 2,196.93$
5,184 18 96 gallon 3 4,943.05$
5,472 19 96 gallon 3 5,217.68$
96 gallon

6.1 Resolution Exhibit B - 2024 Base Rates

93 Total Yards Qty Size Volume Frequency
per week Rate
1 1 1 yard 1 131.95$
2 1 1 yard 2 265.98$
3 1 1 yard 3 402.16$
4 1 1 yard 4 540.34$
5 1 1 yard 5 680.61$
6 1 1 yard 6 823.05$
7 1 1 yard 7 967.49$
Rate Year 2024
Commercial Bin Rates
City of Foster City
1 - YARD

6.1 Resolution Exhibit B - 2024 Base Rates

94 Rate Year 2024
Commercial Bin Rates
City of Foster City
Total Yards Qty Size Volume Frequency
per week Rate
2 1 2 yard 1 263.92$
4 1 2 yard 2 531.99$
6 1 2 yard 3 804.29$
8 1 2 yard 4 1,080.69$
10 1 2 yard 5 1,361.23$
12 1 2 yard 6 1,693.60$
14 1 2 yard 7 1,990.39$
4 2 2 yard 1 527.85$
8 2 2 yard 2 1,063.99$
12 2 2 yard 3 1,656.09$
16 2 2 yard 4 2,224.71$
20 2 2 yard 5 2,801.65$
24 2 2 yard 6 3,485.08$
28 2 2 yard 7 4,094.92$
6 3 2 yard 1 791.75$
12 3 2 yard 2 1,643.48$
18 3 2 yard 3 2,484.14$
24 3 2 yard 4 3,434.95$
30 3 2 yard 5 4,324.77$
36 3 2 yard 6 5,227.60$
42 3 2 yard 7 6,142.40$
8 4 2 yard 1 1,055.70$
16 4 2 yard 2 2,191.29$
24 4 2 yard 3 3,410.07$
32 4 2 yard 4 4,579.92$
40 4 2 yard 5 5,766.36$
48 4 2 yard 6 6,970.13$
56 4 2 yard 7 8,189.86$
2 - YARD

6.1 Resolution Exhibit B - 2024 Base Rates

95 Rate Year 2024
Commercial Bin Rates
City of Foster City
10 5 2 yard 1 1,319.60$
20 5 2 yard 2 2,739.14$
30 5 2 yard 3 4,262.60$
40 5 2 yard 4 5,724.90$
50 5 2 yard 5 7,207.94$
60 5 2 yard 6 8,712.67$
70 5 2 yard 7 10,237.31$

6.1 Resolution Exhibit B - 2024 Base Rates

96 Rate Year 2024
Commercial Bin Rates
City of Foster City
Total Yards Qty Size Volume Frequency
per week Rate
3 1 3 yard 1 395.88$
6 1 3 yard 2 797.98$
9 1 3 yard 3 1,206.44$
12 1 3 yard 4 1,668.54$
15 1 3 yard 5 2,101.22$
18 1 3 yard 6 2,540.40$
21 1 3 yard 7 3,071.18$
6 2 3 yard 1 791.75$
12 2 3 yard 2 1,643.48$
18 2 3 yard 3 2,484.14$
24 2 3 yard 4 3,434.95$
30 2 3 yard 5 4,324.77$
36 2 3 yard 6 5,227.60$
42 2 3 yard 7 6,142.40$
9 3 3 yard 1 1,187.63$
18 3 3 yard 2 2,465.21$
27 3 3 yard 3 3,836.32$
36 3 3 yard 4 5,152.39$
45 3 3 yard 5 6,487.15$
54 3 3 yard 6 7,841.40$
63 3 3 yard 7 9,213.58$
12 4 3 yard 1 1,631.04$
24 4 3 yard 2 3,384.82$
36 4 3 yard 3 5,115.10$
48 4 3 yard 4 6,869.89$
60 4 3 yard 5 8,649.53$
72 4 3 yard 6 10,455.20$
84 4 3 yard 7 12,284.79$
3 - YARD

6.1 Resolution Exhibit B - 2024 Base Rates

97 Rate Year 2024
Commercial Bin Rates
City of Foster City
15 5 3 yard 1 2,038.77$
30 5 3 yard 2 4,231.01$
45 5 3 yard 3 6,393.62$
60 5 3 yard 4 8,587.38$
105 5 3 yard 7 15,355.98$
18 6 3 yard 1 2,446.56$
36 6 3 yard 2 5,077.21$
54 6 3 yard 3 7,672.63$
72 6 3 yard 4 10,304.83$
90 6 3 yard 5 12,974.31$
108 6 3 yard 6 15,682.79$
126 6 3 yard 7 18,427.19$
21 7 3 yard 1 2,939.96$
42 7 3 yard 2 5,923.41$
63 7 3 yard 3 8,951.40$
84 7 3 yard 4 12,022.27$
105 7 3 yard 5 15,136.70$
126 7 3 yard 6 18,296.59$
147 7 3 yard 7 21,498.39$
24 8 3 yard 1 3,359.96$
48 8 3 yard 2 6,769.63$
72 8 3 yard 3 10,230.20$
96 8 3 yard 4 13,739.76$
120 8 3 yard 5 17,299.08$
144 8 3 yard 6 20,910.39$
168 8 3 yard 7 24,569.58$
27 9 3 yard 1 3,779.94$
54 9 3 yard 2 7,615.83$
81 9 3 yard 3 11,508.98$

6.1 Resolution Exhibit B - 2024 Base Rates

98 Rate Year 2024
Commercial Bin Rates
City of Foster City
30 10 3 yard 1 4,199.92$
60 10 3 yard 2 8,462.04$
90 10 3 yard 3 12,787.75$
120 10 3 yard 4 17,174.71$
150 10 3 yard 5 21,623.86$
180 10 3 yard 6 26,137.98$
210 10 3 yard 7 30,712.00$
66 11 3 yard 2 9,308.25$
36 12 3 yard 1 5,039.88$
72 12 3 yard 2 10,154.46$
108 12 3 yard 3 15,345.30$
144 12 3 yard 4 20,609.63$
180 12 3 yard 5 25,948.60$
216 12 3 yard 6 31,365.59$
252 12 3 yard 7 36,854.39$
45 15 3 yard 1 6,299.90$
90 15 3 yard 2 12,693.04$
135 15 3 yard 3 19,181.61$
138 23 3 yard 2 19,462.70$
150 25 3 yard 2 21,155.07$

6.1 Resolution Exhibit B - 2024 Base Rates

99 Rate Year 2024
Commercial Bin Rates
City of Foster City
Total Yards Qty Size Volume Frequency
per week Rate
4 1 4 yard 1 527.85$
8 1 4 yard 2 1,063.99$
12 1 4 yard 3 1,656.09$
16 1 4 yard 4 2,224.71$
20 1 4 yard 5 2,801.65$
24 1 4 yard 6 3,485.08$
8 2 4 yard 1 1,055.69$
16 2 4 yard 2 2,190.84$
24 2 4 yard 3 3,409.94$
40 2 4 yard 5 5,766.36$
12 3 4 yard 1 1,631.04$
24 3 4 yard 2 3,384.82$
36 3 4 yard 3 5,115.10$
48 3 4 yard 4 6,869.87$
60 3 4 yard 5 8,649.53$
72 3 4 yard 6 10,455.20$
84 3 4 yard 7 12,284.79$
16 4 4 yard 1 2,174.70$
32 4 4 yard 2 4,513.09$
48 4 4 yard 3 6,820.15$
64 4 4 yard 4 9,159.84$
80 4 4 yard 5 11,532.74$
96 4 4 yard 6 13,940.24$
112 4 4 yard 7 16,379.74$
48 6 4 yard 2 6,769.63$
4 - YARD

6.1 Resolution Exhibit B - 2024 Base Rates

100

Rate Year 2024
Commercial Bin Rates
City of Foster City
6 1 6 yard 1 791.75$
12 1 6 yard 2 1,643.48$
18 1 6 yard 3 2,484.14$
24 1 6 yard 4 3,434.95$
30 1 6 yard 5 4,324.77$
36 1 6 yard 6 5,227.60$
42 1 6 yard 7 6,142.40$
24 2 6 yard 2 3,384.92$
36 2 6 yard 3 5,115.10$
48 2 6 yard 4 6,869.89$
60 2 6 yard 5 8,649.53$
72 2 6 yard 6 10,455.20$
84 2 6 yard 7 12,284.79$
54 3 6 yard 3 7,672.63$
72 3 6 yard 4 10,304.83$
90 3 6 yard 5 12,974.33$
108 3 6 yard 6 15,682.79$
126 3 6 yard 7 18,427.17$
8 1 8 yard 1 1,119.98$
16 1 8 yard 2 2,256.64$
24 1 8 yard 3 3,409.94$
32 1 8 yard 4 4,579.92$
40 1 8 yard 5 5,766.57$
16 2 8 yard 1 2,239.95$
32 2 8 yard 2 4,513.26$
8 - YARD
6 - YARD

6.1 Resolution Exhibit B - 2024 Base Rates

101

City of Foster City
All Compactor Rates
Rate Year 2024
Cost Per Yard, Per PULL - Organics = $84.62
Cost Per Yard, Per PULL - Trash = $112.83

COMPACTOR RATE
Organics Program, COMPACTOR RATE (25% Discount)

6.1 Resolution Exhibit B - 2024 Base Rates

102

Service Category
Backyard Collection Service—Single
Family Dwelling
Return Trip (SFD, MFD, Mixed Use,
Commercial)
On-Call Pick-Up for SFD, MFD,
Mixed Use and Commercial
Customers
Additional Targeted Recyclable
Materials or Organic Materials Cart
Service for SFD
Collection of Contaminated Targeted
Recyclable Materials or Organic
Materials Container
Lock Purchase
Overage Fee
Overage Bags
On-Call Bulky Item Collection Service
Per collection event
C -- $114.09 C – per 96 gallon Cart
$109.47 Per Event (after first two per account
annually)
Container Cleaning
A -- $67.12 A – per Cart
B -- $114.09 B – per Bin or Drop-Box
Dirty Cart Replacement
A -- $87.24 A – per 32 gallon Cart
B -- $100.67 B – per 64 gallon Cart
100% of the base monthly rate Per collection event
50% of the base monthly rate or
$10.73 minimum Rate per bag
Key Service
A -- $11.41 per month A – Residential Customers
B -- $12.75 per month B – Commercial Customers
$22.81 –one time charge One-time charge per account. No fee for replacement locks.
25% of the base monthly rate for the
size of container collected once per
week
Per collection event per container
$4.03 Monthly rental fee (any size cart)
25% of base monthly rate for the
container size collected once per
week + Return Trip fee if applicable.

Distance charge—MFD and
Commercial Accounts
A – 10% of base monthly rate A – 51 to 100 feet
B – 25% of base monthly rate B – 101 feet or more
Container Relocation Service
A – 12% of base monthly rate A – 51 to 100 feet
B – 27% of base monthly rate B – 101 feet or more
$20.14 Per collection event.

Foster City
2024 Rates for Unscheduled Services

5.465% above 2023 Rates
Rate Description of Rate
See charges in the table at the end
of this Attachmen
See charges in the table at the end
of this Attachmen

6.1 Resolution Exhibit B - 2024 Base Rates

103

One (1) Solid
Waste Cart
Two (2) Solid
Waste Carts
Three (3) Solid
Waste Carts
Four (4) Solid
Waste Carts
Distance from Curbside
Base monthly
Solid Waste
Rate plus
Base monthly
Solid Waste
Rate plus
Base monthly
Solid Waste
Rate plus
Base monthly
Solid Waste
Rate plus
0 – 50 feet $24.16 $38.55 $77.10 $115.65
51-100 feet $28.18 $42.58 $81.13 $119.68
101-150 feet $32.21 $46.61 $85.16 $123.71
151 – 200 feet $36.24 $50.63 $89.19 $127.73
201 – 250 feet $40.27 $54.66 $93.20 $131.76
251 – 300 feet $44.29 $58.68 $97.24 $135.78
301 - 350 feet $48.32 $62.71 $101.26 $139.81
Each additional 50 foot increment
over 350 feet
Amount equals the difference between the Charge for 250 to 350 feet and 300 to 350 feet
Backyard Collection Service Distance Costs for Single-Family Dwellings (Section 5.02.A)

6.1 Resolution Exhibit B - 2024 Base Rates

104

MINUTE ORDER
No. 1942

OFFICE OF THE CITY CLERK

FOSTER CITY, CALIFORNIA
Date: October 3, 2023
Attention: City Council/ EMID Board
Stefan Chatwin, City/ District Manager
Andrew Brozyna, Public Works Director/ City Engineer
Andra Lorenz, Principal Management Analyst
City Council/ EMID Board of Directors Meeting Date: October 2, 2023 Subject: Solid Waste Rates for the Five- Year Period of 2024- 2028 Motion by Mayor Froomin, seconded by Vice Mayor Sullivan, and carried, 4-1-0, Councilmember Kiesel voted “no”, IT WAS ORDERED to provide policy direction staff to mail a Proposition 218 notice and set a public hearing to be held on November 20, 2023, for Council to consider the following:

1. Updating solid waste rates for a five- year period of 2024- 2028;

2. Increasing the 2023 residential collection rates by no more than $ 5.40 per account for 2024, $ 4.74 in Rate Year 2025, $ 4.98 in Rate Year 2026 , $4.19 in Rate Year 2027, and $ 4.35 in Rate Year 2028; and

3. Increasing 2024 charges for Unscheduled Services ( optional services requested by customers above the base service level) by 5.465% over 2023, and annually thereafter based on actual indexed factors up to a maximum not to exceed 6.0% per year.

CITY CLERK/ DISTRICT SECRETARY
DocuSign Envelope ID: 995FA2B4- A250- 405B- 85CA- EA4A9C645202

6.1 Attachment 3 - Minute Order No. 1942

105

This notice is to you that the Foster City, City
Council will be holding a public hearing to
consider approving updated rates for
garbage, recyclables and organics collection
services, and this notice is therefore given in
accordance with Proposition 218 and Article
XIID of the California Constitution.

NOTICE OF

PUBLIC HEARING TO

CONSIDER PROPOSED

INCREASE IN GARBAGE,

RECYCLABLES AND

ORGANICS COLLECTION

SERVICE RATES
Effective January 1, 2024
City of Foster City
610 Foster City Boulevard, Foster City, CA 94404-2222

PRSRT STD

US POSTAGE
PAID

HAYWARD, CA
PERMIT #3335
Rates for Unscheduled Services
The franchise agreement allows for adjustments to Unscheduled Service charges, which are generally those optional services that are specifically requested and paid for by the requestor. During the five-year term, Unscheduled Services charges will be adjusted in 2024 by 5.465% over 2023 rates and annually thereafter based on actual indexed factors up to a maximum not to exceed 6.0% per year. The City is including information about charges for unscheduled services in this notice for the purpose of transparency although Unscheduled Service charges are not subject to Proposition 218’s noticing and public hearing requirements. 41073 - Brochure mailer - 1 - Work-and-turn - 9/29/2023 - 2:47:13 PM - Proofer Profile: $[ICCProoferProfile] - ImposePDF - Readers Spreads 41073 AMS Printing Brochure mailer FB 001 Work-and-turn 9/29/2023 2:47:13 PM Black $[LayerName]

6.1 Attachment 4 - Notice of Intent to Increase Collection Rates for The Rate Year 2024 For Solid Waste, Recyclables, And Organic Materials Collection in The City of Foster City (Proposition 218 Notice)

106

PUT TRASH IN ITS PLACE
Not everything belongs in the solid waste
stream. Keep rates low, help ensure the
continuing availability of landfill space, reduce
greenhouse gas emissions and reduce the
toxicity of the environment by handling wastes
properly.
• Make an appointment to take Hazardous
Wastes, like paints and pesticides, to the
County’s Hazardous Waste program.
• Keep batteries out of all carts. Place
household batteries and cell phones in zipper
bags on top of your black cart (single family)
or ask your property manager to place a
battery bucket in a common area for all
residents. (multi-family).
• Place food waste in your green cart where it
can be composted into useful products.
• Place used automobile oil in sealed one-
gallon containers and oil filters in plastic
zipper bags at your curb.
• Drop off unwanted medications at Health
Department Safe Medication Disposal
locations.
• Make an appointment for Recology to pick up
bulky items.
• Take other items to the Shoreway Public
Recycling Center for proper disposal or
recycling.
• When in doubt, call Recology San Mateo
County to ask if an item belongs in the cart.

ABOUT SOLID WASTE COLLECTION

SERVICES IN FOSTER CITY
Garbage, recyclables and organics collection is
provided under a franchise agreement between
Recology San Mateo County and the City of
Foster City. Foster City is a member of the South
Bayside Waste Management Authority (SBWMA),
also known as RethinkWaste, a collection of
agencies that coordinate waste management
services and manage the Shoreway
Environmental Center in San Carlos. Make an
appointment for a tour of the Shoreway facility at
rethinkwaste.org.

WHAT DO PROPOSED BASE RATES
PAY FOR?
Residential:
• Weekly curbside collection of garbage,
recyclables and organics
• Curbside collection of used motor oil, oil
filters, cell phone and household batteries
• Two annual “On Call” bulky item pick-ups (by
appointment)
• Holiday tree recycling
• No cost public recycling at Shoreway
Environmental Center, including mattresses,
electronics, batteries, and small appliances
• One annual confidential document shredding
event and one annual compost give-away
event (additional events in Foster City are
funded by other sources)
Commercial
• Subscribed level of collection for garbage,
recycling, and organics
• Customized waste management assistance by
Waste Zero Specialists
All Customers
• Energy-efficient, cleaner emissions collection
vehicles
• Operation of the Shoreway Environmental
Center for waste and recycling
• Education and information related to Federal,
State and Local solid waste requirements

RECOLOGY SAN MATEO COUNTY
Garbage, Recyclables and Organics Collection
www.Recology.com/Recology-san-mateo-county
(650) 595-3900

RETHINKWASTE
Governing Board, Shoreway Tours,
Waste Reduction Information
www.RethinkWaste.org
(650) 802-3500
SAN MATEO COUNTY HEALTH DEPT.

Hazardous Waste Disposal
www.smchealth.org/safe-waste-disposal
Medical Waste Disposal
www.smchealth.org/rxdisposal

PROPOSED RATE INCREASE
Foster City’s Solid Waste rates are calculated to
collect the revenue required to run the Solid
Waste program. Approximately 94% of the
revenue requirement is based on the cost of
collection, processing, and disposal from Foster
City's residents and businesses.. The remainder is
composed of city-specific service levels. Revenue
from commodity sales of recovered recyclables is
used to offset revenue requirements. City fees
were reviewed in 2023 and were validated to be
less than the actual cost of service. A rate
analysis conducted in 2023 demonstrated that an
increase is needed in residential rates based on
the cost to provide the services while commercial
rates are currently sufficient to recover their cost
of service. Based on this analysis, residential base
rates for the five-year period from 2024 through
2028 are proposed to increase by $5.40 per
account in Rate Year 2024, $4.74 in Rate Year
2025, $4.98 in Rate Year 2026, $4.19 in Rate Year
2027 and $4.35 in Rate Year 2028. These rates
will provide for adequate revenue for the Solid
Waste program after taking into account
offsetting revenues and utilizing excess fund
balance that has been generated for this
purpose.

The rate analysis performed in 2023 sets forth
the basis upon which the rates were calculated.

Some significant reasons for the rate increase
include a fuel index increase of 14.9%, an
increase to processing and disposal costs of

25.1% and increases related to the
implementation of SB 1383 regulations.

PUBLIC HEARING
Monday, November 20, 2023, at 6:30 PM
The City Council has scheduled a Public Hearing
to consider adopting garbage, recyclables and
organics collection service rates for Foster City
for Calendar Year 2024.

Unless prohibited by public health orders, the
public hearing will be held in the Foster City
Council Chambers, 620 Foster City Boulevard,
Foster City, CA. The public may participate by
providing live verbal public comment in person,
by joining the meeting via video or
teleconference, or by submitting comments to
[email protected]. Instructions on
how to join the meeting will be included in the agenda
that will be posted at least 72 hours prior to the
meeting at www.fostercity.org/agendasandminutes.

The Public Hearing is open to the public, and
anyone may appear and be heard or submit a
written statement on this matter. At the
conclusion of the Public Hearing, the City Council
will consider taking official action to set garbage,
recyclables and organics collection rates for
Foster City for Rate Year 2024.

Any owner or customer associated with a
property receiving solid waste services in Foster
City may file a written protest against the
proposed rate increases. The City Council will
consider all input, but State law provides that
only written protests may be counted to
determine whether a majority protest to the
proposed increases exists. The City Clerk must
receive a written protest not later than the close
of the Public Hearing to be counted. If a majority
protest exists, then the City Council cannot
impose the increased rates. If, at the conclusion
of the Public Hearing, a majority protest does not
exist, the City Council will consider adoption of
the proposed rates.

Written protests must include the protestor’s
name, property service address or tax assessor’s
parcel number, and the protestor’s original
signature. Written protests may be hand
delivered or mailed to: City Clerk, 610 Foster
City Boulevard, Foster City, CA 94404. No more
than one protest per parcel will be counted.

MULTI-YEAR RATE SETTING
Setting rates for multiple years allows for the
rates to recover costs of service while taking into
account the anticipated revenue requirements
for the five-year period including known future
increases associated with anticipated compliance
with new service and enforcement requirements
associated with stormwater regulations and
California State Senate Bill 1383 regulations.
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107

ATTACHMENT 5
COMPARISON OF 2023 RATES OF SBWMA AGENCIES
Member Agency
RATES1
20-gallon 32-gallon2 64-gallon 96-gallon
Foster City (2023 rate) $17.18 $27.52 $55.02 $82.55
Burlingame $16.13 $29.83 $59.66 $88.54
Foster City (proposed 2024 rate) $22.58 $32.92 $60.42 $87.95 San Mateo $23.59 $32.93 $58.93 $89.08
North Fair Oaks $36.79 $36.79 $36.79 $84.14
Redwood City $23.87 $38.86 $67.20 $95.31
Belmont $36.22 $43.21 $85.06 $127.59
San Mateo County $36.74 $43.67 $64.43 $88.00
San Carlos $30.81 $46.04 $70.11 $90.59
Menlo Park $39.31 $47.64 $67.22 $91.46
East Palo Alto $55.41 $55.41 $55.41 $55.41
West Bay Sanitary District $50.00 $56.00 $72.75 $105.00 Hillsborough $58.13 $64.60 $84.38 $109.86
NOTE 1: The rates shown for member agencies are for current year and do not reflect possible changes in the next rate period.

NOTE 2: Rates are sorted based on the current 32 gallon rate from lowest to highest.

6.1 Attachment 5 - Comparison of Current Rates of SBWMA Agencies

108

6.1 Attachment 6 - Mailing Confirmation

109

5 0
1 DATE: November 20, 2023

TO: Mayor and Members of the City Council
VIA: Stefan Chatwin, City Manager
Marlene Subhashini, Assistant City Manager

FROM: Sofia Mangalam, Community Development Director
Nori Jabba, Housing Coordinator
Thai-Chau Le, Planning Manager
DEPARTMENT: Community Development
SUBJECT: RZ2023-0008, AMEND TITLE 17, “ZONING” CHAPTER 17.90

BELOW MARKET RATE INCLUSIONARY HOUSING PROGRAM

AND FINDING THE AMENDMENTS EXEMPT FROM THE

CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA)
PURSUANT TO CEQA GUIDELINE SECTION 15061(B)(3)

RECOMMENDATION
It is recommended that the City Council (1) introduce and pass to second reading the Ordinance (Attachment 1) amending Title 17, “Zoning” Chapter 17.90 Below Market Rate Inclusionary Housing Program and finding the amendments exempt from the California Environmental Quality Act (CEQA) pursuant to CEQA Guideline Section 15061(b)(3); and (2) review, discuss, and provide direction to staff for the proposed revisions to BMR Administrative Procedures and Guidelines “BMR Guidelines”.

EXECUTIVE SUMMARY
Chapter 17.90 Below Market Rate Inclusionary Housing Program of the Foster City Municipal Code implements the city’s adopted inclusionary policy contained in the Housing Element of the General Plan by creating standards and a mechanism to provide Below Market Rate (BMR) dwelling units as part of new residential development projects.

The City’s inclusionary policy requires that 20% of all units, excluding bonus units, in residential projects be affordable in order to meet the City’s regional share of very low-,

6.2 6.2 Staff Report

110

5 0
1 low- and moderate-income housing needs and the needs of special groups, including the elderly, disabled, small and large families, and local workers.

The Below Market Rate Inclusionary Housing Program includes provisions regarding the development of the new BMR units, including the required number of BMR units; level of affordability for rental and ownership projects; payment of BMR in-lieu fee; standards for new BMR units; BMR housing plan and agreement; alternatives to BMR requirements; waiver of BMR requirements; affordable housing fund; and enforcement.

In recent months, the Community Development Department (CDD) staff reviewed Chapter 17.90 and related documents, including the City’s BMR Guidelines. Chapter

17.90 mainly focuses on the development of the new BMR units. Staff has determined that the implementation and enforcement of existing BMR programs could be improved with revisions to Chapter 17.90 to clarify certain terms, and a comprehensive update to the BMR Guidelines would provide clarity to landlords, property managers and tenants regarding BMR unit administration practices to better support the City’s anti-displacement policies and further fair housing strategies.

On October 19, 2023, the Planning Commission held a public hearing to review the draft amendments to Chapter 17.90. At the meeting, the Commission voted 4-0-1 to approve Resolution P-19-23 recommending that the City Council adopt an Ordinance amending Title 17, “Zoning” Chapter 17.90 Below Market Rate Inclusionary Housing Program and finding the amendments exempt from the California Environmental Quality Act (CEQA) section 15061(b)(3) (see Attachment 7).

BACKGROUND
CDD staff oversees the City’s Affordable Housing programs, including deed restricted ownership units, BMR program, Workforce Housing, Existing Unit Purchase Program, HIP Home Sharing Program, and Housing Rehabilitation Loan Program.

BMR Program
The BMR program covers all rental and ownership properties subject to an affordable housing deed restriction or agreement that restricts units to extremely low, very low, moderate, or workforce units. The responsibilities pertaining to the oversight and administration of overseeing and monitoring existing BMR programs are specified in the requisite deed restriction applicable to the property, and the City’s BMR Guidelines. The City ensures compliance with terms of the affordability agreement, Chapter 17.90 of the Municipal Code, as well as any regulations such as the BMR Guidelines and Council policies. In addition to reviewing annual reports submitted by property managers, staff assists property managers in applying the BMR Guidelines and assists tenants in navigating BMR requirements as appropriate.

To assist with these responsibilities, the “BMR Guidelines” were created in 2010, and minor revisions were made in 2011, 2016, and 2020. Furthermore, on March 21, 2022

6.2 6.2 Staff Report

111

5 0
1 (first reading on March 7, 2022), the City Council adopted a new Chapter 17.90, Below Market Rate Inclusionary Housing Program, to Title 17, “Zoning”, of the Foster City Municipal Code (Ordinance No. 644). Staff monitors and ensures compliance of BMR rental, senior rental, workforce, and ownership properties, as described below.

BMR Property Summary
The BMR Guidelines cover all rental and ownership properties subject to a property covenant or agreement that restricts units to extremely low, very low, moderate, or workforce income or rent limits, including the following properties:

Senior Rental

1. 1. Alma Point (65 senior rental units)

2. 2. Metro Center Senior Apartments (60 senior rental units) BMR Rental

3. Foster’s Landing (BMR covenants expire December 31, 2023) (4 remaining rental units)

4. Marlin Cove (84 rental units)

5. Miramar Apartments (48 rental units)

6. One Hundred Grand (33 rental units)

7. The Pilgrim Workforce Housing (22 rental property units, owned by the City)

8. The Plaza (60 rental units)

9. The Triton (48 rental units)

10. The Existing Unit Purchase Program homes (rental properties owned by the City): six (6) individual homes and duplexes categorized as one (1) property; in various locations.

Ownership

11. Emerald Bay BMR homes (ownership): seven (7) low and very low ownership properties in the Emerald Bay neighborhood that were sold to income-qualified buyers in the early 1990s.

The properties named above provide 437 BMR units for the City of Foster City. The City’s Regional Housing Needs Allocation (RHNA) from the State calls for the City to plan for 1,896 new housing units from 2023-2031 in its 6 th Cycle of the Housing Element. This comprises of 1,119 BMR units and 777 above-moderate rate units. With these RHNA targets and State’s efforts to encourage affordable housing production through new legislation, the City’s overall number of BMR units is expected to increase.

BMR Property Restrictions
Each BMR property is subject to individual covenants and/or deed restrictions, which generally set forth the number of BMR units, affordability levels of those units, and associated terms and conditions, as explained in further detail below.

6.2 6.2 Staff Report

112

5 0
1 Senior Rental and BMR Rental:

The covenants for BMR rental properties set forth how many units in the development must be income and or rent-restricted, affordability designations, occupancy standards, how affordable rents are determined, annual reporting requirements, preferences, income restrictions, annual income recertification requirements, and other requirements.

The covenants also reference sections in the California Health and Safety Code and California Code of Regulations, Title 25, for determining affordability, occupancy standards, income, and affordable rent. In addition, some of the properties are also covered by Low-Income Housing Tax Credits (LIHTC) or Bond Agreements.

BMR Ownership:

The BMR owner-occupied properties each include a deed restriction that requires the initial owners to meet restrictions for the specified income levels and maintain the property as the owner’s sole and primary residence. During the deed-restricted period, if the property is sold, it must be sold at a below-market price and to an income-qualified household. After the expiration of the deed restriction, owners may choose to sell the property at market rates.1 The Existing Unit Purchase properties, owned by the City, are deed-restricted for rental to very low- and low-income households, consistent with the BMR rental properties.

For future BMR ownership properties, Chapter 17.90 provides that the deed restriction will have a term of at least 45 years and that the 45-year term shall start over with each resale. If a below-market rate dwelling unit has not been sold or resold prior to the expiration of the 45-year term, then upon the expiration of the 45-year term, the restrictions set forth in the below-market rate housing agreement shall terminate, expire, and be of no further force or effect and the dwelling unit may then be sold at market rate.

With the 6th cycle of the Housing Element, staff anticipates substantial growth in the overall number of BMR units in the City. Staff has determined that the implementation and enforcement of existing BMR programs could be improved with revisions to Chapter

17.90 and the BMR Guidelines.

Public Meetings (see Attachment 8 and Attachment 9 for meeting minutes)

•Planning Commission Study Session
On October 5, 2023, a Study Session was held to discuss the City’s affordable housing programs and proposed amendments to Chapter 17.90 and BMR Guidelines. Staff provided an overview of the BMR housing programs, explained the need for revisions and outlined the proposed amendments to Chapter 17.90 and BMR Guidelines ( see link to the meeting for details). At the meeting, one of 1 The Emerald Bay deed restrictions provide that the City of Foster City receives a portion of the proceeds of the first sale after the expiration of the restrictions. The Emerald Bay deed restrictions expire in November 2026.

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1 the Commissioners suggested adding language for expiring covenants to include that the City will engage with the property owner(s) to determine the feasibility of extending the expiring covenants.
•Planning Commission Public Hearing
Subsequently, on October 19, 2023, a Planning Commission public hearing was scheduled and staff made further revisions to the Chapter 17.90 to include a new section 17.90.120 Expiring Covenants requiring that five (5) years prior to expiration of an affordability restriction, the Director or designee shall present a report to the City Council informing them about the expiration and will commence discussions with the property owner(s) to determine the feasibility of extending or prolonging affordability restrictions on the property. The Commission reviewed the revisions to Chapter 17.90 and BMR Guidelines and approved Resolution P-19- 23 recommending that the City Council adopt the Ordinance amending Title 17, “Zoning” proposed amendments to the Municipal Code Chapter 17.90 Below Market Rate Inclusionary Housing Program and BMR Guidelines as included below.

ANALYSIS
Summary of Proposed Amendments to the Chapter 17.90 of the Municipal Code The proposed revisions to Chapter 17.90 (Exhibit A, Attachment 1) include additional definitions of terms, updates to code references, clarity on the use of compliance and monitoring fees, formatting updates to improve clarity, the addition of a new section for standards for occupancy, management, and compliance of BMR dwelling units, and the inclusion of enforcement of the BMR Guidelines, enforcement methodology, and other clarifying revisions, as follows:
•Section 17.90.010 Purpose: Addition of “extremely low-income households” to City’s regional share in Section 17.90.010.B, to mirror the language used in the 6th cycle Housing Element. Included language in the section 17.90.010.F to apply the provisions of the chapter to ‘existing and proposed providing program management, maintenance, and compliance standards and Guidelines for eligibility and occupancy of below market rate units.’
•Section 17.90.020 Definitions: Addition of six (6) new definitions, including: (i) administration and compliance monitoring cost, (ii) “director”, (iii) development applicant, (iv) “household, (iv) housing applicant, and (vi) workforce housing.

These additional definitions provide clarity for the terms used in the chapter. In addition, staff made minor revisions to the language of a few definitions. •Section 17.90.030 Applicability: Formatting changes and other minor revisions. •Section 17.90.040 Requirements for inclusion of below market rate dwelling units: Formatting changes and other minor revisions, including moving items relating to standards for management of units to a new section, 17.90.110. •Section 17.90.050 Payment of below market rate housing in-lieu fee:

Formatting, updated references, and other minor changes and other revisions.

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1 •Section 17.90.060 Standards for development of below market rate dwelling units: Formatting changes, minor change in title for clarity; moved sections relating to management and compliance of BMR units from this section to a new Section 17.90.110 to differentiate between development of units and management of units; and other minor revisions.
•Section 17.90.070 Below market rate housing plan and below market rate housing agreement: Formatting and other minor revisions. Also added provision relating to requirement of replacement units per Municipal Code Chapter 17.55. •Section 17.90.080 Alternatives: Formatting and other minor revisions. •Section 17.90.090 Waiver of requirements: The Section has been removed since there is a provision for exemptions under section 17.90.303.C, and to ensure the City’s inclusionary requirements are enforceable as objective standards. •Section 17.90.100 Affordable Housing Fund is now renumbered to Section

17.90.090 and there are no changes.
•Section 17.90.110 Standards for occupancy, management, and compliance of below market rate housing units: Staff proposes this new section which is comprised of existing standards for occupancy, management, and compliance of BMR housing from Section 17.90.060 to this new section to differentiate between standards for development of BMR units and standards for managing below market rate units. Staff additionally proposes updated language regarding BMR housing administrative standards and Guidelines. This section is now renumbered to Section 17.90.100.
•Section 17.90.120 Enforcement: Clarification of the Enforcement section of the Chapter to include BMR Guidelines and to enable staff to enforce rules and requirements for management and compliance of BMR units, especially as best practices continue to evolve in this area. This change is necessary to ensure consistency in income certification methodologies and the city’s anti-displacement strategies. This section was also renumbered to accommodate the new Section

17.90.110.
•Section 17.90.120 Expiring Covenants: Language added to require that five (5) years prior to expiration of an affordability restriction, the Director or designee shall present a report to the City Council informing them about the expiration and will commence discussions with the property owner(s) to determine the feasibility of extending or prolonging affordability restrictions on the property.

It shall be noted that that extension of covenants would be voluntary and mutually agreed upon by the property owner(s).

See Attachment 2 for the redline version showing the proposed amendments to Chapter

17.90. The revisions to Chapter 17.90, Below Market Rate Inclusionary Housing Program will facilitate more effective BMR program management and administration in the following ways:
•Clarify the purpose, scope, and definitions of the BMR Program.

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1 •Position staff to better monitor BMR units and ensure compliance with the City’s BMR program.
•Ensure consistency and enforcement of Chapter 17.90.
•Clarify enforcement of the City’s BMR Guidelines.

Next Steps for Code Amendments
Should the Council approve these amendments, staff will come back for the second reading of the ordinance at a future meeting.

Summary of Proposed Revisions to BMR Guidelines
In order to assist with responsibilities of overseeing, monitoring and administering existing BMR programs, the BMR Guidelines were created in 2010, and minor revisions were made in 2011, 2016, and 2020 (See Attachment 6).

For effective implementation of the BMR Guidelines, staff divided the existing guidelines into (i) ownership and (ii) rental property documents due to the differences between the two (2) programs. Additionally, a table of contents, detailed instructions and guidance, more references, and enforcement provisions were added. These enhancements aim to ensure consistent BMR management practices, offer clear guidance, support the Housing Element goals and anti-displacement strategies, and reduce the risk of BMR non- compliance.

Following is a brief summary of two (2) BMR Guidelines documents, including:
•BMR Rental Guidelines (Attachment 3): This document includes requirements, standards, procedures, best practices, and recommendations for BMR unit compliance, waitlist management, marketing plans for initial lease-ups, tenant eligibility, occupancy standards, determination of income and rent, annual income recertifications, annual reports, training for property managers, and other critical elements of compliance for BMR units. The BMR Guidelines are the primary resource for property managers to implement the terms of the regulatory agreements.
•BMR Ownership Guidelines (Attachment 5): This document includes requirements, procedures and best practices for City Staff to determine purchaser eligibility for initial sale and rules for sale of the property during and after the deed restriction period. The BMR Ownership Guidelines are an important resource for City staff to ensure compliance of owner-occupied BMR units with regulatory agreements.

Policy Direction from the City Council on BMR Rental guidelines Staff is seeking policy direction from the City Council on the following items:

1. Occupancy Standards (Section 17.14.2).

Staff recommends changing general occupancy standards for future BMR properties to align with state issued standards for minimum occupancies and industry standards

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1 for maximum occupancies. The minimum and maximum occupancies allowed in BMR units varies by property according to deed restrictions. In general, the City uses the following standards:

Table 1. Foster City General Occupancy Standards*
Size of Unit Minimum
Occupancy
Maximum
Occupancy
Studio 1 2
One-Bedroom 1 2
One-Bedroom + Den 1 3
Two-Bedroom 3 4
Three-Bedroom 5 6
Four-Bedroom 7 8
*a few properties use different standards as stated in their deed restrictions or bond agreements.

These standards, which have been used since the 1990s, are problematic for the following reasons.
a.Inconsistency in Occupancy Standards. The City’s occupancy standards differ from state issued and accepted industry standards. The City’s standards differ from the San Mateo County HUD standards, the California Title 25, Section 8305 standards, and accepted industry standards. Differences in the standards compared to the City’s general standards are highlighted in yellow.

Table 2. HUD Standards, as adopted by the County of San Mateo Housing Authority*
Size of Unit Minimum
Occupancy*
Maximum
Occupancy
Studio 1 2
One-Bedroom 1 4
One-Bedroom + Den n/a n/a
Two-Bedroom 2 6
Three-Bedroom 4 8
Four-Bedroom 6 10
Five-Bedroom 8 12
*Each housing authority establishes its own standards for HUD programs. The San Mateo Housing Authority uses their own standards and based on Federal Code of Regulations, Title 24, Section 982.401. Minimums for San Mateo County vary based on unit size and household status. Guidelines include head of household and spouse, co-head, or partner will be issued one bedroom. All remaining family members will be issued one bedroom per two family members regardless of gender, age, or relationship of these family members. Live-in aides will be assigned one bedroom. Minimums and maximums are based on the Keating Memo of 1991,which is one person per bedroom as a minimum and two people per bedroom/sleeping room as a maximum. Living rooms are considered sleeping rooms.

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1 Table 3. California Title 25, Section 8305 Standards* Size of Unit Minimum
Occupancy
Maximum
Occupancy
Studio 1 n/a
One-Bedroom 1 n/a
One-Bedroom + Den n/a n/a
Two-Bedroom 2 n/a
Three-Bedroom 4 n/a
Four-Bedroom 6 n/a
Five-Bedroom 8 n/a
* California Code of Regulations, Title 25, Division 1, Chapter 7, Subchapter 19, Uniform Multifamily Regulations, Section 8305, Tenant Selection This section applies to those projects with funding from the California Department of Housing and Community Development (HCD), and includes HOME, CalHFA, California Tax Credit Allocation Committee (TCAC), and California Debt Limit Allocation Committee (CDLAC) funding. These standards do not include maximum occupancies.

Table 4. Accepted Industry Standards*
Size of Unit Minimum
Occupancy
Maximum
Occupancy
Studio 1 2
One-Bedroom 1 3
One-Bedroom + Den n/a n/a
Two-Bedroom 2 5
Three-Bedroom 3 7
Four-Bedroom 4 9
Five-Bedroom 5 11
*Industry standards are one person per bedroom for minimums and 2 people per bedroom plus one for each unit and are an accepted standard by the California Civil Rights Department, which oversees fair housing, although they are not codified by law at the state level. FEH Council Minutes January 10 2017 (ca.gov).
b.Challenges in Practical Application. The City’s general standards can cause hardship for tenants, especially in cases where household experience changes such as a member passing away, divorce, and an adult child who lives at home, or an adult child who leaves the home. These situations often lead to occupants falling below the required minimum occupancy for their unit size, causing distress and the risk of displacement. Additionally, the City’s general occupancy standards do not allow families of five to live in a two-bedroom unit, even if the family chooses to do so or can’t afford or find an affordable three-bedroom unit. c.Longer Vacancies. The City’s general occupancy standards can also lead to longer vacancies as these standards exceed industry and state standards. For example, two roommates, an adult child and parent, or two unrelated seniors are not able to rent a two-bedroom unit. The required minimums and maximums lead to longer periods of vacancy.
d. Compliance Challenges. The City’s general standards create compliance challenges. When a property is covered by more than one regulatory

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1 agreement and each uses a different standard, the standard of applying the strictest rule can require an additional agreement with owners and lenders on interpretation since the strictest rule in occupancy can, in some cases, result in higher rents.

In addition, the adjustment of household size to calculate rent also varies from property to property. The state standards differ from the HUD standards and tax credit standards. The City of Foster City generally uses the State of California standards. However, Marlin Cove uses different maximum occupancy limits, which leads to higher rents than other BMR units in the City with the same affordability level. In addition, it is worth noting that the County of San Mateo uses the HCD income limits and the HUD household size adjustment multiplier, not the California State Code multipliers. Therefore, the annual county-issued rent limits do not apply to Foster City BMRs.

Table 5. Standard Multipliers for Adjustment of Household Size for Rent Calculations
Size of Unit State of CA
(HSC § 50052.5)
TCAC/HUD Marlin Cove
Studio 1 1 2
One-Bedroom 2 1.5 2
One-Bedroom + Den n/a n/a n/a
Two-Bedroom 3 2 4
Three-Bedroom 4 4.5 n/a
Four-Bedroom 5 6 n/a
Staff Recommendation: Staff recommends that City Council direct staff to formalize the following occupancy standards for future BMR properties:
a. Establish use of the State of California Health and Safety Code, Section 50052.5 Standards for adjustment of household size with the exception of any property with bond, TCAC, or other financing, in which case, the standards established by the financing agency or referenced in financing agreement shall prevail.
b. Adopt occupancy standards using the California Code of Regulations, Title 25, Section 8305 for occupancy minimums and the accepted industry standards for maximum occupancy, except for developments receiving HUD financial assistance, in which case the HUD occupancy standards as adopted by the County of San Mateo would apply.

The reason for staff’s recommendation is that all Foster City deed-restricted affordable housing references the California State codes for affordable rents and income eligibility and using the State standards of Title 25, Section 8305 reduces the number of exceptions the City would have to make due to additional financing.

If the City adopts the accepted industry standard for minimums as well as

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1 maximums, then two exceptions would be needed for Section 8 and HUD funded units/properties, as well as HCD-funded properties. In addition, while the industry standards are accepted, they are not legislatively adopted, while the Title 25, Section 8305 standards for minimum occupancy are issued by the State of California, thereby providing additional protections for the City in the event of a fair housing claim regarding minimum occupancy.

2. Anti-Displacement Strategy (Section 8.4.1).

Staff is seeking policy direction regarding establishment of an annual rent increase cap for BMR units for future BMR Agreements.

As background, BMR units are exempt from Assembly Bill (AB) 1482, the Tenant Protection Act of 2019, which provides protections for tenants for just cause evictions and limits rent increases to 5% plus the percentage change in the cost of living (CPI), or 10 percent, whichever is lower. For 2023, the maximum permitted increase for San Mateo County is 4.2%.

Foster City BMR rents are restricted to the maximum chargeable rent as calculated annually for each size of unit based on California Department of Housing and Community Development (HCD) income limits that are published annually. BMR property owners and managers may increase rental rates by any amount, provided the rent is below the maximum chargeable rent. This results in increases that exceed CPI in many cases and sometimes exceed 10%, which can lead to financial hardship for BMR tenants.

For reference, owners and managers calculate BMR maximum rents using income limits issued by HCD, adjusted for household size. The income limits are based on Area Median Income (AMI) for San Mateo County. Annual increases of Area Median Income for San Mateo County over the last five years are as follows:

Table 6: AMI increases, San Mateo County
Year AMI for a Family
of Four
% increase over
prior year
CPI
April-April
2023 $175,000 5.4% 4.2%
2022 $166,000 11.4% 5.0%
2021 $149,600 4.5% 3.8%
2020 $143,100 4.6% 1.1%
2019 $136,800 15.6% 4.0%
As Table 6 shows, the percentage increase from year to year is not related to CPI and is greater than the CPI increase. In addition, when a tenant moves in, they may be charged less than the current maximum rent for that year due to current market conditions. Staff has received inquiries from BMR tenants experiencing high rent increases and currently, staff must explain that the increase is permitted under existing regulations if the increased rent does not exceed the maximum chargeable rent for the unit.

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1 Rent increases for 2023 for Foster City’s BMR properties have ranged from 0% to 27%. In 2023, 45% of the City’s BMR tenants experienced rent increases exceeding 10% the CPI and state mandated maximum increase of 4.2% for San Mateo County rental properties covered by AB1482.

The following are examples of BMR rent caps in other cities. •San Mateo: 4% maximum increase for BMR units.
•Pacifica: 5% plus CPI with a maximum of 10% to match AB 1482 for one of their BMR properties with over 100 units.
•Burlingame: no limits other than BMR maximum rents
•Belmont: no limits other than BMR maximum rents.
•San Bruno: no limits other than BMR maximum rents
•Daly City: no limits other than BMR maximum rents, but the most recent three BMR agreements have limits of 5%.
•Mountain View: CPI or 5%, whichever is lower; applies to all rental units, including BMRs.
•San Francisco: limits BMR increases to the percentage increase in Area Median Income from the prior year (over 17% this year).

Staff Recommendation: Staff recommends a required maximum rent increase for future BMR units of the lowest of a) maximum chargeable rent, or b) CPI defined as the 12-month CPI for San Francisco-Oakland-Hayward, all items, not seasonally adjusted, for April of each year and effective June 1 of each year to May 31 of the following year, or c) 5%, whichever is lower. Staff additionally recommends studying the feasibility of recommending a rent cap for the existing BMR units. The timing of the CPI dates closely coincides with the issuance of state income limits each year and mirrors the period used for calculating CPI for AB1482.

3. Rents for City-Owned Rental Properties Housing Rents (new Section 8.5).

Staff is requesting authorization to adjust rental rates up to 10% (both increase or decrease) for vacant units for city-owned rental properties, including the 14 BMR and the eight (8) workforce housing units at 501 Pilgrim Drive, on an as-needed basis. This adjustment will be made as needed, allowing staff to respond promptly to market changes. The aim is to fill vacancies swiftly with rent decreases or enhance city revenues through rent increases, based on market conditions. For example, currently, all rent changes for the workforce housing property need City Council approval, but staff believes that this request if approved would help in filling future vacancies.

Staff Recommendation: Staff recommends the City Council authorize staff, to adjust rents for vacant units of city-owned rental housing properties (including workforce units) by up to 10% (increase or decrease) on as-needed basis due to current market conditions and limit annual rent increases directed by City Council policy.

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1 4. Policy Direction and Addition of New Sections Regarding Fees, Section

10.14, Monitoring Fees and Section 13.3.1, Compliance Fees.

Staff recommends exploring the establishment of a BMR compliance and monitoring fee to the City’s Master Fee Schedule in the future. a) Monitoring fees, to cover staff time to review annual reports, conduct audits and inspections of BMR properties and files, and review and calculate rent and utility allowance calculations annually. Staff recommends that monitoring fees only apply to future development projects, not existing BMR properties. In researching monitoring fees, staff found that fees range from $35 per unit to $150 per unit in other jurisdictions. The California Tax Credit Allocation Committee charges $415 per unit for their compliance monitoring fee. While no jurisdiction in San Mateo County was found to use monitoring fees at the present time, several jurisdictions are considering establishing monitoring fees for BMR developments. In Foster City, the Workforce Housing Affordable Housing Regulatory Agreement and Declaration of Covenants includes an annual monitoring fee of $70 per unit. However, the City does not charge this amount because it has retained ownership of the units.
b) Penalties on a per property and/or per unit basis that would be assessed for continued or repeated non-compliance. It is critical to maintain the integrity of the City’s BMR Housing Program through compliance with regulatory agreements, the BMR Rental Housing and Ownership Housing Procedures and Guidelines, Municipal Code Chapter 17.90, and the Housing Element. To facilitate compliance, staff recommend studying the imposition of penalties on non-compliant owners/managers of both existing and future BMR properties as part of the enforcement process. Penalties would be assessed only if non-compliance remains uncured following enforcement remedy procedures. Possible circumstances where potential penalty fines could be appropriate include, but are not limited to the following examples:
•Unwarranted removal of a tenant from a BMR program. Penalties would be in addition to any credits owed to the tenant.
•Non-compliance with BMR Rental Procedures and Guidelines, such as failure to use required methods to determine eligibility or annual recertification of income, or failure to maintain files as required. •Non-compliance with term or terms of deed restrictions or affordability agreements, such preferences, annual report deadlines, annual recertifications, adhering to occupancy standards, or overcharging of rent, or not handling over-income tenants as required, or not maintaining property or units as required. Fines would be in addition to any credits owed to individual tenants.
•Late payment or non-payment of annual monitoring and compliance fines.

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1 Staff has reached out to all existing BMR property managers regarding the revised guidelines and will provide training to all BMR property managers on the revised BMR Rental Housing Guidelines in both group and on-one-one settings.

Staff recommendation: Staff recommends studying the establishment of BMR compliance and monitoring fees, including studying a reasonable per unit per year BMR monitoring fee for the term of affordability with reasonable periodic increases for all future affordable housing development agreements. In addition, staff recommends studying the establishment of penalties in the event of non-compliant BMR property owners and managers. In the event Council provides direction to proceed, staff will return with an item for the Council’s consideration at a future meeting date..

Next Steps for BMR Guidelines
If the City Council approves the recommendations (Attachment 4) as noted above, staff will incorporate these changes in the Guidelines (Attachment 3) and will bring back a resolution to Council to adopt the final Guidelines at the same time that Council conducts the second reading of the Ordinance Amending Title 17, “Zoning,” Chapter 17.90 “Below Market Rate Inclusionary Housing Program”. Future minor revisions to the BMR Guidelines will be issued by Staff as provided by Chapter 17.90.

Specifically with regard to the establishment of BMR compliance and monitoring fees, if directed by the City Council to proceed with analyzing potential recovery of staff costs through fees, staff will conduct analysis of fees and provide a recommended schedule to the City Council for review as part of the master fee and budget approval process for the 2024-2025 fiscal year.

CEQA
The proposed actions would update City’s existing Municipal Code. The actions would not result in physical changes to the environment and would be exempt pursuant to CEQA Guidelines Section 15061(b)(3).

FISCAL IMPACT
No fiscal impact.

CITY COUNCIL VISION, MISSION, AND VALUE/PRIORITY AREA
Smart Planning, Development, and the Local Economy

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1 ATTACHMENTS:

Attachment 1 - Ordinance and Exhibit A Chapter 17.90
Attachment 2 - Chapter 17.90 Redline Version
Attachment 3 – Draft 2023 Revised BMR Rental Housing Program Administrative Procedures and Guidelines
Attachment 4 - List of Recommended Updates to BMR Rental Housing Program Administrative Procedures and Guidelines
Attachment 5 - Draft Revised BMR Ownership Housing Programs Administrative Procedures and Guidelines
Attachment 6 – Original 2020 BMR Administrative Procedures and Guidelines Attachment 7 – Planning Commission Resolution P-19-23
Attachment 8 – Meeting minutes for October 19 Planning Commission meeting Attachment 9 – Meeting Minutes for October 5 Planning Commission Meeting

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6 ORDINANCE NO. __________

AN ORDINANCE OF THE CITY OF FOSTER CITY MAKING TEXT AMENDMENTS TO TITLE 17, “ZONING” OF THE FOSTER CITY MUNICIPAL CODE CHAPTER 17.90, “BELOW MARKET INCLUSIONARY HOUSING PROGRAM” AND FINDING THE

AMENDMENTS EXEMPT FROM THE CALIFORNIA ENVIRONMENTAL QUALITY ACT PURSUANT TO CEQA GUIDELINE SECTION 15061(B)(3) - RZ2023-0008

CITY OF FOSTER CITY
WHEREAS, the Community Development Department (CDD) oversees Affordable Housing programs, including Deed Restricted Ownership Units, Below Market Rate (BMR) program, Existing Unit Purchase Program, HIP Home Sharing Program, and Housing Rehabilitation Loan Program; and
WHEREAS, the BMR program covers all rental and ownership properties subject to an affordable housing deed restriction or agreement that restricts units to extremely low, very low, moderate, or workforce units; and
WHEREAS, on March 21, 2022, the City Council adopted Ordinance 644 establishing Chapter 17.90 Below Market Rate Inclusionary Housing Program to Title 17, Zoning, of the Foster City Municipal Code; and
WHEREAS, Chapter 17.90 Below Market Rate Inclusionary Housing Program focuses on the development of the BMR units, including the required number of BMR units, level of affordability for rental and ownership projects, payment of BMR in-lieu fee, standards for new BMR units, BMR housing plan and agreement, alternatives to BMR requirements; waiver of BMR requirements; affordable housing fund and enforcement; and
WHEREAS, in recent months, the CDD staff reviewed Chapter 17.90 and the related documents, including the BMR Guidelines, and determined that the responsibilities pertaining to overseeing and monitoring of the existing BMR program could be further improved with the proposed revisions to the Chapter 17.90; and WHEREAS, on October 5, 2023, a Planning Commission Study Session was held to discuss the proposed revisions to the Chapter 17.90 Below Market Inclusionary Housing Program and BMR guidelines; and
WHEREAS, the periodic updates to the Municipal Code without a physical change to the environment is exempt under the CEQA Guidelines Section 15061(b)(3), Common Sense Exemption; and
WHEREAS, on October 19, 2023, the Planning Commission conducted a duly and properly noticed public hearing to take public testimony and consider a Resolution

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6 regarding the amendments to Chapter 17.90, and after conducting the public hearing, adopted Resolution No. P-13-23 with the Planning Commission recommending City Council approval of the amendments to Chapter 17.90; and WHEREAS, on November 08, 2023, a public hearing notice was published posted in three public places, and mailed pursuant to California Code Section 65090 for the City Council public hearing on November 20, 2023; and

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

Section 1. The City Council does hereby find and determine based upon the aforementioned Record as follows:

1. The foregoing Recitals are true and correct and are incorporated herein by this reference; and

2. Components of the proposed amendments have been reviewed for compliance with the provisions of the California Environmental Quality Act (CEQA) and are found to be exempt from review as follows:
a. Amend Chapter 17.90 Below Market Inclusionary Housing Program is exempt pursuant to CEQA Guidelines Section 15061(b)(3); Section 2. Amendment. Chapter 17.90 “Below Market Inclusionary Housing program” within Title 17, “Zoning” of the Foster City Municipal Code are hereby amended and revised to read as set forth in the attached Exhibits A, as listed below and attached hereto and incorporated herein by reference:

Section 3. Severability. If any section, subsection, sentence, clause or phrase of this Ordinance is for any reason held to be invalid, such decision shall not affect the validity of the remaining portions of this Ordinance. The City Council does hereby declare that it should have adopted the Ordinance and each section, subsection, sentence, clause or phrase thereof, irrespective of the fact that any one or more sections, subsections, sentences, clauses or phrases be declared invalid or unconstitutional.

Section 4. Taking Effect. This Ordinance shall take effect and be in force thirty (30) days from and after its adoption.

Section 5. Posting. Within fifteen (15) days after the adoption of this Ordinance, the City Clerk shall have it posted in three (3) public places designated by the City Council.

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6 This Ordinance was introduced and read on the 20th day of November, 2023, and passed and adopted on the ____ day of ___, 2023, by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:

JON FROOMIN, MAYOR
ATTEST:

PRISCILLA SCHAUS, CITY CLERK

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6 EXHIBIT A
Chapter 17.90

BELOW MARKET RATE INCLUSIONARY HOUSING PROGRAM
Sections:

17.90.010 Purpose.

17.90.020 Definitions.

17.90.030 Applicability.

17.90.040 Requirements for inclusion of below market rate dwelling units in development projects.

17.90.050 Payment of below market rate housing in-lieu fee.

17.90.060 Standards for development of below market rate dwelling units.

17.90.070 Alternatives.

17.90.080 Below market rate housing plan and below market rate housing agreement.

17.90.090 Affordable housing fund.

17.90.100 Standards for occupancy, management, and compliance of below market rate dwelling units.

17.90.110 Enforcement.

17.90.120 Expiring covenants.

17.90.010 Purpose.

The purpose of this chapter, to be known as the Below Market Rate Inclusionary Housing Program, is to:

A. Enhance the public welfare by establishing policies and encouraging the development and availability of housing opportunities to a broad range of households with varying income levels within the city as mandated by state law, California Government Code Section 65580 and following; and B. Promote the city’s goals as stated in the housing element of the general plan to increase the supply of below market rate housing to meet the city’s regional share of extremely low, very low, low, and moderate income housing needs and the needs of special groups, including the elderly, disabled, small and large families, and local workers by imposing an inclusionary requirement for residential development projects; and

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6 C. Reduce vehicle miles traveled (VMT) and greenhouse gas (GHG) emissions by providing people at all income levels more opportunities to live near where they work; and D. Support the local economy by making it easier for employers to attract and retain workers by providing people at all income levels more opportunities to live near where they work; and E. Affirmatively further the policies and purposes of the Fair Housing Act, also known as “Affirmatively Furthering Fair Housing” by reducing segregation and concentration of poverty; and F. Implement the city’s adopted inclusionary policy contained in the housing element of the general plan by creating standards and a mechanism to provide below market rate dwelling units as part of proposed residential development projects, including by providing program management, maintenance, and compliance standards and guidelines for eligibility and occupancy of below market rate units for existing and proposed residential projects; and
G. Provide for the establishment and imposition of a below market rate housing in-lieu fee on residential development projects as an alternative means of mitigating the impact of residential development projects on the need for below market rate dwelling units in the city, as opposed to the development and construction of below market rate dwelling units as part of residential development projects, in certain circumstances. (Ord. 644 § 3, 2022) (Ord. XX, 2023).

17.90.020 Definitions.

A. “Administration and compliance monitoring cost” means the ongoing cost of city services for administration, compliance, and monitoring of new and existing below market rate dwelling units. The city council, by resolution or deed restriction, may establish recurring annual fees for below market rate property owners on a per unit basis for the ongoing annual administration and compliance monitoring costs of the below market rate units.

Fees may be updated from time to time.

B. “Below market rate housing fund” means a separate or segregated fund or account designated by the city to maintain and account for all monies received pursuant to this chapter.

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6 C. “Below market rate ownership cost” means the sale price for a below market rate dwelling unit, available as a for-sale unit, resulting in a projected average monthly housing expense during the first calendar year of an eligible household’s occupancy, including mortgage principal and interest, mortgage insurance, property taxes, homeowners’ insurance, homeowners’ association dues, if any, and a reasonable allowance for utilities, not exceeding the sales prices specified by Section 50052.5 of the California Health and Safety Code and California Code of Regulations Title 25, Sections 6910 through 6924.

D. “Below market rate rent” means the total monthly housing expenses for a below market rate dwelling unit, available as a rental unit, not exceeding the rents specified by Section 50053 of the California Health and Safety Code and California Code of Regulations Title 25, Sections 6910 through 6924, except that the city may permit alternative criteria, when necessary, to be consistent with pertinent state and federal statutes and regulations governing publicly assisted rental housing, or for workforce housing. As used in this chapter, “below market rate rent” shall include the total of monthly payments by the tenant for all of the following:

1. Use and occupancy of the below market rate dwelling unit and land and all facilities associated with the below market rate dwelling unit, including but not limited to parking (whether unbundled or not), bicycle storage, storage lockers, and use of all common areas;

2. Any additional separately charged fees or service charges assessed by the owner, other than security deposits;

3. An allowance for utilities paid by the tenant as established by the San Mateo County Housing Authority which may be updated from time to time, including garbage collection, sewer, water, electricity, gas, and other heating, cooking, and refrigeration fuel, but not telephone service, cable TV or WiFi/internet and any other fees required to be paid by the tenant for services received;

4. Any other interest, taxes, fees or charges for use of the land or below market rate dwelling unit or associated facilities and assessed by a public or private entity other than the owner and paid by the tenant.

E. “Below market rate dwelling unit” means a dwelling unit in a residential development project that is restricted for sale or rental to and occupancy by an eligible household at a below market rate ownership cost or below market rate rent, as applicable, and as required by this chapter.

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6 F. “Below market rate housing administrative standards and guidelines” means standards and guidelines adopted by the community development director from time to time to provide a consistent framework for determining household income, below market rate ownership cost, below market rate rent, eligible households, monitoring, reporting, scope of below market rate housing plan, terms of below market rate housing agreement, marketing plan requirements, and any other relevant rules, regulations or provisions necessary for the administration of this chapter.

G. “Below market rate housing agreement” means an agreement that shall specify the number, type, location, size, and phasing of all below market rate dwelling units required in a residential development project, provisions for income certification and screening of potential purchasers or renters of below market rate dwelling units, and resale control mechanisms, including the financing of ongoing administration and compliance monitoring costs , consistent with the approved below market rate housing plan, as determined by the community development director.

H. “Below market rate housing in-lieu fee” means the fee imposed on each dwelling unit of a residential development project, established by resolution of the city council, and updated from time to time, not to exceed the cost of mitigating the impact of residential development projects on the need for below market rate dwelling units in the city. For purposes of this Chapter, such an in-lieu fee is only for residential development projects, or residential components of mixed-use projects.

I. “Below market rate housing plan” means a plan prepared by the developer of a residential development project that describes how the proposed dwelling units conform to the requirements of this chapter, and city and state density bonus law requirements, as applicable, and shall include, at a minimum, procedures and requirements for determining eligible households for rental of rental units or purchasers of for-sale units, occupancy requirements, initial and ongoing marketing policies, application process, waitlist management, income verification requirements, annual recertification, if applicable, rejection of ineligible housing applicants and eligibility termination, ongoing compliance monitoring costs, and such other provisions as the community development director may prescribe from time to time pursuant to below market rate housing administrative guidelines.

J. “Building permit” includes full structural building permits as well as partial permits such as foundation-only permits and demolition permits.

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6 K. “Density bonus” means entitlement to build additional residential units above the maximum number of units permitted pursuant to the existing general plan, applicable specific plan and/or zoning designation, and as further specified in Chapter 17.86 and California Government Code Section 65915 (“State Density Bonus Law”).

L. “Developer” means the person(s) or legal entity(ies), including the property owner, or successor, seeking a planning permit or building permit for a residential development project.

M. “Development applicant” means the developer seeking a planning permit or building permit for a residential development project.

N. “Director” means the director of the city’s community development department, or designee.

O. “Dwelling unit” means a dwelling designed for occupancy by one household; the foregoing notwithstanding, dwelling unit shall not include an accessory dwelling unit as defined in Section 17.78.040.

P. “Eligible household” means those households whose maximum income does not exceed levels published annually for extremely low income households, very low income households, low (or lower) income households, and moderate income households, adjusted for household size and appropriate for the below market rate dwelling unit.

Q. “Extremely low income households” means households with incomes no greater than the maximum income for extremely low income households, as published annually by the California Department of Housing and Community Development (HCD) as the Official State Income Limits pursuant to Health and Safety Code Section 50093 for San Mateo County, adjusted for household size, except that the city may permit alternative criteria, when necessary, to be consistent with pertinent state and federal statutes and regulations governing publicly assisted housing.

R. “For-sale unit” means a dwelling unit that may be sold individually in conformance with the Subdivision Map Act. For-sale units also include dwelling units that are converted from rental units to for-sale units.

S. “Household” means one (1) person living alone or two (2) or more persons sharing residency whose income is considered for housing payments, and all minor children.

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6 T. “Housing applicant” means an individual or household who has submitted or will submit an application to rent a below market rate dwelling unit.

U. “Low income households” means households with incomes no greater than the maximum income for low or lower income households, as published annually by the California Department of Housing and Community Development (HCD) as the Official State Income Limits pursuant to Health and Safety Code Section 50093 for San Mateo County, adjusted for household size, except that the city may permit alternative criteria, when necessary, to be consistent with pertinent state and federal statutes and regulations governing publicly assisted housing. “Market rate unit” means a dwelling unit in a residential development project that is not a below market rate dwelling unit.

V. “Moderate income households” means households with incomes no greater than the maximum income for moderate income households, as published annually by the California Department of Housing and Community Development (HCD) as the Official State Income Limits pursuant to Health and Safety Code Section 50093 for San Mateo County, adjusted for household size, except that the city may permit alternative criteria, when necessary, to be consistent with pertinent state and federal statutes and regulations governing publicly assisted housing.

W. “One location” includes all adjacent parcels of land under common ownership or control, the property lines of which are contiguous at any point, or the property lines of which are separated only by a public or private street, road, or other public or private right-of-way, or separated only by the lands owned or controlled by the developer.

X. “Planning permit” means any discretionary approval of a residential development project, including, without limitation, a general or specific plan adoption or amendment, rezoning, tentative map, parcel map, conditional use permit, variances, or architectural review.

Y. “Property owner” means the developer or successor owner or authorized agent of below market rate development.

Z. “Rental unit” means a dwelling unit that is intended to be offered for rent or lease and that cannot be sold individually in conformance with the Subdivision Map Act.

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6 AA. “Residential development project” means an application for a planning permit or building permit at one location to create one or more dwelling units, redevelop an existing residential development project to remove and replace dwelling units and/or create one or more additional dwelling units, convert nonresidential uses to dwelling units, subdivide a parcel to create one or more separately transferable parcels intended for development of dwelling units, or implement a condominium conversion, including development of dwelling units constructed at one location and in phases.

BB. “Review authority” means the city staff person or body authorized to approve or deny an application for a planning permit or building permit for a residential development project.

CC. “Very low income households” means households with incomes no greater than the maximum income for very low income households, as published annually by the California Department of Housing and Community Development (HCD) as the Official State Income Limits pursuant to Health and Safety Code Section 50093 for San Mateo County, adjusted for household size, except that the city may permit alternative criteria, when necessary, to be consistent with pertinent state and federal statutes and regulations governing publicly assisted housing.

DD. “Workforce housing” means dwelling units rented at below market rental rates for certain categories of workers pursuant to Section 17.90.100(D). (Ord. 644 § 3, 2022) (Ord. XX, 2023).. \

17.90.030 Applicability.

The requirements of this chapter shall apply to any residential development project as set forth below.

1. Pay a below market rate housing in-lieu fee for each dwelling unit upon issuance of a building permit, or

2. Construct below market rate units on the location of the residential development project per Section 17.90.040 (Requirements for inclusion of below market rate dwelling units), make said below market rate dwelling units available for sale or rental to and occupancy by

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6 eligible households at the applicable household income level and at below market rate ownership cost or below market rate rent, as applicable, and secure said obligation pursuant to a below market rate housing agreement as set forth in Section 17.90.080(E) (Below Market Rate Housing Agreements).

B. Residential Development Projects—Ten Dwelling Units or More. Residential development projects of ten dwelling units or more are hereby required, as a condition of issuance of a planning permit or building permit, to:

1. Construct below market rate units on the location of the residential development project per Section 17.90.040 (Requirements for inclusion of below market rate dwelling units);

2. Make said below market rate dwelling units available for sale or rental to and occupancy by eligible households at the applicable household income level and at below market rate ownership cost or below market rate rent, as applicable; and,

3. Secure said obligation pursuant to a below market rate housing agreement as set forth in Section 17.90.080(E) (Below Market Rate Housing Agreements).

C. Exemptions. The provisions of this chapter shall not apply to developers of residential development projects which fall within one or more of the following categories:

1. Residential development projects containing four or fewer dwelling units;

2. Residential development projects located on property owned by the state of California, the United States of America, or any of its agencies and used exclusively for governmental or educational purposes;

3. Residential development projects involving the repair or replacement of a building that was damaged or destroyed by fire or other calamity, so long as:
(a) The square footage and use of the building remains the same; (b) Construction of the replacement building is conducted in accordance with California Government Code Section 65852.25, which section requires a building permit to be secured within two years of the occurrence of any such event; and, (c) In accordance with California Health and Safety Code Section 18938.6, construction begins within one year from the issuance of a building permit, subject to the issuance of

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6 one or more extensions, not to exceed one hundred eighty days, upon a showing of justifiable cause by the development applicant to the satisfaction of the building official.

4. Accessory dwelling units (ADUs) or junior accessory dwelling units (JADUs) as defined in Chapter 17.78;

5. Residential development projects which are developed in accordance with the terms of a development agreement adopted by ordinance pursuant to the authority and provisions of California Government Code Section 65864 et seq., and that is executed prior to the effective date of the ordinance codified in this chapter; provided, that such residential development projects shall comply with any below market rate inclusionary housing requirements included in the development agreement or any predecessor ordinance in effect on the date the development agreement was executed;

6. Residential development projects exempted by California Government Code Section 66474.2 or 66498.1 or successor provision; provided, that such residential development projects shall comply with any predecessor ordinance, resolution, or policy governing below market rate inclusionary housing in effect on the date the application for the development was deemed complete;

7. Residential development projects exempted by California Government Code Section 65589.5(o) or successor provision; provided, that such residential development projects shall comply with any predecessor ordinance, resolution, or policy governing below market rate inclusionary housing in effect on the date that a preliminary application for the development containing all of the information required by California Government Code Section 65941.1 was submitted to the city; or

8. Residential development projects for which all applications for city of Foster City discretionary development entitlements required to develop the project have been deemed complete prior to the effective date of the ordinance codified in this chapter; provided, that such residential development projects shall comply with any predecessor ordinance, resolution, or policy governing below market rate inclusionary housing in effect on the date the application for the development was deemed complete. (Ord. 644 § 3, 2022) (Ord. XX, 2023)

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6 17.90.040 Requirements for inclusion of below market rate dwelling units in development projects A. For the purposes of this section, “total dwelling units” does not include:

1. Dwelling units awarded above the otherwise-allowable maximum density as part of a density bonus in Chapter 17.86 (Density Bonuses), as provided by California Government Code Section 65915(b)(3), or

2. In a residential development project that will require the demolition of dwelling units, the number of dwelling units demolished, provided the residential development project will create at least as many dwelling units as will be demolished and otherwise complies with the requirements of California Government Code Section 66300(d), as applicable to the demolished units.

B. Number of Below Market Rate Dwelling (“BMR”) Units and Level of Affordability. Residential development projects of ten dwelling units or more, or residential projects of five to nine units that opt to construct units, shall construct, or cause to be constructed, the number of below market rate dwelling units as specified below.

1. Rental Projects
(a) Five percent of the proposed total dwelling units in a rental residential development project shall be BMR units occupied by or available for occupancy by moderate income households at or below market rate rents;
(b) Five percent of the proposed total dwelling units shall be below market rate dwelling units occupied by or available for occupancy by low income households at or below market rate rents; and,
(c) Ten percent of the proposed total dwelling units shall be below market rate dwelling units occupied by or available for occupancy by very low income households at or below market rate rents.

2. Ownership Projects.
(a) Twenty percent of the proposed total dwelling units in a for-sale residential development project shall be BMR units sold to and occupied by or available for sale

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6 to and occupancy by moderate income households at or below market rate ownership cost.

3. Fractional Units. Calculation of units or fees when the number of BMR units is not a whole number shall be as follows:
(a) Any fraction of less than 0.50 shall be satisfied by payment of an amount equal to the below market rate housing in-lieu fee, as adopted by the city council applicable to rental or ownership residential developments, times the applicable fraction, or (b) Any fraction of 0.50 or more shall be satisfied by developing one below market rate dwelling unit available for sale or rental to and occupancy by eligible households at the applicable household income level and at below market rate ownership cost or below market rate rent, as applicable. In either scenario, the development applicant has the option to provide an additional BMR unit instead of the fee.

4. Density Bonus. BMR units that satisfy the requirements of this chapter may be counted toward the number of BMR units required for a density bonus under California Government Code Sections 65915 through 65918 as set forth in Chapter 17.86 (Density Bonuses). (Ord. 644 § 3, 2022) (Ord. XX, 2023).

17.90.050 Payment of below market rate housing in-lieu fee.

A. Amount. The amount of the BMR housing in-lieu fee applicable to rental residential development projects and ownership residential development projects shall be established by resolution of the city council and be calculated based on the type of residential development (rental or ownership). The below market rate housing in-lieu fee established for rental residential development projects and ownership residential development projects shall not exceed the cost of mitigating the impact of rental or ownership residential development projects on the need for below market rate dwelling units in the city.

B. Timing of Payment. Payment of the BMR housing in-lieu fee shall be due prior to the issuance of the first building permit and the applicable fee schedule in effect at the time the building permit is issued for a rental residential development project or ownership residential development project. (Ord. 644 § 3, 2022) (Ord. XX, 2023).

17.90.60 Standards for development of below market rate dwelling units.

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6 A. Quality of Construction and Number of Bedrooms. All below market rate dwelling units required by this chapter shall be equal to the overall quality of construction to market rate units in the same residential development project as follows:

1. The exterior appearance of the BMR units shall be the same as that of market rate units.

2. Interior finishes and amenities of the BMR units shall not differ from those provided in the base model market rate units.

3. The number of bedrooms in the BMR units shall be equal to the average number of bedrooms in the market rate units, including square footage by unit size, and the below market rate dwelling units shall be dispersed within the residential development project, with the location of below market rate dwelling units comparable to those of the market rate units, subject to review and approval by the director.

4. The BMR units shall have access to the same amenities as the market rate units and shall be included within the below market rate ownership cost or below market rate rent for the below market rate dwelling unit. For example, residents of the below market rate dwelling units shall not be excluded from common open space, parking, storage, and other community facilities or amenities in the residential development project, nor shall households residing in below market rate dwelling units be charged more than a below market rate rent or a below market rate ownership cost as defined in Section 17.90.020 (Definitions) for the use of such facilities and amenities.

B. Availability for Occupancy. Below market rate dwelling units required by this chapter shall be made available for occupancy concurrently with the market rate units. For the purposes of this subsection, “concurrently” means that the city may not issue building permits for more than fifty percent of the market rate units until it has issued building permits for all of the below market rate dwelling units, and the city may not approve any final inspections or certificates of occupancy for more than fifty percent of the market rate units until it has issued final inspections or certificates of occupancy for all of the below market rate dwelling units.

C. Duration of Affordability.

1. Ownership. BMR units available as a for-sale unit are subject to the following:

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6 (a) Pursuant to the terms of a below market rate housing agreement, BMR units are legally restricted for sale to and occupancy by eligible households within the income levels for which the below market rate dwelling units were designated and at a below market rate ownership cost for a period of at least forty-five years from the date of recordation of each grant deed.
(b) Resale of the BMR unit during the forty-five-year term shall be restricted to eligible households at a below market rate ownership cost as defined herein and set forth in the below market rate housing agreement recorded against the below market rate dwelling unit and the forty-five-year term shall start over with each resale. (c) If a BMR unit has not been sold or resold prior to the expiration of the forty-five-year term, then upon the expiration of the forty-five-year term, the restrictions set forth in the below market rate housing agreement shall terminate, expire and be of no further force or effect and the dwelling unit may then be sold at market rate. (d) The below market rate housing agreement shall be recorded against the property of the applicable residential development project and below market rate dwelling unit(s) in accordance with the provisions of and consistent with the form specified in Section 17.80.070(E).

2. Rental. BMR units available as a rental unit are subject to the following:
(a) Pursuant to the provisions of California Government Code Section 66300(d) BMR units shall, pursuant to the terms of a below market rate housing agreement, be legally restricted to occupancy by eligible households within the income levels for which the below market rate dwelling units were designated and at a below market rate rent for a period of at least ninety-nine years from the date a certificate of occupancy is issued by city for the entire residential development project.
(b) The director, or his or her designee, may accept a shorter period of affordability of no less than fifty-five years, if the applicable residential development project provides substantial evidence that a shorter-term restriction is necessary and required in order to obtain financing for the applicable residential development project. (c) The below market rate housing agreement shall be recorded against the property of the applicable residential development project in accordance with the provisions of and consistent with the form specified in Section 17.90.080(E). (Ord. 644 § 3, 2022) (Ord. XX, 2023).

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6 17.90.070 Alternatives.

A developer may propose an alternative means of compliance with this chapter subject to the following provisions:

A. Construction of Off-Site Below Market Rate Dwelling Units. If a developer of a residential development project of ten or more dwelling units proposes the construction of off-site below market rate dwelling units in the below market rate housing plan required under Section 17.90.080, the city council may, in its discretion, approve such a proposal if it finds the proposal meets all of the following condition

1. The proposed off-site location is within the city of Foster City, is currently owned by the developer or is under contract for purchase by the developer, is not located in a flood hazard zone and does not contain environmentally sensitive habitat, is not contaminated with or otherwise impaired by the presence of hazardous materials or hazardous substances in the soil, soil vapor or groundwater in, on, or under the off-site location or emanating from lands in proximity thereto, as reflected in a Phase I Environmental Site Assessment, and if necessary, a Phase II Environmental Site Assessment, and development and construction of a residential development project on the proposed off-site location is consistent with the city’s adopted general plan, housing element, and zoning; and

2. The proposed off-site location is suitable for and development of a residential development project thereon is economically and financially feasible as determined by the city, in its sole discretion, pursuant to a feasibility analysis of a proposed residential development project on the proposed off-site location prepared by the city, at the expense of the developer, and approved by the city council; and

3. The proposed off-site location is adequately served by all required utilities and transportation infrastructure, all of which are appropriately sized to accommodate the proposed off-site below market rate units, the off-site residential development project, and all reasonable foreseeable probable future development within the area served by said utilities and transportation infrastructure; and

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6 4. The proposed off-site below market rate units are in addition to any below market rate dwelling units otherwise required for the off-site residential development project; and

5. The construction of the proposed off-site below market rate dwelling units within the off-site residential development project has not commenced before the approval of the on-site residential development project, the off-site below market rate dwelling units will be available for occupancy prior to or concurrently with the market rate units within the on-site residential development project, and the inclusion of the below market rate dwelling units within the off-site residential development project will not, when combined with the below market rate inclusionary requirement of the off-site residential development project, significantly contribute to residential segregation by income level within the city; and

6. The proposed off-site below market rate dwelling units would be provided in at least the same quantity and affordability levels as would be required for on-site units. The foregoing notwithstanding, any proposal to provide rental off-site below market rate dwelling units to satisfy an inclusionary requirement for an ownership project shall comply with Sections 17.90.040(A)(1) and 17.90.060(C)(2); and

7. The proposed off-site below market rate dwelling units comply with all other requirements of this chapter; and

8. All necessary agreements required to secure the construction of the off-site below market rate dwelling units will be made a part of the affordable housing agreement required for the on-site residential development project; and

9. Financing or a viable financing plan, which may include public funding sources, is in place for the acquisition of land, development and construction of the proposed off-site below market rate dwelling units; and

10. The purposes of this chapter would be better served by implementation of the proposed alternative and that the proposed alternative meets the greatest community needs at that time.

B. Conversion of Off-Site Dwelling Units or Nonresidential Buildings to Off-Site Below Market Rate Dwelling Units. If a developer of a residential development project of ten or more dwelling units proposes the

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6 conversion of off-site dwelling units or nonresidential buildings to off-site below market rate dwelling units in the below market rate housing plan required under Section 17.90.080, the city council may, in its discretion, approve such a proposal if it finds the proposal meets all of the following conditions:

1. All of the conditions as set forth in subsection A of this section; and

2. The construction of the proposed off-site below market rate dwelling units shall be in addition to any replacement units otherwise required by state law, including but not limited to Government Code Sections 66300(d) and 65915(c)(3).

C. On-Site Clustering of Below Market Rate Dwelling Units. If a developer of a residential development project of ten or more dwelling units proposes the clustering of on-site below market rate dwelling units in the below market rate housing plan required under Section 17.90.080 as an alternative to the provisions of Section 17.90.060(A)(3) requiring the reasonable dispersal of such units within the residential development project, the city council may, in its discretion, approve such a proposal if it finds the proposal meets all of the following conditions:

1. The clustering of on-site below market rate dwelling units is necessary to access and secure sources of financing needed for the residential development project; and

1. Construction of the clustered below market rate dwelling units will occur prior to or concurrently with the construction of the market units in the residential development project; and

3. The clustering of on-site below market rate dwelling units will not, when considered singularly or in connection with other residential development projects in the vicinity of the project, significantly contribute to residential segregation by income level within the city; and

4. The purposes of this chapter would be better served by implementation of the proposed alternative and that the proposed alternative meets the greatest community needs at that time.

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6 the construction of below market rate dwelling units in the below market rate housing plan required under Section 17.90.080, the city council may, in its discretion, approve such a proposal if it finds the proposal meets all of the following conditions:

1. The land proposed to be donated to the city is located within the city of Foster City, is currently owned by the developer or is under contract for purchase by the developer, is not located in a flood hazard zone and does not contain environmentally sensitive habitat, and development and construction of a residential development project on the site is consistent with the city’s adopted general plan, housing element, and zoning; and

2. The land proposed to be donated is suitable for and development of a residential development project thereon is economically and financially feasible as determined by the city, in its sole discretion, pursuant to a feasibility analysis of a proposed residential development project on the land proposed to be donated prepared by the city, at the expense of the developer, and approved by the city council; and

3. The land proposed to be donated to the city is adequately served by all required utilities and transportation infrastructure, all of which are appropriately sized to accommodate a residential development project on the site and all reasonable foreseeable probable future development within the area served by said utilities and transportation infrastructure; and

4. The fair market value of the land proposed to be donated equals or exceeds the value of the on-site below market rate dwelling units otherwise required to be provided as part of the residential development project, as shown in an appraisal of the land to be donated and a financial analysis of the proposed residential development project prepared by the city, at the expense of the developer, and approved by the city council; and

5. The land proposed to be donated to the city shall not be contaminated with or otherwise impaired by the presence of hazardous materials or hazardous substances in the soil, soil vapor or groundwater in, on, or under the land to be donated or emanating from lands in proximity thereto, as determined by and to satisfaction of the city, in its sole discretion, pursuant to a Phase I Environmental Site Assessment, and if necessary, a Phase II Environmental Site Assessment, conducted under the direction of the city and at the expense of developer; and

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6 6. The purposes of this chapter would be better served by implementation of the proposed alternative and that the proposed alternative meets the greatest community needs at that time. (Ord. 644 § 3, 2022) (Ord. XX, 2023)

17.90.080 Below market rate housing plan and below market rate housing agreement.

1. Describe how the proposed dwelling units conform to the requirements of this chapter and city and state density bonus law requirements, as applicable.

2. Include provisions that demonstrate compliance with California Government Code Sections 65915(c)(3) and 66300(d), requiring replacement units to be restricted to lower- income households to match the percentage of lower-income tenants, as provided in Chapter

17.55, Replacement Units.

3. Include, at a minimum, procedures and requirements for:
(a) determining rental rates
(b) eligibility of households for rental of rental units or purchasers of for-sale unit, (c) income requirements
(d) occupancy standards
(e) Initial and ongoing marketing policies
(f) application process
(g) waitlist management
(h) income verification requirements
(i) annual income recertification requirements
(j) If applicable, rejection of ineligible housing applicants, eligibility termination (k) funding by developer for ongoing administration and compliance monitoring costs following occupancy of below market rate dwelling units (l) and such other provisions as the director may prescribe from time to time pursuant to below market rate housing administrative standards and guidelines.

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6 4. Below market rate housing plans are not required for residential development projects that are not required to provide for the construction, sale and/or rental of on-site or off-site below market rate dwelling units, in compliance with the provisions of this chapter Submittal and Review. The below market rate housing plan must be submitted prior to the first planning permit application being deemed complete. The below market rate housing plan shall be processed concurrently with all other planning permits required for the residential development project.

C. Approval of On-Site Below Market Rate Dwelling Units. The review authority may approve or conditionally approve a below market rate housing plan that proposes on-site below market rate dwelling units if it makes findings, based on substantial evidence, that:

1. The on-site below market rate dwelling units comply with the applicable standards in this chapter, including, without limitation, the requirement that the below market rate dwelling units be made available for occupancy concurrently with the market rate units.

2. The on-site below market rate dwelling units will mitigate the impact of the market rate units in the residential development project on the need for below market rate dwelling units in the city.

D. Amendments. The approved below market rate housing plan may be amended prior to issuance of any building permit for the residential development project. A request for a minor modification of an approved below market rate housing plan may be granted by the director if the modification is substantially in compliance with the original below market rate housing plan and conditions of approval. Other significant or substantial modifications to the below market rate housing plan, as determined by the director, shall be processed in the same manner as the original below market rate housing plan.

E. Below Market Rate Housing Agreements. As a condition of approval of a residential development project, a below market rate housing agreement acceptable to the director, approved by the city attorney and executed by the city manager, shall:

1. Be recorded against the residential development project prior to approval of any final or parcel map, or issuance of any building permit, whichever occurs first.

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6 2. Specify the number, type, location, size, and phasing of all below market rate dwelling units, provisions for income certification and screening of potential purchasers or renters of below market rate dwelling units, and resale control mechanisms, and provisions for funding by developer for administration and compliance monitoring costs following occupancy of below market rate dwelling units consistent with the approved below market rate housing plan.

3. Provide for the indemnification and defense of the city, as approved by the city attorney, against any and all claims brought by any and all persons, including eligible households, in connection with the administration and implementation by city of the below market rate housing plan and below market rate housing agreement.

4. A below market rate housing agreement applicable to below market rate dwelling units, available as for-sale units, shall require as a condition of the sale of a below market rate dwelling unit from developer to an eligible household, that the restrictions set forth in the below market rate housing agreement and this chapter be recorded against the below market rate dwelling unit in the form of a resale restriction agreement, performance deed of trust, and/or regulatory agreement, as approved by the city attorney and executed by the city manager, to ensure the continued affordability of the below market rate dwelling units. (Ord. 644 § 3, 2022) (Ord. XX, 2023)

17.90.90 Affordable housing fund.

A. Establishment of the Affordable Housing Fund. The city of Foster City has established an affordable housing fund as set forth in Section 17.88.060. The city reaffirms that the affordable housing fund is created for the purpose of receiving and dispersing certain monies to address the housing needs of extremely low, very low, low and moderate income households. Separate accounts within the affordable housing fund may be created from time to time to avoid commingling of monies, if required by law or as deemed appropriate for the administration of the affordable housing fund
B. Deposits. All below market rate housing in-lieu fees or other funds collected under this chapter shall be deposited into the affordable housing fund.

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6 C. Use of Funds. In addition to the purposes set forth in Section 17.88.060, the monies in the affordable housing fund, including all interest and earnings from investment of the monies therein, shall be expended exclusively to provide, or assure the continued provision of, below market rate dwelling units to extremely low income, very low income, lower income, and moderate income households in the city, through property acquisition, construction, development assistance, rehabilitation, conversion, financing, rental assistance or other subsidies or methods, consistent with the goals and policies contained in the city’s housing element and the purposes for which the fees were collected, and for administration and compliance monitoring of the below market rate dwelling units established pursuant to this chapter.

D. Guidelines. The city council may, from time to time, adopt guidelines for expenditure of monies in the affordable housing fund. (Ord. 644 § 3, 2022) (Ord. XX, 2023)

17.90.100 Standards for occupancy, management, and compliance of below market rate dwelling units A. Below Market Rate Housing Administrative Standards and Guidelines. The community development director may adopt and revise standards, rules, regulations and guidelines, best practices, and methodologies for determining household income, below market rate housing cost, below market rate rent, determining eligibility of households of for-sale units and rental units, establishing monitoring, reporting, requirements, for residential development projects, marketing plans, and such other provisions and requirements as are relevant to the administration of this chapter.

B. Eligibility. No eligible household may occupy a below market rate dwelling unit available as a rental unit or acquire a below market rate dwelling unit available as a for-sale unit until the director, or his or her designee, has approved a below market rate housing plan prepared by the developer, which plan shall include eligibility requirements specific to the residential development project, and a below market rate housing agreement has been recorded against the residential development project in accordance with Section 17.90.080.

C. Principal Residence. Any eligible household that occupies a below market rate dwelling unit must occupy that dwelling unit as its principal residence, unless otherwise approved in writing for rental to a third party for a limited period of time due to household hardship, as determined and approved by the city in advance and in accordance with below market rate housing administrative standards and guidelines.

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6 D. Housing Preferences. Subject to applicable state and federal fair housing laws, the city may implement preferences for the sale or rental to and occupancy of below market rate dwelling units at the applicable below market rate ownership cost or below market rate rent, as applicable, to eligible households that live and/or work in the city or any other characteristics the city deems appropriate to further the purposes of this chapter. The city may also, from time to time, adopt preferences applicable to specific residential development projects, as permitted by law. (Ord. 644 § 3, 2022) (Ord. XX, 2023)

17.90.110 Enforcement.

A. Nuisance. Any violation of the provisions of this chapter, or the terms or conditions of a planning permit or building permit issued for a residential development project, or the terms of a below market rate housing plan or below market rate housing agreement approved in accordance with this chapter, or the below market rate standards and guidelines shall constitute a public nuisance. Provision of Below Market Rate Dwelling Units— Payment Obligation. Provision of below market rate dwelling units and/or payment of the below market rate housing in-lieu fee in accordance with the requirements of this chapter is the obligation of the developer of a residential development project. The city may institute any appropriate legal actions or proceedings necessary to ensure compliance herewith, including, but not limited to, actions to revoke, deny, modify or suspend any planning permit or building permit approved by the city.

B. Enforcement. (i) General. The director or designee shall enforce this chapter and all below market rate housing administrative standards and guidelines, agreements, resale restrictions, performance deeds of trust, regulatory agreements, all other covenants or restrictions placed on residential development projects or below market rate dwelling units; and its provisions shall be binding on all agents, successors, and assigns of a development applicant or property owner.

1. If it is determined that a violation of the provisions of this chapter has occurred, the director or designee will do the following:

First letter: A courtesy first letter to the development applicant, for proposed development, or property owner, for approved or built developments, describing the nature of the non- compliance and providing a reasonable opportunity to resolve the issue. If the development applicant or the property owner does not resolve the issue within the timeline specified, the city will issue a second letter.

Second Letter: The second violation letter will request the violation to be resolved and brought into compliance within the time specified by the Director or designee.

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6 Third Letter: if the development applicant, for proposed development, or property owner, for approved or built developments, does not resolve the issue after the issuance of the second letter, a third and final letter will be sent to the development applicant or owner requesting that the violation be resolved within the timeline specified by the Director or designee.

2. Administrative Appeals: The development applicant, for proposed development, or property owner, for approved or built developments, may appeal a Director’s finding of a violation per the provisions of Section 17.06.150 Appeal procedures.

3. In the event the code compliance has not been achieved, the City Attorney is authorized to enforce the provisions of this chapter, including but not limited to, any and all below market rate housing agreements, resale restrictions, performance deeds of trust, regulatory agreements, and all other covenants or restrictions placed on residential development projects or below market rate dwelling units, as well as any administrative regulations, standards, or guidelines, by civil action and any other proceeding or method permitted by law. The city shall be entitled to recover its costs, expenses and fees, including reasonable attorneys’ fees, incurred in connection with the enforcement of the provisions of this chapter and all below market rate housing administrative regulations, standards, or guidelines, agreements, resale restrictions, performance deeds of trust, regulatory agreements, and all other covenants or restrictions placed on residential development projects or below market rate dwelling units.

C. Developer Responsibility. Failure of any official or agency to enforce the requirements of this chapter shall not excuse any developer or owner from the requirements of this chapter. No planning permit, building permit, license, map, or other approval or entitlement for a residential development project or dwelling unit shall be issued, including without limitation a final inspection or certificate of occupancy, until all applicable requirements of this chapter have been satisfied.

D. Remedies. The remedies provided for in this section shall be cumulative and not exclusive and shall not preclude the city from any other remedy or relief to which it otherwise would be entitled under law or equity. (Ord. 644 § 3, 2022) (Ord. XX, 2023)

17.90.120 Expiring covenants.

Five (5) years prior to expiration of an affordability restriction on a property subject to this Chapter, the Director or designee shall present a report to the City Council informing them about the expiration and will commence discussions with the property owner(s) to determine the feasibility of extending or prolonging affordability restrictions on the property.

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Sections:

17.90.010 Purpose.

17.90.020 Definitions.

17.90.030 Applicability.

17.90.040 Requirements for inclusion of below market rate dwelling units in development projects.

17.90.050 Payment of below market rate housing in-lieu fee.

17.90.060 Standards for development of below market rate dwelling units.

17.90.070 Below market rate housing plan and below market rate housing agreement.Alternatives.

17.90.080 AlternativesBelow market rate housing plan and below market rate housing agreement .

17.90.090 Waiver of requirementsAffordable housing fund.

17.90.100 Affordable housing fundStandards for occupancy, management, and compliance of below market rate dwelling units.

17.90.110 Enforcement.

17.90.120 Expiring covenants..

17.90.010 Purpose.

The purpose of this chapter, to be known as the Below Market Rate Inclusionary Housing Program, is to:

B. Promote the city’s goals as stated in the housing element of the general plan to increase the supply of below market rate housing to meet the city’s regional share of extremely low, very low, low, and moderate income housing needs and the needs of special groups, including the elderly, disabled, small and large families, and local workers by imposing an inclusionary requirement for residential development projects; and

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C. Reduce vehicle miles traveled (VMT) and greenhouse gas (GHG) emissions by providing people at all income levels more opportunities to live near where they work; and

D. Support the local economy by making it easier for employers to attract and retain workers by providing people at all income levels more opportunities to live near where they work; and

E. Affirmatively further the policies and purposes of the Fair Housing Act, also known as “Affirmatively FurtherFurthering Fair Housing” by reducing segregation and concentration of poverty; and

F. Implement the city’s adopted inclusionary policy contained in the housing element of the general plan by creating standards and a mechanism to provide below market rate dwelling units as part of new proposed residential development projects;, including by providing program management, maintenance, and compliance standards and guidelines for eligibility and occupancy of below market rate units for existing and proposed residential projects; and

G. Provide for the establishment and imposition of a below market rate housing in-lieu fee on residential development projects as an alternative means of mitigating the impact of residential development projects on the need for below market rate dwelling units in the city, as opposed to the development and construction of below market rate dwelling units as part of residential development projects, in certain circumstances. (Ord. 644 § 3, 2022)) (Ord. XX, 2023).

17.90.020 Definitions.

Fees may be updated from time to time.

B. “Below market rate housing fund” means a separate or segregated fund or account designated by the city to maintain and account for all monies received pursuant to this chapter.

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C. “Below market rate ownership cost” means the sale price for a below market rate dwelling unit, available as a for-sale unit, resulting in a projected average monthly housing expense during the first calendar year of an eligible household’s occupancy, including mortgage principal and interest, mortgage insurance, property taxes, homeowners’ insurance, homeowners’ association dues, if any, and a reasonable allowance for utilities, not exceeding the sales prices specified by Section 50052.5 of the California Health and Safety Code and California Code of Regulations Title 25, Sections 6910 through 6924.

C
D. “Below market rate rent” means the total monthly housing expenses for a below market rate dwelling unit, available as a rental unit, not exceeding the rents specified by Section 50053 of the California Health and Safety Code and California Code of Regulations Title 25, Sections 6910 through 6924, except that the city may permit alternative criteria, when necessary, to be consistent with pertinent state and federal statutes and regulations governing publicly assisted rental housing., or for workforce housing. As used in this chapter, “below market rate rent” shall include the total of monthly payments by the tenant for all of the following:

2. Any additional separately charged fees or service charges assessed by the owner, other than security deposits;

3. An allowance for utilities paid by the tenant as established by the San Mateo County Housing Authority which may be updated from time to time, including garbage collection, sewer, water, electricity, gas, and other heating, cooking, and refrigeration fuel, but not telephone service, cable TV or WiFi/internet; and and any other fees required to be paid by the tenant for services received;

D
E. “Below market rate dwelling unit” means a dwelling unit in a residential development project that is restricted for sale or rental to and occupancy by an eligible household at a below market rate ownership cost or below market rate rent, as applicable, and as required by this chapter.

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F. “Below market rate housing administrative standards and guidelines” means standards and guidelines adopted by the community development director from time to time to provide a consistent framework for determining household income, below market rate ownership cost, below market rate rent, eligible households, monitoring, reporting, scope of below market rate housing plan, terms of below market rate housing agreement, marketing plan requirements, and any other relevant rules, regulations or provisions necessary for the administration of this chapter.

F
G. “Below market rate housing agreement” means an agreement that shall specify the number, type, location, size, and phasing of all below market rate dwelling units required in a residential development project, provisions for income certification and screening of potential purchasers or renters of below market rate dwelling units, and resale control mechanisms, including the financing of ongoing administrativeadministration and compliance monitoring costs , consistent with the approved below market rate housing plan, as determined by the community development director.

G
H. “Below market rate housing in-lieu fee” means the fee imposed on each dwelling unit of a residential development project, established by resolution of the city council, and updated from time to time, not to exceed the cost of mitigating the impact of residential development projects on the need for below market rate dwelling units in the city. For purposes of this Chapter, such an in-lieu fee is only for residential development projects, or residential components of mixed-use projects.

H
I. “Below market rate housing plan” means a plan prepared by the developer of a residential development project that describes how the proposed dwelling units conform to the requirements of this chapter, and city and state density bonus law requirements, as applicable, and shall include, at a minimum, procedures and requirements for determining eligible households for rental of rental units or purchasers of for-sale units, occupancy requirements, initial and ongoing marketing policies, application process, waitlist management, income verification requirements, annual recertification, if applicable, rejection of ineligible housing applicants and eligibility termination, ongoing compliance monitoring costs, and such other provisions as the community development director may prescribe from time to time pursuant to below market rate housing administrative guidelines.

I
J. “Building permit” includes full structural building permits as well as partial permits such as foundation-only permits and demolition permits.

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K. “Density bonus” means entitlement to build additional residential units above the maximum number of units permitted pursuant to the existing general plan, applicable specific plan and/or zoning designation, and as further specified in Chapter 17.86 and California Government Code Section 65915 (“State Density Bonus Law”).

K
L. “Developer” means the person(s) or legal entity(ies), including the property owner, or successor, seeking a planning permit or building permit for a residential development project.

L
M. “Development applicant” means the developer seeking a planning permit or building permit for a residential development project.

N. “Director” means the director of the city’s community development department, or designee.

M
P. “Eligible household” means those households whose maximum income does not exceed levels published annually for extremely low income households, very low income households, low (or lower) income households, and moderate income households, adjusted for household size and appropriate for the below market rate dwelling unit.

O50093. “For-sale unit” means a dwelling unit that may be sold individually in conformance with the Subdivision Map Act. For-sale units also include dwelling units that are converted from rental units to for-sale units.

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P. “Low income households” means households with incomes no greater than the maximum income for low income households, as published annually by the California Department of Housing and Community Development (HCD) as the Official State Income Limits pursuant to Health and Safety Code Section 50093 for San Mateo County, adjusted for household size, except that the city may permit alternative criteria, when necessary, to be consistent with pertinent state and federal statutes and regulations governing publicly assisted housing.

S. “Household” means one (1) person living alone or two (2) or more persons sharing residency whose income is considered for housing payments, and all minor children.

T. “Housing applicant” means an individual or household who has submitted or will submit an application to rent a below market rate dwelling unit.

R
V. “Moderate income households” means households with incomes no greater than the maximum income for moderate income households, as published annually by the California Department of Housing and Community Development (HCD) as the Official State Income Limits pursuant to Health and Safety Code Section 5009350093 for San Mateo County, adjusted for household size, except that the city may permit alternative criteria, when necessary, to be consistent with pertinent state and federal statutes and regulations governing publicly assisted housing.

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T
X. “Planning permit” means any discretionary approval of a residential development project, including, without limitation, a general or specific plan adoption or amendment, rezoning, tentative map, parcel map, conditional use permit, variances, or architectural review.

U
Y. “Property owner” means the developer or successor owner or authorized agent of below market rate development.

Z. “Rental unit” means a dwelling unit that is intended to be offered for rent or lease and that cannot be sold individually in conformance with the Subdivision Map Act.

V
AA. “Residential development project” means an application for a planning permit or building permit at one location to create one or more dwelling units, redevelop an existing residential development project to remove and replace dwelling units and/or create one or more additional dwelling units, convert nonresidential uses to dwelling units, subdivide a parcel to create one or more separately transferable parcels intended for development of dwelling units, or implement a condominium conversion, including development of dwelling units constructed at one location and in phases.

W
BB. “Review authority” means the city staff person or body authorized to approve or deny an application for a planning permit or building permit for a residential development project.

X
CC. “Very low income households” means households with incomes no greater than the maximum income for very low income households, as published annually by the California Department of Housing and Community Development (HCD) as the Official State Income Limits pursuant to Health and Safety Code Section 5009350093 for San Mateo County, adjusted for household size, except that the city may permit alternative criteria, when necessary, to be consistent with pertinent state and federal statutes and regulations governing publicly assisted housing. (Ord. 644 § 3, 2022)

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DD. “Workforce housing” means dwelling units rented at below market rental rates for certain categories of workers pursuant to Section 17.90.100(D). (Ord. 644 § 3, 2022) (Ord. XX, 2023).. \

17.90.030 Applicability.

The requirements of this chapter shall apply to any residential development project as set forth below.

A. Residential Development Projects—Five to Nine Dwelling Units. Residential development projects containing five to nine dwelling units are hereby required, as a condition of issuance of a planning permit or building permit, to either (:
1) pay. Pay a below market rate housing in-lieu fee for each dwelling unit upon issuance of a building permit, or (
2) construct. Construct below market rate units on the location of the residential development project per Section 17.90.040 (Requirements for inclusion of below market rate dwelling units), make said below market rate dwelling units available for sale or rental to and occupancy by eligible households at the applicable household income level and at below market rate ownership cost or below market rate rent, as applicable, and secure said obligation pursuant to a below market rate housing agreement as set forth in Section 17.90.070(E) (Below Market Rate Housing Agreements).

17.90.040B. Residential Development Projects—Ten Dwelling Units or More. Residential development projects of ten dwelling units or more are hereby required, as a condition of issuance of a planning permit or building permit, to construct below market rate units on the location of the residential development project per Section 17.90.040 (Requirements for inclusion of below market rate dwelling units), make said below market rate dwelling units available for sale or rental to and occupancy by eligible households at the applicable household income level and at below market rate ownership cost or below market rate rent, as applicable, and secure said obligation pursuant to a below market rate housing agreement as set forth in Section 17.90.070

17.90.080(E) (Below Market Rate Housing Agreements).

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1. Construct below market rate units on the location of the residential development project per Section 17.90.040 (Requirements for inclusion of below market rate dwelling units);

3. Secure said obligation pursuant to a below market rate housing agreement as set forth in Section 17.90.080(E) (Below Market Rate Housing Agreements).

C. Exemptions. The provisions of this chapter shall not apply to developers of residential development projects which fall within one or more of the following categories:

1. Residential development projects containing four or fewer dwelling units;

3. Residential development projects involving the repair or replacement of a building that was damaged or destroyed by fire or other calamity, so long as :
(a) the The square footage and use of the building remains the same, ; (b) construction Construction of the replacement building is conducted in accordance with California Government Code Section 65852.2565852.25, which section requires a building permit to be secured within two years of the occurrence of any such event,; and , (c) in In accordance with California Health and Safety Code Section 18938.618938.6, construction begins within one year from the issuance of a building permit, subject to the issuance of one or more extensions, not to exceed one hundred eighty days, upon a showing of justifiable cause by the development applicant to the satisfaction of the building official;.

4. Accessory dwelling units (ADUs) or junior accessory dwelling units (JADUs) as defined in Chapter 17.78;

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17.90.040 Requirements for inclusion of below market rate dwelling units. in A. Number of Below Market Rate Dwelling Units and Level of Affordability. Residential development projects

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A. of ten dwelling units or more shall construct, or cause to be constructed, the number of below market rate dwelling units as specified below. For the purposes of this section, “total dwelling units” does not include (:

1) dwelling. Dwelling units awarded above the otherwise-allowable maximum density as part of a density bonus in Chapter 17.8617.86 (Density Bonuses), as provided by California Government Code Section 65915(b)(3), or (2) in65915(b)(3), or

1. Rental Projects.
(a) Five percent of the proposed total dwelling units in a rental residential development project shall be below market rate dwellingBMR units occupied by or available for occupancy by moderate income households at or below market rate rents; five (b) Five percent of the proposed total dwelling units shall be below market rate dwelling units occupied by or available for occupancy by low income households at or below market rate rents; and ten,
(c) Ten percent of the proposed total dwelling units shall be below market rate dwelling units occupied by or available for occupancy by very low income households at or below market rate rents. Alternative percentages and levels of affordability may be considered as part of the below market rate housing plan and below market rate housing agreement (Section 17.90.070) and the reviewing authority may approve or conditionally approve such an alternative if it determines, based on substantial evidence, that such alternative percentages and levels of affordability will provide as many or more below market rate

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units at the same or lower income levels or will otherwise provide greater public benefit than the standard requirement.

2. Ownership Projects.
(a) Twenty percent of the proposed total dwelling units in a for-sale residential development project shall be below market rate dwellingBMR units sold to and occupied by or available for sale to and occupancy by moderate income households at or below market rate ownership cost.

3. Fractional Units. In calculatingCalculation of units or fees when the number of below market rate dwelling units required pursuant to subsections (A)(1) and (A)(2) of this section, anyBMR units is not a whole number shall be as follows:
(a) Any fraction of less than 0.50 shall be satisfied by payment of an amount equal to the below market rate housing in-lieu fee, as adopted by the city council applicable to rental or ownership residential developments, times the applicable fraction, and anyor (b) Any fraction of 0.50 or more shall be satisfied by developing one below market rate dwelling unit available for sale or rental to and occupancy by eligible households at the applicable household income level and at below market rate ownership cost or below market rate rent, as applicableapplicableI In either scenario, the development applicant has the option to provide an additional BMR unit instead of the fee.

4. Density Bonus. Below market rate dwellingBMR units that satisfy the requirements of this chapter may be counted toward the number of below market rate dwellingBMR units required for a density bonus under California Government Code Sections 6591565915 through 65918.

To be eligible, the below market rate dwelling units shall meet all of the applicable requirements in California Government Code Section 65915. These requirements, including application submittal requirements and replacement housing obligations, are65918as set forth in Chapter 17.8617.86 (Density Bonuses). (Ord. 644 § 3, 2022) (Ord. XX, 2023).

17.90.050 Payment of below market rate housing in-lieu fee.

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A. Amount. The amount of the below market rateBMR housing in-lieu fee applicable to rental residential development projects and ownership residential development projects shall be established from time to time by resolution of the city council. and be calculated based on the type of residential development (rental or ownership). The below market rate housing in-lieu fee established for rental residential development projects and ownership residential development projects shall not exceed the cost of mitigating the impact of rental or ownership residential development projects on the need for below market rate dwelling units in the city.

B. Timing of Payment. Payment of the below market rateBMR housing in-lieu fee shall be due prior to the issuance of the first building permit for the residential development project. The below market rate housing in- lieu fee shall be calculated based on the type of residential development project (i.e., either rental or ownership), and the applicable fee schedule in effect at the time the building permit is issued for a rental residential development project or ownership residential development project. (Ord. 644 § 3, 2022) (Ord. XX, 2023).

17.90.060 Standards for development of below market rate dwelling units.

A. A. Quality of Construction and Number of Bedrooms. All below market rate dwelling units required by this chapter shall be equal to the overall quality of construction to market rate units in the same residential development project as follows:

1. 1. The exterior appearance of the below market rate dwellingBMR units shall be the same as that of market rate units.

2. Interior finishes and amenities of the below market rate dwellingBMR units shall not differ from those provided in the base model market rate units.

3. The number of bedrooms in the below market rate dwellingBMR units shall be equal to the average number of bedrooms in the market rate units, including square footage by unit size, and the below market rate dwelling units shall be dispersed within the residential development project, with the location of below market rate dwelling units comparable to those of the market rate units, subject to review and approval by the community development director.

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4. The below market rate dwellingBMR units shall have access to the same amenities as the market rate units and shall be included within the below market rate ownership cost or below market rate rent for the below market rate dwelling unit. For example, residents of the below market rate dwelling units shall not be excluded from common open space, parking, storage, and other community facilities or amenities in the residential development project, nor shall households residing in below market rate dwelling units be charged more than a below market rate rent or a below market rate ownership cost as defined in Section 17.90.020 (Definitions) for the use of such facilities and amenities.

C. Duration of Affordability.

1. Ownership. Below market rate dwellingBMR units available as a for-sale unit produced as required by this chapter shall, pursuantare subject to the following:
(a) Pursuant to the terms of a below market rate housing agreement, beBMR units are legally restricted for sale to and occupancy by eligible households within the income levels for which the below market rate dwelling units were designated and at a below market rate ownership cost for a period of at least forty-five years from the date of recordation of each grant deed.
(b) Resale of the below market rate dwellingBMR unit during the forty-five-year term shall be restricted to eligible households at a below market rate ownership cost as defined herein and set forth in the below market rate housing agreement recorded against the below market rate dwelling unit and the forty-five-year term shall start over with each resale.
(c) If a below market rate dwellingBMR unit has not been sold or resold prior to the expiration of the forty-five-year term, then upon the expiration of the forty-five-year term, the restrictions set forth in the below market rate housing agreement shall terminate,

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expire and be of no further force or effect and the dwelling unit may then be sold at market rate.
(d) The below market rate housing agreement shall be recorded against the property of the applicable residential development project and below market rate dwelling unit(s) in accordance with the provisions of and consistent with the form specified in Section 17.9080.070(E).

2. Rental. Below market rate dwellingBMR units available as a rental unit produced as required by this chapter or pursuantare subject to the following:
(a) Pursuant to the provisions of California Government Code Section 66300(d) BMR units shall, pursuant to the terms of a below market rate housing agreement, be legally restricted to occupancy by eligible households within the income levels for which the below market rate dwelling units were designated and at a below market rate rent for a period of at least ninety-nine years from the date a certificate of occupancy is issued by city for the entire residential development project.
(b) The foregoing notwithstanding, the community development director, or his or her designee, may, in the exercise of her or his discretion, accept a shorter period of affordability of no less than fifty-five years, if the applicable residential development project provides substantial evidence that a shorter-term restriction is necessary and required in order to obtain financing for the applicable residential development project. (c) The below market rate housing agreement shall be recorded against the property of the applicable residential development project in accordance with the provisions of and consistent with the form specified in Section 17.90.070080(E). (Ord. 644 § 3, 2022) (Ord.

XX, 2023).

D. Eligibility. No eligible household may occupy a below market rate dwelling unit available as a rental unit or acquire a below market rate dwelling unit available as a for-sale unit until the community development director, or his or her designee, has approved a below market rate housing plan prepared by the developer, which plan shall include eligibility requirements specific to the residential development project, and a below market rate housing agreement has been recorded against the residential development project in accordance with Section 17.90.070(E).

E. Principal Residence. Any eligible household that occupies a below market rate dwelling unit must occupy that dwelling unit as its principal residence, unless otherwise approved in writing for rental to a third party for a

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limited period of time due to household hardship, as determined and approved by the city in advance and in accordance with below market rate housing administrative guidelines.

F. Below Market Rate Housing Administrative Guidelines. The community development director, or his or her designee, may, from time to time, adopt and revise rules, regulations and guidelines for determining household income, below market rate housing cost, below market rate rent, determining eligible households of for-sale units and rental units, establishing monitoring and reporting requirements for residential development projects, and such other provisions and requirements as are relevant to the administration of this chapter.

G. Housing Preferences. Subject to applicable state and federal fair housing laws, the city council may, from time to time, adopt preferences for the sale or rental to and occupancy of below market rate dwelling units at the applicable below market rate ownership cost or below market rate rent, as applicable, to eligible households that live and/or work in the city or any other characteristics the city council deems appropriate to further the purposes of this chapter. The city council may also, from time to time, adopt preferences applicable to specific residential development projects. (Ord. 644 § 3, 2022)

17.90.070 Below market rate housing plan and below market rate housing agreement.

A. Required. A below market rate housing plan is required for any residential development project that provides below market rate dwelling units, either on site or off site. The below market rate housing plan shall describe how the proposed dwelling units conform to the requirements of this chapter and city and state density bonus law requirements, as applicable. Further, the below market rate housing plan shall include, at a minimum, procedures and requirements for determining eligible households for rental of rental units or purchasers of for-sale units, occupancy requirements, initial and ongoing marketing policies, application process, waitlist management, income verification requirements, annual recertification, if applicable, rejection of ineligible applicants and eligibility termination, funding by developer of ongoing administration and monitoring costs to be incurred by city following occupancy of below market rate dwelling units, and such other provisions as the community development director, or his or her designee, may prescribe from time to time pursuant to below market rate housing administrative guidelines. Below market rate housing plans are not required for residential development projects that are not required to provide for the construction, sale and/or rental of on- site or off-site below market rate dwelling units, in compliance with the provisions of this chapter.

B. Submittal and Review. The below market rate housing plan must be submitted prior to the first planning permit application being deemed complete. The below market rate housing

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plan shall be processed concurrently with all other planning permits required for the residential development project.

2. 2. The on-site below market rate dwelling units will mitigate the impact of the market rate units in the residential development project on the need for below market rate dwelling units in the city.

D. Amendments. The approved below market rate housing plan may be amended prior to issuance of any building permit for the residential development project. A request for a minor modification of an approved below market rate housing plan may be granted by the community development director if the modification is substantially in compliance with the original below market rate housing plan and conditions of approval. Other significant or substantial modifications to the below market rate housing plan, as determined by the community development director, shall be processed in the same manner as the original below market rate housing plan.

E. Below Market Rate Housing Agreements. As a condition of approval of a residential development project, a below market rate housing agreement acceptable to the community development director, approved by the city attorney and executed by the city manager, shall be recorded against the residential development project prior to approval of any final or parcel map, or issuance of any building permit, whichever occurs first. The below market rate housing agreement shall specify the number, type, location, size, and phasing of all below market rate dwelling units, provisions for income certification and screening of potential purchasers or renters of below market rate dwelling units, and resale control mechanisms, including funding by developer of ongoing administrative and monitoring costs incurred by city, consistent with the approved below market rate housing plan. The below market rate housing agreement shall provide for the indemnification and defense of the city, as approved by the city attorney, against any and all claims brought by any and all persons, including eligible households, in connection with the administration and implementation by city of the below market rate housing plan and below market rate housing agreement. A below market rate housing agreement

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applicable to below market rate dwelling units, available as for-sale units, shall require as a condition of the sale of a below market rate dwelling unit from developer to an eligible household, that the restrictions set forth in the below market rate housing agreement and this chapter be recorded against the below market rate dwelling unit in the form of a resale restriction agreement, performance deed of trust, and/or regulatory agreement, as approved by the city attorney and executed by the city manager, to ensure the continued affordability of the below market rate dwelling units. (Ord. 644 § 3, 2022)

17.90.070

17.90.080 Alternatives.

To the extent permitted by law, the city’s objective is to obtain the actual development and construction of below market rate dwelling units within each residential development project, as opposed to the receipt of payment of below market rate housing in-lieu fees, construction of off-site below market rate dwelling units, or other such alternatives as set forth herein. Nevertheless, aA developer may propose an alternative means of compliance with this chapter subject to the following provisions:

A. Construction of Off-Site Below Market Rate Dwelling Units. If a developer of a residential development project of ten or more dwelling units proposes the construction of off-site below market rate dwelling units in the below market rate housing plan required under Section 17.90.070080, the city council may, in its discretion, approve such a proposal if it finds the proposal meets all of the following conditions:condition

1. 1. The proposed off-site location is within the city of Foster City, is currently owned by the developer or is under contract for purchase by the developer, is not located in a flood hazard zone and does not contain environmentally sensitive habitat, is not contaminated with or otherwise impaired by the presence of hazardous materials or hazardous substances in the soil, soil vapor or groundwater in, on, or under the off-site location or emanating from lands in proximity thereto, as reflected in a Phase I Environmental Site Assessment, and if necessary, a Phase II Environmental Site Assessment, and development and construction of a residential development project on the proposed off-site location is consistent with the city’s adopted general plan, housing element, and zoning; and

2. 2. The proposed off-site location is suitable for and development of a residential development project thereon is economically and financially feasible as determined by the

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city, in its sole discretion, pursuant to a feasibility analysis of a proposed residential development project on the proposed off-site location prepared by the city, at the expense of the developer, and approved by the city council; and

3. 3. The proposed off-site location is adequately served by all required utilities and transportation infrastructure, all of which are appropriately sized to accommodate the proposed off-site below market rate units, the off-site residential development project, and all reasonable foreseeable probable future development within the area served by said utilities and transportation infrastructure; and

4. 4. The proposed off-site below market rate units are in addition to any below market rate dwelling units otherwise required for the off-site residential development project; and

5. 5. The construction of the proposed off-site below market rate dwelling units within the off- site residential development project has not commenced before the approval of the on-site residential development project, the off-site below market rate dwelling units will be available for occupancy prior to or concurrently with the market rate units within the on-site residential development project, and the inclusion of the below market rate dwelling units within the off- site residential development project will not, when combined with the below market rate inclusionary requirement of the off-site residential development project, significantly contribute to residential segregation by income level within the city; and

6. 6. The proposed off-site below market rate dwelling units would be provided in at least the same quantity and affordability levels as would be required for on-site units. The foregoing notwithstanding, any proposal to provide rental off-site below market rate dwelling units to satisfy an inclusionary requirement for an ownership project shall comply with Sections 17.90.040(A)(1) and 17.90.060(C)(2); and

7. 7. The proposed off-site below market rate dwelling units comply with all other requirements of this chapter; and

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10. The purposes of this chapter would be better served by implementation of the proposed alternative and that the proposed alternative meets the greatest community needs at that time.

B. B. Conversion of Off-Site Dwelling Units or Nonresidential Buildings to Off-Site Below Market Rate Dwelling Units. If a developer of a residential development project of ten or more dwelling units proposes the conversion of off-site dwelling units or nonresidential buildings to off-site below market rate dwelling units in the below market rate housing plan required under Section 17.90.070080, the city council may, in its discretion, approve such a proposal if it finds the proposal meets all of the following conditions:

1. All of the conditions as set forth in subsection A of this section; and

C. On-Site Clustering of Below Market Rate Dwelling Units. If a developer of a residential development project of ten or more dwelling units proposes the clustering of on-site below market rate dwelling units in the below market rate housing plan required under Section 17.90.070080 as an alternative to the provisions of Section 17.90.060(A)(3) requiring the reasonable dispersal of such units within the residential development project, the city council may, in its discretion, approve such a proposal if it finds the proposal meets all of the following conditions:

1. The clustering of on-site below market rate dwelling units is necessary to access and secure sources of financing needed for the residential development project; and

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2. 2. Construction of the clustered below market rate dwelling units will occur prior to or concurrently with the construction of the market units in the residential development project; and

4. The purposes of this chapter would be better served by implementation of the proposed alternative and that the proposed alternative meets the greatest community needs at that time.

D. Alternative to On-Site Construction of Below Market Rate Dwelling Units—Donation of Land. If a developer of a residential development project of ten or more dwelling units proposes the donation of land to the city for the construction of below market rate dwelling units in the below market rate housing plan required under Section 17.90.070080, the city council may, in its discretion, approve such a proposal if it finds the proposal meets all of the following conditions:

3. The land proposed to be donated to the city is adequately served by all required utilities and transportation infrastructure, all of which are appropriately sized to accommodate a

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residential development project on the site and all reasonable foreseeable probable future development within the area served by said utilities and transportation infrastructure; and

6. The purposes of this chapter would be better served by implementation of the proposed alternative and that the proposed alternative meets the greatest community needs at that time. (Ord. 644 § 3, 2022) (Ord. XX, 2023)

17.90.080 Below market rate housing plan and below market rate housing agreement.

A. Required. A below market rate housing plan is required for any residential development project that provides below market rate dwelling units, either on site or off site. 17.90.090 Waiver of requirements.

A. Timing of Request. A developer of a residential development project may apply for a reduction, adjustment, or waiver of The below market rate housing plan shall:

1. Describe how the proposed dwelling units conform to the requirements of this chapter as part of an application for the approval of a planning permit or building permit, whichever permit is required first.

B. Application Requirements. The developer must show that applying the requirements of this chapter, without the requested reduction, adjustment or waiver, would result in an unconstitutional taking of property or would result in any other unconstitutional result. The developer shall set forth in detail the factual and legal

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basis for the claim, including all supporting technical documentation, and shall bear the burden of presenting the requisite evidence to demonstrate the alleged unconstitutional result.

C. City Assumptions. The city may assume each of the following when applicable:

1. The developer will benefit from the incentives set forth in and state density bonus law and the zoning ordinance; andrequirements, as applicable.

2. The developer is able to provide the most economical below market rate dwelling units feasible in terms of financing, construction, design, location and tenure.

17.55, Replacement Units.

3. Include, at a minimum, procedures and requirements for:
(a) determining rental rates
(b) eligibility of households for rental of rental units or purchasers of for-sale unit, (c) income requirements
(d) occupancy standards
(e) Initial and ongoing marketing policies
(f) application process
(g) waitlist management
(h) income verification requirements
(i) annual income recertification requirements
(j)
D. Decision. The review authority, based upon legal advice provided by or at the behest of the city attorney, may approve a reduction, adjustment, or waiver of the requirements of this chapter if the review authority determines that applying the requirements of this chapter would effectuate an unconstitutional taking of property or otherwise have an unconstitutional application to the property. The reduction, adjustment, or waiver may be approved only to the extent necessary to avoid an unconstitutional result after adoption of written findings, based on legal analysis and the evidence.

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E. Changes to the Project. If a reduction, adjustment, or waiver is granted, any subsequent change in the applicable, rejection of ineligible housing applicants, eligibility termination
(k) funding by developer for ongoing administration and compliance monitoring costs following occupancy of below market rate dwelling units (l) and such other provisions as the director may prescribe from time to time pursuant to below market rate housing administrative standards and guidelines.

4. Below market rate housing plans are not required for residential development projects that are not required to provide for the construction, sale and/or rental of on-site or off-site below market rate dwelling units, in compliance with the provisions of this chapter Submittal and Review. The below market rate housing plan must be submitted prior to the first planning permit application being deemed complete. The below market rate housing plan shall be processed concurrently with all other planning permits required for the residential development project.

2. The on-site below market rate dwelling units will mitigate the impact of the market rate units in the residential development project on the need for below market rate dwelling units in the city.

D. Amendments. The approved below market rate housing plan may be amended prior to issuance of any building permit for the residential development project. projectA request for a minor modification of an approved below market rate housing plan may be granted by the director if the modification is substantially in compliance with the original below market rate housing plan and conditions of approval. Other significant or substantial

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modifications to the below market rate housing plan, as determined by the director, shall be processed in the same manner as the original below market rate housing plan.

E. Below Market Rate Housing Agreements. invalidate the reduction, adjustment, or waiver, and As a condition of approval of a residential development project, a new applicationbelow market rate housing agreement acceptable to the director, approved by the city attorney and executed by the city manager, shall be required for :

1. Be recorded against the residential development project prior to approval of any final or parcel map, or issuance of any building permit, whichever occurs first.

2. Specify the number, type, location, size, and phasing of all below market rate dwelling units, provisions for income certification and screening of potential purchasers or renters of below market rate dwelling units, and resale control mechanisms, and provisions for funding by developer for administration and compliance monitoring costs following occupancy of below market rate dwelling units consistent with the approved below market rate housing plan.

4. A below market rate housing agreement applicable to below market rate dwelling units, available as for-sale units, shall require as a reduction, adjustment, or waiver per this section.condition of the sale of a below market rate dwelling unit from developer to an eligible household, that the restrictions set forth in the below market rate housing agreement and this chapter be recorded against the below market rate dwelling unit in the form of a resale restriction agreement, performance deed of trust, and/or regulatory agreement, as approved by the city attorney and executed by the city manager, to ensure the continued affordability of the below market rate dwelling units. (Ord. 644 § 3, 2022) (Ord. XX, 2023)

17.90.10090 Affordable housing fund.

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B. Deposits. All below market rate housing in-lieu fees or other funds collected under this chapter shall be deposited into the affordable housing fund.

C. Use of Funds. In addition to the purposes set forth in Section 17.88.060, the monies in the affordable housing fund, including all interest and earnings from investment of the monies therein, shall be expended exclusively to provide, or assure the continued provision of, below market rate dwelling units to extremely low income, very low income, lower income, and moderate income households in the city, through property acquisition, construction, development assistance, rehabilitation, conversion, financing, rental assistance or other subsidies or methods, consistent with the goals and policies contained in the city’s housing element and the purposes for which the fees were collected, and for administration and compliance monitoring of the below market rate dwelling units established pursuant to this chapter.

D. Guidelines. The city council may, from time to time, adopt guidelines for expenditure of monies in the affordable housing fund. (Ord. 644 § 3, 2022) (Ord. XX, 2023)

17.90.100 Standards for occupancy, management, and compliance of below market rate dwelling units

A. Below Market Rate Housing Administrative Standards and Guidelines. The community development director may adopt and revise standards, rules, regulations and guidelines, best practices, and methodologies for determining household income, below market rate housing cost, below market rate rent, determining eligibility of households of for-sale units and rental units, establishing monitoring, reporting, requirements, for residential development projects, marketing plans, and such other provisions and requirements as are relevant to the administration of this chapter.

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D. Housing Preferences. Subject to applicable state and federal fair housing laws, the city may implement preferences for the sale or rental to and occupancy of below market rate dwelling units at the applicable below market rate ownership cost or below market rate rent, as applicable, to eligible households that live and/or work in the city or any other characteristics the city deems appropriate to further the purposes of this chapter. The city may also, from time to time, adopt preferences applicable to specific residential development projects, as permitted by law. (Ord. 644 § 3, 2022) (Ord. XX, 2023)

17.90.110 Enforcement.

B. Provision of Below Market Rate Dwelling Units—Payment Obligation. Provision of below market rate dwelling units and/or payment of the below market rate housing in-lieu fee in accordance with the requirements of this chapter is the obligation of the developer of a residential development project. The city may institute any appropriate legal actions or proceedings necessary to ensure compliance herewith, including, but not limited to, actions to revoke, deny, modify or suspend any planning permit or building permit approved by the city.

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B. C. City Attorney Enforcement. (i) General. The city attorneydirector or designee shall beenforce this chapter and all below market rate housing administrative standards and guidelines, agreements, resale restrictions, performance deeds of trust, regulatory agreements, all other covenants or restrictions placed on residential development projects or below market rate dwelling units; and its provisions shall be binding on all agents, successors, and assigns of a development applicant or property owner.

1. If it is determined that a violation of the provisions of this chapter has occurred, the director or designee will do the following:

Second Letter: The second violation letter will request the violation to be resolved and brought into compliance within the time specified by the Director or designee.

Third Letter: if the development applicant, for proposed development, or property owner, for approved or built developments, does not resolve the issue after the issuance of the second letter, a third and final letter will be sent to the development applicant or owner requesting that the violation be resolved within the timeline specified by the Director or designee.

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D
C. Developer Responsibility. Failure of any official or agency to enforce the requirements of this chapter shall not excuse any developer or owner from the requirements of this chapter. No planning permit, building permit, license, map, or other approval or entitlement for a residential development project or dwelling unit shall be issued, including without limitation a final inspection or certificate of occupancy, until all applicable requirements of this chapter have been satisfied.

E
D. Remedies. The remedies provided for in this section shall be cumulative and not exclusive and shall not preclude the city from any other remedy or relief to which it otherwise would be entitled under law or equity. (Ord. 644 § 3, 2022) (Ord. XX, 2023)

17.90.120 Expiring covenants.co
Five (5) years prior to expiration of an affordability restriction on a property subject to this Chapter, the Director or designee shall present a report to the City Council informing them about the expiration and will commence discussions with the property owner(s) to determine the feasibility of extending or prolonging affordability restrictions on the property.

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4857-4845-0679 v1

2023
Draft

Below Market Rate
Rental Housing Programs

ADMINISTRATIVE PROCEDURES AND GUIDELINES

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TABLE OF CONTENTS

1 IMPLEMENTATION AUTHORITY ....................................................................................................5 2 INTRODUCTION ...........................................................................................................................5 3 FAIR HOUSING .............................................................................................................................5

3.1 Property Manager Requirements ............................................................................................ 6 4 COVERED PROPERTIES..................................................................................................................6 5 DOCUMENTS REQUIRING CITY APPROVAL PRIOR TO LEASING .......................................................6

5.1 Marketing Plans ....................................................................................................................... 6

5.2 Affirmative Marketing Plans .................................................................................................... 7

5.3 Resident Selection Policy ......................................................................................................... 7

5.4 Applications for Housing .......................................................................................................... 7

5.5 Submittal and Approval of Marketing Plans, Selection Policy, and Application...................... 8 6 REQUIREMENTS FOR WAITLISTS ...................................................................................................8

6.1 Requirements for Waitlist Applications ................................................................................... 8

6.2 Requirements for Formatting a Waitlist .................................................................................. 9

6.3 Requirements for Temporary and Permanent Closure of a Waitlist ....................................... 9

6.4 Requirements for Reopening a Waitlist ................................................................................. 10

6.5 Guidelines for Waitlist Management ..................................................................................... 10

6.6 Requirements for Notifying Applicants on Waitlist of a Vacancy .......................................... 10 7 DETERMINING ELIGIBILITY .......................................................................................................... 11

7.1 Standard Preference Categories and Exceptions ................................................................... 11

7.2 Preference Requirement at time of Application for Housing ................................................ 12

7.3 Preference Verification .......................................................................................................... 12

7.3.1 Verifying Foster City Residence........................................................................................... 12

7.3.2 Verifying Work Location in Foster City................................................................................ 12

7.3.3 Verifying City of Foster City Employment ........................................................................... 13

7.3.4 Preference Verification Form .............................................................................................. 13

7.4 Ownership of Real Estate ....................................................................................................... 13

7.5 Sole and Primary Residence Requirement ............................................................................ 13

7.6 Requirements for Income Eligibility....................................................................................... 14 7 .6.1 Applicability ......................................................................................................................... 14

7.6.2 Source for Income Limits .................................................................................................... 14

7.6.3 Other Governing Income Limits .......................................................................................... 15

7.6.4 Calculating Non-Standard Income Limits ............................................................................ 16

7.6.5 Third-Party Verification of Income and Assets ................................................................... 16

7.6.6 Reductions in Income Limits ............................................................................................... 16

7.6.7 Annual Income Recertification Requirement...................................................................... 16

7.6.8 Minimum Income Requirement .......................................................................................... 17

7.6.9 Minimum Income Verification for workforce Units ............................................................ 17

7.6.10 General Guidance on Income Certification Procedures ..................................................... 17

7.7 Annual Recertification of Income .......................................................................................... 17

7.7.1 Applicability ......................................................................................................................... 17

7.7.2 Annual Recertification Date ................................................................................................ 17

7.7.3 Deadline for Forms and Documents Submitted by Tenants ............................................... 18

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7.7.4 Notices to Tenants .............................................................................................................. 18

7.7.5 Notification of Non-Compliance ......................................................................................... 18

7.8 Procedures for Calculating Income ........................................................................................ 19

7.8.1 Applicability ......................................................................................................................... 19

7.8.2 Multiple or Conflicting Requirements ................................................................................. 19

7.8.3 Projected Income ................................................................................................................ 19

7.8.4 Household Member Income to Count ................................................................................ 19

7.8.5 Full Set of Forms Required for all Adult Household Members ........................................... 19

7.8.6 Rules on Redacting of Information Provided for Income Certification ............................... 19

7.8.7 Income Inclusions and Exclusions ....................................................................................... 19

7.8.8 Three Methods Required to Calculate Income ................................................................... 20

7.8.9 Lump Sum Payments ........................................................................................................... 22

7.8.10 Tax Returns ......................................................................................................................... 22

7.8.11 Income of Teachers and Seasonal Workers ........................................................................ 23

7.8.12 Self-Employment Income .................................................................................................... 23

7.8.13 Unemployment and Disability Income................................................................................ 25

7.8.14 Social Security and Supplemental Social Security Income .................................................. 25

7.8.15 Dates of verifications .......................................................................................................... 25

7.8.16 Ownership of Real Estate or Timeshares ............................................................................ 25

7.9 Asset Eligibility and Verification............................................................................................. 26

7.9.1 Use of California Code of Regulations, Title 25 for Calculating Income from Assets ......... 26

7.9.2 Ten Per Cent Imputed Income Rule .................................................................................... 26

7.9.3 Third-Party Verification of Assets ....................................................................................... 27

7.9.4 Negative or Blank Asset Verifications ................................................................................. 27

7.9.5 Rules on Redacting Information on Documents Provided .................................................. 27

7.9.6 Calculating the Cash Value and Income from Financial Assets ........................................... 27

7.9.7 Computing Income from Real Estate Assets ....................................................................... 27

7.9.8 Lump Sum Payments ........................................................................................................... 28

7.10 Household Income Above or Below the Income Limit at the Time of Recertification .......... 28

7.10.1 Over Income Households in City Owned Units ................................................................... 28

7.10.2 Over Income Households for All Other BMR Units ............................................................. 28

7.10.3 Under Income Households .................................................................................................. 28

7.10.4 Next Available Unit Rule ..................................................................................................... 29

7.11 Student Status ........................................................................................................................ 29

7.12 Live-In Aides ........................................................................................................................... 29

7.13 Documenting Income Certifications and Annual Recertifications ......................................... 29

7.13.1 Forms .................................................................................................................................. 29

7.13.2 Tenant File Organization ..................................................................................................... 30

7.13.3 Required Forms ................................................................................................................... 30

7.13.4 Creation of Forms by Property Managers ........................................................................... 31

7.13.5 Use of California Tax Credit Allocation Committee Tenant Income Certification Form ..... 31

7.13.6 Signatures on Forms ........................................................................................................... 31

7.13.7 Dates on Forms ................................................................................................................... 31

7.13.8 Mistakes and Corrections on Forms ................................................................................... 31

7.13.9 Conflicting, Incomplete, Insufficient, or Unclear Information Provided on Forms............. 31

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7.14 Occupancy Standards ............................................................................................................ 31

7.14.1 Minimum and Maximum Household Size Requirements ................................................... 31

7.14.2 Annual Occupancy Monitoring ........................................................................................... 32

7.15 Requesting Additional Information Required for Eligibility ................................................... 32

7.16 Citizenship/Resident Alien Status Verification ...................................................................... 33 8 DETERMINING RENT................................................................................................................... 33

8.1 Requirements for Determining Rents .................................................................................... 33

8.1.1 City’s Standard Methodology for Rent Calculations ........................................................... 33

8.1.2 Gross Rent ........................................................................................................................... 34

8.1.3 Maximum Chargeable Rent ................................................................................................ 34

8.2 Requirements for Determining Utility Allowances ................................................................ 34

8.2.1 Definition of a Reasonable Utility Allowance...................................................................... 35

8.2.2 Calculating the Utility Allowance ........................................................................................ 35

8.2.3 Source for Utility Allowance Schedule ................................................................................ 35

8.2.4 Rounding ............................................................................................................................. 36

8.2.5 Tenant-Paid Utilities Must be Stated in the Lease .............................................................. 36

8.2.6 Annual Notification of Utility Allowance ............................................................................. 36

8.2.7 City’s Request of Information ............................................................................................. 36

8.2.8 Tenant’s Request for Information ....................................................................................... 36

8.2.9 Implementation of Annual Utility Allowance...................................................................... 36

8.3 Requirements for Implementing Changes in Rental Rates .................................................... 36

8.3.1 Timing of Rent Changes ...................................................................................................... 36

8.3.2 Noticing of Tenants of Rent Changes .................................................................................. 37

8.4 Annual Rent Increases and Anti-Displacement Strategy ....................................................... 37

8.4.1 Anti-Displacement Strategy ................................................................................................ 37 9 REQUIREMENTS FOR LEASES ...................................................................................................... 38

9.1 General Lease Requirements ................................................................................................. 38

9.1.1 HUD Model Lease ................................................................................................................ 38

9.1.2 Affordable Housing Program Addendum ............................................................................ 38

9.1.3 Utilities ................................................................................................................................ 38

9.1.4 Household Members Named on Lease ............................................................................... 38

9.1.5 Renter’s Insurance .............................................................................................................. 39

9.1.6 Lease Term .......................................................................................................................... 39

9.1.7 Addenda .............................................................................................................................. 39

9.1.8 Resident Selection Policy .................................................................................................... 39

9.1.9 AB 1482 ............................................................................................................................... 39

9.2 Requirements for Termination of BMR or Workforce Tenancy ............................................ 39 10 REQUIREMENTS FOR PROGRAM MONITORING AND ADMINISTRATION....................................... 39

10.1 Use of Housing Compliance Software.................................................................................... 39

10.2 Annual submission of Waitlist to City .................................................................................... 39

10.3 Submission of Utility Allowance Worksheets to City ............................................................. 40

10.4 Digital Signatures on Leases and Income Certifications ........................................................ 40

10.5 Submission of Lease Documents to City ................................................................................ 40

10.6 Retention of Records ............................................................................................................. 40

10.6.1 Storage Time Requirement ................................................................................................. 40

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10.6.2 Tenant Files ......................................................................................................................... 40

10.6.3 Electronic Files .................................................................................................................... 40

10.6.4 Disposal of Records ............................................................................................................. 40

10.7 City Audits and Monitoring .................................................................................................... 41

10.8 Changes in Management or Ownership ................................................................................ 41

10.9 Expiration of Program Restrictions – Tenant Notification ..................................................... 41

10.10 Duty to Disclose Complaints or Legal Action Taken by a Tenant ........................................... 41

10.11 Tenant Access to Files ............................................................................................................ 41

10.12 Best Practices for Property Management ............................................................................. 41

10.13 Additional Requirements ....................................................................................................... 41 11 USE OF HUD GUIDELINES FOR ITEMS NOT COVERED IN THESE GUIDELINES .................................. 41

11.1 Use of HUD Guidelines for BMR and Workforce Properties .................................................. 41

11.1.1 Use of HUD Guidelines for Properties Covered by One or More HUD-Funded Programs . 42

11.2 Use of HUD for Properties not Covered by HUD-Funded Programs ..................................... 42

11.3 Use of HUD’s Fair Housing Policies ........................................................................................ 42 12 TRAINING REQUIREMENTS FOR PROPERTY MANAGERS .............................................................. 43

12.1 Fair Housing Training ............................................................................................................. 43

12.2 Compliance Training .............................................................................................................. 43

12.3 Technical Assistance .............................................................................................................. 43

12.3.1 Technical Assistance to Non-Profits .................................................................................... 43

12.3.2 Technical Assistance to Property Managers ....................................................................... 43

12.4 Additional Recommended Training ....................................................................................... 43 13 NON-COMPLIANCE AND ENFORCEMENT ..................................................................................... 44

13.1 Procedure for Enforcement of Non-Compliance ................................................................... 44

13.1.1 Appeal Process .................................................................................................................... 44

13.1.2 Continued or Repeated Non-Compliance ........................................................................... 44

13.1.3 Fair Housing Issues .............................................................................................................. 44

13.1.4 Americans with Disabilities Act ........................................................................................... 44

13.2 Tenant Inquires and Dispute Resolution ............................................................................... 44

13.3 REMEDIES ............................................................................................................................... 45 14 CONFLICT WITH HOUSING ELEMENT OR OTHER REGULATORY INSTRUMENT(S) ........................... 45 15 LIST OF SAMPLES AND TEMPLATES AVAILABLE ........................................................................... 45

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5 File name: Draft Revised Below Market Rate Rental Housing Program Administrative Procedures and Guidelines.pdf 1 IMPLEMENTATION AUTHORITY

Authority for implementation of these Below Market Rate and Workforce Rental Housing Administrative Procedures and Guidelines (“ BMR Guidelines”) is provided by t he City of Foster City Municipal Code, Chapter 17.90.020 (E).

This document replaces the BMR Administrative Procedures and Guidelines, last updated on March 19, 2020.

2 INTRODUCTION

This document provides administrative procedures and guidelines to implement the City of Foster City’s (“City”) Below Market Rate ( “BMR”) Rental Housing Program , and the Workforce Housing Program (“Workforce”). These Administrative Procedures and Guidelines may be amended and updated from time to time by the Community Development Department Director.

The purpose of these BMR Guidelines is to provide clear and consistent guidance, procedures, and best practices to implement Chapter 17.90 of the Foster City Municipal Code https://www.codepublishing.com/CA/FosterCity/
and affordability restrictions, and regulatory
agreements, as well as to promote the goals of the City's Housing Element 2023-2031, as adopted on May 22, 2023, specifically fair housing and anti-discrimination priorities as stipulated in the Fair Housing Action Plan in Chapter 3, Affirmatively Furthering Fair Housing. https://engagefostercity.org/housing-element.

3 FAIR HOUSING

The priorities of the City’s Fair Housing Action Plan in the 2023-2031 Housing Element include:

1. Address disproportionate impacts by increasing the supply of affordable housing and providing more housing choices throughout the City.

2. Protect Tenants from displacement through an anti-displacement strategy.

3. Address housing discrimination through fair housing information and training.

4. Address housing discrimination by providing additional support and opportunities for housing to meet special needs.

The BMR and Workforce Programs must comply with AB 686 ( https://www.hcd.ca.gov/community-
development/housing-element/housing-element-
memos/docs/ab686_summaryhousingelementfinal_04222020.pdf), which requires all public agencies to administer programs and activities related to housing and community development in a manner that affirmatively furthers fair housing.

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3.1 PROPERTY MANAGER REQUIREMENTS
BMR and Workforce Property Managers and all property management and maintenance staff must comply with Fair Housing laws and regulations and complete Fair Housing training (see Section 12, Training Requirements). In addition, Property Managers are required to notify all BMR and Workforce Tenants of annual City-provided informational sessions on Fair Housing and work in partnership with City Staff to help provide reasonable accommodation to those with disabilities who need assistance in attending the annual informational session.

4 COVERED PROPERTIES

These BMR Guidelines apply to all rental properties in the City that are subject to an affordability restriction. Owner-occupied BMR properties are covered by separate guidelines.

Chapter 17.90 of the Foster City Municipal Code defines “below market rate dwelling unit” as “a dwelling unit in a residential development project that is restricted for sale or rental to and occupancy by an eligible household at a below market rate ownership cost or below market rate rent.” Workforce Housing is designed to make it possible for public servants (including first responders, public employees, and teachers) to live near where they work, and falls within the definition of “below market rate dwe lling unit.” Different requirements apply to Workforce Housing compared to other BMR Housing. For example, Workforce Housing is deed-restricted for rental rates but not incomes. For clarity, these BMR Guidelines distinguish between the Below Market Rate Housing Program and the Workforce Housing Program as needed.

5 DOCUMENTS REQUIRING CITY APPROVAL PRIOR TO LEASING

5.1 MARKETING PLANS
Owners or their authorized agents must submit a marketing plan to the City in advance of initial leasing up a property and prior to reopening a closed Waitlist. For properties with extremely low- income and/or accessible or adaptable units and/or units that are designated as supportive housing are also subject to Section 5.2 below. Marketing plans shall include, at a minimum:

1. Procedures and requirements for determining eligible households for rental of rental units.

2. Minimum and maximum o ccupancy requirement s as provided in the affordability restriction on the property, if applicable.

3. Initial and ongoing marketing, advertising, outreach policies, and a list of target agencies and organizations, including the City of Foster City website and the Foster City Islander newspaper.

4. A statement explaining the application process, including accommodations for those who need assistance in applying.

5. Preference requirements.

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6. Waitlist management procedures.

7. Income verification requirements.

8. Annual recertification requirements.

9. The process for rejection of ineligible applicants and eligibility termination.

10. A statement on fair housing that complies with the current laws and regulations.

11. Such other provisions as the Community Development Director may prescribe from time to time according to these BMR Guidelines.

The marketing plan may be updated from time to time or as required by the City. Any changes to a City-approved marketing plan shall require City approval.

5.2 AFFIRMATIVE MARKETING PLANS
This section has been added to comply with the City of Foster City Housing Element (https://engagefosterCity.org/housing-element) and AB 686 (https://www.hcd.ca.gov/community- development/housing-element/housing-element-
memos/docs/ab686_summaryhousingelementfinal_04222020.pdf), which require all public agencies to administer programs and activities related to housing and community development in a manner that affirmatively furthers fair housing.

For all BMR properties with extremely low-income or accessible or adaptable units or designated as supportive housing, the Property Manager shall prepare and submit an Affirmative Marketing Plan for special needs groups to the City for approval, including a process for encouraging qualified households to apply. The Affirmative Marketing Plan shall be used prior to notice of the availability of the units at the initial lease-up and for any future vacancies. The Affirmative Marketing Plan may be included as a section of the Marketing Plan or may be a separate document.

5.3 RESIDENT SELECTION POLICY
Property Managers shall submit a Resident Selection Policy for approval by the City in advance of marketing a property. The Resident Selection Policy shall include a statement of fair housing and non-discrimination, preferences and a statement that the preference must be in effect at the time of Application, the minimum and maximum occupancy standards for each unit size, credit and background check requirements, the application fee amount and acceptable methods of payment, application requirements, documents required along with the Application, including identification and proof of income, the requirements for i ncome eligibility, including minimum income, income limits, and income certification and annual recertification requirements, and an initial lease term of 12 months. The Resident Selection Policy must be signed and dated by all adult household members and must be kept in the file.

5.4 APPLICATIONS FOR HOUSING
The Property Manager shall submit the Application draft to the City for approval prior to the initial leasing of the property. The Application must include a statement of fair housing and include space for names, birthdates, social security numbers or tax identification numbers, if applicable, employment information, and past residency information for all household members. The Application must be signed by all adult household members and kept in the file.

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5.5 SUBMITTAL AND APPROVAL OF MARKETING PLANS, SELECTION POLICY, AND APPLICATION These items shall be submitted to the City for approval in advance of the initial lease -up, and one or more may be required by the City to be re-submitted to the City in advance of the availability of multiple BMR and Workforce units or reopening of a closed Waitlist. The City will respond within ten days of submittal. In the event that the City does not respond, a lack of response indicates approval of the submitted document. Available units shall be marketed in accordance with the approved Marketing Plan.

6 REQUIREMENTS FOR WAITLISTS

6.1 REQUIREMENTS FOR WAITLIST APPLICATIONS
a) Information to be Included in the Waitlist Application. At a minimum, the application shall include at least the information needed to determine initial estimate of gross household income, preference category, household size, and contact information. The application must also include a statement of Fair Housing that complies with current laws . The required data items are contained in the sample format for the Waitlist and sample applications.

b) Additional Information in Application. The application may include additional information to conduct an initial eligibility screening. The application shall include a statement that it is the applicant’s responsibility to inform the Property Manager of any changes in address, phone number or email.

c) Required Statement of Truth and Accuracy. The application shall include a statement that if the applicant provides false or misleading information, they may be considered ineligible.

d) Accommodation for those with Disabilities. The application must be available in multiple formats to accommodate those with disabilities.

e) Preliminary Application. The Property Manager may have a preliminary application that contains only the basic information required to apply to the Waitlist or they may have a more detailed application if they want to conduct a more thorough screening at the time of application to the Waitlist.

f) Changes and Updates to Applications . The burden shall be on the applicant to inform the Property Manager of any changes in status, such as household size, residence, or employment location, contact information or other information. The Property Manager shall adjust the preference category if the applicant provides the appropriate documentation. A statement to this effect must be included in the Waitlist application.

g) Use of Third -Party Waitlist Management Providers . Property Managers may elect to use a third-party provider to manage their application s and Waitlists. The costs associated with third-party contracts shall be incurred by the Property Manager and/or Owner.

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9 File name: Draft Revised Below Market Rate Rental Housing Program Administrative Procedures and Guidelines.pdf h) Use of County’s Doorways Portal . Property Managers are required to use the County’s Doorways portal for available properties for any vacancies or open Waitlist s unless the City grants an exception. https://smc.housingbayarea.org/get-assistance.

i) Use of Other Online Portals for Waitlists. The City strong ly recommends against the use of online portals, other than the County of San Mateo’s Doorways Program, to make additions to the Waitlist unless the portal can flag or eliminate duplicate entries.

6.2 REQUIREMENTS FOR FORMATTING A WAITLIST
a) Waitlist Format. The Waitlist shall be kept in this format in an electronic spreadsheet and include the information that will be necessary in order to sort the Waitlist by Preference Category. The s orting feature can be utilized to create a custom order list by Preference Categories. If the Waitlist is managed by a third party contracted by the property management, the Waitlist shall be kept in a manner that enables sorting by preference category, lottery number, and application date.

b) Use of Filters. A filter may be applied for viewing the list or finding a specific applicant. A filter can be applied to hide the inactive applicants, while retaining their information in the event they later question why they were changed to inactive status. An electronic version of the Waitlist in spreadsheet format is available from the Community Development Department.

Property Managers may add columns for additional data items for any special program requirements or other uses if they wish.

c) Notes and Updates Added to Waitlist. Notes shall be kept in the Waitlist spreadsheet to document all contacts and communications with the applicants, including the complete date and initials of the staff member. It is important to maintain these notes in order to verify and document appropriate use of the Waitlist to fill vacancies and changes to an applicant’s status.

d) Sorting the Waitlist . The Waitlist shall be sorted by: (1) Preference category; (2) Lottery number (if applicable); (3) Application date.

e) Move-ins. Those applicants who have moved into the unit shall remain on the Waitlist in inactive status with a note that they have moved in and the move-in date.

f) New Applicants. New applicants to the Waitlist shall be placed at the end of the list in the appropriate preference category by their date of application.

6.3 REQUIREMENTS FOR TEMPORARY AND PERMANENT CLOSURE OF A WAITLIST a) Temporary Closure. Closure of a Waitlist is at t he Property Manager’s discretion . The City recommends that Waitlists remain open if there are fewer than 50 applicants for new lease- ups or properties with three or more vacancies. The Property Manager shall notify City staff of closure of a Waitlist to new applicants. Waitlists may be open for some categories and closed for others , in sequential order of preferences, upon approval by the City’s Housing Coordinator.

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b) Notification of City Staff . The Property Manager shall discuss with City staff any plan to reopen a closed Waitlist and obtain City staff approval for an updated marketing plan.

c) Permanent Closure. The Property Manager shall submit a Waitlist closure plan to the City for approval. The plan shall include procedures and a schedule for notifying households on the Waitlist of the closure and whether they will automatically be transferred to a new list or must apply.

6.4 REQUIREMENTS FOR REOPENING A WAITLIST
a) Reopening a Waitlist. Temporarily closed Waitlists may be reopened at the discretion of the Property Manager. Before re -opening a Waitlist , the Property Manager shall submit an updated Marketing Plan and/or Affirmative Marketing Plan to the City for approval pursuant to Section 5.

b) Workforce Housing Waitlist. For Workforce housing units, the City may require that the Waitlist be open for a period of time or indefinitely for one or more of the highest preference categories.

6.5 GUIDELINES FOR WAITLIST MANAGEMENT
Annually, the Property Manager is encouraged to send a Waitlist Information Update Letter, or purge letter, to ascertain whether the people on the Waitlist want to remain on the list. The letter shall state that no response will result in removal from the list. Applicants shall be given a minimum of two weeks to respond. If email is used as a substitute for a mailed letter, a copy of the email shall be kept. If someone notifies the Property Manager via telephone that they wish to be removed from the Waitlist, a follow-up letter shall be mailed to the applicant confirming their decision to be removed from the Waitlist.

6.6 REQUIREMENTS FOR NOTIFYING APPLICANTS ON WAITLIST OF A VACANCY a) Notification Timeline Rules. When a unit becomes available, except as noted in item 6.6(b), the Property Manager shall notify the first person on the Waitlist and allow them not less than five (5) business days to submit an application for housing after they have responded with interest in submitting an application per Section 6.5.

b) Expediting Waitlist Processing . To expedite processing of applicants , the batching of up to ten (10) names on the Waitlist within the first preference category may be invited simultaneously to respond. Respondents shall be given a minimum of five (5) business days to submit an application. Applications will be processed in waitlist order. Application fees for any unprocessed applications shall be returned to resp ondents. If there are no qualified applicants from the first batch, the Property Manager moves on to the next batch of up to ten names within the preference category. Once the preference category is exhausted, the Property Manager may move on to the next batch of up to ten (10) names in the next preference category.

c) Handling Applicants Who Decline. The Property Manager may establish a policy to make an

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d) Notification Rules for a New Vacancy. The notification of applicants shall restart at the top of the list when a new vacancy occurs, except for applicants that have been notified within the past 30 days.

7 DETERMINING ELIGIBILITY

Preference and other e ligibility standards must be included in the Resident Selection Policy for each property. Income eligibility for BMR and Workforce housing for initial move-ins and annual recertifications is based on HUD and California Tax Allocation Committee (CTCAC) s tandards, with exceptions as noted below. Eligibility requires initial income certification and annual recertification of income performed in a manner pursuant to these BMR Guidelines, unless superseded by the affordability restrictions or other regulatory document in effect.

7.1 STANDARD PREFERENCE CATEGORIES AND EXCEPTIONS
Except as noted below or by the affordability restrictions or regulatory document in effect, properties covered by these BMR Guidelines shall maintain preference categories for eligibility established by the City Council in Resolution 2020 -24 or a subsequent amendment to prioritize applicants as follows:

City of Foster City Standard Preference Categories for BMR Housing Preference Description
1a Persons who are currently living in a Below Market Rate deed restricted unit in Foster City and have been so for at least twelve (12) months, whose unit is subject to termination of affordability restrictions within three (3) years.
1 Persons who live and work in Foster City.
2 Persons who live in Foster City.
3 Employees of the City of Foster City.
4 Classroom teachers who are employees of the San Mateo -Foster City School District, the San Mateo Union High School District, or the San Mateo County Community College District.
5 Persons who work in Foster City.
6 All others who are income qualified.

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City of Foster City Standard Preference Categories for Workforce Housing* Preference Description
1a Persons with mobility-related disabilities
1 Persons who are employed by the City of Foster City in First Responder Departments
2 Other employees of the City of Foster City
3 Classroom teachers in the Foster City School District, Foster City -San Mateo Union High School District, or the San Mateo County Community Colleges District
4 Persons who live and work in Foster City
5 Persons who live in Foster City
6 Persons who work in Foster City
7 All others who are income-qualified**
*These preferences also apply to the BMR units within the workforce housing development, except for Preference 1a and 1. The first preference category for the BMR units in the workforce housing development is for all city employees.
**Workforce housing applicants must only meet minimum income requirements.

7.2 PREFERENCE REQUIREMENT AT TIME OF APPLICATION FOR HOUSING The preference category of the applicant shall be confirmed as the preference category in effect at the time of the Application for housing, not the date of the Application to the Waitlist.

7.3 PREFERENCE VERIFICATION
The preference category shall be verified for all initial move-ins based on the date of application for housing. Preference category verification is not required for annual recertification.

7.3.1 Verifying Foster City Residence
Property Managers are supplied with a map of Foster City that shows the City limits. Note that parts of the 94404 zip code are within the City of San Mateo. Property Managers should contact the Community Development Department with any questions about whether a property is within Foster City.

In order to be assigned a Preference Category as a resident of Foster City, at least one member of the household must be currently living in Foster City. There is no requirement for the duration of residence except that persons claiming Preference Category 1a which requires a minimum 12 months. Residency shall be verified through submittal of two current utility bills from at least one of the following utility providers: Pacific Gas & Electric Company, water, telephone, television service, or garbage. If the applicant has recently moved and does not yet have utility bills, a lease agreement will be accepted. If the applicant cannot provide items listed above, then an Affidavit of Residence is required.

7.3.2 Verifying Work Location in Foster City
Property Managers are supplied with a map of Foster City that shows the City limits. Note that parts of the 94404 zip code are within the City of San Mateo. Property Managers should contact

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At least one half of one household member’s income shall be from employment within Foster City in order to qualify for the “works in Foster City” Preference Category and that paid employment shall be at least 16 hours per week. If the employment is a home occupation, the home address shall be a Foster City residence and the household member must also have a Foster City business license.

Employment in Foster City must be based at a fixed address, not an itinerant type of occupation or temporary work assignment.

7.3.3 Verifying City of Foster City Employment
If an applicant states that they are an employee of the City of Foster City, the Property Manager shall contact the Community Development Department for verification.

7.3.4 Preference Verification Form
The Property Manager shall complete a preference verification form or statement for each Tenant file that indicates the preference category verified for the household and the method used for verification. A sample of this form is available from the City.

7.4 OWNERSHIP OF REAL ESTATE
The City does not permit any household member of rental BMR or Workforce housing to own domestic or foreign residential real estate for income or leisure purposes, including short-or-long term rentals, second homes , vacation homes, or timeshare units. Existing residents with residential property used for income or leisure purpose that occupied the BMR or Workforce residence prior to the effective date of these BMR Guidelines, may remain in their unit. Property Managers should follow the procedures outlined in Section 7.8.16 to calculate income from the real estate asset.

Tenants who acquire residential real estate for income or leisure purposes after the date they moved into the BMR or Workforce unit, or after the effective date of these BMR Guidelines, whichever is later, are no longer eligible for the BMR or Workforce program and must vacate the BMR or Workforce unit or pay market rate rent. The only exception is when a household member acquires residential property through divorce, inheritance, or other legal transfer not initiated by the household member, after moving into the BMR or Workforce unit.

7.5 SOLE AND PRIMARY RESIDENCE REQUIREMENT
The BMR or Workforce unit must be the full- time, sole, and primary residence of all household members, with the exception of students who may live near their educational institution during some of the year but still claim the BMR or Workforce unit as their primary residence , military leave, institutional stays, or child -custody arrangements. With the exception s as noted in this section and as of students and exceptions noted in Section 7.4, tenants who claim the BMR or Workforce unit as their sole and primary residence to meet program requirements, but are found to have an alternate primary residence, will be deemed ineligible for the BMR or Workforce

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14 File name: Draft Revised Below Market Rate Rental Housing Program Administrative Procedures and Guidelines.pdf program and required to vacate the BMR or Workforce unit or pay market rate rent. Household members shall not be named on a lease of any other unit , pay rent for any other unit for themselves or another household member, or reside in any other unit or units for more than sixty (60) days (consecutive or non-consecutive) in any 12-month period, with exceptions as noted in this section.

7.6 REQUIREMENTS FOR INCOME ELIGIBILITY

7.6.1 Applicability
For LIHTC properties, this section is superseded by the California Tax Credit Allocation Committee (CTCAC) Compliance Online Reference Manual and all applicable CTCAC rules and regulations. See https://www.treasurer.ca.gov/ctcac/compliance.asp. For bond programs and specific HUD programs, please refer to the Property Bond Agreement, affordability restrictions , and other property-specific governing documents. For all other BMR and Workforce housing properties, this Section applies.

7.6.2 Source for Income Limits
Per the City of Foster City Municipal Code, Chapter 17.90, t he City uses the income limits as established by the California Department of Housing and Community Development (HCD) , as amended or any successor statute thereto, except as noted below or by affordability restrictions.

These income limits are issued in the spring of each year, with the actual issuance date varying from approximately February to June.

Foster City Municipal Code, Chapter 17.90.020, Definitions defines Extremely Low, Very Low, Low (or Lower), and Moderate income as follows:

“Extremely low income households” means households with incomes no greater than the maximum income for extremely low income households, as published annually by the California Department of Housing and Community Development (HCD) as the Official State Income Limits pursuant to Health and Safety Code Section 50093 for San
Mateo County, adjusted for household size, except that the city may permit alternative criteria, when necessary, to be consistent with pertinent state and federal statutes and regulations governing publicly assisted housing.”

Section 50093 refers to Section 50106, which states that Extremely Low Income is less than 30% of Area Median Income.

“Very low income households” means households with incomes no greater than the maximum income for very low income households, as published annually by the California Department of Housing and Community Development (HCD) as the Official State Income Limits pursuant to Health and Safety Code Section 50093 for San Mateo
County, adjusted for household size, except that the city may permit alternative criteria, when necessary, to be consistent with pertinent state and federal statutes and regulations governing publicly assisted housing. (Ord. 644 § 3, 2022)

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“Low income households” means households with incomes no greater than the maximum income for low income households, as published annually by the California Department of Housing and Community Development (HCD) as the Official State Income Limits pursuant to Health and Safety Code Section 50093 for San Mateo County,
adjusted for household size, except that the city may permit alternative criteria, when necessary, to be consistent with pertinent state and federal statutes and regulations governing publicly assisted housing.

Section 50093 refers to Section 50079.5, which states that Lower Income is less than 80% of Area Median Income.

“Moderate income households” means households with incomes no greater than the maximum income for moderate income households, as published annually by the California Department of Housing and Community Development (HCD) as the Official State Income Limits pursuant to Health and Safety Code Section 50093 for San Mateo
County, adjusted for household size, except that the city may permit alternative criteria, when necessary, to be consistent with pertinent state and federal statutes and regulations governing publicly assisted housing.

Section 50093 states that moderate income is less than 120% of Area Median Income.

Property Managers are responsible for determining and applying the income limits for their property each year in accordance with the affordability restrictions for their property and submitting a copy of their income and rent limits to the City annually for review and confirmation of correctness. The City issue s confirmation of income limits annually for each property . The annual calculations of income and rent limits are due to the City within 30 days following the annual issue of HCD limits. The income li mits apply to the following affordability categorie s:

Extremely Low- Income, Very Low -Income, Low -Income, and Moderate -Income. The income limits, and an explanation of the methodology used to develop them, are available at:
https://www.hcd.ca.gov/grants-funding/income-limits/state-and-federal-income-limits.shtml

(see the “Official State Income Limits”).

7.6.3 Other Governing Income Limits
The HCD income limits may be different than the income limits required by other programs that may affect a property, such as tax credits or bonds. The coordination of these requirements shall be as established by mutual agreement for each affected development and the City. For the Marlin Cove and Miramar developments, the City and the Owner s have agreed that: i nitial occupancy shall be governed by the HCD income limits and recertifications shall utilize the HUD HERA income and limits. The HUD HERA income l imits are available on the California Tax Allocation Committee website: https://www.treasurer.ca.gov/ctcac/compliance.asp.

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7.6.4 Calculating Non-Standard Income Limits
To calculate income limits or rents using income limits other than the published percentages of very low (50% of AMI), low or lower income (80% of AMI), and moderate (120% of AMI), the City uses the HUD standards for calculations in which all affordability levels less than the Area Median Income (100%) are based on the Very Low Income Level of 50% of AMI, and all affordability levels over the Area Median Income are based on the median income (100% of AMI). For more details on the methodology, see: https://www.hcd.ca.gov/sites/default/files/docs/grants-and- funding/income-limits-2023.pdf. U se the following table to calculate non -standard income limits for determining rents or income limits, where K is the 50% of AMI income limit and M is the median income limit, 100% of AMI.

Multipliers for Calculating Income Limits, where K= 50% of AMI and M = 100% of AMI 5% = K * .1 30% = K * .6 55% = K * 1.1 80% = K * 1.6 110% = M * 1.1 10% = K * .2 35% = K * .7 60% = K * 1.2 85% = K * 1.7 120% = M * 1.2 15% = K * .3 40% = K * .8 65% = K * 1.3 90% = K * 1.8 130% = M * 1.3 20% = K * .4 45% = K * .9 70% = K * 1.4 95% = K * 1.9
25% = K * .5 50% = K 75% = K * 1.5 100% = M

Example: if the Area Median Income is $175,000 (the 2023 HCD Area Median Income for a family of four) and 50% of AMI is $93,200, then 60% of AMI is 93,200 x 1.2 = $111,840 (rounded down to nearest 100, or $111,800), 80% of AMI = 93,200 x 1.6 = $149,120 (rounded down to nearest hundred, $149,100), 110% AMI is 175,000 x 1.1 = $192,500, and 120% of AMI is 175,000 x 1.2 = $210,000.

7.6.5 Third-Party Verification of Income and Assets
The City of Foster City requires third-party verification of employment income and assets for initial certifications only. For recertifications, the City recommends third -party verification if information provided by the household member is incomplete, confusing, conflicting, or inaccurate, or if income is periodic or sporadic. Third -party verification may also be required by bond agreements or tax credit programs or by the Property Manager. Property Managers’ verification policies must comply with current fair housing regulations and the current HUD Handbook, Chapter 5, Section 3, Verifications.

7.6.6 Reductions in Income Limits
In cases where the income limit established by HCD is lower than the prior year, and the Tenant’s income would continue to qualify under the prior year's income limit, the Tenant will be deemed to comply with the income requirements.

7.6.7 Annual Income Recertification Requirement
The Property Manager shall annually re-certify each household for continued eligibility in the BMR program no later than the Tenant ’s recertification deadline (generally the first day of the anniversary of the month the Tenant moved in), with the exception of the Workforce housing units (see Section 7.6.9). Methods used to calculate annual income shall follow the methodology as set forth in these BMR Guidelines unless superseded by another program due to funding, grant, affordability restrictions, or other regulation or Agreement.

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17 File name: Draft Revised Below Market Rate Rental Housing Program Administrative Procedures and Guidelines.pdf In the event that the income certification cannot be completed due to non-cooperation from the tenant, incomplete, or inaccurate information, or the inability to verify information, the tenant shall be deemed non-compliant. Absent procedures in the property’s covenant, the tenant shall be in-eligible for the BMR program and rent will be increased to market rent with a sixty-day (60) written notice.

7.6.8 Minimum Income Requirement
Property Managers shall determine the minimum income required for each BMR and Workforce unit. The City recommends but does not require a minimum income to rent ratio of 2.5 (minimum income is rent multiplied by 2.5 multiplied by 12) for BMR and Workforce units. The minimum income requirement shall be included in the Resident Selection Policy (see Section 5 .3). For applicants with Housing Choice Vouchers or other rent subsidy, the minimum gross income shall be based on the applicant’s share of rent rather than the full rental rate.

7.6.9 Minimum Income Verification for workforce Units
Minimum income shall be verified for initial eligibility for the household to occupy the unit.

Minimum household income shall be verified using three months of paystubs, a copy of the most recent federal taxes, and other documentation as needed to ensure the household meets the minimum income for the unit. Annual income recertification is not required for the workforce housing units in the workforce housing program.

7.6.10 General Guidance on Income Certification Procedures Income certification methods not covered in these BMR Guidelines or by the affordability restrictions or a Bond/Financing Agreement for the property shall follow the U.S. Code of Federal Regulations and provided on the website of the U.S. Department of Housing and Urban Development at: https://www.hud.gov/sites/documents/43503HSGH.PDF . In the event of
multiple requirements or conflicting methodology due to requirements of bond or tax credit financing or the affordability restrictions for the property, the strictest rule shall apply in calculation of income. It is imperative that all bond/tax credit properties follow directives as stipulated in the agreements. If a Property Manager is unclear on which methodology to follow or seeks clarification of these BMR Guidelines, the City shall provide guidance regarding and interpretation, if requested by the Property Manager.

7.7 ANNUAL RECERTIFICATION OF INCOME

7.7.1 Applicability
For LIHTC properties, this section is superseded the California Tax Credit Allocation Committee (CTCAC) Compliance Online Reference Manual and all applicable CTCAC rules and regulations. See https://www.treasurer.ca.gov/ctcac/compliance.asp
. For bond programs and specific HUD
programs, please refer to the Property Bond Agreement, affordability restrictions , and other property-specific governing documents. For all other BMR and Workforce housing properties, this Section applies.

7.7.2 Annual Recertification Date
The annual recertification date for each Tenant shall be the first day of the month the Tenant

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18 File name: Draft Revised Below Market Rate Rental Housing Program Administrative Procedures and Guidelines.pdf moved in. For example, if the Tenant moved in on May 15, 202 3, then the recertification date shall be May 1, 2024. If Property Managers prefer to have all Tenants on the same schedule, they must recertify the household twice in one year to put the new household on the annual schedule.

The mass certification deadline must be at least 30 days prior to the deadline for the annual Property Status Report (PSR) for the property.

7.7.3 Deadline for Forms and Documents Submitted by Tenants The City follows Chapter 7 of the HUD Handbook on this issue. The final deadline for submission of all completed forms and documents shall be the 10 th day of the month prior to their annual recertification deadline. For example, if the recertification deadline is January 1 st, then the deadline to complete forms and submit documents is December 10.

7.7.4 Notices to Tenants
Property managers should follow HUD Handbook 4350.3 Rev-1 (“HUD Handbook”), Chapter 7 for recertification notices, with the exceptions on noticing timelines as noted below. Tenants who respond to notice(s) but do not submit all required completed forms or documents by the deadline(s) stated in reminder notice(s), shall be notified in writing of non -compliance status following the final notice deadline and informed that their rent will change in rent to market rate, in accordance with current notice laws and regulations. Please note that the City ’s notice requirements for recertification deviate from the HUD Handbook on notice of recertifications as follows:

1. First notice: the first notice of annual recertification shall be sent at least ninety (90) days prior to the recertification deadline.

2. Second notice: if the Tenant does not respond to the first notice or has not completed submittal of all required documents and forms, the second reminder notice shall be sent at least sixty (60) days prior to the recertification deadline.

3. Third and final notice: if the Tenant does not respond to the second reminder notice or has not completed submittal of all required documents and forms, a third and final reminder notice of recertification shall be sent at least thirty (30) days prior to the recertification deadline.

4. Notice of non-compliance: if the Tenant has not responded to the three notices or has not submitted required documentation or forms , a notice of non - compliance shall be sent on the day of or after the recertification deadline.

Each reminder notice must list the recertification deadline, the deadline for submitting all completed forms and documents, the forms and documents required, how to submit forms and documents, and Property Manager contact information, including email, telephone number, and office hours of the Property Manager. It is highly recommended that the Property Manager schedule an in -person appointment with the household members to collect forms and documentation and provide the Tenant with the opportunity to reschedule the appointment to another day and time during business hours.

7.7.5 Notification of Non-Compliance
The Property Manager shall copy the City on any notice of non -compliance related to

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7.8 PROCEDURES FOR CALCULATING INCOME

7.8.1 Applicability
For LIHTC properties, this section is superseded the California Tax Credit Allocation Committee (CTCAC) Compliance Online Reference Manual and all applicable CTCAC rules and regulations. See https://www.treasurer.ca.gov/ctcac/compliance.asp
. For bond programs and specific HUD
programs, please refer to the Property Bond Agreement, affordability restrictions as , and other property-specific governing documents. For all other BMR and Workforce housing properties, this Section applies.

The purpose of this methodology is to ensure consistency in calculating income for all Foster City BMR units and to ensure compliance with Fair Housing laws. The methodology is based on the HUD standards as stipulated in the HUD Handbook 4350.3 (https://www.hud.gov/sites/documents/43503HSGH.PDF) and uses HUD form s and some California Tax Credit Allocation Committee forms.

7.8.2 Multiple or Conflicting Requirements
In the event of multiple requirements or conflicting methodology required by the affordability restrictions for the property, the strictest rule shall apply in calculation of income.

7.8.3 Projected Income
Income is projected for the next 12 months using documentation provided by the household.

7.8.4 Household Member Income to Count
Any adult household member aged 18 or over and residing in the unit 14 days or more per year (consecutive or non -consecutive days) shall be counted for income calculation purposes and included in the household size. This includes college students living away from home for some of the year. However, do not include incomes of live-in aides. See the HUD Handbook for guidance on live-in aides.

7.8.5 Full Set of Forms Required for all Adult Household Members A full set of forms and associated documents is required for each adult household member, including a Tenant Income Questionnaire. A Forms Schedule is available from the City.

7.8.6 Rules on Redacting of Information Provided for Income Certification Tenants are not permitted to r edact information, other than Social Security Numbers, that are provided on documents submitted for the income certification process.

7.8.7 Income Inclusions and Exclusions
The City of Foster City follows the HUD Manual regarding income inclusions and exclusions, with the following clarifications. See https://www.hud.gov/sites/documents/DOC_35699.PDF .

However, if the affordability restrictions for the property reference California Code of Regulations, Title 25, Section 6914 for determining income, then CCR Title 25, Section 6914 shall supersede

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For temporary, non -recurring, or sporadic income (including gifts) , non-recurring is defined as income that appears only one time in any calendar year. For example, sporadic income from the same source that results in multiple deposits to a checking or savings account, even if differing amounts, in a given calendar year, is considered recurring income and must be counted. Assets in foreign or offshore accounts shall be included in the asset section of the certification.

Rent subsidies provided by government programs, such as Section 8, COVID relief, and other sources, are excluded from income. Rent subsidies from any source should be excluded from income if the subsidy is tied to the income of the Tenant, even if it is recurring and not a lump sum single payment and/or temporary in nature. If the subsidy is recurring, not temporary, and is a set amount that is not dependent on the amount of income of the Tenant , the subsidy should be counted as income. The exclusion rule, while not explicitly stipulated in the HUD list of exclusions, is based on the definition of determinable income as stated in the Housing Act of 1937 (https://www.hud.gov/sites/documents/DOC_10010.PDF). For example, Section 8 subsidies paid by the Housing Authority of San Mateo County and temporary emergency rent relief subsidies paid by any source should always be excluded from income.

7.8.8 Three Methods Required to Calculate Income
Property Managers should use three methods to calculate income from employment and take the highest of the three incomes for use in the income certification or recertifications, except as noted below, or if superseded by the property’s affordability restrictions or other regulatory agreement in effect.

The three methods include: 1) gross income paystub averaging for three months of paystubs using the gross pay; 2) annualized year-to-date income calculation, and 3) pay rate calculation, including overtime. Exceptions: (1) If the Property Manager obtains third- party employment verification, the information provided in the verification shall supersede information from paystubs or other methods of calculation. However, paystubs should still be included in the file even if employment verification is received; (2) for self-employment, see Section 7.7.11.

The City requires t hree m onths of paystubs to be submitted by employed adult household members. Employment verification may be substituted for paystubs only if paystubs are not available. For those who have been employed less than three months or are about to start a new position, a letter of employment serves as acceptable verification of employment.

Method 1: Paystub Averaging
For each type of payment schedule, take the sum of the gross pay for each pay stub and divide and multiply as directed below.

• If paid weekly , 12 paystubs are required. Divide the total sum of payments by 12, then multiply by 52.
• If paid monthly, three paystubs are required. Divide the total sum of payments by three, then multiply by 12.

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21 File name: Draft Revised Below Market Rate Rental Housing Program Administrative Procedures and Guidelines.pdf • If paid bi-weekly (every other week): seven paystubs are required. Divide the total sum of payments by seven, then multiply by 26.
• If paid semi- monthly (twice a month on the same days each month): six paystubs are required. Divide the total sum of payments by six then multiply by 24. • For teachers who are paid ten months out of the year, take the total sum of three months and divide by ten then multiply by ten.

Method 2: Year-to-Date Annualization
Take the gross year to date amount and the pay period end date from the paystub. Determine how many days or weeks the end date is in the year. Use either the weeks calculator method or the days calculator method and use one or the other consistently in your calculations for each property.

Calculating annualized YTD income using weeks calculation: If using the weeks method, be sure to use a decimal for partial weeks: one day=.143, two days =.286, three days=.429, four days=.571, five days=.714, six days= .8 57). Use an online calculator program such as https://planetcalc.com/7741/
. Divide the YTD amount on the paystub by the number of weeks and then multiply by 52 weeks.

Calculating annualized YTD income using days calculation: If using the days method, divide the paystub amount by the number of days between January 1 and the end date of the pay period to get an average daily rate and then multiply by 365. The Excel DAYS formula can be used to find the number of days.

Note that the pay period end date includes the last date, but the calculators do not, they count the first date, and all dates up to the last date but not the last date, so for accuracy you must add one day when using a weeks or days calculator. For example, If a pay period end date is January 15, that is 15 days or two weeks and one day of pay, but if you use the days or weeks calculator, it is 14 days or two weeks and zero days. Therefore, you must add a day to capture the pay period end date.

In the event that the household member started a job after January 1 of the given year, use the start date as the first date to annualize rather than January 1.

Examples:

Assumptions: YTD pay period end date: June 15, 2023. Pay YTD: $45,500

Example for Weeks Method:

Using PlanetCalc or another online calculator to determine the weeks between 01/01/2023 and 06/16/2023 (remember to add a day), the answer provided is 23 weeks, 5 days. Note: Excel does not provide decimal points and rounds up, so the Excel weeks formula is not recommended to determine the weeks.

Convert the days to a decimal. 5 days divided by 7 is .714, so the number of weeks is 23.714.

Divide $45,500 by 23.714 to get a weekly average pay. $45,500/23.714 = $1918.70 Multiply that result by 52 to annualize: 1918.70 x 52 = $99,772.40

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Example for Days Method using Excel:

Enter the formula as follows into a spreadsheet using the DAYS formula:
=DAYS(“16-JUN-2023, “1-JAN-2023”) = 166 days (remember to add a day) Divide $45,500 by 166 to get the average daily rate: 45,500/166 = 274.10 Multiply by 365 to annualize: $274.10 x 365 = $100,046.50

Due to rounding, the final values are slightly different. Therefore , the City recommends that the Property Manager use either the weeks method or the days method consistently for all BMR income calculations.

Method 3: Pay Rate Calculation
This method uses the hourly rate or salaried amount that the household member earns and annualizes it. If the household member works overtime, overtime rates should be averaged an annualized as well. For full-time work, use 2,080 hours or 40 hours a week.

Example 1. Full -time work, $ 47.50 per hour. The household member works an average of five hours of overtime per pay period and is paid bi-weekly.

Regular pay 47.50 x 2080 = $98,800 or 47.50 x 40 x 52 = $98,800 Overtime: rate is 1.5 x pay rate or $ 71.25. The average of two hours OT per pay period and 26 payments per year (paid bi-weekly) equates to 52 OT hours per year. $ 71.25 x 26 = $1,852.50 additional earnings per year.

Total income from this method is: $100,652.50.

Reviewing the methods, and, for the purposes of this example, the Property Manager uses the Days method for calculating YTD, and the paystub averaging method resulted in an annual income of $101,222.22, the amount that should be used for the income certification is the highest of the three, or $101,222.22.

7.8.9 Lump Sum Payments
See the HUD Manual Income Inclusions and Exclusions for more information on lump sum payments and when to count them as income or assets. In general, single payment lump sums are not counted as income for certifications. See:
https://www.hud.gov/sites/documents/DOC_35699.PDF. However, if the property’s affordability restrictions reference California Code of Regulations, Title 25, Section 6914 for determining income, then CCR Title 25, Section 6914 shall supersede this section.

7.8.10 Tax Returns
The prior year’s tax return assists the property manager with income verification as a reference point for reasonableness . Taxes and tax transcripts must be signed and dated by the taxpayer.

The 120-day HUD and CTCAC rule for dating documents does not apply.

Since income is projected forward, taxes are not used for calculating income , except for self - employment income in some cases. See Section 7.8.12 for details on Self-Employment Income. If a household member does not have their most recent tax returns, they must submit Form 4506- T to the IRS to obtain a statement of non-tax filing. If the household member does not file taxes,

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23 File name: Draft Revised Below Market Rate Rental Housing Program Administrative Procedures and Guidelines.pdf the household member must complete a non-tax filer affidavit and submit Form 4506-T to the IRS to obtain a statement of non-tax filing.

Transcripts and statements of non-tax filing may be requested by mail, telephone or online. If the household member cannot produce a transcript or statement using the mail, phone or online methods, the City recommends that the Property Manager witness the request by having the tenant call, mail, or go online from the Property Management office. The person signing the form is responsible for completing the IRS form accurately, submitting it to the IRS, and providing the report from the IRS to the Property Manager.

• Use www.IRS.gov or the IRS2Go app to access Get Transcript by Mail ; transcript will be delivered within 10 days to the tax filer's address of record, or • Submit Form 4506 -T or 4506T -EZ to have a transcript mailed to the tax filer at the tax filer's address of record with the IRS. Complete and print the form at https://www.irs.gov/forms-pubs/about-form-4506-t
• Call 800-908-9946 for an automated Get Transcript by Mail feature.

In the event that the household member is still unable to produce a transcript or taxes, and the Property Manager can attest to witnessing the transcript request, an affidavit of non -tax filer status will suffice in the file, along with a clarification of verification.

7.8.11 Income of Teachers and Seasonal Workers
While third-party employment verification is not required by the City for recertifications, the City recommends that the Property Manager obtain third-party employment verification for teachers and seasonal workers to obtain clarification on annual pay due to varying payment schedules. A letter or email from the employer or the Employment Verification form will suffice as third-party verification.

7.8.12 Self-Employment Income
Self-employment in Foster City, including home -based businesses, independent contractors, door-to-door sales, and peddling, requires a valid Foster City Business License. See https://www.fostercity.org/finance/page/tax for more information.

For self- employment, which includes sole proprietorships with or without employees , single entity LLCs, contract work, “gig” work, and work paid in cash with no paystub, the household member shall complete a Self-Employment Affidavit. The Self-Employment Affidavit shall be used to document projected net self-employment business income for the following 12 months and must be confirmed through tax returns and other documentation, such as business bank statements that may be requested by the Property Manager t o clarify income . Net business income is all anticipated revenue for the next 12 months less business expenses. Self-employment income cannot be zero for income certification unless the prior year’s income taxes show a loss, and the Tenant anticipates a continued loss for the next 12 months.

Those who are self-employed must provide their most recent taxes for verification. In the event that the Tenant does not file taxes, the Tenant must complete a Non -Tax Filer Affidavit, a Form

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24 File name: Draft Revised Below Market Rate Rental Housing Program Administrative Procedures and Guidelines.pdf 4506-T, and provide evidence of the business, such as deposits, receipts, or business bank account statements for verification.

For businesses in which the business o wner pays themselves a regular salary, th e amount they pay themselves should be included in the business expenses and should not be listed separately as income. For a business owner that pays other household members, the income amount should be included as part of that household member’s income. Self -employment should not be third - party verified other than through taxes.

The Self -Employment Affidavit shall include a statement that providing false or misleading information may result in disqualification and be subject to prosecution. The City does not require that the form be notarized, but this may be required by other fun ding programs. The Property Manager may create a Self-Employment Affidavit for their property based on one of the samples provided, which may be submitted to the City for review, or use the form provided by the City.

The business Owner must submit business documentation as needed and the most recent federal tax return. Use the amount on the affidavit and collect last year’s federal tax return to verify the business and the business income.

Example 1: Uber Driver
• Tenant anticipates $35,000 in gross revenue in the next 12 months. • Business expenses (car washes, gas, insurance, etc.): $10,000. • Net Business Income: $25,000.
• Use $25,000 as the projected income for the next 12 months for the income certification. • Have the Tenant complete the Under Income Affidavit form if there are no other sources of income sufficient to pay the rent.
• Screenshots of payments from Uber are not required.

Example 2: Sole Proprietorship with a Loss
• Tenant anticipates $0 for the next 12 months due to higher expenses than revenues. • Revenues are anticipated at $25,000.
• Expenses are anticipated at $30,000 due to recently starting the business. • Last year’s taxes showed a loss.
• Use $0 as the projected income for the income certification. • Note: if the last year’s taxes did not show a loss, and the Tenant is claiming $0 for the next 12 months, use the amount from the prior year’s taxes for the income certification.

Example 3: Occasional Cash-Paid Service Worker
(e.g., babysitting in which the employer does not claim the worker as an employee) • Tenant anticipates $3,500 in revenue for the next 12 months. • Expenses are anticipated at $0.
• Use $3,500 as the projected income for the income certification. • Verify evidence of past payments through deposits to checking account(s), if possible. • Have the Tenant complete the Under Income Affidavit form if there are no other sources of income sufficient to pay the rent.

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7.8.13 Unemployment and Disability Income
Unemployment and disability benefits shall be annualized unless the household member provides documentation that benefits will cease in the next 12 months.

7.8.14 Social Security and Supplemental Social Security Income For Social Security Income or Supplemental Security Income (SSI), a benefit verification letter with a date no earlier than 120 days prior to the effective date of certification or recertification is required. Refer to the Social Security website on how to obtain this letter. See https://www.ssa.gov/manage-benefits/get-benefit-letter
. Count the total income before any
deductions. If the Benefit Verification Letter is for the prior year and lists payment amounts prior to December of the prior year, you must multiply the benefit amount by the cost- of-living adjustment (COLA) to project benefits for the following year. The current year COLA adjustment can be found here:
https://www.ssa.gov/oact/cola/latestCOLA.html. Note that if a Tenant’s sole source of income is from Social Security, the Tenant should also complete a Non -Employment Affidavit. For lump sum social security payments, refer to the HUD Manual, Chapter 5.

7.8.15 Dates of verifications
All verifications received, including the dated social security benefit letter received should be dated within 120 days prior to the annual recertification deadline. Written clarifications shall be included in the Tenant file for any exception to rules or any calculation that needs explanation.

7.8.16 Ownership of Real Estate or Timeshares
As stated in Section 7.4, effective the date the Tenant moves into the BMR or Workforce unit, the City does not permit any household member of BMR or Workforce housing to own residential real estate for income purposes, second homes, vacation homes, or timeshares, including short-term and long-term rentals.

Existing residents with residential property used for income purposes, vacation, or second homes or who own timeshares that occupied the BMR or Workforce residence prior to the effective date of these BMR Guidelines may remain in their unit as long as the BMR or Workforce unit is the sole residence of all household members, with the exception of students who live near their educational institution some of the year but still claim the BMR or Workforce unit as their primary residence.

Tenants who acquire real estate for income purposes or second homes after the date they moved into the BMR or Workforce unit, or after the effective date of these BMR Guidelines, whichever is later, are no longer eligible for the BMR or Workforce Housing program and must vacate the BMR or Workforce unit or pay market rate rent in which they reside , pursuant to the affordability restrictions on their property for tenants who are no longer eligible. The Notice to Vacate shall be issued to the tenant with at least 60 days’ notice, or more, if required by law.

BMR or Workforce tenants who own residential real estate for income purposes or second homes prior to the effective date of these BMR Guidelines , or who receive income from ownership of commercial real estate, must include the rental income in the income section of the certification and the cash value of the asset in the asset section of the certification.

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26 File name: Draft Revised Below Market Rate Rental Housing Program Administrative Procedures and Guidelines.pdf • To determine the income for the income section, subtract the annual property expenses from annual property revenue based on a Real Estate Income A ffidavit form (available from the City) indicating anticipated expenses for the following year. Expenses cannot be lower than the prior year’s expenses as shown on Schedule C of the Tenant ’s federal taxes. This income is similar to self-employment income.

• Use documentation on the purchase of the property, a current lease, or most recent federal taxes to confirm net property income.

• See Section 7.9.7 to determine the cash value of the property, obtain a value of the property from three sources, such as a recent appraisal that is 120 days old or less and on-line resources such as www.realtor.com, www.zillow.com, and www.redfin.com . Take the average of the three values and subtract 6% for average sales costs and subtract any remaining mortgage on the property. To verify the remaining mortgage, obtain a recent mortgage payment statement or use an online source to verify the outstanding balance. The cash value of the asset goes in the asset section of the Tenant Income Certification (TIC). Imputed income will also be added to the income from assets since the cash value of the real estate , combined with other financial assets, will likely trigger the imputed income rule.

7.9 ASSET ELIGIBILITY AND VERIFICATION

7.9.1 Use of California Code of Regulations, Title 25 for Calculating Income from Assets For all properties, unless noted in the property’s affordability restrictions or Affordable Housing Agreement, Property Managers should calculate income from assets in accordance with the requirements set forth in California Code of Regulations, Title 25, Section 6914 and as directed in these BMR Guidelines. View Document - California Code of Regulations (westlaw.com)

7.9.2 Ten Per Cent Imputed Income Rule
The California Code of Regulations, Title 25, Section 6914 states: “ Where a family has net family assets in excess of $5,000, income shall include the actual amount of income, if any, derived from all of the net family assets or 10 percent of the value of all such assets, whichever is greater. For purposes of this section, net family assets is defined as the value of equity in real property other than the household's full -time residence, savings, stocks, bonds, and other forms of capital investment. The value of necessary items such as furniture and automobiles shall be ex cluded.” The City of Foster City uses this rule in calculating household income. Notably, this is different than the imputed income rate of 0.06% used by the California Tax Credit Allocation Committee on Tenant Income Certification forms.

Property Managers must use the 10% imputed income rate instead of the 0.06% rate when calculating household income, unless LIHTC funding or the terms of other bonds require the City to use a different method of calculating income. In the event that a property’s affordability restrictions or Regulatory Agreement for a particular property does not refer to Section 6914, this Section applies unless a different methodology is referenced or stated in the property’s affordability restrictions or governing Regulatory Agreement.

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7.9.3 Third-Party Verification of Assets
The City of Foster City does not require third-party verification of assets for annual recertification of income for BMR housing. However, third -party verification may be required by bond agreements or tax credit programs or by the Property Management. Furthermore, t he City recommends third-party asset verification if the forms and documents provided by the household member are confusing, conflicting, incomplete, or varies from assets disclosed in the last three years of income recertifications. Third-party verifications must comply with current fair housing regulations and the current HUD Handbook, Chapter 5, Section 3, Verifications.

7.9.4 Negative or Blank Asset Verifications
Negative or blank asset verifications, in which the Property Manager seeks to determine if an account is held at a financial institution and for which there is no d isclosure of the asset on the TICQ, are not permitted unless the asset had been disclosed in the prior three years, or if there is documented evidence of existence of the asset or documented suspected fraud. The Property Manager must inform the Tenant of the reason for the blanket or negative verification. T he Property Manager must also have a written policy in place that clearly documents the sc enarios for which a blanket or negative verification is justified and must provide a copy of the policy to the Tenant, if requested. The names of financial institutions must be stated on the verification form prior to obtaining Tenant signatures. The Property Manager has an obligation to inform the City of any suspected fraud.

7.9.5 Rules on Redacting Information on Documents Provided The City does not allow redacted information, other than social security numbers, o n any documents submitted for the income certification process. Tenants that redact information other than social security numbers will be deemed non-compliant. The City recommends including this information in the annual recertification notice to tenants.

7.9.6 Calculating the Cash Value and Income from Financial Assets Six months of bank statements are required for checking and savings accounts and the latest quarterly statement for investment and retirement accounts. For checking accounts, the cash value of the asset is the average of the ending balance for six months. For savings accounts, the cash value is the ending balance on the most recent statement. For investment accounts, the cash value is the ending balance on the current statement, less any penalty for early withdrawal (usually 10%), if applicable. Substantial, frequent, or regular deposits of $100 or more require explanation from the household member, if not included on the TICQ. See Sample Forms . For income from financial assets, most checking accounts are 0% interest; most savings accounts are .01%. The bank statements generally state the percentage rate for interest. If no interest rate can be determined, it is acceptable to use 0% for checking and .01% for savings accounts . For retirement and investment accounts, use the interest earned to date on the most current ba nk statement and annualize the amount. For negative returns, use zero. Alternatively, you can use actual dividends earned to date and annualize them.

7.9.7 Computing Income from Real Estate Assets
For real estate assets, in accordance with Section 7.4, Property Managers should verify the cash value of the asset through three online sources (examples include Zillow, Redfin, and Realtor.com)

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28 File name: Draft Revised Below Market Rate Rental Housing Program Administrative Procedures and Guidelines.pdf or a recent appraisal that is not more than 120 days old. Take the average of the three values and subtract 6% for average sales costs (or current industry standard if not 6%) and subtract any remaining mortgage on the property. To verify the remaining mortgage, obtain a recent mortgage payment statement or use an online source to verify the outstanding balance. The cas h value of the asset goes in the asset section of the Tenant Income Certification (TIC). Imputed income will also be added to the income fro m assets since the cash value of the real estate, combined with other financial assets, will likely trigger the imputed income rule.

7.9.8 Lump Sum Payments
Single l ump sums for the following items should be counted as assets rather than income:
inheritance, capital gains, lottery winnings made in one payment, cash from sale of assets, insurance settlements, workers compensation, and personal property losses; any other amounts that are received in one -time lump sum payments. Two or more payments of these items shall be counted as income, rather than assets. See HUD Inclusions and Exclusions to Income for more details. See https://www.hud.gov/sites/documents/DOC_35699.PDF .

7.10 HOUSEHOLD INCOME ABOVE OR BELOW THE INCOME LIMIT AT THE TIME OF RECERTIFICATION

7.10.1 Over Income Households in City Owned Units
For the City-owned units, other than Workforce Housing, or as provided by regulatory agreement, Tenants who have an income that exceeds the highest affordability designation in the BMR housing program will be given a 60 -day notice to vacate, or if market rate units are provided at the property, the rental rate shall graduate to market rate . At the discretion of the City, an additional thirty (30) day extension may be granted. For very low- and low -income units, if a Tenant’s income exceeds the income limit, they will be “graduated” to the next higher affordability level provided on the property for which they are qualified. The next available similarly sized unit will be utilized to bring the development back into compliance with the required number and affordability level of units. For Workforce Housing, there is no income limit.

7.10.2 Over Income Households for All Other BMR Units
For all other BMR units, refer to the current regulatory agreement regarding Tenants who are over income at the time of annual income recertification. In general, the Tenant shall graduate to the next level of the program or, if they are over -income for the highest level of affordability in the program, to market rate, if market rate units are provided at the property. The next available unit rule applies. For moderate-income BMR households, to the extent allowed by applicable law, including Section 42 of t he Internal Revenue Code, if a Tenant ’s income exceeds the Moderate- Income limit, they will be “graduated” from the BMR program and charged market rent. The next available similarly sized unit will be utilized to bring the development back into compliance with the required number and affordability level of units. For LIHTC units, follow CTCAC rules.

7.10.3 Under Income Households
Property Managers shall not evict a Tenant for being under the income minimum for the income range of their household size provided that they continue to pay rent per their Lease Agreement.

However, if the income is below the minimum income range for the household size and affordability and/or below the minimum required income for the unit as specified in by the

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29 File name: Draft Revised Below Market Rate Rental Housing Program Administrative Procedures and Guidelines.pdf Property Management in the Resident Selection Policy, the Property Management is required to have the Tenant submit an Under Minimum Income Affidavit. This Affidavit provides the Tenant’s statement of how they will pay their rent and the sources of income. This form must be submitted by the Tenant prior to final certification of income to allow additional time for submission of additional documentation and forms and the recalculation of income , if needed. The income certification deadline should be extended by thirty (30) days if additional documentation, verification, and recalculation of income is necessary. The Under Minimum Income Affidavit form is available from the City.

7.10.4 Next Available Unit Rule
If a Tenant’s income falls below the income limit for a lower affordability category, they may go on the Waitlist in the appropriate preference category and application date for a unit of a lower affordability level, if permitted by property’s affordability restrictions or Regulatory Agreement.

When a unit is available, the Tenant’s unit may be reclassified for the lower affordability level and the next available unit may be classified with the higher affordability level so that the tenant does not need to move units.

7.11 STUDENT STATUS
The City’s BMR and Workforce Housing programs are not intended as student housing.

Accordingly, a household in which all occupants, including those in grades K -12, are full- time students, is not eligible for BMR or Workforce Housing. An e xception is made for single parents with dependent children and certain other conditions. See https://www.hud.gov/sites/documents/43503HSGH.PDF
for exceptions . Children ages 0 -5 are
not considered full -time students. See income inclusions and exclusion rules that apply to full- time s tudents when calculating income :
https://www.hud.gov/sites/documents/DOC_35699.PDF. For LIHTC properties, refer to CTCAC compliance rules on this issue.

7.12 LIVE-IN AIDES
The City does not count income from live-in aides as defined by HUD. See HUD Handbook Chapter 3 and Chapter 5: https://www.hud.gov/sites/documents/43503c3HSGH.PDF and https://www.hud.gov/sites/documents/43503c5HSGH.PDF for more information. For LIHTC properties, refer to CTCAC compliance rules on this issue.

7.13 DOCUMENTING INCOME CERTIFICATIONS AND ANNUAL RECERTIFICATIONS

7.13.1 Forms
Property Managers shall use the most current forms available from the California Tax Credit Allocation Committee (CTCAC) or the City, as provided below, or substantially similar forms created by the Owner or Property Manager or third -party software provider, as noted below:

CTCAC forms are available on the CTCAC website at
https://www.treasurer.ca.gov/ctcac/compliance.asp
. Sample City forms are available from the
City. In addition, Property Managers shall include a calculation worksheet for each household showing how income was calculated for each household member.

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7.13.2 Tenant File Organization
Income Certifications for Tenant files shall be organized in the following order unless required otherwise for LIHTC, bond, or other programs.

1. Tenant Income Certification Form

2. Income calculation worksheet(s), income and rent limits, and Utility Allowance Schedule for the household.

The following Items shall be in order by household member with the head of household first.

1. Tenant Income Questionnaire

2. Income forms and documents

3. Asset forms and documents

4. Child support forms and documents

5. Student status forms and documents

7.13.3 Required Forms
Forms required by the City of Foster City for Initial Income Certifications and Recertifications are listed below. Unless otherwise noted, one form is required for each adult household member.

Forms listed as “Sample” are provided by the City. Forms marked by an asterisk are available on the CTCAC website at https://www.treasurer.ca.gov/ctcac/compliance.asp. The City recommends checking the CTCAC website regularly to check for CTCAC form updates.

1. Sample Affidavit of Residence Form (required for Foster City residents for new move-ins)

2. Sample Annual Household Composition Form (one per household; required annually)

3. Tenant Income Certification (TIC) Form*(one per household)

4. Sample Income Calculation Worksheet

5. Tenant Income Questionnaire (TICQ)*

6. Sample Self-Employment Affidavit (SEA), if applicable

7. Family Contribution Affidavit, if applicable*

8. Non-Employment Form, if applicable*

9. Zero Income Certification Form, if applicable*

10. Sample Non-Tax Filer Affidavit, if applicable

11. IRS Form 4506-T, if applicable https://www.irs.gov/forms-pubs/about-form-4506-t

12. Under $5,000 in Asset Certification Form, required if value of assets is < $5000*

13. Sample Substantial Deposits form, (required if bank statements show multiple deposits over $100 that are not disclosed on TICQ)

14. Child or Spousal Support Affidavit*

15. Sample Student Status Affidavit, (required for all students, full or part-time)

16. Live-In Aide Verification Form, if applicable*

17. Sample Under Minimum Income Affidavit, (required if income is under the minimum income for the affordability range and/or under the minimum required income for the unit)

18. Sample Clarification Form, if applicable

19. Sample Asset Verification Clarification Form, if applicable

20. Other forms, as required for LIHTC, Section 8 or other HUD programs, or Bond programs.

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7.13.4 Creation of Forms by Property Managers
Property managers may elect to use their own forms for all non -TCAC forms (TCAC forms are marked with an asterisk above), provided they are substantially similar to the sample forms provided by the City. Property Managers that use compliance software that produce s non-TCAC TIC forms for non-tax credit properties may use the non-TCAC TIC forms (e.g., Yardi or On-Site).

7.13.5 Use of California Tax Credit Allocation Committee Tenant Income Certification Form The City requires use of the California Tax Credit Allocation Committee tenant income certification form, with the exception noted in Section 7.13.4, but acknowledges that the form is designed for tax credit properties. As described in Section 7.9.2, Property Managers must use the imputed income rate required for the property per the property’s affordability restrictions (e.g., 10% instead of .06%) and enter the income limit required for their property on the LIHTC income and rent limits lines if different from the LIHTC limits.

7.13.6 Signatures on Forms
The Tenant Income Certification form must be signed by all adult household members and the Property Manager. All forms must be signed as indicated on the form. Taxes included in the file must be signed by the Tenant.

7.13.7 Dates on Forms
Forms prepared and/or signed after the effective date of recertification shall be signed with the current date and include the following statement “True and Correct as of (insert effective date).

The statement must be initialed by the Tenant(s). Backdating of forms is not permitted.

7.13.8 Mistakes and Corrections on Forms
Forms and documents submitted for recertification may not be amended or corrected unless authorized by the Property Manager and initialed by the household member. Errors should be crossed out and initialed. Blacking or whiting out of errors is not permitted.

7.13.9 Conflicting, Incomplete, Insufficient, or Unclear Information Provided on Forms If the Property Manager determines they have received conflicting, unclear, or insufficient forms or documentation, they have the right to request additional information from the household member pursuant to HUD Guidelines.

7.14 OCCUPANCY STANDARDS

7.14.1 Minimum and Maximum Household Size Requirements
The minimum and maximum household size for occupancy of various size units varies based on the requirements of the applicable affordable housing restrictions for each property. If occupancy standards are not addressed in the affordability restriction, the following general o ccupancy standards of a minimum occupancy of one person per bedroom for a studio and one bedroom, two people for a two-bedroom, four people for a three-bedroom, six people for a four bedroom, and eight people for a five -bedroom unit per Title 25, Section 8305 , and the accepted industry standard maximum occupancy of two people per bedroom, plus one person per unit, shall apply.

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32 File name: Draft Revised Below Market Rate Rental Housing Program Administrative Procedures and Guidelines.pdf Note that if the tenant has a live-in aide, the live-in aide counts in determining the household size for occupancy standards, but the aid is not counted in the household for income purposes, nor is the aide’s income counted in the household income.

City of Foster City General Occupancy Standards
Unit Size Minimum Occupancy Maximum Occupancy
Studio 1 person 2 people
One-Bedroom 1 person 3 people
One-Bedroom Plus Den 1 person 3 people
Two-Bedroom 2 people 5 people
Three-Bedroom 4 people 7 people
Four-Bedroom 6 people 9 people
Five-Bedroom 8 people 11 people

7.14.2 Annual Occupancy Monitoring
Households must complete a Household Composition Form annually for recertification and all two- and three-bedroom households must complete an Under -Occupancy Agreement form at move-in. A change in the number of occupants in the household may change the size of the unit for which the household is qualified. If the household no longer qualifies for the size unit they are renting, they shall be given at least a 60 -day notice at the time of recertification that when an appropriate sized unit becomes available, they will be given a 30 -day notice to move into such appropriate sized unit. Until an appropriately sized unit becomes available, they may stay in their current unit. If the development does not offer the appropriately sized unit for the household size, the Tenant shall be given a ninety ( 90)-day notice to vacate unless City determines that allowing additional time to comply is warran ted. For example, if a family of six lives in a two - bedroom unit in a development in which there are no three-bedroom units, the family will receive a notice to vacate.

In the event that the property manager is unable to verify occupancy of one or more household members due to lack of tenant cooperation, or incomplete or inaccurate documentation, the tenant’s household size will be certified only for the verified occupant s. The tenant may be required to move to an appropriately sized unit if the tenant is under the minimum occupancy requirement for the unit. The tenant shall be offered the next available appropriately sized unit and shall be provided with a thirty (30)-day notice. If occupancy of all tenants cannot be verified, the tenant will no longer be eligible for the BMR unit, and the rent shall be increased to market rate with a 60-day notice (ninety (90) days if the tenant is on a month-to-month lease). The next available unit shall be designated as a BMR unit at the same affordability level to maintain the required number of BMR units.

7.15 REQUESTING ADDITIONAL INFORMATION REQUIRED FOR ELIGIBILITY Additional information and documentation may be required to review a Tenant’s eligibility to rent a unit in accordance with the HUD Handbook. Property Managers shall have policies and guidelines in effect when they request additional information and documentation to ensure compliance with Fair Housing laws and regulations. All policies and guidelines should be submitted to the City.

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7.16 CITIZENSHIP/RESIDENT ALIEN STATUS VERIFICATION
T he City does not require verification of citizenship or resident alien status unless required by law.

8 DETERMINING RENT

8.1 REQUIREMENTS FOR DETERMINING RENTS
Property Managers are required to submit an Annual Rent and Income Limit Summary and a Utility Allowance Schedule to the City within 30 days of issuance of HCD Income Limits. The City issues a confirmation of rent limit s for each property annually within 30 days of submission.

Requirements for determining the M aximum Chargeable Rent pursuant to affordability designations are in each property’s affordability restrictions. See Section 7.6.4 for calculating non- standard income limits to be used in calculating rents.

8.1.1 City’s Standard Methodology for Rent Calculations Unless stated otherwise in the property’s affordability restrictions or other regulatory agreement in effect, the City of Foster City calculates rent by determining the gross rent and deducting a reasonable utility allowance to determine the maximum chargeable rent for each size of unit.

The City of Foster City Municipal Code, Chapter 17.90 (C) defines below market rate rent as follows:

“Below market rate rent” means the total monthly housing expenses for a below market rate dwelling unit, available as a rental unit, not exceeding the rents specified by Section 50053
of the California Health and Safety Code and California Code of Regulations Title 25, Sections 6910 through 6924, except that the city may permit alternative criteria, when necessary, to be consistent with pertinent state and federal statutes and regulations governing publicly assisted rental housing. As used in this chapter, “below market rate rent” shall include the total of monthly payments by the tenant for all of the following:

2. Any additional separately charged fees or service charges assessed by the owner, other than security deposits;

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8.1.2 Gross Rent
Gross Rent, defined as the affordable cost of housing and includes rent and utilities. Gross rent is generally calculated as 30% of the income limit for the applicable income category as established by California’s Housing and Community Development Department (HCD) for the household size or as stipulated in the property’s affordability restrictions , Regulatory Agreement, or Bond Agreement.

The affordability restriction may require use of different income limits to be used for income recertification than for calculating rent. For example, moderate income may be specified as 120% of AMI for determining income but refer to California Health and Safety Code Section 50053 for determining rent. The moderate income rent in Section 50053 is currently set at 110% of AMI.

Therefore, the Property Manager must use 120% of AMI to calculate the household income for recertification purposes and 110% of AMI for the maximum rent calculation. Refer to the property’s affordability restrictions to confirm affordability levels for determining rent. Section

7.6.4 provides multiplier factors for determining non -standard percentages of Area Median Income.

8.1.3 Maximum Chargeable Rent
Maximum Chargeable Rent, or net rent, is defined as the maximum amount a Property Manager can charge the Tenant for their rent. Maximum Chargeable Rent is calculated by deducting a standard utility allowance, comprised of average costs for utilities and mandatory fees paid by the Tenant in order to live in their unit , from the Gross Rent. In general, and if not specified in the affordability restriction recorded on the property, the following household sizes shall be assumed:
for a one -bedroom unit, a hous ehold size of two shall be assumed; for a two-bedroom unit, a household size of three shall be assumed, and for a three-bedroom unit, a household size of four shall be assumed. See Section 8.2 below for how to calculate the Utility Allowance.

a) Maximum Chargeable Rent is always rounded down to the nearest dollar, if rounding is used, regardless of the fractional dollar amount. For example, if the Maximum Chargeable Rent is $2,500.75, the rent must be rounded down to $2,500. Charging $2,501 would be greater than the Maximum Chargeable Rent.

b) For properties with multiple regulatory agreements setting forth different methods to calculate maximum allowable rent, the lowest rent of the applicable calculation methods shall be used as the Maximum Chargeable Rent.

c) Property Managers may charge less than the Maximum Chargeable Rent.

8.2 REQUIREMENTS FOR DETERMINING UTILITY ALLOWANCES
The Utility Allowance is the sum total of typical or average costs of certain utilities as listed on the Utility Allowance Schedule issued by the County of San Mateo , with exceptions as noted below, and that are paid for by the Tenant . The amount is determined annually for each size of unit in

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35 File name: Draft Revised Below Market Rate Rental Housing Program Administrative Procedures and Guidelines.pdf each BMR and Workforce housing development. Utilities paid for by the Tenant include those paid directly to the landlord, a third -party service, or to the utility company. The allowance also includes any mandatory fees charged to the Tenant. The Utility Allowance for each size of unit is deducted from the maximum gross rent for the unit to determine the maximum chargeable rent.

8.2.1 Definition of a Reasonable Utility Allowance
A reasonable utility allowance is defined as the sum total of all values for utilities that are paid for by tenants in addition to their rent as listed on the Utility Allowance Schedule issued annually by the County of San Mateo at https://www.smcgov.org/housing/utility -allowance-schedules, including sewer charges and other non -optional mandatory fees, as specified in the Foster City Municipal Code, Chapter 17.90.020 (C).

8.2.2 Calculating the Utility Allowance
Utility Allowances should be calculated consistently from year to year unless there is a change in how utilities are paid or charged to Tenant s. An explanation of any change from one year to the next must be documented by the Property Manager and submitted to the City.

8.2.3 Source for Utility Allowance Schedule
Utility Allowances shall be as established by HUD for San Mateo County, as amended annually .

The appropriate Utility Allowance shall be deducted from maximum rent to determine maximum chargeable rent for Tenant s for each unit type at each property , unless stated otherwise in the property’s affordability restrictions. HUD provides for the costs allocated to each type of utility for San Mateo County and the rates are listed on the following County of San Mateo website and issued annually: https://www.smcgov.org/housing/utility -allowance-schedules. The following additional items must be included on the Utility Allowance Schedule if they are charged to the Tenant, regardless of the method of billing.

a) Renter’s Insurance. If renter’s insurance is required to be purchased by the Tenant , then an appropriate allowance for this shall be provided. The Property Manager shall determine the appropriate allowance amount and the source for calculating the allowance shall be included in the annual Utility Allowance Schedule. In addition, the requirement for insurance must be included in the lease and the Property Manager must collect the evidence of coverage from the Tenant as part of the lease renewal process.

b) Sewer Charges. If sewer costs for the property are charged to Tenants, the methodology for calculations shall be the average of the actual monthly sewer charges for the property for the last 12 months, prorated by unit size , number of units of that size in the property, and the household size per unit using the household size used in determining rent (example: 2 people in a one-bedroom unit, 3 people for a 2 -bedroom unit, 4 people for a 3 -bedroom unit). The bill shall be prorated and allocated as a flat rate for each size of unit. Calculations should be submitted with the Utility Allowance Schedule to the City annually.

c) Additional Mandatory Fees. Any other mandatory fees charged to the Tenants must be included in the Utility Allowance. Examples parking fees, utility billing service fees, required use of a computer application to pay rent, monthly or quarterly pest control charges, etc. The allowances for these additional fees must be calculated using actual costs and the

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8.2.4 Rounding
Utility Allowances must always be rounded up to the nearest dollar if rounding is used, regardless of the fractional dollar amount. For example, if the Utility Allowance total is $ 75.45, the Utility Allowance amount must be rounded up to the nearest dollar, or $76.00 if rounding is used , to ensure that the allowance is not charged below the amount. Rounding is optional. It is acceptable to charge $75.45.

8.2.5 Tenant-Paid Utilities Must be Stated in the Lease The types of utilities paid for by Tenants to determine the Utility Allowance must be stated in the body of the lease or as a Utility Addendum, and included regardless of the entity to which the Tenant pays the utility bill. The Lease must also include the formula for calculating or prorating the utility payments, if applicable. In the event of conflicting information, the lease shall prevail in determining which utilities to include in the Utility Allowance. The Lease should also clearly state which utilities are paid for and not charged to the Tenant.

8.2.6 Annual Notification of Utility Allowance
Property Managers must submit a copy to the City of the annual Utility Allowance Schedule for each type of unit within 30 days of issuance by the County of San Mateo . See https://www.smcgov.org/housing/utility-allowance-schedules for current rates to be used in calculations.

8.2.7 City’s Request of Information
The City has the right to request documentation regarding the Utility Allowance schedules prepared by Property Managers.

8.2.8 Tenant’s Request for Information
Property Managers shall provide Tenants with the Utility Allowance Schedule and calculations for the Tenant’s premises upon request. The City recommends providing the tenants with a copy of the Utility Allowance Schedule each year.

8.2.9 Implementation of Annual Utility Allowance
There are no restrictions in the California Housing regulations on the timing of adjustments to utilities allowances. Property Managers therefore have the following options to implement new allowances when they are issued: (1) begin using the new allowances and recalculate rents immediately, (2) make adjustments as Tenants are recertified and leases are renewed, or (3) make adjustments later in the year when the new HCD income limits are published, and rents are reset.

8.3 REQUIREMENTS FOR IMPLEMENTING CHANGES IN RENTAL RATES

8.3.1 Timing of Rent Changes
Any changes in rent shall take effect upon recertification at the time the Tenant’s lease is renewed or January 1, at the discretion of the Property Manager, or another date mutually agreed upon by

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8.3.2 Noticing of Tenants of Rent Changes
All rent changes must be noticed to Tenant s pursuant to current State of California notice laws and regulations. In the event of conflicting notice rules as stipulated by HUD, financing entities, the property’s affordability restrictions, or local regulation, the longest notice rule shall apply.

8.4 ANNUAL RENT INCREASES AND ANTI-DISPLACEMENT STRATEGY Property Managers are permitted to raise BMR and Workforce rents to no more than the Maximum Chargeable Rent (See Section 8.1) per the property’s affordability restrictions, or as provided by local, state, or federal law.

However, due to the following reasons, BMR and Workforce Tenant s often face financial hardship due to substantial rent increases, as many Property Managers increase rents to the maximum allowed annually, regardless of the percentage increase or Tenant hardship:

• HCD income limits often experience substantial increases from year to year, and due to the direct relationship between rent limits and income limits, the rent limits are often substantially greater than the prior year and often increase more than 10%. • Property Managers often set initial rents at rates substantially lower than the Maximum Chargeable Rent due to prevailing market conditions, thereby creating a significant gap between the current rental rate and the maximum chargeable rental rate.

The practice of raising annual rents close to or at the maximum chargeable rent limit can also result in an overcharging of rent if it is determined that the Utility Allowance was incorrectly calculated.

Therefore, and to support the City of Foster City’s Fair Housing Action Plan priorities as outlined in the Housing Element 2023-2031 (https://engagefosterCity.org/housing-element ), a key element of
the City’s Anti-Displacement Strategy for BMR and Workforce Housing is as noted below in Section

8.4.1. 8.4.1 Anti-Displacement Strategy
For existing BMR properties, the City strongly recommends that BMR and Workforce Property Managers limit annual rent increases to no more than the lower of the Maximum Chargeable Rent, or the current rental rate multiplied by one (1) plus the annual Consumer Price Index (CPI) Summary percentage, converted to decimal configuration, before seasonal adjustment, for all items for the prior 12 months for April each year (see
https://www.bls.gov/news.release/cpi.toc.htm), or 5%, whichever is lower, unless otherwise limited by statute at the local, state, or federal level or as required by the financing entity or bond program for a property. The annual CPI Index amount, which shall stay in place for 12 months, shall be provided annually by the City to all BMR and Workforce housing Property Managers . For example, the April 2023 Index Amount is 4.3%. Therefore, the City recommends a rental rate increase of no more than 4.3%, or the current rental rate x 1.04 3 for 2023 provided the new rate is below the maximum chargeable rent.

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9 REQUIREMENTS FOR LEASES

9.1 GENERAL LEASE REQUIREMENTS

9.1.1 HUD Model Lease
BMR and Workforce Leases should follow the applicable terms of the HUD model lease , including all required California Addenda. All leases are subject to current local, state, and federal regulations.

9.1.2 Affordable Housing Program Addendum
BMR and Workforce Leases must include an Affordable Housing Program Addendum signed by all adult household members and the agent for the Property that explains the requirements of the BMR or Workforce Housing program, including:

a) The affordability designation for the unit for income and rent and the source s used for income and rent limits and the Utility Allowance determinations. b) Annual recertification of income requirements, if applicable. c) The Tenant’s annual recertification deadline and deadline for submitting completed forms and documents each year, if applicable.
d) Requirements for each adult household member, including documents required for annual recertification, if applicable.
e) A statement that Tenant cooperation is required for continued participation in the program, if applicable.
f) A statement explaining what happens if the Tenant’s income is over the limit for their unit, the Tenant does not submit all requested and complete recertification forms documents by the deadline, does not provide accurate information, provides false or misleading documentation or information, or withholds information. g) Annual rent increase rules and policies.

Properties with HUD-financing must comply with the HUD Handbook, Chapter 6, Requirements and Leasing Activities.

9.1.3 Utilities
BMR and Workforce Leases must include information about which utilities the Tenant pays for, any utilities charged to the Tenant through a ratio utility billing system (RUBS), if payments are made to a third -party service, how charges are calculated, any utilities paid for by the landlord, and any mandatory fees, including required renter’s insurance. This information must be included in the lease document or a Utility Addendum. See Section 8.2 for details on calculating the Utility Allowance.

9.1.4 Household Members Named on Lease
Any person residing at the BMR or Workforce residence fourteen (14) or more consecutive or non-consecutive days per year , regardless of age, must be on the lease. Those who no longer reside in the household must complete a Release from Lease form. Refer to the HUD Handbook

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9.1.5 Renter’s Insurance
If renter’s insurance is required by the Property Manager, a copy of the Tenant ’s policy must be included in the lease and updated annually.

9.1.6 Lease Term
Initial leases must be offered to the Tenant for at least 12 months. Renewals may be month to month or annual or as required by the property’s affordability restrictions, or local, state, or federal regulation.

9.1.7 Addenda
Leases shall include all addenda required by local, state, or federal, or financing entity law, regulation, or policy.

9.1.8 Resident Selection Policy
The resident selection policy must be included in the tenant’s file, completed as part of the application for housing, and must be signed by all adult household members.

9.1.9 AB 1482
BMR and Workforce Leases are exempt from AB 1482, the California Tenant Protection Act of 2019.

9.2 REQUIREMENTS FOR TERMINATION OF BMR OR WORKFORCE TENANCY Please refer to HUD Handbook HUD Handbook 4350.3 REV -1, Chapter 8 for guidelines regarding terminations. Any terminations of tenancy comply with local, state, and federal laws. Note that a Tenant’s income falling below the minimum income required is not a valid reason for lease termination. The Property Manager shall notify the City and provide a copy of the eviction proceedings.

10 REQUIREMENTS FOR PROGRAM MONITORING AND

ADMINISTRATION

10.1 USE OF HOUSING COMPLIANCE SOFTWARE
Property Managers shall use the Housing Compliance software to file their annual Property Status Report (PSR) with the City. The annual deadline for report submission is April 1 of each year unless specified otherwise in the property’s affordability restrictions or Affordable Agreement.

Instructions for Housing Compliance software: https://www.housingcompliance.org/faq-help/.

10.2 ANNUAL SUBMISSION OF WAITLIST TO CITY
At the same time as the Property Manager submits a report to the City, an up-to-date version of the Waitlist shall also be submitted by email in an electronic spreadsheet format.

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10.3 SUBMISSION OF UTILITY ALLOWANCE WORKSHEETS TO CITY The Property Manager shall submit, a current Utility Allowance Schedule To the City concurrent with the Annual Report and within thirty (30) days of issuance of the schedule by the County of San Mateo.

10.4 DIGITAL SIGNATURES ON LEASES AND INCOME CERTIFICATIONS The City allows electronic signatures on documents and follows the California Tax Credit Allocation Committee rules on digital signatures. See:
https://www.treasurer.ca.gov/ctcac/compliance/memos/compliance-monitoring-2022.pdf .

10.5 SUBMISSION OF LEASE DOCUMENTS TO CITY
For City-owned units, Property Managers must submit a copy of each BMR or Workforce Lease, including all addenda, to the City within seven (7) days of execution.

10.6 RETENTION OF RECORDS

10.6.1 Storage Time Requirement
Property Managers must maintain records for at least seven ( 7) years that document the compliance of their BMR or Workforce rental properties with the City ’s requirements. These records must also support the accuracy of the reports that Property Managers submit to the City.

Required records include documentation related to Tenant income certifications, unit rents, applications, selection policies, and leases, and policies, procedures, marketing plans.

This requirement may be superseded by property’s affordability restrictions or state or federal rules or regulations governing the properties, including those in LIHTC or bond programs.

10.6.2 Tenant Files
Tenant files must be in locked cabinets or locked storage rooms. Documents and file contents must be affixed to the file and in date order. Lease and certification files may be separated into separate files if preferred. File contents should be date ordered.

10.6.3 Electronic Files
Files may be kept electronically or in hard copy. Electronic files must be protected . The City requires all electronic files to comply with California Tax Credit Allocation Committee rules on electronic files. See: https://www.treasurer.ca.gov/ctcac/compliance/memos/electronic- storage.pdf.

10.6.4 Disposal of Records
Records must be disposed of in a manner that protects the privacy of Tenants. Unneeded documents and Tenant files containing personal and confidential information must be shredded onsite or using a third -party shredding service. Tenant files with sensitive information should never be put in the trash or recycling containers.

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10.7 CITY AUDITS AND MONITORING
The City may, at any time, request to review the records to verify compliance with program requirements and/or inspect the property or records associated with Tenant files or the BMR or Workforce program. City audits may be conducted at the property if requested by the City.

10.8 CHANGES IN MANAGEMENT OR OWNERSHIP
The City shall be notified of any changes in management or Ownership. These BMR Guidelines shall be provided to any new management staff.

10.9 EXPIRATION OF PROGRAM RESTRICTIONS – TENANT NOTIFICATION At least two years prior to the expiration of program restrictions, the Property Manager shall begin a discussion with the City regarding procedures for Tenant notification.

10.10 DUTY TO DISCLOSE COMPLAINTS OR LEGAL ACTION TAKEN BY A TENANT Property Managers shall notify the City of any legal action pursued by a Tenant regarding Fair Housing, discrimination, landlord-Tenant disputes, or compliance with the affordability restriction for the property or these BMR Guidelines.

10.11 TENANT ACCESS TO FILES
Tenants shall be given the opportunity to review their physical file upon request and be given access within a reasonable amount of time. Tenants shall have access to all contents of their file, including, but not limited to information regarding income limits, calculations of rent and utility allowances, initial and recertifications, any policies related to certification or recertification, resident selection policies, and leases.

10.12 BEST PRACTICES FOR PROPERTY MANAGEMENT
The City recommends that the Property Manager follow the CALIFORNIA TENANT’S GUIDE, A GUIDE TO RESIDENTIAL TENANTS’ AND LANDLORDS’ RIGHTS AND RESPONSIBILITIES and make this guide available to the applicant/ Tenant at the time of their initial lease .

Https://www.courts.ca.gov/documents/California-Tenants-Guide.pdf .

10.13 ADDITIONAL REQUIREMENTS
The property’s affordability restrictions, local, state, or federal regulation may require additional records management and reporting requirements, or supersede requirements as stipulated in this Section 10.

11 USE OF HUD GUIDELINES FOR ITEMS NOT COVERED IN THESE

GUIDELINES

11.1 USE OF HUD GUIDELINES FOR BMR AND WORKFORCE PROPERTIES For items not covered in these BMR Guidelines , the HUD Handbook 4350.3 REV -1 shall be

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Department of Housing and Urban Development at:
http://portal.hud.gov/hudportal/HUD?src=/program_offices/administration/hudclips/handbook s/hsgh/4350.3

Note that the City does not use or require use of the Enterprise Income Verification (EIV) system referenced in the HUD Manual, unless required by the property’s affordability restrictions or Bond Financing. In addition, the Below Market Interest Rate (BMIR) referenced in the HUD Manual is not the same as the City of Foster City’s BMR Program. Specific requirements for HUD -based programs, such as Section 8, only apply if the property is a Project-Based Section 8 property or a Tenant has a Section 8 (now ca lled Moving to Work) voucher. In the event that guidance is not provided by the HUD Manual referenced above or is not clear, the City shall provide guidance regarding the methods used for income certification and interpretation of the HUD Manual and property’s affordability restrictions or other regulatory agreements that relate to income certification, at the request of the Property Manager.

11.1.1 Use of HUD Guidelines for Properties Covered by One or More HUD-Funded Programs For properties covered by one or more HUD-funded Programs, if there is conflicting information in the HUD Handbook, the property’s affordability restrictions, or these BMR Guidelines, then the strictest policy shall apply. An overview of HUD Programs can be found at https://www.hud.gov/sites/dfiles/Main/documents/HUDPrograms2023.pdf.

11.2 USE OF HUD FOR PROPERTIES NOT COVERED BY HUD-FUNDED PROGRAMS For properties that are not financed by HUD-funded Programs, The HUD Handbook does not supersede the affordability restrictions in place for a property or these BMR Guidelines but supplements these documents by providing best practices . For example, a BMR or Workforce property that is not subject to Section 8 and has no Tenants with Section 8 vouchers, is not subject to the Section 8 rent calculation, minimum rent, or other rules specific to Section 8. An overview of HUD Programs can be found at:
https://www.hud.gov/sites/dfiles/Main/documents/HUDPrograms2023.pdf.

11.3 USE OF HUD’S FAIR HOUSING POLICIES
Please note that HUD’s policies on Fair Housing are applicable to all BMR and Workforce properties. See:
https://www.hud.gov/program_offices/fair_housing_equal_opp/fair_housing_act_overview#_T he_Fair_Housing. I n addition, the following t emporary HUD Programs may apply to the BMR or Workforce property if the Owner received federal financial assistance through one of the following programs:
• The Coronavirus Aid, Relief, and Economic Security Act (CARES Act) (Public Law 116-136, approved March 27, 2020)
https://www.congress.gov/bill/116th-congress/house-bill/748/text • American Rescue Plan Act of 2021 (Public Law 117-2, approved March 11, 2021) https://www.congress.gov/bill/116th-congress/house-bill/748/text

Please note that the State of California Fair Housing laws also apply to all properties. More

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https://calcivilrights.ca.gov/LegalRecords/.

12 TRAINING REQUIREMENTS FOR PROPERTY MANAGERS

12.1 FAIR HOUSING TRAINING
The City requires that all Property Managers interacting with Tenant s in leasing and/or income certifications complete Fair Housing Training at least once every other year . Property Managers must submit their training certificates to the City upon request. Additional information about Fair Housing is available here:
https://calcivilrights.ca.gov/california-fair-housing-regulations-webinar-pdfs/.

12.2 COMPLIANCE TRAINING
The City requires federal, state, or local income certification training at least once every three years for all property management staff involved in conducting i ncome certifications and initial training within six months for any new hires . Workshop schedules for the California Tax Credit Allocation Committee are available here: https://www.treasurer.ca.gov/ctcac/compliance.asp.

HUD training is available at https://www.hudexchange.info/trainings/. Please note that TCAC has a stricter set of rules for compliance than HUD and these BMR Guidelines. Therefore, not all TCAC training is applicable.

12.3 TECHNICAL ASSISTANCE

12.3.1 Technical Assistance to Non-Profits
The City will provide technical assistance, such as information on applicable regulations and policies and how to coordinate various programs , to nonprofit groups organized to encourage provision of affordable housing and sponsors of affordable housing projects and programs.

12.3.2 Technical Assistance to Property Managers
The City will facilitate provision of housing by providing technical assistance in a liaison role with non-profit housing groups and managers of affordable housing units in the City. The City may also provide training on these BMR Guidelines from time to time or upon request.

12.4 ADDITIONAL RECOMMENDED TRAINING
The City recommends that Property Managers complete training on topics such as AB 1482, the Tenant Protection Act, Service and Assistive Animals, and other topics relevant to property management to stay apprised of current laws and industry best practices. The City may from time- to-time share training opportunities with Property Managers. Property Managers should also consult their property’s affordability restrictions, and, for City -owned properties, the Property Management Agreement, regarding any additional training requirements.

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In the event that the City determines that BMR management practices are not in compliance with the provisions of the property’s affordability restrictions, or other regulatory document in effect the City has enforcement authority pursuant to City of Foster City Municipal Code, Chapter 17.90.110 (E) . https://www.codepublishing.com/CA/FosterCity/.

13.1 PROCEDURE FOR ENFORCEMENT OF NON-COMPLIANCE
In the event that the City determines that BMR management practices are not in compliance with the provisions of the property’s affordability restrictions, or other regulatory document in effect, City staff shall notify the Property Manager with a Notice of Non-Compliance, and remedies, per Section 13.2, and deadlines for correcting non-compliance issues.

13.1.1 Appeal Process
Property Managers /Owners who wish to appeal a notice of non-compliance must submit a request for appeal in writing to the City within ten (10) business days of receipt of the Notice of Non-Compliance. Appeals must provide evidence that demonstrates that the property complies with the property’s affordability restrictions or other governing regulatory document in effect, as applicable. The City will respond to the appeal within thirty (30) days. Appeals are denied or approved by the Community Development Director in coordination with the City Attorney. In the event of a denial the Property Manager/Owner shall have 30 (thirty) days from the date of the denial, to remedy the non-compliance.

13.1.2 Continued or Repeated Non-Compliance
Property Managers/Owners that remain in a state of non -compliance for more than ninety (90) days after the date of a Notice of Non -Compliance or Denial of an Appeal of Non -Compliance or are notified by the City of non-compliance may be subject to fines, as established by Resolution, or legal action by the City pursuant to City of Foster City Municipal Code, Chapter 17.90.110 (E).

13.1.3 Fair Housing Issues
The City refers any member of the public alleging a violation of Fair Housing laws to the California Civil Rights Department . See h ttps://calcivilrights.ca.gov/complaintprocess/. Property Managers shall notify the City of any complaint filed by a BMR or Workforce Tenant. If the City suspects a fair housing violation due to findings of an audit of BMR or Workforce files, the City has an obligation to inform the Property Manager in writing of the potential violation and request immediate action to demonstrate the City’s commitment to Affirmatively Furthering Fair Housing as provided in the Housing Element, Chapter 3 (https://engagefosterCity.org/housing-element).

13.1.4 Americans with Disabilities Act
The City refers any member of the public alleging a violation of the Americans with Disabilities Act to the California Civil Rights Department. Property Managers shall notify the City of any complaint filed by a BMR or Workforce Tenant.

13.2 TENANT INQUIRES AND DISPUTE RESOLUTION
The City has an obligation to respond to BMR and Workforce Tenants that contact the City to

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The City facilitates dispute resolution in accordance with the affordability restriction on the property, financing entity rules and regulations, these BMR Guidelines, the Housing Element 2023- 2031, and Fair Housing and Anti -Discrimination Regulations. Disputes are handled on a case -by- case basis and, if necessary, are referred to the State of California Civil Rights Department’s Community Conflict Resolution Unit (https://calcivilrights.ca.gov/disputeresolution/#conflictBody) or the Peninsula Conflict Resolution Center (https://www.pcrcweb.org).

13.3 REMEDIES
City staff may elect to seek one or more remedies as necessary to enforce the p rovisions of the property’s affordability restrictions or other Regulatory Agreement in effect. The City will provide a reasonable period of time to cure violation s. Remedies shall be consistent with the applicable affordability restrictions or other Regulatory Agreement, as well as Foster City Municipal Code Chapter 17.90, as amended from time to time.

14 CONFLICT WITH HOUSING ELEMENT OR OTHER

REGULATORY INSTRUMENT(S)

These BMR Guidelines serve as an implementation tool for the Housing Element and property affordability restrictions, affordable housing agreements, amendments, or other regulatory instruments that are in effect for all properties covered by these BMR Guidelines. In the event that these BMR Guidelines conflict with the Housing Element, the deed restriction recorded for the p roperty, affordability restrictions , affordable housing agreement, or amendment to a covenant or agreement or other local, state, or federal regulation covering the property, the regulatory instrument(s) in effect for the property shall supersede these BMR Guidelines.

15 LIST OF SAMPLES AND TEMPLATES AVAILABLE

The following samples, forms, and templates are available from City Staff upon request. • Sample Marketing Plan
• Sample Flyer for Waitlist Opening
• List of Organizations for Outreach
• Waitlist Template
• Waitlist Application Template
• Purge Letter Template
• Income Certification Forms Checklist
• Income Certification Forms Packet
• Rent Calculation Spreadsheet Template
• Calculation Worksheet Template

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Other templates and samples may be added to this list from time to time.

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List of Recommended Policy Updates to BMR Rental Housing Program Administrative Procedures and Guidelines
November 20, 2023
The following four policy items will be added to the Below Market Rate Rental Housing Program Administrative Procedures and Guidelines , as appropriate, depending on Council Direction. Recommended new text is underlined and in red. Deleted text shows strike-through lines.

1. O
ccupancy Standards: revise section 7.14.1 as follows:

7. 14.1 Minimum and Maximum Household Size Requirements For existing BMR units as of the effective date of these BMR Guidelines, the minimum and maximum household size for occupancy of various size units varies based on the requirements of the applicable a ffordable housing restrictions for each property. If occupancy standards are not addressed in the affordability restriction, the following general occupancy standards of a minimum of one person per bedroom for a studio and one bedroom, two people for a two- bedroom, four people for a three- bedroom, six people for a four bedroom, and eight people for a five- bedroom unit per Title 25, Section 8305 and a maximum occupancy, based on accepted industry standards , of two people per bedroom, plus one person per unit, shall apply.

F
or BMR properties completed after the effective date of these BMR Guidelines, the following general occupancy standards of a minimum of one person per bedroom for a studio and one bedroom, two people for a two- bedroom, four people for a three- bedroom, six people for a four bedroom, and eight people for a five-bedroom unit per Title 25, Section 8305, and a maximum occupancy, based on accepted industry standards, of two people per bedroom, plus one person per unit, shall apply and shall be stated in the affordability agreement for the property.

N
ote that if the tenant has a live- in aide, the live -in aide counts in determining the household size for occupancy standards, but the aid is not counted in the household for income purposes, nor is the aide’s income counted in the household income.

F
oster City General BMR Occupancy Standards
Unit Size Minimum Occupancy Maximum Occupancy
Studio 1 person 2 people
One-Bedroom 1 person 3 people
One-Bedroom
Plus Den
1 person 3 people
Two-Bedroom 2 people 5 people
Three-Bedroom 4 people 7 people
Four-Bedroom 6 people 9 people
Five-Bedroom 8 people 11 people

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2. Anti-Displacement Strategy: revise subsection 8.4.1 in Section 8, Determining Rent, as follows:

8.4.1, Anti-displacement Strategy
For existing BMR properties, the City strongly recommends that BMR and Workforce Property Managers limit annual rent increases to no more than the lower of the Maximum Chargeable Rent or the current rental rate multiplied by one (1) plus the annual Consumer Price Index (CPI) Summary percentage, converted to decimal configuration, before seasonal adjustment, for all items for the prior 12 months for April each year prior to the month of issue of income limit s (see https://www.bls.gov/news.release/cpi.toc.htm), or 5%, whichever is lower, unless otherwise limited by statute at the local, state, or federal level or as required by the financing entity or bond program for a property. The annual CPI Index amount, which shall stay in place for 12 months, shall be provided annually by the City to all BMR and Workforce housing Property Managers. For example, the April 2023 Index Amount is

4.3%. Therefore, the City recommends a rental rate increase of no more than 4.3%, or the current rental rate x 1.043 for 2023 provided the new rate is below the maximum chargeable rent.

For BMR properties completed after the effective date of these BMR Guidelines, the City’s policy is to limit annual rent increases as stated in this Section. The restriction shall be stated in the affordability agreement for the property.

3. Workforce Housing Rent Adjustments : add a new subsection to Section 8, Determining Rent, as follows:

8.5 Workforce Housing Rent Adjustments
The Director of Community Development may adjust rents for vacant units at city - owned workforce housing properties (including workforce and BMR units) by up to 10% on an as needed basis due to current market conditions.

4. BMR Compliance and Monitoring Fees : add new subsections to Section 10, Program Monitoring and Administration and Section 13, Non-Compliance and Enforcement, as follows:

10.14 Monitoring Fees
The Community Development Department establishes annual monitoring fees for new BMR housing developments. Fees shall be a reasonable cost recovery on a per unit basis for the term of affordability, with reasonable periodic increase. Fees are included in the City’s master fee schedule.

13.3.1 BMR Compliance Fees
The Community Development Department establishes compliance fees in the event of non- compliant BMR property owners and managers. All revenues for BMR

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compliance and monitoring fees are allocated to Affordable Housing Fund. Fees are included in the City’s master fee schedule.

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4881-3610-1501v1
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Draft
Below Market Rate
Ownership Housing
Program

ADMINISTRATIVE PROCEDURES AND GUIDELINES

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TABLE OF CONTENTS

1 IMPLEMENTATION AUTHORITY ................................ ................................ ................................ ....3 2 INTRODUCTION ................................ ................................ ................................ ........................... 3 3 FAIR HOUSING ................................ ................................ ................................ ............................. 3 4 COVERED PROPERTIES................................ ................................ ................................ ..................4 5 deed restrictions ................................ ................................ ................................ .......................... 4

5.1 General Provisions of Deed Restrictions.................................................................................. 4

5.2 Names of Owners .................................................................................................................... 5 6 Income Restrictions ................................ ................................ ................................ .....................5

6.1 Source for Income Limits ......................................................................................................... 5

6.2 Procedures for Calculating Income .......................................................................................... 5

6.2.1 Applicability ........................................................................................................................... 5

6.2.2 Multiple or Conflicting Requirements ................................................................................... 5

6.2.3 Household Member Income to Count .................................................................................. 5

6.2.4 Full Set of Forms Required for all Adult Household Members ............................................. 5

6.2.5 Rules on Redacting of Information Provided for Income Certification ................................. 5

6.2.6 Income Inclusions and Exclusions ......................................................................................... 6

6.2.7 Three Methods Required to Calculate Income ..................................................................... 6

6.2.8 Lump Sum Payments ............................................................................................................. 8

6.2.9 Tax Returns ........................................................................................................................... 8

6.2.10 Self-Employment Income ...................................................................................................... 9

6.2.11 Unemployment and Disability Income................................................................................ 10

6.2.12 Social Security and Supplemental Social Security Income .................................................. 10

6.2.13 Dates of verifications .......................................................................................................... 11

6.3 Asset Eligibility and Verification............................................................................................. 11

6.3.1 Use of California Code of Regulations, Title 25 for Calculating Income from Assets ......... 11

6.3.2 Third-Party Verification of Assets ....................................................................................... 11

6.3.3 Negative or Blank Asset Verifications ................................................................................. 11

6.3.4 Rules on Redacting Information on Documents Provided .................................................. 11

6.3.5 Calculating Income from Assets .......................................................................................... 11

6.3.6 Computing Income from Real Estate Assets ...................................................................... 11

6.3.7 Lump Sum Payments ........................................................................................................... 12

6.4 Live-In Aides ........................................................................................................................... 12

6.5 Documenting Purchaser Income Certifications ..................................................................... 12

6.5.1 Forms .................................................................................................................................. 12

6.5.2 Owner Income Certification File Organization .................................................................... 12

6.5.3 Required Forms ................................................................................................................... 13

6.5.4 Signatures on Forms ........................................................................................................... 13

6.5.5 Dates on Forms ................................................................................................................... 13

6.5.6 Mistakes and Corrections on Forms ................................................................................... 13

6.5.7 Conflicting, Incomplete, Insufficient, or Unclear Information Provided on Forms............. 13

6.6 Requesting Additional Information Required for Eligibility ................................................... 14

6.7 Citizenship/Resident Alien Status Verification ...................................................................... 14

6.2 Attachment 5 - Draft Revised BMR Ownership Housing Guidelines

231

City of Foster City
Below Market Rate Ownership Housing Program
Administrative Procedures and Guidelines
Draft Revised for October 5, 2023 Planning Commission Study Session

2 File name: Draft Revised BMR Ownership Housing Program Administrative Procedures and Guidelines

6.8 Sole Residency Requirement ................................................................................................. 14 7 DETERMINING PURCHASE PRICE ................................ ................................ ................................ . 14

7.1 Eligibility ................................................................................................................................. 14

7.2 Initial Purchase Price .............................................................................................................. 14 8 RESALE PRICE RESTRICTION ................................ ................................ ................................ ........ 15

8.1 Term of Restrictions ............................................................................................................... 15

8.2 Definition of Transfer ............................................................................................................. 15

8.3 Resale Procedures .................................................................................................................. 15

8.4 Resale Price ............................................................................................................................ 16

8.4.1 Calculation of Resale Price During the Deed Restriction Period ......................................... 16

8.4.2 Adjustments to Resale Price ............................................................................................... 16

8.4.3 Establishment of Resale Price ............................................................................................. 17

8.4.4 Value of Capital Improvements .......................................................................................... 17 9 SHARE OF PROCEEDS TO AGENCY ................................ ................................ ............................... 17 10 REQUIREMENTS FOR PROGRAM MONITORING AND ADMINISTRATION................................ ....... 18

10.1 Retention of Records ............................................................................................................. 18

10.1.1 Storage Time Requirement ................................................................................................. 18

10.1.2 Electronic Files .................................................................................................................... 18

10.1.3 Additional Requirements .................................................................................................... 18

10.2 Monitoring ............................................................................................................................. 18 11 USE OF HUD GUIDELINES FOR ITEMS NOT COVERED IN THESE GUIDELINES ................................ .. 19

11.1 Use of HUD Guidelines for BMR Properties ........................................................................... 19

11.2 Use of HUD’s Fair Housing Policies ........................................................................................ 19 12 NON-COMPLIANCE and remedies ................................ ................................ .............................. 19

12.1 Procedure for Non-Compliance ............................................................................................. 19

12.1.1 Appeal Process .................................................................................................................... 20

12.1.2 Continued or Repeated Non-Compliance ........................................................................... 20

12.2 Remedies ............................................................................................................................... 20

12.2.1 Unauthorized Sale, Lease or Transfer of Property .............................................................. 20

12.2.2 Violation of Deed Restrictions or Other Regulatory Documents ........................................ 20 13 CONFLICT WITH HOUSING ELEMENT OR OTHER REGULATORY INSTRUMENT(S) ........................... 20

6.2 Attachment 5 - Draft Revised BMR Ownership Housing Guidelines

232

City of Foster City
Below Market Rate Ownership Housing Program
Administrative Procedures and Guidelines
Draft Revised for October 5, 2023 Planning Commission Study Session

3 File name: Draft Revised BMR Ownership Housing Program Administrative Procedures and Guidelines

1 IMPLEMENTATION AUTHORITY

Authority for implementation of these Below Market Rate Ownership Housing Administrative Procedures and Guidelines (“Guidelines”) is provided by the City of Foster City Municipal Code, Chapter 17.90.020 (E)

Foster City City CouncilNovember 20, 2023

Foster City City Council
November 20, 2023