Gilroy City Council
August 3, 2026

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• Montague Expressway
• Oregon Expressway
• San Tomas Expressway
• Southwest Expressway
Complicated Exceptions
Further complicating efforts to determine which agency has jurisdiction over a particular area, cities, Caltrans, the County, and even the federal government (such as near Moffett Federal Airfield) have maintenance agreements that specify which agency is responsible for certain roadway segments – such as onramps, offramps, and other defined areas (City of Mountain View, 2019). It is not always easy to determine which agency is responsible for which segments.

Complicated Maps
Some jurisdictions have no public maps indicating which roads they are responsible for. The County and some cities, including San José, Campbell, and Mountain View, do post searchable maps online that can help the public narrow down which jurisdiction is responsible for a particular road. However, the maps often use complicated interfaces rather than a simple image or printout, and many maps are not specific to just the roads maintained by the jurisdictions.

San José, which maintains more than 4,000 miles of locally maintained lanes within its borders, has its own mapping website (Metropolitan Transportation Commission, 2026; City of San José, 2020). It shows whether a particular street within its boundaries is maintained by San José, the County, a private entity, or another agency. The website provides a large amount of information, although it is complicated for the average user to navigate.

An alternative source of information is pavement management plans that some agencies make available. These plans may list all roads maintained by the jurisdiction and can be used as a reference. As an example, Morgan Hill has a link to its latest 2024 Pavement Management Report with a list of streets at the end. However, there is no direct link from the claim forms webpage, so claimants would not be aware of this reference (AMS Consulting, 2025).

Filing a Claim: Obtaining and Submitting a Claim Form
Once a person has found the proper jurisdiction, the next step is to download the claim form from the local agency’s website.

Of the 16 jurisdictions, the Civil Grand Jury found that only Gilroy, Los Gatos, Palo Alto, Santa Clara, and Sunnyvale provide adequate claims process information on their webpages or on the claim form itself.

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Most jurisdictions provide forms only in English. This is an omission that could potentially disenfranchise community members who have limited proficiency in English.

The Civil Grand Jury identified three cities that took the helpful step of providing additional language options:
• Morgan Hill provides a PDF of its claim form in English and Spanish. • Sunnyvale has a translation feature that allows claimants to translate the form into one of 200+ languages. Users can either fill out the translated form online and print a copy or print out a blank translated form and fill it out by hand.
• Saratoga’s website uses a third-party widget to translate its website in addition to an online form to many other languages.

The Civil Grand Jury also investigated how easy it is to find claim forms on each jurisdiction’s website by searching for the term “claim form.”
The Civil Grand Jury could not find any information about submitting a pothole claim in four entities: Campbell, Los Altos, Los Altos Hills, and Monte Sereno.

Cupertino provides a claim form, but users must use the website’s search function to find it.

Gilroy does not link directly to a claim form, although it does provide instructions on how to request a form by email or in person.

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Table 1: Access to online claim process instructions and link to claim form (See References for links)
Jurisdiction Online Claims Process
Instructions
Link to
Claim Form
Caltrans Yes Yes
County of Santa Clara No Yes
Campbell No No
Cupertino No Yes
Gilroy Yes No
Los Altos No No
Los Altos Hills No No
Los Gatos Yes Yes
Milpitas No Yes
Monte Sereno No No
Morgan Hill No Yes
Mountain View No Yes
Palo Alto Yes Yes
San José No Yes
Santa Clara Yes Yes
Saratoga No Yes
Sunnyvale Yes Yes
Many jurisdictions recommend that claimants deliver the claim form in person, including all relevant information, such as photos, receipts, and witness statements. The claimant should retain a signed copy.

Some agencies allow for email submission, but this is the exception. Alternatively, a claimant could submit the claim by mail to the city or town clerk (or, for the County, the Clerk of the Board).

According to the California Government Claims Act, the agency has 45 days from the date the claim form was mailed or delivered in person to respond to the claimant.

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CONCLUSION
Even though state law sets strict rules for filing and reviewing claims, local government agencies retain significant discretion over their processes. By offering clearer online information, improving access to claim forms, expanding language options, and providing more detailed explanations when claims are denied, jurisdictions can significantly improve public trust, reduce frustration, and increase fairness.

Implementing the recommended updates is not only feasible, but it also aligns with the spirit of responsive and transparent public service. The Civil Grand Jury urges all jurisdictions to adopt these improvements by the recommended deadlines to ensure that the claims process is fairer, more consistent, and easier for the public to navigate.

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FINDINGS AND RECOMMENDATIONS
Finding 1
Jurisdictions within Santa Clara County rejected 92% of pothole claims from 2020 to 2025 due to reasons including missed deadlines, incorrect jurisdiction, and lack of prior notice.

Recommendation 1
No recommendation.

Finding 2
Claims are often rejected because the claimant filed with the incorrect jurisdiction, which can happen because jurisdictional lines are often unclear or poorly communicated. The claims websites of all jurisdictions within Santa Clara County lack information about how to determine if a road is in its jurisdiction.

Recommendation 2a
All jurisdictions within Santa Clara County should include a link to a map or list of roads they maintain on their claims website.

The jurisdictions should implement this by December 15, 2026.

Recommendation 2b
All jurisdictions within Santa Clara County should update their claims websites to identify roads that are commonly mistaken as being in their jurisdictions.

The jurisdictions should implement this by December 15, 2026.

Finding 3
Fifteen jurisdictions – the County, Campbell, Cupertino, Gilroy, Los Altos, Los Altos Hills, Los Gatos, Milpitas, Monte Sereno, Morgan Hill, Mountain View, Palo Alto, San José, Santa Clara, and Saratoga – have websites with deficiencies that make it difficult to file a claim.

Recommendation 3a
Eleven jurisdictions – the County, Campbell, Cupertino, Los Altos, Los Altos Hills, Milpitas, Monte Sereno, Morgan Hill, Mountain View, San José, and Saratoga – should update their websites to provide clear instructions and information about how to file a claim in addition to a link to the claim form.

The jurisdictions should implement this by December 15, 2026.

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Recommendation 3b
Fourteen jurisdictions – the County, Campbell, Cupertino, Gilroy, Los Altos, Los Altos Hills, Los Gatos, Milpitas, Monte Sereno, Morgan Hill, Mountain View, Palo Alto, San José, and Santa Clara – should incorporate useable software on their websites that can translate claim forms into multiple languages or provide claim forms in multiple languages based on the demographics they serve.

The jurisdictions should implement this by December 15, 2026.

Finding 4
When pothole claims are rejected, claimants filing claims against the County, Los Altos, Los Gatos, Mountain View, Palo Alto, and San José receive a notice that provides little or sometimes no explanation for the rejection. Although jurisdictions within Santa Clara County are not legally obligated to provide a reason for rejection, the lack of clarity in the decisions made on the claims can add to a claimant’s frustration.

Recommendation 4
The County, Los Altos, Los Gatos, Mountain View, Palo Alto, and San José should update their rejection letters to specify whether the decision was due to lack of timeliness, incorrect jurisdiction, lack of prior notice, or other reason and to provide a specific contact to call or email if the claimant has further questions about the reason for rejection.

The jurisdictions should implement this by December 15, 2026.

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REQUIRED RESPONSES
Pursuant to California Penal Code section 933(a) et seq. and California Penal Code section 933.05, the 2025-2026 Santa Clara County Civil Grand Jury requests responses from the following governing body:

Responding Agency Findings Recommendations
County of Santa Clara 1, 2, 3, 4 2a, 2b, 3a, 3b, 4
City of Campbell 1, 2, 3 2a, 2b, 3a, 3b
City of Cupertino 1, 2, 3 2a, 2b, 3a, 3b
City of Gilroy 1, 2, 3 2a, 2b, 3b
City of Los Altos 1, 2, 3, 4 2a, 2b, 3a, 3b, 4
Town of Los Altos Hills 1, 2, 3 2a, 2b, 3a, 3b
Town of Los Gatos 1, 2, 3, 4 2a, 2b, 3b, 4
City of Milpitas 1, 2, 3 2a, 2b, 3a, 3b
City of Monte Sereno 1, 2, 3 2a, 2b, 3a, 3b
City of Morgan Hill 1, 2, 3 2a, 2b, 3a, 3b
City of Mountain View 1, 2, 3, 4 2a, 2b, 3a, 3b, 4
City of Palo Alto 1, 2, 3, 4 2a, 2b, 3b, 4
City of San José 1, 2, 3, 4 2a, 2b, 3a, 3b, 4
City of Santa Clara 1, 2, 3 2a, 2b, 3b
City of Saratoga 1, 2, 3 2a, 2b, 3a
City of Sunnyvale 1, 2 2a, 2b

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APPENDIX A: Reporting a Pothole
Residents who see a pothole can report it so the jurisdiction can repair it in a timely manner.

Based on a Civil Grand Jury review, here is a list of contacts (as of April 15, 2026) where potholes or other needed street repairs can be reported:

Jurisdiction Website to report a pothole
Caltrans https://csr.dot.ca.gov/index.php/Msrsubmit
County of Santa Clara https://roads.santaclaracounty.gov/services/service-requests Campbell https://www.campbellca.gov/requesttracker.aspx Cupertino https://cupertinoca.citysourced.com/servicerequests/create Gilroy https://seeclickfix.com/gilroy
Los Altos https://www.losaltosca.gov/FormCenter/Public-Works-6/ Maintenance-Service-Request-46
Los Altos Hills https://www.losaltoshills.ca.gov/requesttracker.aspx Los Gatos https://www.losgatosca.gov/FormCenter/PPW-15/Report-aParks-Public-Works-Concern-87 Milpitas https://seeclickfix.com/web_portal/
chZ2d7WdKoe4V2BriJxUCFqd/report/category
Monte Sereno https://www.montesereno.org/forms.aspx?FID=80 Morgan Hill https://www.morganhill.ca.gov/509/Maintenance Mountain View https://www.mountainview.gov/our-city/departments/publicworks/roads-and-transportation/street-maintenance Palo Alto https://www.paloalto.gov/Residents/Services/Report-an-Issue San José https://311.sanjoseca.gov/
Santa Clara https://www.santaclaraca.gov/our-city/government/mayor-andcouncil/contact-city-council Saratoga https://www.saratoga.ca.us/FormCenter/Report-a-Concern6/Fix-It-Form-45 Sunnyvale https://sunnyvale.dynamics365portals.us/neighborhoodcomplaints/

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REFERENCES
Bibliography
AMS Consulting. “Pavement Management Technical Assistance Program (P-TAP) Round 25, 2024/2025 Pavement Management Report.” March 21, 2025.
(https://www.morganhill.ca.gov/DocumentCenter/View/53950/Updated-Morgan-HillPTAP-25-Rev01-for-Web). Accessed April 16, 2026.

Cal. Gov. Code § 810 et seq.

Cal. Gov. Code § 913 et seq.

California Department of Transportation. “California Road Data 2024.” November 2025. (https://dot.ca.gov/-/media/dot-media/programs/research-innovation-systeminformation/documents/hpms/hpms-2024-prd-a11y.pdf). Accessed April 28, 2026.

California Department of Transportation. “Submit Damage Claim.” n.d. (https://dot.ca.gov/ online-services/submit-damage-claim). Accessed April 15, 2026.

City of Cupertino. “Claim Form.” September 2022.
(https://cupertinoca.prelive.opencities.com/files/assets/city/v/1/yourcity/documents/claim-form-rev-102523.pdf). Accessed April 29, 2026.

City of Gilroy. “How to File a Claim.” n.d. (https://www.cityofgilroy.org/966/How-to-File-aClaim). Accessed April 15, 2026.

City of Milpitas. “Helpful Links.” n.d. (https://www.milpitas.gov/188/Helpful-Links). Accessed April 15, 2026.

City of Morgan Hill. “Claim for Damages Form.” n.d. (https://www.morganhill.ca.gov/1411/ Claim-for-Damages-Form). Accessed April 15, 2026.

City of Mountain View. “Claim Form.” n.d. (https://www.mountainview.gov/our-city/ departments/city-attorneys-office/claim-form). Accessed April 15, 2026.

City of Mountain View. “GIS/Mapping Portal, Map Road Centerline” July 18, 2019. (https://data-mountainview.opendata.arcgis.com/search?q=roads). Accessed April 28, 2026.

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City of Palo Alto. “Submit a Claim Against the City.” n.d. (https://www.paloalto.gov/ Departments/City-Attorney/Submit-a-Claim-Against-the-City). Accessed April 15, 2026.

City of San José. “File Claim Against City Form.” n.d. (https://www.sanjoseca.gov/yourgovernment/appointees/city-clerk/forms-filings/file-claim-against-city-form). Accessed April 15, 2026.

City of San José. “Streets.” August 27, 2020. (https://gisdatacsj.opendata.arcgis.com/datasets/CSJ::streets/about). Accessed April 16, 2026.

City of Santa Clara. “Frequently Asked Questions.” July 23, 2015. (https://www.santaclaraca.gov/our-city/departments-a-f/city-attorney-s-office/frequentlyasked-questions). Accessed April 15, 2026.

City of Saratoga. “Claims Against Saratoga.” n.d. (https://www.saratoga.ca.us/FormCenter/ Claims-Form-37/Claims-Against-Saratoga-102). Accessed April 15, 2026.

City of Sunnyvale. “File a Claim Against the City.” n.d. (https://www.sunnyvale.ca.gov/yourgovernment/city-clerk/file-a-claim-against-the-city). Accessed April 15, 2026.

County of Santa Clara. “File a claim of loss against the County.” n.d. (https://cob.santaclaracounty.gov/services/file-claim-loss-against-county). Accessed April 15, 2026.

Feingold, Lindsey and Manthey, Grace. “Less than 4% of Bay Area Caltrans pothole, other damage claims approved in recent years: data.” KGO-TV. January 25, 2024. (https:// abc7news.com/post/bay-area-potholes-caltrans-claims-car-damages/14359988/).

Accessed April 14, 2026.

Metropolitan Transportation Commission. “Pavement Conditions of Bay Area Jurisdictions 2024.” January 5, 2026. (https://mtc.ca.gov/digital-library/5099739-pavement-conditionbay-area-jurisdictions-2024). Accessed April 15, 2026.

Town of Los Gatos. “File a Claim.” n.d. (https://www.losgatosca.gov/2422/File-a-Claim).

Accessed April 15, 2026.

Watts, Julie and Manthey, Grace. “California freeways with the most potholes and car damage claims.” CBS News California. May 23, 2024.
(https://www.cbsnews.com/news/california-freeways-most-potholes-damage-claims/).

Accessed April 14, 2026.

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This report was ADOPTED by the 2025-2026 Santa Clara County Civil Grand Jury on this 12th day of June, 2026.
______________________________
Dinesh Ramde
Foreperson

City of Gilroy
7351 Rosanna Street
Gilroy, California
95020-6197
Administration
Department
Telephone (408) 846-0202
http://www.cityofgilroy.org
August XX, 2026
Via Email ([email protected]) and U.S. Mail
The Honorable Julie A. Emede,
Presiding Judge
Superior Court of California, County of Santa Clara
191 North First Street
San Jose, CA 95113
Re: City of Gilroy Response to the 2025–2026 Civil Grand Jury Final Report — "Pothole Damage:

Improving Claims Processes within Santa Clara County"
Dear Judge Emede:

Pursuant to California Penal Code sections 933(c) and 933.05, the City of Gilroy respectfully submits its response to the findings and recommendations directed to the City in the 2025–2026 Santa Clara County Civil Grand Jury's final report, "Pothole Damage: Improving Claims Processes within Santa Clara County," released June 12, 2026. The City is required to respond to Findings 1, 2, and 3 and Recommendations 2a, 2b, and 3b, and does so below in accordance with the response requirements of Penal Code section 933.05.

Response to Findings
Finding 1: “Jurisdictions within Santa Clara County rejected 92% of pothole claims from 2020 to 2025 due to reasons including missed deadlines, incorrect jurisdiction, and lack of prior notice." Response: The City of Gilroy agrees with the finding. According to the report, the finding reflects aggregate claims data reported by the sixteen jurisdictions across Santa Clara County.

Finding 2: "Claims are often rejected because the claimant filed with the incorrect jurisdiction, which can happen because jurisdictional lines are often unclear or poorly communicated. The claims websites of all jurisdictions within Santa Clara County lack information about how to determine if a road is in its jurisdiction."
Response: The City of Gilroy agrees with the finding. The City's own claims experience confirms that jurisdictional boundaries are a common source of confusion.

Finding 3: "Fifteen jurisdictions – the County, Campbell, Cupertino, Gilroy, Los Altos, Los Altos Hills, Los Gatos, Milpitas, Monte Sereno, Morgan Hill, Mountain View, Palo Alto, San José, Santa Clara, and Saratoga – have websites with deficiencies that make it difficult to file a claim."

2 Response: The City of Gilroy partially disagrees with the finding. The City disagrees with the characterization of its website as having deficiencies that make it difficult to file a claim. The Civil Grand Jury's own investigation found that Gilroy is one of only five jurisdictions in Santa Clara County that provide adequate claims process information on their website.

The City is concerned that the finding measures fifteen jurisdictions against the electronic filing solutions adopted by a small number of agencies, and treats the absence of comparable features as a "deficiency." The Government Claims Act does not require electronic filing, and the appropriate filing method for each jurisdiction reflects local resources, claim volume, and records management practices. In Gilroy's case, an average of one to two pothole claims per year does not indicate a process that deters or burdens claimants.

The City does agree that its website does not currently include a direct link to a downloadable claim form, and it will add such a link to its claims webpages as a customer service improvement.

Responses to Recommendations
Recommendation 2a: "All jurisdictions within Santa Clara County should include a link to a map or list of roads they maintain on their claims website. The jurisdictions should implement this by December 15, 2026."
Response: The recommendation has not yet been implemented but will be implemented by December 15, 2026, consistent with the Civil Grand Jury’s recommended timeframe.

Recommendation 2b: "All jurisdictions within Santa Clara County should update their claims websites to identify roads that are commonly mistaken as being in their jurisdictions. The jurisdictions should implement this by December 15, 2026."
Response: The recommendation has not yet been implemented but will be implemented by December 15, 2026, consistent with the Civil Grand Jury’s recommended timeframe.

Recommendation 3b: "Fourteen jurisdictions – the County, Campbell, Cupertino, Gilroy, Los Altos, Los Altos Hills, Los Gatos, Milpitas, Monte Sereno, Morgan Hill, Mountain View, Palo Alto, San José, and Santa Clara – should incorporate useable software on their websites that can translate claim forms into multiple languages or provide claim forms in multiple languages based on the demographics they serve.

The jurisdictions should implement this by December 15, 2026." Response: The recommendation has been implemented. The City has implemented the DocAccess software on its website, which translates all PDF documents, including forms, into multiple languages. The City has also added a direct link to a downloadable claim form.

The City of Gilroy thanks the Civil Grand Jury for its review and its recommendations to improve the accessibility and transparency of the claims process. Please contact the City Clerk's Office at (408) 846- 0204 with any questions regarding this response.

3 Respectfully submitted,
Matt Morley, City Administrator
On Behalf of Gilroy City Council
City of Gilroy

City of Gilroy

STAFF REPORT
Agenda Item Title: Approval of City’s Response to 2025-26 Civil Grand Jury Final Report "VTA’s Management and Oversight of BART
Silicon Valley Phase II"
Meeting Date: August 3, 2026
From: Matt Morley, City Administrator
Department: Administration
Submitted by: Harjot Sangha, Assistant City Administrator Prepared by: Harjot Sangha, Assistant City Administrator STRATEGIC PLAN GOALS:

RECOMMENDATION
Approve the City’s response to the 2025-26 Civil Grand Jury Final Report "VTA’s Management and Oversight of BART Silicon Valley Phase II" and authorize the City Administrator to submit the response.

EXECUTIVE SUMMARY
On June 17, 2026, the 2025-26 Santa Clara County Civil Grand Jury released its final report, "VTA’s Management and Oversight of BART Silicon Valley Phase II." The report examined the Santa Clara Valley Transportation Authority’s (VTA) management and oversight of the $12.7 billion BART Silicon Valley Phase II (BSVII) project, including its funding strategy, oversight structure, coordination with BART, and Board governance.

While most of the report’s findings and recommendations are directed to the VTA Board of Directors, the City of Gilroy is required to respond only to Findings 6 and 7 and Recommendations 6 and 7, which concern how the VTA Board Appointing Authority Groups 2 through 5 make and manage their Board appointments.

Pursuant to California Penal Code sections 933(c) and 933.05, the City’s response is due no later than September 15, 2026. The attached response disagrees with Finding 6 and partially disagrees with Finding 7 as they apply to Appointing Authority Group 4 (Gilroy and Morgan Hill), citing the structured South County rotation framework the two cities jointly adopted by resolution in 2024. The response states that Recommendation

6 will not be implemented because the established Group 4 process meets the needs of both cities, and reports Recommendation 7 as implemented for Group 4, noting that a uniform process spanning Groups 2 through 5 would require coordination among fourteen cities and cannot be accomplished unilaterally by Gilroy.

BACKGROUND
The Civil Grand Jury is a judicial body empowered under California law to investigate and report on the operations of local government agencies. When a Civil Grand Jury final report contains findings and recommendations pertaining to a public agency, California Penal Code section 933(c) requires the agency’s governing body to respond to the Presiding Judge of the Superior Court within 90 days of the report’s release.

Penal Code section 933.05 prescribes the format of that response: the agency must agree or disagree (wholly or partially, with an explanation) with each applicable finding, and must report one of four specified actions for each applicable recommendation. The City received the report and 90-day notice through the City Clerk on June 17, 2026.

The report reviewed the BSVII project’s financial risks, the role of the VTA Board and its Oversight Committee, coordination between VTA and BART, and the experience and continuity of the VTA Board. Among its governance observations, the report noted that VTA directors serve two-year terms and average 3.7 years of service, shorter than directors at peer agencies, and that prior audits have recommended reforms to Board terms and appointment practices. The VTA Board is composed of twelve elected officials appointed by six appointing authority groups. Gilroy and Morgan Hill together constitute Group 4, which appoints one Board member and one alternate on behalf of South County.

In 2024, the Cities of Gilroy and Morgan Hill adopted joint resolutions (Gilroy Resolution No. 2024-50 and Morgan Hill Resolution No. 24-035) establishing a structured South County rotation schedule for the Group 4 seat. Under that framework, the Board member is appointed from one city and the alternate from the other, rotating on a fixed schedule. The City is required to respond only to Findings 6 and 7 and Recommendations 6 and 7, which address whether Appointing Authority Groups 2 through 5 follow the VTA Administrative Code admonitions on transportation experience and consecutive-term reappointments, and whether the groups should adopt a uniform appointment process. Staff coordinated the City’s draft response with the City of Morgan Hill, whose parallel response is anticipated to be considered by its City Council at an upcoming regularly scheduled August City Council meeting.

ANALYSIS
The draft response letter, included as an attachment to this report, addresses each required finding and recommendation in the format prescribed by Penal Code section 933.05, summarized below.

Finding 6 (adherence to Administrative Code admonitions) – Disagree. The City

responds only as to Group 4 and expresses no position on the practices of Groups 2, 3, and 5. The 2024 joint resolutions established a deliberate, publicly adopted framework that promotes continuity and predictability in Group 4 appointments. While the joint resolution does not contain express language addressing the Administrative Code admonitions, the Mayor and Council take transportation experience and qualifications into consideration when selecting the City’s representative, and the member/alternate pairing across the two cities builds experience so that incoming Board members are informed of their role.

Recommendation 6 (certification to the VTA Board) – Will not be implemented.

The established process meets the needs of the Group 4 cities. The City will continue to consider opportunities to facilitate consistency in representation.

Finding 7 (differing appointment processes among groups) – Partially Disagree.

The City understands that the processes used by Groups 2 through 5 differ from one another. Within Group 4, however, Gilroy and Morgan Hill have already adopted a uniform, documented process through the 2024 joint resolutions and rotation schedule.

Recommendation 7 (uniform process across Groups 2 through 5) – Has been implemented for Group 4. The 2024 joint resolutions remain in effect and govern how the Group 4 appointment is made and rotates between the two cities. A single uniform process across Groups 2 through 5 would require agreement among fourteen cities in four appointing groups and cannot be implemented unilaterally by Gilroy. The City is willing to participate in any coordinated effort among those cities, or facilitated by VTA, to develop a common appointment process.

The South County Approach
Group 4 is distinct from the other appointing authority groups in ways that support its approach. It is the only two-city group, representing South County’s shared interests on a Board otherwise dominated by larger jurisdictions. The rotation framework guarantees each city a predictable path to the Board seat, keeps both cities engaged at all times through the member/alternate pairing, and creates a pipeline in which the alternate gains familiarity with VTA matters before assuming the seat. The larger groups, by contrast, comprise three to five cities that negotiate appointments each cycle without a comparable documented framework. The response reflects the City’s position that this structure achieves the continuity and preparation objectives underlying the Civil Grand Jury’s recommendations without the certification mechanism proposed in Recommendation 6.

Rotation Cycle Discussion
The joint resolutions currently rotate the Group 4 seat on a fixed two-year cycle, matching the two-year VTA director term. The Civil Grand Jury’s report observes that short director tenures limit Board experience and continuity, and notes broad support among elected officials for four-year terms. Council may wish to discuss whether a

longer rotation interval for the Group 4 seat would strengthen South County’s continuity and influence on the VTA Board, recognizing that any change would require coordination with the City of Morgan Hill and an amendment to the joint resolutions.

Direction from Council on this question could result in revisions to the final response prior to submittal.

ALTERNATIVES
The City Council may direct staff to modify the response to any finding or recommendation, including revisions reflecting Council direction on the Group 4 rotation cycle, provided the revised response continues to comply with the format requirements of Penal Code section 933.05 and is submitted by the September 15, 2026 statutory deadline.

The City Council could decline to approve a response. This alternative is not recommended, as it would place the City out of compliance with the mandatory response requirements of Penal Code section 933(c).

FISCAL IMPACT/FUNDING SOURCE
There is no fiscal impact associated with approving and submitting the response.

PUBLIC OUTREACH
This agenda item was posted in accordance with the Brown Act. The Civil Grand Jury’s final report is publicly available on the Superior Court’s website, and the City’s response, once submitted, will be placed on file with the Clerk of the Court as a public record.

NEXT STEPS
Upon City Council approval, staff will incorporate any Council direction, including any revisions arising from the rotation cycle discussion, into the final response. The City Administrator will then transmit the response to the Superior Court of California, County of Santa Clara, via email and U.S. Mail in advance of the September 15, 2026 deadline.

Attachments:

1. 2025-2026 Civil Grand Jury Final Report – "VTA’s Management and Oversight of BART Silicon Valley Phase II"

2. Draft City of Gilroy Response Letter

3. Exhibit 1 – Gilroy Resolution No. 2024-50 / Morgan Hill Resolution No. 24-035

SUPERIOR COURT BUILDING • 191 NORTH FIRST STREET, SAN JOSE, CALIFORNIA 95113 • (408) 882-2721 • FAX (408) 882-2795

G R A N D J U R Y S A N T A C L A R A C O U N T Y
June 17, 2026
City of Gilroy
c/o Ms. Kim Mancera, City Clerk
7351 Rosanna Street
Gilroy, California 95020
Sent via email: [email protected]
Dear Ms. Mancera,
The 2025-26 Santa Clara County Civil Grand Jury is transmitting to you its Final Report, VTA’s Management and Oversight of BART Silicon Valley Phase II.

California Penal Code section 933(c) requires that a governing body of the particular public agency or department that has been the subject of a Grand Jury final report shall respond within 90 days to the Presiding Judge of the Superior Court on the findings and recommendations pertaining to matters under the control of the governing body. California Penal Code section 933.05 contains guidelines for responses to Grand Jury findings and recommendations and is attached to this transmission.

Please note:

1. As stated in Penal Code section 933.05(a), attached, you are required to "Agree" or "Disagree" with each applicable Finding: 6 and 7. If you disagree, in whole or part, you must include an explanation of the reasons you disagree.

2. As stated in Penal Code section 933.05(b), attached, you are required to respond with one of four possible actions to each applicable Recommendation: 6 and 7.

Your comments are due to the office of the Honorable Julie A. Emede, Presiding Judge, Superior Court of California, County of Santa Clara, 191 North First Street, San José, CA 95113, no later than Tuesday, September 15, 2026. You may transmit these via email to [email protected]. Copies of all responses shall be placed on file with the Clerk of the Court.

If you have any questions, please contact Britney Huelbig, Deputy Manager for the Civil Grand Jury, at (408) 882-2721 or [email protected].

Sincerely,
Dinesh Ramde
Foreperson
2025-2026 Civil Grand Jury
Enclosures
cc: Matt Morley, City Administrator
Kavita Narayan, Chief Assistant County Counsel, County of Santa Clara

State of California

PENAL CODE
Section 933.05
933.05. (a)  For purposes of subdivision (b) of Section 933, as to each grand jury finding, the responding person or entity shall indicate one of the following:
(1)  The respondent agrees with the finding.
(2)  The respondent disagrees wholly or partially with the finding, in which case the response shall specify the portion of the finding that is disputed and shall include an explanation of the reasons therefor.
(b)  For purposes of subdivision (b) of Section 933, as to each grand jury recommendation, the responding person or entity shall report one of the following actions:
(1)  The recommendation has been implemented, with a summary regarding the implemented action.
(2)  The recommendation has not yet been implemented, but will be implemented in the future, with a timeframe for implementation.
(3)  The recommendation requires further analysis, with an explanation and the scope and parameters of an analysis or study, and a timeframe for the matter to be prepared for discussion by the officer or head of the agency or department being investigated or reviewed, including the governing body of the public agency when applicable. This timeframe shall not exceed six months from the date of publication of the grand jury report.
(4)  The recommendation will not be implemented because it is not warranted or is not reasonable, with an explanation therefor.
(c)  However, if a finding or recommendation of the grand jury addresses budgetary or personnel matters of a county agency or department headed by an elected officer, both the agency or department head and the board of supervisors shall respond if requested by the grand jury, but the response of the board of supervisors shall address only those budgetary or personnel matters over which it has some decisionmaking authority. The response of the elected agency or department head shall address all aspects of the findings or recommendations affecting his or her agency or department. (d)  A grand jury may request a subject person or entity to come before the grand jury for the purpose of reading and discussing the findings of the grand jury report that relates to that person or entity in order to verify the accuracy of the findings prior to their release.
(e)  During an investigation, the grand jury shall meet with the subject of that investigation regarding the investigation, unless the court, either on its own determination or upon request of the foreperson of the grand jury, determines that such a meeting would be detrimental.

(f)  A grand jury shall provide to the affected agency a copy of the portion of the grand jury report relating to that person or entity two working days prior to its public release and after the approval of the presiding judge. No officer, agency, department, or governing body of a public agency shall disclose any contents of the report prior to the public release of the final report.
(Amended by Stats. 1997, Ch. 443, Sec. 5. Effective January 1, 1998.)

2025-2026 Santa Clara County Civil Grand Jury
VTA’s Management and
Oversight of BART
Silicon Valley Phase II
June 17, 2026

VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II

TABLE OF CONTENTS
SUMMARY ................................................................................................................................... 2 BACKGROUND ........................................................................................................................... 3 METHODOLOGY ....................................................................................................................... 7 INVESTIGATION........................................................................................................................ 8 Financial Risks .......................................................................................................................... 8 Oversight Concerns ................................................................................................................ 13 Coordination with BART ....................................................................................................... 21 Board Experience and Continuity......................................................................................... 22 Public Communication ........................................................................................................... 25 CONCLUSION ........................................................................................................................... 26 FINDINGS AND RECOMMENDATIONS ............................................................................. 27 REQUIRED RESPONSES......................................................................................................... 31 APPENDIX A: BART Management Letter ............................................................................. 32 CONFLICTS ............................................................................................................................... 34 REFERENCES............................................................................................................................ 34

VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II

SUMMARY
The Santa Clara Valley Transportation Authority (VTA) project to extend rapid transit rail service through downtown San José is controversial and the most costly and complex project it has ever undertaken. Known as BART Silicon Valley Phase II (BSVII), the $12.7 billion project extends rail service six miles and includes a large, single-bore underground tunnel and will take 10 years or more from 2026 to complete (VTA, March 2024).

Despite significantly reduced ridership projections and uncertainty about funding sources for both capital and operating costs, VTA has awarded major construction contracts, including for the construction of a launch structure to stage a specialized one-of-a-kind Tunnel Boring Machine (TBM), which will be owned by VTA. Over the next few years, VTA anticipates awarding further construction contracts worth billions of dollars. To reduce uncertainty, the spokesperson for an independent peer review of the project urged VTA to move quickly to “build as much as you can, as fast as you can” (VTA Special Board Meeting, 2025). Such an approach assumes that there will be political will and taxpayer support to finish an incomplete project regardless of cost increases, delays, or reduced ridership.

The VTA’s Board of Directors (Board) has recognized the need for additional oversight and guidance, but the Board has failed to exercise its obligation to provide the strategic direction needed for a successful project. The Oversight Committee it created has been left to define its own role. It was not required to, and does not, provide reports that share available independent analyses of critical issues. The Oversight Committee does not routinely make policy recommendations to the Board and does not hold VTA staff accountable for providing the timely analysis it has requested.

The 2025-26 Santa Clara County Civil Grand Jury (Civil Grand Jury) investigated the role of the VTA Board, its Oversight Committee, its staff, and officials in the management and oversight of the BSVII project.

This report identifies financial challenges, risks, and accountability issues that VTA must address to earn the public’s trust in delivering the Bay Area Rapid Transit (BART) extension to Silicon Valley and to secure support for future sales tax measures.

VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II

BACKGROUND
The Valley Transportation Authority is a transportation agency established by state law. It is responsible for operating public transit services, including buses, light rail, and paratransit within Santa Clara County. In addition to public transit, VTA is a planning and funding agency for transportation infrastructure projects throughout Santa Clara County. As established by the California Public Utilities Code Sections 100060-100070, the VTA is governed by a 12-person Board of Directors composed of elected officials appointed by the County of Santa Clara (County) and the cities in Santa Clara County, who each serve two-year terms. The Board has many responsibilities and its monthly meeting agendas are lengthy.

The San Francisco Bay Area Rapid Transit District provides regional commuter rail service and is governed by a nine-person Board of Directors elected to four-year terms from districts representing San Francisco, Alameda, and Contra Costa counties. As part of its larger regional system, BART operates the commuter rail service within Santa Clara County.

By contract with BART, VTA is solely responsible for paying the capital and net operating costs of extending commuter rail service into Santa Clara County (BART and VTA, Comprehensive Agreement, 2001). Although the County was not included in the legislation establishing BART, voters of Santa Clara County supported three sales tax measures which provided funds to plan, build, and operate the extension of BART to Santa Clara County. Today, 1.625% of sales tax collected in Santa Clara County supports VTA and other local jurisdictions (see Table 1). If a currently proposed measure qualifies for the ballot, in November 2026, voters will decide whether to approve an additional 0.5% sales tax to fund local transit, which would increase the County’s base sales tax rate from the current 9.75% to 10.25%.

VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II Table 1: Countywide Sales Tax in Santa Clara County, Effective April 2026 Description Sales Tax % Expiration Funding Purpose
California Base 7.250% No Expiration
State General Fund
Local Revenue Fund
Local Public Safety
Health & Social Services
1976 Measure A 0.500% No Expiration Transit: VTA
2000 Measure A 0.500% 2036 Transit: VTA, BART Silicon
Valley
2008 Measure B 0.125% 2042 Transit: BART Silicon Valley 2016 Measure B 0.500% 2047
Transit: VTA +
County/City/Caltrain/Caltrans
Infrastructure
2012 Measure A 0.125% No Expiration County General Fund 2020 Measure RR 0.125% 2050 Transit: Caltrain
2026 Measure A 0.625% 2031 General incl. Healthcare
Total Base Sales Tax
Rate 9.750%
Data extracted from: California Department of Tax and Fee Administration. 2026. (https://cdtfa.ca.gov/formspubs/cdtfa105.pdf); VTA Annual Comprehensive Financial Report.

Note: Some cities have higher voter-approved rates in addition to the County base rate; Highlighted section of the table refers to sales tax measures that fund VTA.

The first phase of BART to Silicon Valley extended service to Milpitas and then to the Berryessa Transit Center (Berryessa). Construction started in 2012 and was completed in 2020. Ridership for Phase I has not met forecasts, and due to operational, maintenance, and depreciation expenses, VTA has experienced significant financial losses. According to data reviewed by the Civil Grand Jury, BART to Silicon Valley Phase I has lost an average of $69 million annually during the first five years of operation.

The second phase consists of a six-mile, four-station extension from Berryessa through downtown San José to the City of Santa Clara. For this phase, VTA is targeting completion by 2037. As a condition of federal funding, the Federal Transit Administration (FTA) has appointed a Project Management Oversight Consultant (PMOC). The PMOC uses a more conservative schedule and forecasts completion in 2039 (AtkinsRéalis USA Holdings LLC, 2026).

VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II At an early planning stage in 2014, the BSVII project cost was estimated at $4.7 billion. By 2020, the cost estimate increased to $6.9 billion. In 2022, based on the PMOC’s projected cost analysis, VTA submitted an estimate of $9.1 billion to the federal government for an Early Start Grant. In October 2023, VTA estimated the construction cost at $12.2 billion with operations to begin in 2036. The most recent estimate is $12.7 billion, and operations are pushed back to 2037 (VTA Auditor General Report, January 2024).

The project's funding sources include federal and state grants, as well as local revenues from voterapproved sales tax measures. All the funding sources are subject to risks, which are identified in this report. Figure 1 shows the funding sources with $700 million to be determined (TBD) and $375 million from a potential ballot measure in November 2026.

Figure 1: Components of $12.7 Billion in BSVII Funding Sources as of April 2026 Source: vtabart.org website (accessed April 9, 2026)
Although two years earlier, VTA had asked for a federal commitment of $6.3 billion, in August 2024, the FTA announced that its share of funding would be capped at $5.1 billion (Geha, 2024).

VTA was forced to increase its reliance on local sales tax revenue and still faced a gap of approximately $700 million (VTA, Summer 2025). To reduce project costs, VTA has been studying design changes while maintaining the full six-mile extension with four stations. Options discussed by VTA staff and officials include (VTA, November 11, 2024):
• Simplifying station configurations;

VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II • Modifying the Santa Clara Newhall Yard and Maintenance Facility; • Modifying the tunnel and station ventilation systems; • Substituting a surface parking lot for a parking structure; • Reconfiguring the tunnel to use less concrete and steel.

In addition, the funding strategy assumes $375 million from the yet-to-be-approved regional sales tax measure for a total outstanding gap of $1.075 billion.

Due in part to the significant increase in estimated cost and a perceived lack of communication about the project’s cost, risks, and schedule, the Board conducted a workshop in October 2023 to review the project’s status. At this workshop, individual Board members expressed a lack of confidence in the VTA staff’s management of the project and requested a new system of oversight and project management.

In response, the Board chair established an Ad Hoc BART Silicon Valley Phase II oversight committee (Oversight Committee) responsible for overseeing all aspects of the project, focusing on a full, independent, and transparent review of costs, funding, risks, and completion schedule.

The Oversight Committee’s bylaws later stated that its purpose was to provide “guidance and oversight” of the project (VTA, April 4, 2024).

The VTA independent auditor general was tasked with providing staff support to the Oversight Committee and was authorized to contract with Subject Matter Experts (SMEs) to independently review and comment on VTA staff recommendations regarding costs, risks, and schedule. In turn, the Oversight Committee authorized the SME firm, Gall Zeidler (GZ), to independently assess the risks and viability of cost-saving alternatives.

In a 2001 Agreement, VTA and BART agreed to cooperate in the project’s planning, design, and construction. They established a series of interagency committees, the latest of which is the Joint VTA/BART Working Committee, which depending on the availability of its members, is scheduled to meet quarterly. BART staff members have been assigned to co-locate with VTA engineers to participate in the preparation and review of BSVII designs in accordance with the agreed Project Design Criteria Manual. According to the BART Inspector General, VTA has reimbursed BART $19.2 million through 2025 for the cost of the assigned employees (BART, December 19, 2025). In August 2025, the BART assistant general manager, operations, rejected some of VTA’s proposed design changes and scope reductions and complained about inadequate coordination (see Appendix A). The BART inspector general issued a report in December 2025 that also raised concerns about inadequate coordination and criticized VTA’s communication with BART officials (Id.).

VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II

METHODOLOGY
The Civil Grand Jury reviewed every meeting of the BSVII Oversight Committee, as well as select VTA Board meetings. This included reviewing agendas, minutes, agenda item reports, public comment submittals, and associated discussions.

In addition, the Civil Grand Jury conducted 17 interviews of officials from VTA, BART, and the State of California. The Civil Grand Jury also reviewed publicly available documents as described in the reference section, as well as documents requested from VTA and submitted to the Civil Grand Jury.

VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II

INVESTIGATION
The Civil Grand Jury investigation of the BSVII project covered critical aspects of VTA’s management and oversight, including:
• VTA’s funding strategy and its reliance on voter-approved sales tax measures, some of which expire before completion of the project, and some of which have yet to be approved; • The establishment of a separate Oversight Committee which provides guidance on the BSVII project and how it evaluates independent analyses provided by the VTA auditor general, contracted SMEs, and the federally mandated PMOC; • The contractual and practical requirement to closely coordinate with BART, which will serve as the system operator;
• The impact of the VTA Board’s governance structure on the effectiveness of strategic direction, management, and oversight of the project;
• VTA’s approach for keeping the public informed of costs, risks, and schedule.

Financial Risks
The 10-year project completion timeline of BSVII exposes VTA to financial risks that require careful, ongoing assessment of capital and operating costs, including that:
• Rising labor and material costs, combined with aggressive construction methods and schedules, may increase total project costs and strain the budget’s contingency for unforeseen risks and unexpected expenses;
• Delays or reductions in state and federal funding will create greater pressure to rely on local funding sources or scale back the scope of the project; • Lower ridership levels will increase VTA’s ongoing obligation to pay net operating costs, which would necessitate service level reductions or voter approval of new or extended sales tax measures;
• Failure to maintain a cash-flow model exclusive to BSVII, means that contracting options for accelerating work may not be able to be financed with available resources.

Risk of Increased Costs of Labor and Materials
The FTA fiscal year 2025 New Starts Financial Assessment report for BSVII stated the VTA inflation estimate was optimistic. If labor and material costs were to rise above those estimated in VTA’s budget, it could lead to funding shortfalls (FTA, 2024).

VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II The VTA auditor general’s May 1, 2025, report to the Board also identified BSVII financial risks associated with project construction costs. The report found that the assumptions and historical data underlying VTA’s financial plan could be more robust to enable the Board and the public to evaluate the financial risk associated with the potential cost increases (VTA, 2025).

Another factor that increases the difficulty in predicting materials and labor costs is the possible extension of the 2037 project completion date. The longer timeline for BSVII increases the likelihood that future costs will differ from current estimates, thereby increasing financial risk.

Local, State, and Federal Funding Risks
The capital cost of construction and the net operating costs are to be paid by VTA from specific revenue sources, some of which are grants with fixed amounts.

The financial risks identified by the Civil Grand Jury have been experienced by other major transit agencies. For example, the various rail projects of the Los Angeles County Metropolitan Transportation Authority (LA Metro) faced escalating cost estimates, reductions in federal funding, cuts into smaller construction segments to match available funding, and shifting agency priorities (Shalby, 2026).

Local Funding Risks
VTA’s capital financing plan calls for the 2016 Measure B to pay $2.5 billion and for the 2000 Measure A to pay $2.0 billion of the estimated $12.7 billion BSVII project. Measure A expires in 2036, before BSVII is expected to be completed. Measure B expires in 2047 (VTA, About 2016 Measure B, n.d.). As the project’s cost estimates have evolved, so have the planned funding sources. Measure B has become a much more significant source of proposed funding.

Because Measure B also funds bus transit, local streets, and highway projects, there are built-in limitations on the amount available to close a BSVII financing gap. Measure B limits spending on BSVII to 23.8% of net sales tax revenue over its 30-year life (FTA, 2024). Net sales tax revenue (defined as Program Tax Revenue in the measure) is calculated as the amount remaining after deducting administrative costs and any debt service.

To close current and potential future funding gaps, VTA could issue bonds to be repaid from Measure B sales tax revenue. However, this would reduce the revenue available for other voterapproved projects. Every dollar spent on debt service for BSVII is a dollar that cannot be spent on

VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II the other transportation projects approved by the voters. Because of bond issuance and interest costs, the total project costs would exceed the current estimate of $12.7 billion.

Another risky approach to filling funding gaps would allow the Board to change the rules and permit a greater percentage of Measure B net sales tax revenue to be used for BSVII. One VTA official acknowledged to the Civil Grand Jury that this would be a “heavy lift” because VTA would first have to notify all the local agencies of the proposed increase in the percentage limit and then approve it by a ¾ vote of the Board (9 of 12 Board members). The County and the cities that have planned other transportation measures are likely to object to reduced funding for their projects.

Of course, more Measure B funds could become available to support the capital costs of BSVII if the expected sales tax revenue exceeds previously anticipated levels. While early projections were based on 2016 economic conditions, it is important for the strategic funding plan that the sales tax forecast be updated regularly. The Civil Grand Jury was informed that VTA has ordered an updated forecast.

Because two key sales tax measures are set to expire, several VTA officials stated in interviews that they would simply place a measure on a future ballot for voter consideration if an extension were needed. Given the current sales tax rates applicable within Santa Clara County and the need for management and oversight reforms identified in this report, there is a risk that voters may not approve such a measure.

State Funding Risk
As of April 2026, the capital construction funding strategy required $1.5 billion from two State of California grants. The VTA has received commitments for nearly $200 million of that total. The sources of funding are the Transit and Intercity Rail Capital Program (TIRCP) and transportation funds administered by the Metropolitan Transportation Commission (MTC), both of which may be affected by a recent state decision to provide a bridge loan to Bay Area transit agencies (MTC, 2026).

In February 2026, the California legislature appropriated $590 million from the same TIRCP account to provide a 12-year loan to MTC. These loan proceeds will be made available to San Francisco Municipal Transportation Agency, AC Transit, BART, and Caltrain to help address a greater need for public transit subsidies. The agencies are required to repay the loan over 12 years (MTC, 2026).

VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II The state justified the loan on the basis that the transit agencies would be able to stabilize their financial situations and avoid service reductions pending the anticipated approval in November of a regional sales tax measure. If the regional measure does not pass, or if for any other reason the agencies do not repay the loans on time, the timing of the receipt of funding to VTA might create some cash flow risk for the project.

Further, the TIRCP account itself is funded by payments from private parties who agree to purchase pollution credits in the state’s Cap and Invest program. The program’s future is uncertain in light of federal changes to environmental regulations and pending legal challenges from the State of California (California State Transportation Agency, n.d.).

Federal Funding Risk
In August 2024, the FTA advised VTA that the federal government’s total contribution to the project would be limited to $5.1 billion. To receive these funds, VTA plans to apply for a Full Funding Grant Agreement (FFGA) by the end of 2026.

Federal support for large-scale rail projects is uncertain. In 2025, the FTA canceled a $4.2 billion commitment to the California High-Speed Rail Project (Shalby, 2025). VTA’s lobbyists have suggested delaying the FFGA application until similar requests from other states are resolved.

Considering the political, economic, and budgetary conditions of the United States, approval of VTA’s request for an FFGA is highly uncertain. It may be delayed, reduced, or denied.

Low Levels of Ridership Could Increase VTA’s Future Costs BART ridership on the current regional system has not recovered to pre-pandemic levels.

Ridership in January 2026 remains only 48% of the levels in January 2019 (BART, January 2026; BART, 2019). Recovering ridership may prove difficult due to the growth of hybrid work patterns.

The Civil Grand Jury also reviewed the forecasts for the first phase of the project, which included the new Milpitas and Berryessa stations. For January 2026, ridership was 86% below estimates (see Table 2).

VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II Table 2: BART Ridership at Milpitas and Berryessa Stations Forecast for Average Daily
Weekday Ridership for
June 2021 at launch
Actual Ridership,
January 2026
Ridership/Day 20,110 2,789
Source: Joint VTA/BART Working Committee Meeting, December 4, 2020; BART February 2026 Monthly Ridership Snapshot.

Note: VTA created forecasts in 2020, expressed as rides per day. BART actuals are based on recorded station entries and exits. To normalize BART actuals to the VTA forecast, entries and exits were averaged to produce a daily ridership figure.

An overall decrease in ridership has led BART to project a $376 million budget deficit for FY2026-

27. To seek additional revenue, BART is relying on a 0.5% additional sales tax measure on the November 2026 ballot that would begin in 2027 and remain in place for 14 years. If the ballot measure does not pass, BART has proposed closing up to 15 stations and reducing service hours and train frequency (BART, February 26, 2026). Ironically, the proposed station closures would not affect Santa Clara County because VTA is solely responsible for the net operating costs.

According to VTA records reviewed by the Civil Grand Jury, for the first three years of operation, VTA forecasts annual average costs of $274 million for operations, maintenance, and capital costs.

Average fare revenue is forecast at $60 million, offsetting VTA's financial obligation to BART, resulting in an average annual financial loss of $214 million. Any drop in ridership will lead to further financial losses.

The Need for a BSVII Cash Flow Model
With a price tag of $12.7 billion, BSVII is the largest public infrastructure project in Santa Clara County (Aragon, 2025). Nearly 60% of the planned funding sources include revenue from grants that will not be distributed in advance but will be reimbursed in accordance with each grant’s draw schedule (See Figure 1). The timing of those cash inflows must be carefully matched with the timing of payment schedules for construction contracts worth billions of dollars.

VTA staff is evaluating different approaches to contracting the construction work. Alternatives are being evaluated for the following reasons: 1) to identify segments of work that could be bid out separately to accelerate the overall schedule; and 2) to identify segments for which there is a greater likelihood of strong competitive bids. For each contract, the cash outflows will be specified and must be carefully matched with the cash inflows.

VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II A cash flow model that matches receipts and expenditures for BSVII would enable VTA decisionmakers to fully evaluate the alternative approaches being studied. However, VTA officials have advised the Civil Grand Jury that such a model has not yet been developed. A cash flow model is necessary to avoid unplanned delays from cash shortfalls.

Oversight Concerns
VTA Board Recognizes That Oversight Must be Improved
Independent reports and audits have identified problems with project management and VTA Board oversight, including those identified by a prior Civil Grand Jury, the California State Auditor, and the PMOC (AtkinsRéalis USA Holdings LLC, 2026). VTA’s cost-estimation practices, along with its lack of transparency around changes to project scope and cost, were identified as significant deficiencies. VTA’s oversight and management of the BSVII project have also been heavily criticized by the media, in public comments presented at Board meetings, and in letters to the editor of multiple local publications.

VTA Board Outsources Guidance and Oversight of the BSVII Project Following a workshop on the project’s direction in October 2023, the VTA Board Chairman announced the creation of an Ad Hoc BART Silicon Valley Phase II Oversight Committee (VTA, 2023).

However, only the Board can make binding decisions on the project’s scope, funding, risks, schedule, and contracting approach. While ultimately accountable itself, the Board nonetheless effectively delegated oversight to a committee without providing clear direction. By abdicating its responsibility to set its expectations of how the Oversight Committee can best support the Board, the committee has been left to set its own course. That course does not keep the Board fully informed of issues raised by independent experts or the PMOC, hampering its ability to make the best decisions about the project's funding and schedule.

At its meeting on January 15, 2026, the Oversight Committee adopted what it called a revised charter intended to clarify the lines of communication and relationships among the auditor general, SME, VTA staff, and Oversight Committee (VTA, January 15, 2026). Members of the Oversight Committee had expressed concern about a perceived lack of coordination between VTA staff and the SME. Nonetheless, the question remains: Is the role of an SME to provide the Board with an independent review of VTA staff recommendations as originally intended, or is it to help VTA staff improve their recommendations? Notably, in the following excerpt, the Charter requires the

VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II auditor general to document issues raised by the SME and the VTA staff but does not require that the full Board be advised of the critical issues:

To ensure transparency and balanced oversight, selected advisory input from SME will be documented in Oversight Committee materials. Where consensus exists between the SME and the Project Team, it will be noted. Where minority or dissenting views are expressed, the AG [auditor general] will explicitly record final input received alongside the majority view (VTA Oversight Committee Charter, 2026).

During Oversight Committee meetings, there are few deliberations or actions to provide collective guidance or oversight, leaving individual members to raise questions and propose guidance for VTA staff to consider. VTA staff also receives input from individual members in private premeeting briefings. As a result, the full Board does not benefit from Oversight Committee analysis, and the public is not fully informed about individual Board member perspectives.

The Committee Has Two Purposes: Guidance and Oversight
“Guidance” suggests that the committee helps the Board establish a strategic direction and recommend actions to keep the project on track. “Oversight,” on the other hand, is a separate function that ensures VTA staff is accountable for following the Board’s direction in an efficient and effective manner. “Guidance” looks forward. “Oversight” monitors implementation as it happens.

Better at Oversight than Guidance
The Oversight Committee requires VTA staff to produce a comprehensive monthly report detailing the financing and construction progress of the BSVII project. The auditor general provides insightful periodic reports on his independent review of the project’s costs, risks, and schedule.

The VTA staff’s monthly reports address the information gap identified in the auditor general’s January 2024 report. As a result, the Oversight Committee can effectively monitor compliance with the Board’s direction.

However, the Oversight Committee often fails to provide guidance on issues critical to future strategic direction.

VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II Strategic Guidance on Critical Issues is Informal, Intermittent, and Often Late VTA staff routinely provide private briefings to Oversight Committee members prior to meetings.

Those briefings allow VTA staff to explain and advocate for their recommendations and to receive input and questions from individual members. Occasionally, some agenda materials for an Oversight Committee meeting are not published with the rest of the agenda because VTA staff members will modify presentations up to the last minute based on what they have heard in private briefings.

The Oversight Committee has established an informal standard of limiting its once-monthly meetings to no more than two hours, and meetings often do not begin on time. At the meetings, VTA staff often deliver lengthy presentations on issues for which it will subsequently seek Board approval, leaving little time for committee deliberations.

During these presentations, only a few members ask questions, and rarely does a committee member propose a policy recommendation that the Oversight Committee might take action on.

Individual Oversight Committee members are given the opportunity to express support or concern about a proposed VTA staff position, providing VTA staff with some insight into how to frame their recommendations to the Board.

The Oversight Committee receives independent analyses from the VTA auditor general, its contracted SME, and the PMOC. The committee often receives lengthy written comments from the public but limits oral comments to one minute. Members of the committee rarely comment on materials received from the public, many of which are extensive critiques of the VTA staff recommendations. Following each meeting, the Oversight Committee chair submits a short report summarizing discussion topics, which is placed on the VTA Board’s consent calendar.

Following presentation to the Oversight Committee, formal VTA staff recommendations are made to the VTA Board, but without the benefit of a summary or synthesis of the alternative perspectives from the auditor general, SME, PMOC, or informed public comment.

The Civil Grand Jury identified three examples of policy issues for which guidance was needed but delivered inadequately. One of the examples, the single-bore versus twin-bore issue, illustrates both the failure of the committee to make recommendations and the VTA staff’s failure to follow through on committee requests in a timely manner.

VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II Example of Inadequate Guidance: The KST Contract Decision The Oversight Committee endorsed a major contract change without providing independent analysis, articulating its rationale, or conveying identified risks to the Board.

VTA had issued a contract to a construction consortium, Kiewit Shea Traylor (KST), using a “progressive/design/build” approach, under which KST would design the tunnel project and, after reviews by VTA and its construction management consultant, KST would build it. By the spring of 2025, VTA believed that KST’s proposed design could significantly increase the project’s estimated cost by up to $1 billion and that it would be preferable to engage in a competitive bidding process for the remaining tunnel work. In a more traditional contract approach, VTA would prepare the design specifications and contract conditions. To accomplish this, it was necessary to limit the contract with KST to only the work required to prepare for the TBM, which VTA would own but make available to the tunneling contractor to operate and maintain.

At its June 12, 2025, meeting, VTA staff presented its proposal to modify the KST contract to the Oversight Committee, which unanimously endorsed it. Two weeks later, the VTA Board met and approved VTA staff recommendations. Although the VTA staff agenda report did include a reference to the Committee’s recommendation, it did not include the risk analysis that had been reviewed by the Committee. The Oversight Committee’s regular report to the VTA Board was placed on the consent calendar and simply reported the committee’s concurrence with the VTA staff recommendation. There was no report or analysis laying out the reasons for the Oversight Committee’s concurrence or the SME’s risk assessment. Therefore, the Board made its decision without a complete understanding of the risks.

Example of Inadequate Guidance: The Twin-Bore versus Single-Bore Decision The Oversight Committee retroactively requested a side-by-side analysis of tunnel options through Downtown San José.

A preliminary design controversy was whether to tunnel two smaller bores for the downtown San José underground tracks or to tunnel a single larger bore at greater depth. Downtown businesses had raised concerns that the twin-bore approach would require additional work and disrupt their operations during construction.

BART initially opposed the single-bore tunnel approach because it differed from its existing, smaller twin-bore tunnels. However, the BART inspector general reported that in the spirit of

VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II cooperation, BART officials consented to the single-bore approach after being assured that operational and safety concerns would be met (BART, December 19, 2025).

In December 2022, VTA approved the fabrication and purchase of a large TBM for $76 million, effectively locking in the single-bore approach. In a news article dated November 7, 2023, in the Mountain View Voice, San José Mayor Matt Mahan was quoted as saying: “There is no turning back now” (Hicks, 2023).

Nonetheless, individual Board members and informed public commenters continued to raise questions about whether a twin-bore approach might be cheaper, faster, and safer for BART operations. In response, members of the Oversight Committee commissioned an analysis of the two options for costs, risks, and impact on schedules.

In September 2025, more than 18 months after the request, VTA and its engineering consultants presented their analysis to the Oversight Committee, confirming the single-bore approach.

Although it had requested the analysis, the Oversight Committee did not make a recommendation to the Board. In October 2025, the Board was presented with the VTA staff and consultants’ analysis and confirmed the single-bore approach by declining to take steps to amend the environmental documents or modify the tunneling contracts.

Example of Inadequate Guidance: Scenario 1 versus 1a Decision In October 2025, VTA decided on an approach to the construction of the tunnel without the benefit of the SME’s analysis that the Oversight Committee had requested.

Before design work could progress to a more advanced level, the VTA Board needed to decide between two alternatives for staging the actual tunneling work. The SME had suggested that concurrent tunneling from both ends could reduce costs and accelerate the schedule (VTA, June 12, 2025). The two options were labeled “Scenario 1” (a straight-through tunneling using the larger TBM from west-to-east) and “Scenario 1a” (an option of concurrent tunneling starting at both the east and west portals using two TBMs).

Although this would require two TBMs, the east-to-west work could be done simultaneously with a smaller-bore tunneling machine. Further, the SME reported that a smaller-bore TBM was readily available and would require less lead time than the TBM being fabricated in Germany.

Because the Oversight Committee considered the potential benefits significant, the committee asked both VTA staff and the SME to analyze the options and prepare a recommendation. On

VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II August 4, 2025, the Oversight Committee authorized an expenditure of $110,000 and directed the auditor general to contract with GZ for the requested work. GZ presented interim reports on September 11, 2025, and October 9, 2025, and promised to deliver its completed report at the November 2025 meeting of the Oversight Committee.

VTA staff subsequently presented its analysis and recommendations to the Oversight Committee on October 9, 2025. Although the Project Manager stated that the VTA staff was aware of some of GZ’s preliminary analysis (especially differing assumptions about the rate at which each of the two TBMs can move forward when digging a tunnel), VTA staff requested a Board meeting to decide between the two alternatives. In prior presentations to the Oversight Committee, VTA staff said that the analysis would be presented at a Board “workshop” (at which no formal action could be taken). However, a special meeting of the Board was called for October 17, 2025, and VTA staff made its recommendations to the Board, neglecting to advise the Board that the Oversight Committee was still awaiting the GZ analysis that the Committee had authorized.

The Oversight Committee failed to present any report or recommendation at the special meeting.

As a result, the Board adopted ‘Scenario 1’ without the benefit of an independent analysis of the risks.

On February 12, 2026, four months after the Board made its decision, the SME presented his written report analyzing the options and raising concerns that should have been considered before the decision.

VTA Staff Accountability for Responding to Oversight Committee Member Requests The auditor general maintains two types of monitoring reports: a tracking report that lists the requests of individual committee members for information or analysis, and a work plan that lists the schedule for upcoming formal reports, including risk assessments such as financing and procurement risks. Both monitoring reports establish a due date, but the deadlines are often not met.

During public meetings, Oversight Committee members rarely discuss the tracking report or the work plan and do not publicly comment on changes to the expected date in subsequent reports.

More importantly, neither the auditor general nor the Oversight Committee holds VTA staff accountable for late responses to issues raised in the tracking report. Below, the Civil Grand Jury presents two examples:

VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II Example of Lack of Accountability: Prolonged Delay in Analysis of Single-Bore versus Twin-Bore The side-by-side analysis of two design options was not provided until more than 18 months after it was first requested.

At the Oversight Committee’s first meeting in November 2023, a member of the public requested that the committee order a cost and risk analysis of the single-bore versus twin-bore options, which remained controversial following the VTA Board’s selection of the single-bore option in 2018. In 2023, the Chair of the Oversight Committee responded that such an “apples-to-apples” (side-byside) analysis would be one of the committee’s first tasks. Here are some of the subsequent activities:
• At the committee’s meeting on January 19, 2023, two committee members formally requested the “apples-to-apples” analysis and placed it on the committee’s tracking list. (VTA, March 2025). At its meeting on June 13, 2024, the Project Manager reported that the scope of the twin-bore analysis would be worked on and reported to the Board “over the course of the summer.”
• At its meeting on August 8, 2024, a member of the public asked about the status of the “apples-to-apples” analysis.
• At the September 12, 2024, Oversight Committee, the auditor general announced that VTA staff had asked engineering design contractor Mott Macdonald to conduct the “apples-toapples” review. • The March 2025 tracking report included a comment regarding the “apples-to-apples” comparison: “These items are being evaluated as part of cost savings task force efforts with participation from GZ” (VTA, April 2024).
• One year later, on September 11, 2025, Mott Macdonald presented its analysis of the twinbore versus single-bore options – nearly 22 months after the request was first discussed at an Oversight Committee meeting – concluding that the single-bore option was preferred (VTA, September 11, 2025).

Example of Lack of Accountability: An Alternative Strategy Some Call “Plan B” Despite multiple requests for an alternative strategy to address risks associated with the federal funding decision, VTA staff advised the Oversight Committee that it would wait until after the federal decision.

Since the Oversight Committee meeting on October 9, 2025, committee members have stressed the need for an alternative strategy in the event the federal government delays or denies the FFGA

VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II for the promised $5.1 billion. Some committee members asked whether a “Plan B” might include reducing the number of planned stations or revising the funding strategy. VTA staff reported to the Civil Grand Jury that there was reluctance to discuss a “Plan B” out of concern that the discussion itself might jeopardize the FFGA. At public meetings, VTA staff dismissed requests for an alternative funding strategy, instead reporting that an alternative plan should not be prepared until the FTA made its decision in 2027. This is an example of the VTA staff’s dismissal of the Oversight Committee direction.

Expediency of Decisions versus Rigorous Analysis
The Civil Grand Jury identified tension between VTA Board members’ competing goals: avoiding delays in decision-making and requiring rigorous, independent analysis of costs, risks, and schedule. In public meetings, the Project Manager has often stated that each month of delay adds $20 to $30 million to the overall project cost (Dorsey, 2025).

There is a strong financial incentive to keep the project moving by advancing decisions incrementally—approving one component at a time to show visible progress—without fully evaluating how each step alters the project’s overall cost, scope, and risk. For a project of this size, complexity, and cost, this piecemeal approach masks cumulative effects, increasing the likelihood of cost escalation and delays. These should be identified and addressed through rigorous, frontend analysis.

With two-year terms and constituencies limited to portions of the County, Board members may understandably focus on immediate actions rather than the long-term, systemwide implications that demand a coherent strategic plan.

The Role Assigned to the Auditor General
The Oversight Committee benefits from periodic risk assessments and audits performed by the VTA auditor general on the BSVII project. However, by assigning the auditor general the responsibility to also provide staff support to the Oversight Committee, VTA has created a situation in which the auditor general is asked to provide an independent audit of prior decisions while also assisting the committee in evaluating future policy and management decisions.

At the June 2025 public Board meeting, the auditor general stated that he sometimes feels like a referee among the analyses provided by VTA staff, the SME, the public, and the PMOC. However, the VTA Board is the final arbiter, not the auditor general.

VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II The Board is best served when it hears all relevant views on an upcoming decision and is presented with options and a recommendation. The auditor general’s participation and input are critical, but he should not be placed in the position of having to synthesize all the competing views, including his own.

The auditor general is better placed to assist the Oversight Committee in its role of “oversight” and less so in commenting on the Oversight Committee's “guidance” functions. Accordingly, the Oversight Committee and the VTA Board would be better served if a VTA staff person were assigned responsibility for staffing the committee. This person could be part of the General Manager’s Office and should not report to the Project Manager. The position would be like that of the chief of staff, which was recently assigned to support the chair of the Board.

Coordination with BART
Because the County of Santa Clara is not part of the BART District, the extension of rail service to San José required a contract that established both VTA’s and BART’s commitment to cooperate.

Under the 2001 Cooperative Agreement, VTA is financially responsible for paying for the design, construction, and operation of the segment in Santa Clara County (BART and VTA, Comprehensive Agreement, 2001). BART retained approval authority over design elements that affect operations, maintenance, and safety. To date, this has been accomplished through the joint preparation of a Design Criteria Manual.

As recently as December 2025, BART’s Independent Office of the Inspector General (OIG) issued a report titled: “Transparency & Communication Gaps in the BSVII Project.” The report summarizes years of controversy over the single-bore versus twin-bore approach but acknowledges that BART eventually agreed to the single-bore concept evaluated in the final environmental impact statement. However, the BART OIG remained critical of the extent of cooperation between the two agencies:

We also determined that the length of time since the project began, extensive media coverage of the project, conflicting subject-matter opinions, and some public displeasure with the single-bore design have created uncertainty about the project’s direction. We concluded that gaps in transparency and communication, including limited public discussions in recent years, have resulted in mixed messaging on a project that has evolved over multiple decades (BART Independent Office of the Inspector General, 2025).

In August 2025, the lack of communication and cooperation was publicly exposed when a BART official wrote a letter to VTA (Appendix A) specifically objecting to the consideration of reducing

VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II the size of the Newhall Yard and Maintenance Facility as a capital cost-saving measure. The VTA Project Manager publicly acknowledged a failure to keep BART informed of design issues that might impact BART’s operational efficiency and pledged to develop recommendations to the administrative heads of both agencies on a more formal process to identify and resolve those issues (VTA Oversight Committee, 2025).

Board Experience and Continuity
Since 2019, five audits and reports have critiqued VTA’s governance structure and recommended a series of revisions to improve VTA’s capability to provide Board direction and oversight of the BART extension. Those audits have included the 2018-19 Santa Clara County Civil Grand Jury in 2019; the Auditor of the State of California, in 2024; the BART Independent Office of the Inspector General in 2025; RSM US LLC, a VTA subcontractor, in 2019; and the VTA Auditor General in 2024. VTA has accepted and acted on most of the recommendations for governance reform, except those relating to the terms and required experience level of Board members.

During the investigation of the BSVII project, sources repeatedly raised concerns about the level of knowledge and decision-making ability of the full VTA Board, which is responsible for the project’s success. Decisions made today will have a direct impact on its ultimate success. Diligent oversight of its schedule, cost, progress, and scope is required.

According to the California Public Utilities Code, which established the VTA Board, “to the extent possible, the appointing powers shall appoint individuals who have expertise, experience, or knowledge relative to transportation issues” (Pub. Util. Code 10000 et seq).

VTA Board members are appointed to two-year terms by appointing agencies, organized into six groups as detailed in Table 3. Appointing agency groups are established and defined by VTA Administrative Code, which states “Appointing Authorities are strongly encouraged, where possible, to: (1) appoint individuals with appropriate experience and qualifications in transportation; (2) ensure that there is sufficient remaining time in the elected official’s term of office to allow full completion of their term as a Director; and (3) reappoint representatives to consecutive terms” (VTA Administrative Code § 2-13).

VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II Table 3: Appointing Authorities Composition of the VTA Board Appointing
Agency
Group
Jurisdiction Represented Number of
Board Members
Method of
Appointment
Group 1 San José 5 members
1 alternate
Appointed by city
council from city
council members/mayor
Group 2 Los Altos, Los Altos Hills,
Mountain View, Palo Alto
1 member
1 alternate
Determined by
Group 2 members
Group 3
Campbell, Cupertino,
Los Gatos, Monte Sereno,
Saratoga
1 member
1 alternate
Determined by
Group 3 members
Group 4 Gilroy, Morgan Hill 1 member
1 alternate
Determined by
Group 4 members
Group 5 Milpitas, Santa Clara,
Sunnyvale
2 members
1 alternate
Determined by
Group 5 members
Group 6 County of Santa Clara 2 members
1 alternate
Appointed by County
Board of Supervisors
Source: California Pub. Util. Code section 100060.

While VTA continues to insist that two-year terms are suitable for its governance (as specified in PUC § 100060.2), peer agencies in the state appoint their Board members to four-year terms, leading to much longer average lengths of service and potentially greater experience and transportation-related knowledge (see Figure 2).

Multiple reports and audits have suggested weaknesses introduced by VTA’s approach to the appointment of Board members. For example, the 2019 Board Governance Assessment concluded, in part, that some processes and policies (e.g., committee structure, term limits, and Board member selection guidelines) might not reflect best practices or support long-term Board stability (VTA, 2019). Additionally, a report by the 2018-19 Santa Clara County Civil Grand Jury found that the VTA Board suffers from:
• A lack of experience and limited continuity by many Board members; • Inadequate time for the directors to devote to the Board’s oversight and policy-making functions;
• A lack of engagement by some of the directors, fostered in part by the committee system, resulted in VTA functioning largely as a staff-driven organization.

More recently, a critical 2024 report from the State Auditor regarding VTA’s project management and financial oversight noted the following weaknesses:

VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II • The process for selecting directors for the Board is not always transparent enough to ensure the appointment of directors experienced in transportation issues. • Some groups of cities appoint VTA directors without public deliberation, limiting transparency and sometimes bypassing the statutory recommendation for transportation expertise.
• VTA directors have shorter tenures, on average, than their peers, meaning that VTA’s Board has less experience overseeing the agency’s operations than the Boards of peer agencies.

Figure 2: Average Directors’ Tenure among VTA and Peer Agencies Source: Auditor of the State of California, “Santa Clara Valley Transportation Authority, Improvements Are Necessary to Strengthen Its Project Management and Financial Oversight,” June 2024.

Note: LA Metro stands for Los Angeles County Metropolitan Transportation Authority; OCTA stands for Orange County Transportation Authority; SacRT stands for Sacramento Regional Transit District.

During interviews and in reviewing existing reports and audits about VTA, the Civil Grand Jury learned that Board members and elected officials broadly support a four-year term for directors.

Lengthening terms would require a change to VTA’s enabling legislation. The findings of the State and VTA’s own auditors’ governance reform recommendations remain unchanged.

VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II Public Communication
Following the VTA auditor general’s report in January 2024, public communication and community outreach regarding the BSVII project have improved. The Civil Grand Jury noted improvements to the VTA BSVII project website, including efforts to deliver timely updates to residents about the impact of construction activities, and a section for frequently asked questions (FAQ) (VTA, BART Silicon Valley Phase II Project, n.d.). In addition, many interviewees told the Civil Grand Jury that VTA has made efforts to better inform the public and officials since the auditor general's report highlighted communication breakdowns in 2023.

However, there are areas where the public would benefit from VTA focusing more on improving communication.

The VTA’s BSVII project website does not offer a simple, clear dashboard outlining the costs, timeline, and progress of the BSVII project. Although it includes technical reports from the federally sponsored PMOC, it does not include the independent analyses by the SME or the VTA auditor general.

A high-level dashboard would consolidate information from multiple sources, present project metrics to the public, and provide access to source materials. Today, information on funding, expenditures, and schedule status is available on the website, but is buried in layers of reports that are nonintuitive to find or navigate.

In addition, the Civil Grand Jury found the site’s search function inadequate for locating specific details or addressing questions not covered in the FAQ, and it often returned results for irrelevant materials. The website would be more user-friendly if VTA incorporated a more robust search engine.

VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II

CONCLUSION
The VTA Board has failed in its responsibility to provide effective management, oversight, and financial control of the BSVII Project.

Based on its investigation, the Civil Grand Jury concludes:
• There is no realistic plan to deal with foreseeable financial risks, including significant uncertainty about BSVII’s construction and operating costs, reliance on expiring voterapproved sales tax measures, uncertain federal government support, cash flow, and declining ridership.
• When considering major scope and design decisions, the Oversight Committee and the VTA Board do not take into account the ongoing operations and maintenance costs that will be borne by VTA and will require voter approval of subsequent sales tax measures. • The Oversight Committee exercises its oversight responsibility by requiring monthly progress reports and by questioning VTA project staff, but when it declines to make recommendations to the VTA Board, it fails in its responsibility to provide guidance on critical policy issues.
• The Oversight Committee receives valuable input from multiple sources but does not share this information with the VTA Board in the form of helpful reports that synthesize the different perspectives of VTA staff, the Subject Matter Expert, the auditor general, the Project Management Oversight Consultant, and the public. • The VTA Board and the Oversight Committee have failed to hold VTA staff accountable for missing deadlines to provide analysis and information requested by members of the Oversight Committee.
• There is a lack of meaningful communication and cooperation between BART and VTA officials, which undermines public confidence.
• VTA’s failure to adopt governance reform recommendations from prior Civil Grand Jury reports and independent audits has led to a lack of Board member continuity and expertise, weakening the Board’s ability to successfully oversee the BSVII project.

VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II

FINDINGS AND RECOMMENDATIONS
Finding 1
The BSVII project currently requires voter approval of additional sales tax measures to address gaps in construction and operations funding.

Recommendation 1
VTA should adopt and publish a strategy for the completion and operation of the project that reduces dependency on new sales tax measures.

This should be implemented by December 31, 2026.

Finding 2
VTA does not maintain a cash-flow model for the BSVII project.

Recommendation 2
The VTA Board should direct the General Manager to prepare a cash-flow model for the BSVII project and present it quarterly to the Oversight Committee and the Board.

This should be implemented by December 31, 2026.

Finding 3
VTA has not developed an alternative funding strategy for the project in the event that planned funding sources are unavailable or insufficient.

Recommendation 3
The VTA Board should direct the General Manager to prepare an alternative funding strategy to meet the project’s estimated total capital costs and VTA’s responsibility for operating and maintenance costs and present it to the Oversight Committee and Board for approval.

This should be implemented by December 31, 2026.

Finding 4
Project management does not consistently report the operating and maintenance cost implications of design and construction decisions to the Oversight Committee or the Board.

VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II Recommendation 4
VTA should adopt a policy requiring staff to present an analysis of operating and maintenance costs when considering design and construction alternatives for BSVII.

This should be implemented by December 31, 2026.

Finding 5
The VTA Board would benefit from longer terms of office to improve continuity and institutional knowledge.

Recommendation 5
VTA should reconsider its prior rejections of audit recommendations calling for the establishment of four-year terms and direct its legislative advocates to seek a legislative author to amend VTA’s enabling statute to require four-year terms.

This should be implemented by December 31, 2026
Finding 6
VTA Board Appointing Authority Groups 2 through 5 often do not follow VTA Administrative Code (Section 2-14) admonitions to “appoint individuals with appropriate experience and qualifications in transportation” and to “reappoint representatives to consecutive terms.” Recommendation 6
VTA Board Appointing Authority Groups 2 through 5 should certify to the VTA Board that they will adhere to VTA Administrative Code (Section 2-14) admonitions, regarding Board member expertise and appointment to consecutive terms.

This should be implemented by December 31, 2026.

Finding 7
VTA Board Appointing Authority Groups 2 through 5 have different processes for making Board appointments.

VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II Recommendation 7
The cities represented in Appointing Authority Groups 2 through 5 should agree on a uniform process for making Board appointments.

This should be implemented by December 31, 2026.

Finding 8
The role assigned to the auditor general is outside the traditional scope of an auditor’s responsibilities and has introduced conflict and uncertainty among VTA staff and the Oversight Committee. Being involved in the management and policy-making process threatens the auditor general’s independence.

Recommendation 8
The Board should implement an alternative model for supporting the Oversight Committee that does not rely on the auditor general to provide services such as agenda preparation, monitoring of VTA staff assignments, or preparation of a synthesis of multiple independent inputs to the Committee’s deliberations.

This should be implemented by December 31, 2026
Finding 9
The Board of Directors has not approved the bylaws, nor the charter of the Oversight Committee.

Recommendation 9
VTA should formally adopt a revised Charter for the Oversight Committee, setting the Board’s expectations on the following issues:
• Defining the role of the auditor general to no longer require him to supervise the presentations by VTA staff to the Oversight Committee;
• The responsibility of the Oversight Committee to report regularly to the Board on the independent analyses of costs, risks, and schedule by the PMOC and any SMEs; and to provide the Oversight Committee’s synthesis of those analyses with recommendations to resolve conflicts when necessary;
• The responsibility of the Oversight Committee to consider and present its recommendations before the Board considers major decisions such as scope of the project, contracting, risk management, budgeting, and funding strategy;

VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II • The responsibility of the Oversight Committee to hold subject matter experts accountable for timely analysis of costs, risk, and schedule;
• The responsibility of the Oversight Committee to report to the Board on the implications of design and construction issues that impact future ongoing operations and maintenance costs to be borne by VTA.

This should be implemented by December 31, 2026.

Finding 10
VTA’s vtabart.org website is poorly organized and not always intuitive to navigate, making it hard to find information about the status, cost, and schedule of the BSVII project.

Recommendation 10
The VTA Board should direct the General Manager to implement and maintain a project dashboard on its vtabart.org website that includes status, cost, and schedule information.

This should be implemented by October 31, 2026.

VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II

REQUIRED RESPONSES
Pursuant to California Penal Code section 933(a) et seq. and California Penal Code section 933.05, the 2025-26 Santa Clara County Civil Grand Jury requests responses from the following governing bodies:

Responding Agency Findings Recommendations
VTA Board of Directors 1, 2, 3, 4, 5, 8, 9, 10 1, 2, 3, 4, 5, 8, 9, 10 County of Santa Clara, Board of Supervisors 6 6
The City of Campbell, City Council 6, 7 6, 7
The City of Cupertino, City Council 6, 7 6, 7
The City of Gilroy, City Council 6, 7 6, 7
The City of Los Altos, City Council 6, 7 6, 7
The Town of Los Altos Hills, Town Council 6, 7 6, 7
The Town of Los Gatos, Town Council 6, 7 6, 7
The City of Milpitas, City Council 6, 7 6, 7
The City of Monte Sereno, City Council 6, 7 6, 7
The City of Morgan Hill, City Council 6, 7 6, 7
The City of Mountain View, City Council 6, 7 6, 7
The City of Palo Alto, City Council 6, 7 6, 7
The City of San José, City Council 6, 7 6, 7
The City of Santa Clara, City Council 6, 7 6, 7
The City of Saratoga, City Council 6, 7 6, 7
The City of Sunnyvale, City Council 6, 7 6, 7

VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II APPENDIX A: BART Management Letter

VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II

VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II

VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II

VTA’S MANAGEMENT AND OVERSIGHT OF BART VTA'S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE SILICON VALLEY PHASE IIII kai BART SILICON VALLEY

PHASE II (BSV I)
BART remains fully committed to the successful delvi ery of this critical regional investment.

However, that commitment depends on VTA's immediate corrective action to restore transparency and accountability.

Sincerely,
Shane Edwards
BART Assistant General Manager, 0perations
BART Project Director
Ce: VTA's BART S i licon Valley Phase II 0versight Committee Members Greg Ri chardson, VTA Deputy General Manager
Robert Powers, BART General Manager
Michael Jones, BART Deputy General Manager
Ni Lee, BART Deputy Proj ect Director
Mon ica Born, VTA Program Director
Tom Maguire, VTA Chief Del ivery Officer of Mega Projects BSVII: Co ll aborati o n , I n n ovat i on, Safety, R e l i ability 2

VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II

CONFLICTS
Members of the Civil Grand Jury are conflicted from a Civil Grand Jury investigation if, as a result of prior or current employment or associations, investment in public or private enterprise, financial interest, bias, or personal relationship, they are subject to recusal from participating in a matter before the Civil Grand Jury. One juror was recused from this matter.

REFERENCES
Bibliography
2018-19 Santa Clara County Civil Grand Jury. “Inquiry Into Governance of the Valley Transportation Authority.” June 18, 2019.
(https://santaclara.courts.ca.gov/system/files/cgj-vta-final-report-061819_0.pdf).

Accessed April 5, 2026.

Aragon, Greg, “Single-Bore Tunnel Method Chosen for BART Silicon Valley Phase II.” ENRWest. November 4, 2025. (https://www.enr.com/articles/61798-single-bore-tunnelmethod-chosen-for-bart-silicon-valley-phase-ii). Accessed April 29, 2026.

AtkinsRéalis USA Holdings LLC. “Project Monitoring Report.” March 9, 2026. (https://vtabart.org/transparency-commitment/#docaccess8dd20a14312d4f35dd29658c7e4d5f55). Accessed May 1, 2026.

Auditor General, Santa Clara Valley Transportation Authority. “Auditor General’s Risk Assessment Report on VTA’s BSVII Finance Risks.” May 1, 2025. (https://santaclaravta.iqm2.com/Citizens/Detail_LegiFile.aspx?MeetingID=4412&ID= 9358). Accessed April 5, 2026.

Auditor of the State of California. “Santa Clara Valley Transportation Authority, Improvements Are Necessary to Strengthen Its Project Management and Financial Oversight.” June 2024. (https://www.auditor.ca.gov/wp-content/uploads/2024/06/2023-101-Report.pdf).

Accessed April 5, 2026.

California State Transportation Agency. “Transit and Intercity Rail Capital Program.” n.d. (https://calsta.ca.gov/subject-areas/transit-intercity-rail-capital-prog). Accessed May 12, 2026.

VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II Cal. Pub. Util. Code section 10000 et seq.

Cal. Pub. Util. Code section 100060 et seq.

Dorsey, Dustin. “Silicon Valley BART Extension construction remains on time, budget.” ABC Eyewitness News. December 8, 2025. (https://abc7news.com/post/silicon-valley-bartextension-construction-remains-time-budget-west-portal-site/18265543/). Accessed April 29, 2026.

Federal Transit Administration. “FY 2025 New Starts Financial Assessment.” June 2024. (https://www.transit.dot.gov/funding/grants/grant-programs/capital-investments/bartsilicon-valley-phase-ii-project-profile-fy-0).

Federal Transit Administration. “BART Silicon Valley Phase II Extension Project San Jose, California. June 2024. (https://www.transit.dot.gov/sites/fta.dot.gov/files/2024-08/CABART-Silicon-Valley-Phase-II-Eng-Profile-20240705.pdf). Accessed March 30, 2026.

Geha, Joseph. “Feds Commit $5.1 Billion to South Bay BART Extension.” KQED.org. August 2, 2024. (https://www.kqed.org/news/11998646/feds-commit-5-1-billion-to-south-baybart-extension#:~:text=Joseph%20Geha,increases%20to%20the%20current%20figure).

Accessed April 22, 2026.

Hicks, Tony. “VTA Board approves purchase of machine to bore BART line.” Mountain View Voice. November 7, 2023. (https://www.mv-voice.com/news/2023/11/07/vta-boardapproves-purchase-of-machine-to-bore-bart-line/). Accessed April 5, 2026.

Metropolitan Transportation Commission. “Agreement Reached on Loan for Bay Area Transit Agencies.” January 30, 2026. (https://mtc.ca.gov/news/agreement-reached-loan-bay-areatransitagencies#:~:text=Because%20many%20transit%20capital%20projects,funds%20remaine d%20in%20state%20accounts.). Accessed April 28, 2026
Office of the County Counsel, County of Santa Clara. “County Counsel’s Impartial Analysis of Measure B.” 2016. (https://www.vta.org/sites/default/files/2025- 08/2016%20Measure%20B%20Ballot.pdf). Accessed April 29, 2026.

VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II San Francisco Bay Area Rapid Transit District Independent Office of the Inspector General. “Transparency & Communication Gaps in BSVII Project.” December 19, 2025. (https://www.bartoig.org/investigation-reports-2025#docaccess-98152ed2acf38 cd4da53e1efbb737c86cc96ef6c2e1f439edf6ec6f51905271f). Accessed April 5, 2026.

San Francisco Bay Area Rapid Transit District and Santa Clara Valley Transportation Authority, Comprehensive Agreement, November 22, 2001.
(www.bart.gov/sites/default/files/docs/O%26M%20Agreement_Silicon%20Valley%20B ART%20Extn.pdf). Accessed May 12, 2026.

San Francisco Bay Area Rapid Transit District. “BART Board initially approves Alternative Service Plan outlining budget balancing details.” February 26, 2026. (https://www.bart.gov/news/articles/2026/news20260226-0). Accessed April 29, 2026.

San Francisco Bay Area Rapid Transit District. "January 2026 Monthly Ridership Snapshot." February 2026. (https://www.bart.gov/sites/default/files/2026- 02/202601%20Monthly%20Ridership%20Snapshot.pdf). Accessed April 29, 2026.

San Francisco Bay Area Rapid Transit District. " 2019 Monthly Ridership Reports." 2019. (https://www.bart.gov/sites/default/files/docs/ridership_2019.zip). Accessed April 29, 2026.

Santa Clara Valley Transportation Authority, BART Silicon Valley Phase II Project. n.d. (https://www.vtabart.org). Accessed May 12, 2026.

Santa Clara Valley Transportation Authority, “VTA Board of Directors Workshop Reviews BART Phase II Timeline, Costs, And Next Steps.” October 23, 2023. (https://www.vta.org/blog/vta-board-directors-workshop-reviews-bart-phase-ii-timelinecosts-and-next-steps). Accessed April 29, 2026.

Santa Clara Valley Transportation Authority Auditor General. “Auditor General’s Initial Monitoring Report on VTA’s BART Silicon Valley Phase II Extension Project.” VTA’s BART Silicon Valley Phase II Extension Oversight Committee Agenda. Item 8a. January 19, 2024. (https://santaclaravta.iqm2.com/Citizens/Detail_Meeting.aspx?ID=4233).

Accessed April 5, 2026.

VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II Santa Clara Valley Transportation Authority/RSM US LLC. “Board Governance Assessment – Santa Clara Valley Transportation Authority.” December 20, 2019. (https://www.vta.gov/ sites/default/files/2020-01/VTA%20Board%20Governance%20Assessment%20 %281%29.pdf). Accessed April 5, 2026.

Santa Clara Valley Transportation Agency. “BART Silicon Valley Extension Project Implements Major Cost Reductions.” November 13, 2024. (https://www.vta.org/blog/bart-siliconvalley-extension-project-implements-major-cost-reductions). Accessed April 23, 2026.

Santa Clara Valley Transportation Authority/HayGroup. “Santa Clara Valley Transportation Authority Organizational and Financial Assessment Executive Report.” March 2007. (https://ti.org/pdfs/HayGrouponVTA.pdf). Accessed April 5, 2026.

Santa Clara Valley Transportation Authority. “Operations and Maintenance Agreement By and Between the Santa Clara Valley Transportation Authority and The San Francisco Bay Area Rapid Transit District.” May 22, 2020. (https://www.vta.org/sites/default/files/2020- 12/VTA%20BART%20Operations%20and%20Maintenance%20Agreement_0.pdf).

Accessed April 23, 2026.

Santa Clara Valley Transportation Authority. “Santa Clara Valley Transit Authority Administrative Code (With Amendments through March 6, 2025).” March 2025. (https://www.vta.org/sites/default/files/2025-04/VTA_Administrative_Code_2025-3-

6.pdf). Accessed April 5, 2026.

Santa Clara Valley Transportation Authority. “Bylaws for VTA’s BART Silicon Valley Phase II Oversight Committee.” April 4, 2024. (https://www.vta.gov/sites/default/files/2024-04/ vta-bsv-oversight-committee-bylaws_0.pdf). Accessed April 8, 2026.

Santa Clara Valley Transportation Authority. Special Board Meeting. October 17, 2025. (https:// santaclaravta.iqm2.com/Citizens/FileOpen.aspx?Type=14&ID=4297&Inline=True) Accessed April 9, 2026.

Santa Clara Valley Transportation Authority. “VTA's BART Silicon Valley Phase II Oversight Committee Regular Meeting”, Agenda Item 9.a, Item #25. April 17, 2024. (https://santaclaravta.iqm2.com/Citizens/FileOpen.aspx?Type=1&ID=3940&Inline=True ). Accessed May 1, 2026.

VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II Santa Clara Valley Transportation Authority. “VTA's BART Silicon Valley Phase II Oversight Committee Regular Meeting.” Agenda Item 4, Item #4. March 13, 2025. (https://santaclaravta.iqm2.com/Citizens/FileOpen.aspx?Type=1&ID=4138&Inline=True ). Accessed May 1, 2026.

Santa Clara Valley Transportation Authority. “VTA's BART Silicon Valley Phase II Oversight Committee Regular Meeting.” Item 11a. June 12, 2025.
(https://santaclaravta.iqm2.com/Citizens/Detail_Meeting.aspx?ID=4430). Accessed April 29, 2026.

Santa Clara Valley Transportation Authority. “BSVII Project Update.” Summer, 2025. (https://vtabart.org/vtas-bart-silicon-valley-phase-ii-extension-project-summer-2025/).

Accessed May 13, 2026.

Santa Clara Valley Transportation Authority. “VTA's BART Silicon Valley Phase II Oversight Committee Regular Meeting.” Item 8. January 15, 2026.
(https://santaclaravta.iqm2.com/Citizens/FileOpen.aspx?Type=1&ID=4354&Inline=True ). Accessed April 22, 2026.

Santa Clara Valley Transportation Authority. “2000 Measure A.” n.d. (https://www.vta.org/projects/funding/2000-measure-a). Accessed April 29, 2026.

Santa Clara Valley Transportation Authority. “About 2016 Measure B.” n.d. (https://2016measureb.vta.org/about). Accessed April 29, 2026.

Santa Clara Valley Transportation Authority. “VTA's BART Silicon Valley Phase II Oversight Committee Regular Meeting.” Item 10b. Slide 21. September 11, 2025. (https://santaclaravta.iqm2.com/Citizens/FileOpen.aspx?Type=1&ID=4273&Inline=True ). Accessed April 13, 2026.

Santa Clara Valley Transportation Authority. “Fact Sheet: VTA's Bart Silicon Valley Phase 2 Extension Project.” March 2024. (https://www.vta.org/sites/default/files/2024- 07/VTABSV_FactSheet_2024_OverviewBenefits%201.pdf). Accessed April 13, 2026.

Shalby, Colleen. “Trump administration pulls billions in funding for high-speed rail project; state leaders call decision ‘illegal.’” Los Angeles Times. July 16, 2025. (https://www.latimes.com/california/story/2025-07-16/trump-administration-cancelsfunding-for-high-speed-rail-project). Accessed April 29, 2026.

VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II Shalby, Colleen. “Multibillion-dollar transit project to tunnel through the Santa Monica Mountains is approved by L.A. Metro.” LA Times. January 22, 2026. (https://www.latimes.com/california/story/2026-01-22/this-multibillion-dollar-transitproject-could-improve-traffic-across-la-it-goes-to-vote-today - :~:text=This is read by an,transit projects in the country). Accessed April 13, 2026.

VTA’S MANAGEMENT AND OVERSIGHT OF BART SILICON VALLEY PHASE II This report was ADOPTED by the 2025-2026 Santa Clara County Civil Grand Jury on this 17th day of June, 2026.
______________________________
Dinesh Ramde
Foreperson

City of Gilroy
7351 Rosanna Street
Gilroy, California
95020-6197
Administration
Department
Telephone (408) 846-0202
http://www.cityofgilroy.org
August XX, 2026
Via Email ([email protected]) and U.S. Mail
The Honorable Julie A. Emede,
Presiding Judge
Superior Court of California, County of Santa Clara
191 North First Street
San Jose, CA 95113
Re: City of Gilroy Response to the 2025–2026 Civil Grand Jury Final Report — "VTA’s Management and Oversight of BART Silicon Valley Phase II”
Dear Judge Emede:

Pursuant to California Penal Code sections 933(c) and 933.05, the City of Gilroy respectfully submits its response to the findings and recommendations directed to the City in the 2025–2026 Santa Clara County Civil Grand Jury's final report, "VTA’s Management and Oversight of BART Silicon Valley Phase II" released June 17, 2026. The City is required to respond to Findings 6 and 7, Recommendations 6 and 7, and does so below in accordance with the response requirements of Penal Code section 933.05.

Findings and Recommendations
Finding 6: “VTA Board Appointing Authority Groups 2 through 5 often do not follow VTA Administrative Code (Section 2-14) admonitions to ‘appoint individuals with appropriate experience and qualifications in transportation’ and to ‘reappoint representatives to consecutive terms.’” Response: The City of Gilroy disagrees.

The City can respond only as to Appointing Authority Group 4 (Gilroy and Morgan Hill) and expresses no position on the practices of Groups 2, 3, and 5. In 2024, the Cities of Gilroy and Morgan Hill adopted a joint resolution establishing a structured South County rotation schedule for the Group 4 seat on the VTA Board of Directors (See Eclosed Exhibit 1 - Gilroy Resolution No. 2024-50/Morgan Hill Resolution No. 24-035). That framework promotes continuity and predictability in Group 4 appointments and reflects deliberate, publicly adopted coordination between the two cities. While the joint resolution currently does not contain express language addressing the VTA Administrative Code admonitions regarding transportation experience and qualifications, the Gilroy Mayor and Council take these principles into consideration when selecting their representative. The appointment of a representative from one city and an alternate from the other City allows for a balance of continuity with the building of experience so that future board members are informed of their role and aligns with the four-year election term of these representatives.

2 Recommendation 6: “VTA Board Appointing Authority Groups 2 through 5 should certify to the VTA Board that they will adhere to VTA Administrative Code (Section 2-14) admonitions, regarding Board member expertise and appointment to consecutive terms. This should be implemented by December 31, 2026.”
Response: The recommendation will not be implemented as the current process meets the needs of the Cities in Group 4. As noted above, the established process meets the needs of the Cities in Group 4. The City will continue to consider opportunities to facilitate consistency in representation.

Finding 7: “VTA Board Appointing Authority Groups 2 through 5 have different processes for making Board appointments.”
Response: The City of Gilroy partially disagrees. The City understands that the appointment processes used by Groups 2 through 5 differ from one another. Within Group 4, however, the Cities of Gilroy and Morgan Hill have already adopted a uniform, documented process: the 2024 joint resolutions establishing the South County VTA Board rotation schedule, which governs how the Group 4 appointment is made and rotates between the two cities. This process aligns with the processes in other groups while maintaining the flexibility for any specific needs of Group 4.

Recommendation 7: “The cities represented in Appointing Authority Groups 2 through 5 should agree on a uniform process for making Board appointments. This should be implemented by December 31, 2026.”
Response: The recommendation has been implemented for Group 4. Any further implementation of a uniform process across Groups 2 through 5 requires coordination beyond the City’s sole control.

The Cities of Gilroy and Morgan Hill adopted a joint resolution in 2024 establishing a uniform, publicly adopted process and rotation schedule for the Group 4 appointment, and that framework remains in effect. To the extent the recommendation contemplates a single uniform process shared across Groups 2 through 5, that outcome requires agreement among fourteen cities across four appointing groups and cannot be implemented unilaterally by Gilroy. The City is willing to participate in any coordinated effort among the Group 2 through 5 cities, or facilitated by VTA, to develop a common appointment process, and will consider adopting any uniform framework that emerges from that effort.

The City of Gilroy thanks the Civil Grand Jury for its review and its recommendations to improve the accessibility and transparency of the claims process. Please contact the City Clerk's Office at (408) 846- 0204 with any questions regarding this response.

Respectfully submitted,

3 Matt Morley, City Administrator
On Behalf of Gilroy City Council
City of Gilroy
Enclosed: Exhibit 1 – Gilroy Resolution 2024-50/Morgan Hill Resolution 24-035

GILROY RESOLUTION NO. 2024-50
MORGAN HILL RESOLUTION NO. 24-035

A JOINT RESOLUTION OF THE CITY COUNCILS OF THE

CITIES OF GILROY AND MORGAN HILL TO

MEMORIALIZE THE ESTABLISHED SCHEDULE OF

SHARED REPRESENTATION ON THE SANTA CLARA
VALLEY TRANSPORTATION AUTHORITY’S BOARD OF

DIRECTORS FOR THE SOUTH COUNTY CITIES GROUP
WHEREAS, the Santa Clara Valley Transportation Authority (VTA) is a regional transportation authority addressing regional transportation and congestion management throughout Santa Clara County; and
WHEREAS, the VTA is governed by its Board of Directors, a board comprised of twelve voting members, in addition to six non-voting members. Five of the voting members are allocated to the City of San Jose, two to the County of Santa Clara, and the remaining five seats are divided amongst the small city groupings; and WHEREAS, the Cities of Gilroy and Morgan Hill (Cities) share one voting member, and one alternate for the South County City Group, Group Four; and WHEREAS, the VTA delegated the determination of how each small city group would share representation and select their appointment to the cities within each group; and
WHEREAS, effective January of 2012, the Cities began self-determining the rotation of representation between the Cities, one city providing the appointee, the other providing the alternate. Every two years the appointee and alternate would switch to the other city; and
WHEREAS, the Cities would provide the name of the appointee and alternate to VTA on their appointment form; and
WHEREAS, in a recent State audit of VTA the need to formally memorialize the shared representation structure was identified by the auditors; and WHEREAS, the Cities desire to adopt this joint resolution to accomplish the purpose as stated above.

NOW, THEREFORE, BE IT RESOLVED by the City Councils of the Cities of Gilroy and Morgan Hill that:

1. The Cities shall share representation through rotation of appointments to the Board of Director Seat for the South County Small Cities Group, Group Four.

2. Representation shall rotate on two-year terms, commencing January 1st of each odd year.

3. One city shall provide the appointee to the VTA Board of Directors, and the alternate shall come from the other city of the South County Small City Group.

4. Based on the current schedule, the City of Morgan Hill will provide the Appointee, and the City of Gilroy will provide the Alternate, for the period of January 1, 2025 through December 31, 2026. Every January 1st of each odd Docusign Envelope ID: 03544532-C615-4E07-A994-98BE4FA3D9CC

Gilroy Resolution No. 2024-50
Morgan Hill Resolution No. 24-035
VTA Board of Directors South County Small Cities Group Shared Representation Gilroy City Council Regular Meeting | October 21, 2024
Morgan Hill City Council Regular Meeting | October 23, 2024

year thereafter, the cities providing the Appointee and the Alternate shall each switch.

5. The City of Gilroy will have their representative selected by their Mayor with their City Council’s approval in accordance with their existing Council policy.

6. The City of Morgan Hill will have their representative to the VTA Board selected by their Mayor in accordance with their existing Council policy.

PASSED AND ADOPTED by the City Council of the City of Gilroy at a regular meeting duly held on the 21st day of October, 2024 by the following roll call vote:

AYES: COUNCIL MEMBERS: BRACCO, ARMENDARIZ, MARQUES,

HILTON, CLINE, TOVAR, BLANKLEY
NOES: COUNCIL MEMBERS:

ABSTAIN: COUNCIL MEMBERS:

ABSENT: COUNCIL MEMBERS:

APPROVED:
__________________________
Marie Blankley, Mayor
ATTEST:
_______________________
Beth Minor, Interim City Clerk
PASSED AND ADOPTED by the City Council of the City of Morgan Hill at a regular meeting duly held on the 23rd day of October, 2024 by the following roll call vote:

AYES: COUNCIL MEMBERS: BORGIOLI, LEBRERS, MARTINEZBELTRAN, TURNER NOES: COUNCIL MEMBERS:

ABSTAIN: COUNCIL MEMBERS:

ABSENT: COUNCIL MEMBERS:

APPROVED:
__________________________
Mark Turner, Mayor
Docusign Envelope ID: 03544532-C615-4E07-A994-98BE4FA3D9CC

Gilroy Resolution No. 2024-50
Morgan Hill Resolution No. 24-035
VTA Board of Directors South County Small Cities Group Shared Representation Gilroy City Council Regular Meeting | October 21, 2024
Morgan Hill City Council Regular Meeting | October 23, 2024

ATTEST:
_______________________
Michelle Bigelow, City Clerk
Docusign Envelope ID: 03544532-C615-4E07-A994-98BE4FA3D9CC

9.1. City of Gilroy

STAFF REPORT
Agenda Item Title: Award a Professional Services Agreement to Kimley-Horn for a Not-to-Exceed Amount of $237,117 for the Development of the City of Gilroy Comprehensive Roadway Safety Action
Plan, Add the Project to the Capital Improvement Program, and Adopt a Budget Amendment Resolution to Appropriate
Grant and Gas Tax Funds to the Project
Meeting Date: August 3, 2026
From: Matt Morley, City Administrator
Department: Public Works
Submitted by: John Doughty, Public Works Director
Prepared by: Nisha Patel, City Engineer
STRATEGIC PLAN GOALS: Not Applicable

RECOMMENDATION

1. Award a Professional Services Agreement to Kimley-Horn for an amount not to exceed $237,117.25 for the development of the City of Gilroy Comprehensive Roadway Safety Action Plan (Project) No. 26-RFP-PW-529, and authorize the City Administrator to execute the contract and associated documents;

2. Add the Project to the Fiscal Year 2027 (FY27) Capital Improvement Program (CIP) with Project Number 801180; and

3. Adopt a resolution amending the FY26 budget within Gas Tax Fund (205) to appropriate $189,693.80 in FY 2024 SS4A Grant Funds to the Project, along with $47,423.45 in local match from the Gas Tax Fund balance, for a total of $237,117.25.

EXECUTIVE SUMMARY
The City was awarded a Fiscal Year 2024 Safe Streets and Roads for All (SS4A) grant for the development of a Comprehensive Roadway Safety Action Plan (CSAP). The

9.1. CSAP aims to reduce traffic-related fatalities and serious injuries through initiatives such as implementation guidance, a list of priority projects along the high injury network, and conceptual design plans for priority locations. Adoption of the Plan is critical to the City being eligible to apply for and receive most federal and State transportation-related grants. These grants provide the City the opportunity to leverage its limited general and special funds to complete needed transportation-related capital projects.

Staff received six proposals for the development of the City of Gilroy CSAP, which were evaluated by assigned personnel to determine which consultant was the most qualified to complete the work. After a round of interviews with three firms, staff concurred with the recommendation of the award of the contract to Kimley-Horn. The Services Agreement with Kimley-Horn to develop the CSAP is in the amount of $237,117.25, and the plan will be developed over the next year along with city staff, project stakeholders, and the community.

The request was originally considered by the City Council on June 15, 2026. The motion to approve the contract failed due to a 3-3 vote of the City Council (Mayor Pro Tempore Hilton was absent). Staff feels that we failed to fully explain the importance of the Plan, particularly given we have pending grant applications which are contingent on having a CSAP in place by September 2027.

BACKGROUND
The SS4A program, administered by the Federal Highway Administration (FHWA), provides funding to support local agencies in creating safer roadways. The program aims to reduce traffic-related fatalities and serious injuries through initiatives such as action plans and implementation projects. The City was awarded a $190,000 SS4A grant for the development of the City of Gilroy CSAP, which requires a 20% City match.

In October 2024, the City Council approved a resolution amending the budget for the City of Gilroy for Fiscal Year 2024-25 appropriating various grant awards, including the awarded SS4A grant. The City Council authorized the City Administrator to execute the grant agreement, which he did in February 2025.

The CSAP will study the most recent crash data to aid the City in identifying the factors that contribute the most to local traffic crashes.

If the City had an approved LRSP (Local Roadway Safety Action Plan) or CSAP, it would better position us to receive safety implementation funding from state and federal grant programs such as Highway Safety Improvement Program (HSIP), Safe Streets for All (SS4A), Active Transportation Program (ATP), and One Bay Area Grant Program (OBAG).

As discussed further below, the City has four grant applications submitted and pending review. All of the grants require the City to ultimately have a CSAP adopted and in place prior to the draw of any funds, assuming grant(s) are awarded to the City.

9.1. ANALYSIS
The SS4A grant will fund the development of the CSAP. The plan will:
• Align with City and regional transportation planning documents such as the City's General Plan, Traffic Circulation Master Plan, Caltrans’ Strategic Highway Safety Plan, and the Safe Systems approach.
• Analyze collision data and roadway conditions to develop a prioritized list of safety improvements.
• Include funding, implementation, monitoring, and evaluation plans to address systemic traffic safety concerns. It will be data-driven and objective with many opportunities to engage stakeholders and the community to identify traffic safety concerns.

In the last five years (2021 to 2025), there have been 82 crashes resulting in serious injuries and fatalities, of which six were fatalities. In 2025, there were nine crashes with serious injuries and fatalities, of which one resulted in a fatality. Since January 1, 2026, the City has already experienced a two crashes resulting in four fatalities along with a serious pedestrian accident on Leavesley. With the significant number of serious injuries and fatalities from crashes within the city limits, the City would benefit from a CSAP that creates a plan and countermeasures to reduce these types of crashes.

Approval of the CSAP will provide access to transportation grant funds which are only available to communities with adopted CSAPs. Currently, the City has submitted applications for an SS4A grant in the amount of $1.8M, an OBAG 4 grant in the amount of $6M, another OBAG 4 grant in the amount of $1.7M, and a Community Action Resource and Empowerment (CARE) grant in the amount of $1.2M. The City is not be eligible for the mentioned grant funds if it does not have an approved City CSAP by September 2027, and a CSAP takes around 13 months to develop.

ALTERNATIVES
The City Council may choose not to award the Services Agreement, which will delay the implementation of a CSAP and affect the City's ability to secure grant funds to implement recommended safety improvements identified in the plan. This action would put $190,000 of grant money dedicated to the Plan at risk as well as limit the ability of the City to compete for certain grant funding opportunities in the future. The City would not be eligible to receive grant funds through SS4A, OBAG, and CARE programs from applications staff have already submitted. If the City does not move forward with the services agreement for Kimley-Horn to develop the Gilroy CSAP, they will also lose the $190,000 SS4A grant for development of a CSAP.

9.1. FISCAL IMPACT/FUNDING SOURCE
The total project cost and Services Agreement amount with Kimley-Horn is $237,117.25. The SS4A grant provides reimbursement funding of up to $190,000 and requires a 20% local match. Based on the project cost, $189,693.80 will be reimbursed through the SS4A grant and $47,423.45 will be funded with an available Gas Tax Fund (205) balance.

The SS4A grant is a reimbursement-based grant. Grant revenues will be received after eligible project expenditures are incurred, and reimbursement requests are submitted in accordance with grant requirements. Therefore, a budget amendment is required to appropriate both the anticipated grant reimbursement revenue and the required local matching funds for Project No. 801180, Comprehensive Roadway Safety Action Plan.

Adoption of a CSAP provides the City access to critical transportation and safety related funding.

PUBLIC OUTREACH
The development of the CSAP will implement community feedback through different efforts, including an online survey, public workshops, and outreach at community events. There will be an emphasis on inclusivity to ensure that at-risk and underrepresented groups are able to share feedback and help shape project recommendations. The completed CSAP will be shared with City Council at a future date.

NEXT STEPS
Upon City Council’s approval, the contract will be executed, and staff will work with the consultant, Kimley-Horn, to develop a final project schedule. The development of the plan is expected to take a year to complete.

Attachments:

1. Services Agreement

2. Resolution

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AGREEMENT FOR SERVICES
(For contracts over $5,000 - CONSULTANT)
This AGREEMENT made this 3rd day of August, 2026, between:

CITY: City of Gilroy, having a principal place of business at 7351 Rosanna Street, Gilroy, California
and CONSULTANT: Kimley-Horn and Associates, Inc., having a principal place of business at 10 South Almaden Boulevard, Suite 1250, San Jose, CA 95113.

ARTICLE 1. TERM OF AGREEMENT
This Agreement will become effective on August 4, 2026 and will continue in effect through June 30, 2028 unless terminated in accordance with the provisions of Article 7 of this Agreement.

Any lapse in insurance coverage as required by Article 5, Section D of this Agreement shall terminate this Agreement regardless of any other provision stated herein. ______ Initial
ARTICLE 2. INDEPENDENT CONTRACTOR STATUS
It is the express intention of the parties that CONSULTANT is an independent contractor and not an employee, agent, joint venturer or partner of CITY. Nothing in this Agreement shall be interpreted or construed as creating or establishing the relationship of employer and employee between CITY and CONSULTANT or any employee or agent of CONSULTANT. Both parties acknowledge that CONSULTANT is not an employee for state or federal tax purposes.

CONSULTANT shall not be entitled to any of the rights or benefits afforded to CITY’S employees, including, without limitation, disability or unemployment insurance, workers’ compensation, medical insurance, sick leave, retirement benefits or any other employment benefits. CONSULTANT shall retain the right to perform services for others during the term of this Agreement.

ARTICLE 3. SERVICES TO BE PERFORMED BY CONSULTANT
A. Specific Services
CONSULTANT agrees to: Perform the services as outlined in Exhibit “A” (“Specific Provisions”) and Exhibit “B” (“Scope of Services”), within the time periods described in Exhibit “C” (“Milestone Schedule”).

B. Method of Performing Services
CONSULTANT shall determine the method, details and means of performing the above-described services. CITY shall have no right to, and shall not, control the manner or determine the method of accomplishing CONSULTANT’S services.

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C. Employment of Assistants
CONSULTANT may, at the CONSULTANT’S own expense, employ such assistants as CONSULTANT deems necessary to perform the services required of CONSULTANT by this Agreement, subject to the prohibition against assignment and subcontracting contained in Article 5 below. CITY may not control, direct, or supervise CONSULTANT’S assistants in the performance of those services. CONSULTANT assumes full and sole responsibility for the payment of all compensation and expenses of these assistants and for all state and federal income tax, unemployment insurance, Social Security, disability insurance and other applicable withholding.

D. Place of Work
CONSULTANT shall perform the services required by this Agreement at any place or location and at such times as CONSULTANT shall determine is necessary to properly and timely perform CONSULTANT’S services.

ARTICLE 4. COMPENSATION
A. Consideration
In consideration for the services to be performed by CONSULTANT, CITY agrees to pay CONSULTANT the amounts set forth in Exhibit “D” (“Payment Schedule”). In no event however shall the total compensation paid to CONSULTANT exceed $237,117.25.

B. Invoices
CONSULTANT shall submit invoices for all services rendered.

C. Payment
Payment shall be due according to the payment schedule set forth in Exhibit “D”. No payment will be made unless CONSULTANT has first provided City with a written receipt of invoice describing the work performed and any approved direct expenses (as provided for in Exhibit “A”, Section IV) incurred during the preceding period. If CITY objects to all or any portion of any invoice, CITY shall notify CONSULTANT of the objection within thirty (30) days from receipt of the invoice, give reasons for the objection, and pay that portion of the invoice not in dispute. It shall not constitute a default or breach of this Agreement for CITY not to pay any invoiced amounts to which it has objected until the objection has been resolved by mutual agreement of the parties.

D. Expenses
CONSULTANT shall be responsible for all costs and expenses incident to the performance of services for CITY, including but not limited to, all costs of equipment used or provided by CONSULTANT, all fees, fines, licenses, bonds or taxes required of or imposed against CONSULTANT and all other of CONSULTANT’S costs of doing business. CITY shall not be responsible for any expenses incurred by CONSULTANT in performing services for CITY, except for those expenses constituting “direct expenses” referenced on Exhibit “A.”

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ARTICLE 5. OBLIGATIONS OF CONSULTANT
A. Tools and Instrumentalities
CONSULTANT shall supply all tools and instrumentalities required to perform the services under this Agreement at its sole cost and expense. CONSULTANT is not required to purchase or rent any tools, equipment or services from CITY.

B. Workers’ Compensation
CONSULTANT agrees to provide workers’ compensation insurance for CONSULTANT’S employees and agents and agrees to hold harmless, defend with counsel acceptable to CITY and indemnify CITY, its officers, representatives, agents and employees from and against any and all claims, suits, damages, costs, fees, demands, causes of action, losses, liabilities and expenses, including without limitation reasonable attorneys’ fees, arising out of any injury, disability, or death of any of CONSULTANT’S employees.

C. Indemnification of Liability, Duty to Defend

1. As to professional liability, to the fullest extent permitted by law, CONSULTANT shall defend, through counsel approved by CITY (which approval shall not be unreasonably withheld), indemnify and hold harmless CITY, its officers, representatives, agents and employees against any and all suits, damages, costs, fees, claims, demands, causes of action, losses, liabilities and expenses, including without limitation attorneys’ fees, to the extent arising or resulting directly or indirectly from any willful or negligent acts, errors or omissions of CONSULTANT or CONSULTANT’S assistants, employees or agents, including all claims relating to the injury or death of any person or damage to any property.

2. As to other liability, to the fullest extent permitted by law, CONSULTANT shall defend, through counsel approved by CITY (which approval shall not be unreasonably withheld), indemnify and hold harmless CITY, its officers, representatives, agents and employees against any and all suits, damages, costs, fees, claims, demands, causes of action, losses, liabilities and expenses, including without limitation attorneys’ fees, arising or resulting directly or indirectly from any act or omission of CONSULTANT or CONSULTANT’S assistants, employees or agents, including all claims relating to the injury or death of any person or damage to any property.

D. Insurance
In addition to any other obligations under this Agreement, CONSULTANT shall, at no cost to CITY, obtain and maintain throughout the term of this Agreement: (a) Commercial Liability Insurance on a per occurrence basis, including coverage for owned and non-owned automobiles, with a minimum combined single limit coverage of $1,000,000 per occurrence for all damages due to bodily injury, sickness or disease, or death to any person, and damage to property, including the loss of use thereof; and (b) Professional Liability Insurance (Errors & Omissions) with a minimum coverage of $1,000,000 per occurrence or claim, and $2,000,000 aggregate; provided however, Professional Liability Insurance written on a claims made basis must comply with the requirements

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set forth below. Professional Liability Insurance written on a claims made basis (including without limitation the initial policy obtained and all subsequent policies purchased as renewals or replacements) must show the retroactive date, and the retroactive date must be before the earlier of the effective date of the contract or the beginning of the contract work. Claims made Professional Liability Insurance must be maintained, and written evidence of insurance must be provided, for at least five (5) years after the completion of the contract work. If claims made coverage is canceled or non-renewed, and not replaced with another claims-made policy form with a retroactive date prior to the earlier of the effective date of the contract or the beginning of the contract work, CONSULTANT must purchase so called “extended reporting” or “tail” coverage for a minimum of five (5) years after completion of work, which must also show a retroactive date that is before the earlier of the effective date of the contract or the beginning of the contract work.

As a condition precedent to CITY’S obligations under this Agreement, CONSULTANT shall furnish written evidence of such coverage (naming CITY, its officers and employees as additional insureds on the Comprehensive Liability insurance policy referred to in (a) immediately above via a specific endorsement) and requiring thirty (30) days written notice of policy lapse or cancellation, or of a material change in policy terms.

E. Assignment
Notwithstanding any other provision of this Agreement, neither this Agreement nor any duties or obligations of CONSULTANT under this Agreement may be assigned or subcontracted by CONSULTANT without the prior written consent of CITY, which CITY may withhold in its sole and absolute discretion.

F. State and Federal Taxes
As CONSULTANT is not CITY’S employee, CONSULTANT shall be responsible for paying all required state and federal taxes. Without limiting the foregoing, CONSULTANT acknowledges and agrees that:
• CITY will not withhold FICA (Social Security) from CONSULTANT’S payments;
• CITY will not make state or federal unemployment insurance contributions on CONSULTANT’S behalf;
• CITY will not withhold state or federal income tax from payment to CONSULTANT;
• CITY will not make disability insurance contributions on behalf of CONSULTANT;
• CITY will not obtain workers’ compensation insurance on behalf of CONSULTANT.

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ARTICLE 6. OBLIGATIONS OF CITY
A. Cooperation of City
CITY agrees to respond to all reasonable requests of CONSULTANT and provide access, at reasonable times following receipt by CITY of reasonable notice, to all documents reasonably necessary to the performance of CONSULTANT’S duties under this Agreement.

B. Assignment
CITY may assign this Agreement or any duties or obligations thereunder to a successor governmental entity without the consent of CONSULTANT. Such assignment shall not release CONSULTANT from any of CONSULTANT’S duties or obligations under this Agreement.

ARTICLE 7. TERMINATION OF AGREEMENT
A. Sale of Consultant’s Business/ Death of Consultant.

CONSULTANT shall notify CITY of the proposed sale of CONSULTANT’s business no later than thirty (30) days prior to any such sale. CITY shall have the option of terminating this Agreement within thirty (30) days after receiving such notice of sale. Any such CITY termination pursuant to this Article 7.A shall be in writing and sent to the address for notices to CONSULTANT set forth in Exhibit A, Subsection V.H., no later than thirty (30) days after CITY’ receipt of such notice of sale.

If CONSULTANT is an individual, this Agreement shall be deemed automatically terminated upon death of CONSULTANT.

B. Termination by City for Default of Consultant
Should CONSULTANT default in the performance of this Agreement or materially breach any of its provisions, CITY, at CITY’S option, may terminate this Agreement by giving written notification to CONSULTANT. For the purposes of this section, material breach of this Agreement shall include, but not be limited to the following:

1. CONSULTANT’S failure to professionally and/or timely perform any of the services contemplated by this Agreement.

2. CONSULTANT’S breach of any of its representations, warranties or covenants contained in this Agreement.

CONSULTANT shall be entitled to payment only for work completed in accordance with the terms of this Agreement through the date of the termination notice, as reasonably determined by CITY, provided that such payment shall not exceed the amounts set forth in this Agreement for the tasks described on Exhibit C” which have been fully, competently and timely rendered by CONSULTANT. Notwithstanding the foregoing, if CITY terminates this Agreement due to CONSULTANT’S default in the performance of this Agreement or material breach by CONSULTANT of any of its provisions, then in addition to any other rights and remedies CITY

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may have, CONSULTANT shall reimburse CITY, within ten (10) days after demand, for any and all costs and expenses incurred by CITY in order to complete the tasks constituting the scope of work as described in this Agreement, to the extent such costs and expenses exceed the amounts CITY would have been obligated to pay CONSULTANT for the performance of that task pursuant to this Agreement.

C. Termination for Failure to Make Agreed-Upon Payments Should CITY fail to pay CONSULTANT all or any part of the compensation set forth in Article 4 of this Agreement on the date due, then if and only if such nonpayment constitutes a default under this Agreement, CONSULTANT, at the CONSULTANT’S option, may terminate this Agreement if such default is not remedied by CITY within thirty (30) days after demand for such payment is given by CONSULTANT to CITY.

D. Transition after Termination
Upon termination, CONSULTANT shall immediately stop work, unless cessation could potentially cause any damage or harm to person or property, in which case CONSULTANT shall cease such work as soon as it is safe to do so. CONSULTANT shall incur no further expenses in connection with this Agreement. CONSULTANT shall promptly deliver to CITY all work done toward completion of the services required hereunder, and shall act in such a manner as to facilitate any the assumption of CONSULTANT’s duties by any new consultant hired by the CITY to complete such services.

ARTICLE 8. GENERAL PROVISIONS
A. Amendment & Modification
No amendments, modifications, alterations or changes to the terms of this Agreement shall be effective unless and until made in a writing signed by both parties hereto.

B. Americans with Disabilities Act of 1990
Throughout the term of this Agreement, the CONSULTANT shall comply fully with all applicable provisions of the Americans with Disabilities Act of 1990 (“the Act”) in its current form and as it may be amended from time to time. CONSULTANT shall also require such compliance of all subcontractors performing work under this Agreement, subject to the prohibition against assignment and subcontracting contained in Article 5 above. The CONSULTANT shall defend with counsel acceptable to CITY, indemnify and hold harmless the CITY OF GILROY, its officers, employees, agents and representatives from and against all suits, claims, demands, damages, costs, causes of action, losses, liabilities, expenses and fees, including without limitation reasonable attorneys’ fees, that may arise out of any violations of the Act by the CONSULTANT, its subcontractors, or the officers, employees, agents or representatives of either.

C. Attorneys’ Fees
If any action at law or in equity, including an action for declaratory relief, is brought to enforce or interpret the provisions of this Agreement, the prevailing party will be entitled to reasonable

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attorneys’ fees, which may be set by the court in the same action or in a separate action brought for that purpose, in addition to any other relief to which that party may be entitled.

D. Captions
The captions and headings of the various sections, paragraphs and subparagraphs of the Agreement are for convenience only and shall not be considered nor referred to for resolving questions of interpretation.

E. Compliance with Laws
The CONSULTANT shall keep itself informed of all State and National laws and all municipal ordinances and regulations of the CITY which in any manner affect those engaged or employed in the work, or the materials used in the work, or which in any way affect the conduct of the work, and of all such orders and decrees of bodies or tribunals having any jurisdiction or authority over the same. Without limiting the foregoing, CONSULTANT agrees to observe the provisions of the Municipal Code of the CITY OF GILROY, obligating every contractor or subcontractor under a contract or subcontract to the CITY OF GILROY for public works or for goods or services to refrain from discriminatory employment or subcontracting practices on the basis of the race, color, sex, religious creed, national origin, ancestry of any employee, applicant for employment, or any potential subcontractor.

F. Conflict of Interest
CONSULTANT certifies that to the best of its knowledge, no CITY employee or office of any public agency interested in this Agreement has any pecuniary interest in the business of CONSULTANT and that no person associated with CONSULTANT has any interest that would constitute a conflict of interest in any manner or degree as to the execution or performance of this Agreement.

G. Entire Agreement
This Agreement supersedes any and all prior agreements, whether oral or written, between the parties hereto with respect to the rendering of services by CONSULTANT for CITY and contains all the covenants and agreements between the parties with respect to the rendering of such services in any manner whatsoever. Each party to this Agreement acknowledges that no representations, inducements, promises or agreements, orally or otherwise, have been made by any party, or anyone acting on behalf of any party, which are not embodied herein, and that no other agreement, statement or promise not contained in this Agreement shall be valid or binding.

No other agreements or conversation with any officer, agent or employee of CITY prior to execution of this Agreement shall affect or modify any of the terms or obligations contained in any documents comprising this Agreement. Such other agreements or conversations shall be considered as unofficial information and in no way binding upon CITY.

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H. Governing Law and Venue
This Agreement shall be governed by and construed in accordance with the laws of the State of California without regard to the conflict of laws provisions of any jurisdiction. The exclusive jurisdiction and venue with respect to any and all disputes arising hereunder shall be in state and federal courts located in Santa Clara County, California.

I. Notices
Any notice to be given hereunder by either party to the other may be effected either by personal delivery in writing or by mail, registered or certified, postage prepaid with return receipt requested.

Mailed notices shall be addressed to the parties at the addresses appearing in Exhibit “A”, Section V.H. but each party may change the address by written notice in accordance with this paragraph.

Notices delivered personally will be deemed delivered as of actual receipt; mailed notices will be deemed delivered as of three (3) days after mailing.

J. Partial Invalidity
If any provision in this Agreement is held by a court of competent jurisdiction to be invalid, void or unenforceable, the remaining provisions will nevertheless continue in full force without being impaired or invalidated in any way.

K. Time of the Essence
All dates and times referred to in this Agreement are of the essence.

L. Waiver
CONSULTANT agrees that waiver by CITY of any one or more of the conditions of performance under this Agreement shall not be construed as waiver(s) of any other condition of performance under this Agreement.

Executed at Gilroy, California, on the date and year first above written.

CONSULTANT: CITY:

Kimley-Horn and Associates, Inc. CITY OF GILROY
By: By:

Name: Frederik Venter, PE Name: Matt Morley
Title: Senior Vice President Title: City Administrator
Social Security or Taxpayer
Identification Number 56-0885615

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Approved as to Form ATTEST:

City Attorney City Clerk

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EXHIBIT “A”

SPECIFIC PROVISIONS
I. PROJECT MANAGER
CONSULTANT shall provide the services indicated on the attached Exhibit “B”, Scope of Services (“Services”). (All exhibits referenced are incorporated herein by reference.) To accomplish that end, CONSULTANT agrees to assign Frederik J. Venter, PE, who will act in the capacity of Project Manager, and who will personally direct such Services.

Except as may be specified elsewhere in this Agreement, CONSULTANT shall furnish all technical and professional services including labor, material, equipment, transportation, supervision and expertise to perform all operations necessary and required to complete the Services in accordance with the terms of this Agreement.

II. NOTICE TO PROCEED/COMPLETION OF SERVICE
A. NOTICE TO PROCEED
CONSULTANT shall commence the Services upon delivery to CONSULTANT of a written “Notice to Proceed”, which Notice to Proceed shall be in the form of a written communication from designated City contact person(s). Notice to Proceed may be in the form of e-mail, fax or letter authorizing commencement of the Services. For purposes of this Agreement, the City Engineer shall be the designated City contact person(s). Notice to Proceed shall be deemed to have been delivered upon actual receipt by CONSULTANT or if otherwise delivered as provided in the Section V.H. (“Notices”) of this Exhibit “A”.

B. COMPLETION OF SERVICES
When CITY determines that CONSULTANT has completed all of the Services in accordance with the terms of this Agreement, CITY shall give CONSULTANT written Notice of Final Acceptance, and CONSULTANT shall not incur any further costs hereunder. CONSULTANT may request this determination of completion when, in its opinion, it has completed all of the Services as required by the terms of this Agreement and, if so requested, CITY shall make this determination within two (2) weeks of such request, or if CITY determines that CONSULTANT has not completed all of such Services as required by this Agreement, CITY shall so inform CONSULTANT within this two (2) week period.

III. PROGRESS SCHEDULE
The schedule for performance and completion of the Services will be as set forth in the attached Exhibit “C”.

IV. PAYMENT OF FEES AND DIRECT EXPENSES
Payments shall be made to CONSULTANT as provided for in Article 4 of this Agreement.

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Direct expenses are charges and fees not included in Exhibit “B”. CITY shall be obligated to pay only for those direct expenses which have been previously approved in writing by CITY.

CONSULTANT shall obtain written approval from CITY prior to incurring or billing of direct expenses.

Copies of pertinent financial records, including invoices, will be included with the submission of billing(s) for all direct expenses.

V. OTHER PROVISIONS
A. STANDARD OF WORKMANSHIP
CONSULTANT represents and warrants that it has the qualifications, skills and licenses necessary to perform the Services, and its duties and obligations, expressed and implied, contained herein, and CITY expressly relies upon CONSULTANT’S representations and warranties regarding its skills, qualifications and licenses. CONSULTANT shall perform such Services and duties in conformance to and consistent with the standards generally recognized as being employed by professionals in the same discipline in the State of California.

Any plans, designs, specifications, estimates, calculations, reports and other documents furnished under this Agreement shall be of a quality acceptable to CITY. The minimum criteria for acceptance shall be a product of neat appearance, well-organized, technically and grammatically correct, checked and having the maker and checker identified. The minimum standard of appearance, organization and content of the drawings shall be that used by CITY for similar purposes.

B. RESPONSIBILITY OF CONSULTANT
CONSULTANT shall be responsible for the professional quality, technical accuracy, and the coordination of the Services furnished by it under this Agreement. CONSULTANT shall not be responsible for the accuracy of any project or technical information provided by the CITY. The CITY’S review, acceptance or payment for any of the Services shall not be construed to operate as a waiver of any rights under this Agreement or of any cause of action arising out of the performance of this Agreement, and CONSULTANT shall be and remain liable to CITY in accordance with applicable law for all damages to CITY caused by CONSULTANT’S negligent performance of any of the services furnished under this Agreement.

C. RIGHT OF CITY TO INSPECT RECORDS OF CONSULTANT
CITY, through its authorized employees, representatives or agents, shall have the right, at any and all reasonable times, to audit the books and records (including, but not limited to, invoices, vouchers, canceled checks, time cards, etc.) of CONSULTANT for the purpose of verifying any and all charges made by CONSULTANT in connection with this Agreement. CONSULTANT shall maintain for a minimum period of three (3) years (from the date of final payment to CONSULTANT), or for any longer period required by law, sufficient books and records in accordance with standard California accounting practices to establish the correctness of all charges submitted to CITY by CONSULTANT, all of which shall be made available to CITY at the CITY’s offices within five (5) business days after CITY’s request.

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D. CONFIDENTIALITY OF MATERIAL
All ideas, memoranda, specifications, plans, manufacturing procedures, data (including, but not limited to, computer data and source code), drawings, descriptions, documents, discussions or other information developed or received by or for CONSULTANT and all other written and oral information developed or received by or for CONSULTANT and all other written and oral information submitted to CONSULTANT in connection with the performance of this Agreement shall be held confidential by CONSULTANT and shall not, without the prior written consent of CITY, be used for any purposes other than the performance of the Services, nor be disclosed to an entity not connected with the performance of the such Services. Nothing furnished to CONSULTANT which is otherwise known to CONSULTANT or is or becomes generally known to the related industry (other than that which becomes generally known as the result of CONSULTANT’S disclosure thereof) shall be deemed confidential. CONSULTANT shall not use CITY’S name or insignia, or distribute publicity pertaining to the services rendered under this Agreement in any magazine, trade paper, newspaper or other medium without the express written consent of CITY.

E. NO PLEDGING OF CITY’S CREDIT.

Under no circumstances shall CONSULTANT have the authority or power to pledge the credit of CITY or incur any obligation in the name of CITY.

F. OWNERSHIP OF MATERIAL.

All material including, but not limited to, computer information, data and source code, sketches, tracings, drawings, plans, diagrams, quantities, estimates, specifications, proposals, tests, maps, calculations, photographs, reports and other material developed, collected, prepared (or caused to be prepared) under this Agreement shall be the property of CITY, but CONSULTANT may retain and use copies thereof subject to Section V.D of this Exhibit “A”.

CITY shall not be limited in any way in its use of said material at any time for any work, whether or not associated with the City project for which the Services are performed. However, CONSULTANT shall not be responsible for, and City shall indemnify CONSULTANT from, damages resulting from the use of said material for work other than PROJECT, including, but not limited to, the release of this material to third parties for work other than on PROJECT.

G. NO THIRD PARTY BENEFICIARY.

This Agreement shall not be construed or deemed to be an agreement for the benefit of any third party or parties, and no third party or parties shall have any claim or right of action hereunder for any cause whatsoever.

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H. NOTICES.

Notices are to be sent as follows:

CITY: City Engineer
City of Gilroy
7351 Rosanna Street
Gilroy, CA 95020
CONSULTANT: Frederik J. Venter, PE
Kimley-Horn and Associates, Inc.
10 South Almaden Boulevard, Suite 1250
San Jose, CA 95113
I. FEDERAL FUNDING REQUIREMENTS.

If the box to the left of this sentence is checked, this Agreement involves federal funding and the requirements of this Section V.I. apply.

If the box to the left of this sentence is checked, this Agreement does not involve federal funding and the requirements of this Section V.I. do not apply.

1. DBE Program
CONSULTANT shall comply with the requirements of Title 49, Part 26, Code of Federal Regulations (49 CFR 26) and the City-adopted Disadvantaged Business Enterprise programs.

2. Cost Principles
Federal Acquisition Regulations in Title 48, CFR 31, shall be used to determine the allowable cost for individual items.

3. Covenant against Contingent Fees
The CONSULTANT warrants that he/she has not employed or retained any company or person, other than a bona fide employee working for the CONSULTANT, to solicit or secure this Agreement, and that he/she has not paid or agreed to pay any company or person, other than a bona fide employee, any fee, commission, percentage, brokerage fee, gift or any other consideration, contingent upon or resulting from the award or formation of this Agreement. For breach or violation of this warranty, the Local Agency shall have the right to annul this Agreement without liability or, at its discretion, to deduct from the agreement price or consideration, or otherwise recover, the full amount of such fee, commission, percentage, brokerage fee, gift or contingent fee.

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EXHIBIT “B”

SCOPE OF SERVICES
See attached "Scope of Services" in Exhibit B-1.

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EXHIBIT “C”

MILESTONE SCHEDULE
The Consultant will begin work immediately. The Consultant will manage the project so that the schedule established is maitained to the degree it is under their control.

See attached "Project Schedule" in Exhibit C-1.

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EXHIBIT “D”

PAYMENT SCHEDULE
The cost for services rendered under this agreement will not exceed $237,117.25. Billing will be conducted monthly.

The following are budgedted costs for each task as outlined in Exhibit "B" Scope of Services:

Task 1 - Detailed Work Plan and Strategy - $30,400.83
Task 2 - Stakeholder and Community Engagement - $50,254.74 Task 3 - Background Review, Plan Vision, Goals, and Objectives - $8,134.34 Task 4 - Collision and Roadway Analysis - $44,583.71
Task 5 - Emphasis Areas and Countermeasures - $24,907.34 Task 6 - Project Identification, Evaluation, and Prioritization - $25,089.68 Task 7 - Draft and Final Safety Action Plans - $43,650.86 Other Direct Costs - $10,095.75
Total not to exceed: $237,117.25

RESOLUTION NO. 2026-XX

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF GILROY AMENDING THE BUDGET FOR FISCAL YEAR 2026-27 TO APPROPRIATE SAFE STREETS AND ROADS FOR ALL (SS4A) GRANT FUNDS AND REQUIRED LOCAL MATCH FOR

THE COMPREHENSIVE ROADWAY SAFETY ACTION PLAN PROJECT
WHEREAS, the City Council adopted the Fiscal Year 2026-27 Budget for the City of Gilroy; and
WHEREAS, the Federal Highway Administration administers the Safe Streets and Roads for All (SS4A) Program to support local agencies in improving roadway safety and reducing trafficrelated fatalities and serious injuries; and WHEREAS, the City of Gilroy was awarded Fiscal Year 2024 SS4A Grant funding for the development of a Comprehensive Roadway Safety Action Plan; and WHEREAS, the grant provides reimbursement funding for eligible project costs in an amount not to exceed $189,693.80 and requires a local match contribution of $47,423.45 from the Gas Tax Fund (205); and
WHEREAS, the total project cost is $237,117.25, and the project was not included in the adopted Fiscal Year 2026-27 Budget; and
WHEREAS, appropriating the grant funds and local match will allow the City to proceed with Project No. 801180, Comprehensive Roadway Safety Action Plan; and NOW, THEREFORE, IT IS HEREBY RESOLVED, ORDERED AND FOUND by the City Council of the City of Gilroy, as follows:

1. The foregoing recitals are true and correct.

2. The Fiscal Year 2026-27 Budget is hereby amended to appropriate $189,693.80 in SS4A Grant Funds and $47,423.45 from Gas Tax Fund balance (205), for a total project budget of $237,117.25 for Project No. 801180, Comprehensive Roadway Safety Action Plan.

3. The Fiscal Year 2026-27 Capital Improvement Program is hereby amended to include Project No. 801180, Comprehensive Roadway Safety Action Plan.

PASSED AND ADOPTED this 3rd day of August 2026, by the following roll call vote:

AYES: COUNCIL MEMBERS:

NOES: COUNCIL MEMBERS:

ABSTAIN: COUNCIL MEMBERS:

ABSENT: COUNCIL MEMBERS:

Resolution No. 2026-XX
Budget Amendment for Comprehensive Safety Action Plan
City Council Regular Meeting | August 3, 2026

APPROVED:
___________________
Greg Bozzo, Mayor
ATTEST:
_______________________
Kim Mancera, City Clerk

CERTIFICATE OF THE CLERK
I, KIM MANCERA, City Clerk of the City of Gilroy, do hereby certify that the attached Resolution No. 2026-XX is an original resolution, or true and correct copy of a City Resolution, duly adopted by the Council of the City of Gilroy at a Regular Meeting of said Council held on Monday, Date, with a quorum present.

IN WITNESS WHEREOF, I have hereunto set my hand and affixed the Official Seal of the City of Gilroy this Tuesday, August 4, 2026.
____________________________________
Kim Mancera
City Clerk of the City of Gilroy

10.1. City of Gilroy

STAFF REPORT
Agenda Item Title: Public Hearing on Downtown Gilroy Street Banner Policy and Program Guidelines and Fee Schedule Amendment
Meeting Date: August 3, 2026
From: Matt Morley, City Administrator
Department: Public Works
Submitted by: John Doughty, Public Works Director
Prepared by: Matt Jones, Deputy Public Works Director, Bryan Rodriguez, Management Analyst Trainee
STRATEGIC PLAN GOALS: Promote Economic Development Activities Develop a Financially Resilient Organization

RECOMMENDATION

1. Open Public Hearing

2. Close Public Hearing

3. Adopt a Resolution:
a. Approving the Downtown Gilroy Street Banner Policy and Program Guidelines; and
b. Approving the updated fee schedule to include a new fee for installation (and removal) of Downtown Streetlight-Pole Banners.

EXECUTIVE SUMMARY
Staff is seeking City Council approval of an updated Downtown Gilroy Street Banner Policy and Program Guidelines to improve clarity, streamline the process, modernize specifications, and enhance program administration. Since the original policy was adopted in 2013, staff has identified gaps in guidance, outdated banner specifications, and inefficiencies in the application process that have created challenges for community organizations. The proposed updates establish clear eligibility criteria, standardized procedures, and revised technical specifications. There is a related fee schedule

10.1. amendment to include a new fee to cover a portion of the costs of installing streetlight pole banners. There is no recommended change to the over-the-street banner fee.

These updates are intended to improve user experience, ensure consistent program administration, streamline the process, and support the City’s goals of promoting community events and enhancing the downtown streetscape.

BACKGROUND
In 2013, the City Council adopted Resolution No. 2013-08, establishing policies and requirements for the display of community over-the-street banners and streetlight pole banners. Since that time, several community organizations have applied to display banners in the Downtown Area.

The 2013 banner specifications and policy have not been updated since their original adoption to reflect changes in manufacturing standards and their associated costs. The policy also lacks clear expectations and guidelines. As a result, applicants have experienced confusion regarding requirements and timelines, which has led to disengagement from the program or missed opportunities to procure compliant banners in time for scheduled events.

The City's fee schedule does not include an application fee for installing streetlight pole banners. The fee associated with over-the-street banners would remain unchanged.

Since 2013, the City has installed holders for streetlight banners in the Downtown Area on Monterey Road, Sixth Street, and Lewis Street. Today, there are a total of 53 streetlight poles which can display up to 53 banners.

There are three organizations that currently display streetlight pole banners. These are the Downtown Gilroy Business Association for the Holiday Parade, the South Santa Clara Valley Memorial District (Gilroy Veterans Memorial Hall) for Memorial Day and Veterans Day, and the Arts and Culture Commission For the Love of Gilroy public arts campaign.

ANALYSIS
In Fall 2025, City staff convened an internal working group to evaluate the existing policy and identify areas for improvement. Staff from the Economic Development, Public Works Operations, and the Engineering Divisions reviewed the policy, banner specifications, application process, and program guidelines. The proposed updates align the program with current industry best practices and improve overall clarity and efficiency for applicants.

Program Goals

10.1. The Downtown Street Banner Program Guidelines are intended to:
• Use well-designed banners on designated City light poles and across City streets as an effective tool to accentuate city streetscapes and convey important City messages regarding upcoming community events to the public, and ensure that all banners are properly designed, installed, and maintained in accordance with City standards to protect the safety of motorists, pedestrians, and all who travel within the public right-of-way;
• Welcome visitors to Gilroy’s downtown;
• Announce and publicize events that are open to the public, including special community events, cultural facilities, and market the downtown to visitors and locals alike;
• Establish uniform procedures for the design, installation, and removal of banners and costs associated;
• Encourage the appropriate use of banners pursuant to the Program Guidelines; and
• Update and establish cost recovery.

Program Eligibility
Banners within the Downtown Banner Area may be used to promote:
• Significant community events;
• Holiday or seasonal community events;
• Cultural events open to the public; and
• Downtown marketing initiatives.

Banners may not be used to promote private events, political campaigns, religious messages, or any activity that is not in compliance with applicable laws or the Program Guidelines.

Over-the-Street Banners
Approved locations for over-the-street banners are limited to the Monterey Street rightof-way, specifically mid-block between Fourth and Fifth Streets and between Fifth and Sixth Streets.

Staff proposes updating banner specifications to ensure durability and public safety under local weather conditions and extending the allowable display period from two weeks to three weeks.

Streetlight Pole-Mounted Banners
Currently, three organizations utilize the existing streetlight pole banners. This policy and recommended fees would not apply to those events or activities (Holiday Parade, Veterans Banners and Annual For the Love of Gilroy Public Arts Campaign). The

10.1. purpose of this policy revision is to establish clear procedures for installation and removal, including the option to use qualified private contractors for any new organizations seeking to display banners. The updated guidelines also provide greater flexibility in display duration for any new organization seeking approval from the City.

Fees
Over the Street Banner
No changes are proposed to the existing $748 fee for over-the-street banners.

Streetlight Pole-Mounted Vertical Banners
Staff recommends establishing a new fee for the installation of streetlight pole banners.

The recommended fee is as follows: 1) $1,000 for installation of banners just along Monterey Street; or 2) $1,500 for installation along Monterey Street and any/all side streets. This fee would apply to any organization or event seeking to use streetlight pole banners. The City Council could always choose to consider a waiver/reduction of fees under the Downtown Special Event Program. The fees would not apply to a City activity such as downtown marketing.

Staff has completed a fee study and determined that City full cost of recovery for application review, installation, and removal equals $120 per streetlight pole banner, which at full utilization, would equal approximately $6,000 (50 locations). Given the parameters of the program and focus on community building and economic development, staff is suggesting a fee structure which is less than 100-percent full cost recovery. The amount of cost recovery is a policy decision for the City Council to consider.

Under the revised guidelines, applicants have the option to install the signs through a third-party State of California C-45 licensed contractor. Applicants who elect to use a private contractor are only required to obtain a right-of-way encroachment permit (currently $456).

ALTERNATIVES

1. Do not adopt the updates and continue operating under the existing 2013 policy. This alternative is not recommended as the community will benefit from the revised policy.

2. Adopt the updated policy with the recommended streetlight banner fee. This action would result in ongoing General Fund support should other organizations choose to seek use of the streetlight pole banners. Staff is recommending this action.

3. Adopt the updated policy with fee set at 100-percent cost recovery for the streetlight banners. This action could result in ongoing General Fund support through new organizations and/or activities. While General Fund financial support is a policy decision of the City Council, the policy itself limits use of the streetlight poles for community building and economic development, which are identified as City Council priorities. This

10.1. alternative is not recommended.

4. Adopt the updated policy and defer final decision on the new fee for streetlight banners to a future date. This action is not recommended as the analysis has been completed, the public hearing has been noticed and currently there is cost recovery associated with the streetlight banner installation.

FISCAL IMPACT/FUNDING SOURCE
The cost of administration will vary from year-to-year given the community events that are scheduled. The program is administered by the Public Works Department with the assistance of Administration (City Hall) staff. The Economic Development Department operating budget includes $7,000 to cover a portion of the costs of the current streetlight banner program. The remainder of installation costs of the program will be absorbed into the existing Public Works operating budget. The Over-the-Street banner program is covered by an existing fee of $748, which is full cost recovery.

PUBLIC OUTREACH
The City published a public notice in the Gilroy Dispatch on May 15, 2026, on the public hearing and proposed fee changes. Staff met with Downtown Gilroy Business Improvement Association (DGBIA) staff early in the process to discuss a number of ongoing efforts including the downtown banner guidelines work. Staff will provide a copy of the Draft Guidelines to the DGBIA.

Following Council approval, staff will maintain a dedicated web page outlining the Downtown Gilroy Street Banner Policy and Program Guidelines and streamlining the application process. Additionally, the Economic Development Department will incorporate program materials into the City’s Special Event Packet.

NEXT STEPS
Upon City Council adoption of the Resolution, staff will:

1. Update the City’s Fee Schedule to reflect the new streetlight pole-mounted banner fee (will become effective in 60-days).

2. Publish a Downtown Street Banner Program website page hosting program information.

3. Incorporate program materials into the City’s Special Event Packet.

Attachments:

1. Resolution Downtown Street Banner Policy and Program Guidelines

2. Resolution Amending Portions of the Comprehensive Fee Schedule

10.1. 3. Exhibit A Downtown Banner Policy Update April 28, 2026

4. Exhibit B Over-the-Street Banner and Streetlight Pole-Mounted Vertical Banner Applications April 8, 2026

RESOLUTION NO. 2026-XX

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF GILROY UPDATING

THE DOWNTOWN GILROY STREET BANNER POLICY AND PROGRAM

GUIDELINES
WHEREAS, in 2013 the City Council adopted Resolution 2013-08 adopting the Policies and Requirements to Display a Community Over-the-Street Banner or a Street Light Pole-Mounted Vertical Banner; and
WHEREAS, the City of Gilroy has developed a Downtown Gilroy Street Banner Policy and Program Guidelines, attached hereto and referred hereinafter as “Exhibit “A,” to facilitate the approval and coordination of vertical and horizontal street banner displays in Downtown Gilroy area; and
WHEREAS, said Program Guidelines provide for the submittal of an Over-the-Street Banner Permit Application and Streetlight Banner Permit Application (as may be modified from time to time), attached hereto and referred herein as Exhibit “B”, to provide that requests are handled in a timely and fair manner, to assure quality of content and design, and to ensure appropriate messaging in accordance with City objectives and standards; and WHEREAS, the Program Guidelines will support local business and community organizations and their events, provide information to the public, and identify, and enhance the appearance of streets and common areas; and
WHEREAS, the City Council has considered all information related to this manner, as presented at the public meetings of the City Council identified herein, including any supporting reports by City Staff, and any information provided during public meetings; and WHEREAS, the location and custodian of the documents or other materials which constitute the record of proceedings upon with this project approval is based is the office of the City Clerk.

NOW, THEREFORE, BE IT RESOLVED.

1. The City Council hereby finds that the facts set forth in the recitals to this Resolution are true and correct and establish the factual basis for the City Council’s adoption of this Resolution.

2. The Downtown Gilroy Street Banner Policy and Program Guidelines identified as Exhibit “A” and attached hereto and incorporated herein by reference are approved.

3. This Resolution shall take effect immediately upon its adoption.

4. That to the extent prior resolutions are inconsistent with this Resolution regarding operating hours, such provisions are hereby superseded.

Resolution No. 2026-XX
Downtown Gilroy Street Banner Policy and Program Guidelines City Council Regular Meeting | August 3, 2026

PASSED AND ADOPTED this 3rd day of August 2026 by the following roll call vote:

AYES: COUNCIL MEMBERS:

NOES: COUNCIL MEMBERS:

ABSTAIN: COUNCIL MEMBERS:

ABSENT: COUNCIL MEMBERS:

APPROVED:
___________________
Greg Bozzo, Mayor
ATTEST:
_______________________
Kim Mancera, City Clerk

CERTIFICATE OF THE CLERK
I, KIM MANCERA, City Clerk of the City of Gilroy, do hereby certify that the attached Resolution No. 2026-XX is an original resolution, or true and correct copy of a City Resolution, duly adopted by the Council of the City of Gilroy at a Regular Meeting of said Council held on Monday, August 3, 2026, with a quorum present.

IN WITNESS WHEREOF, I have hereunto set my hand and affixed the Official Seal of the City of Gilroy this Tuesday, August 4, 2026.
____________________________________
Kim Mancera
City Clerk of the City of Gilroy

RESOLUTION NO. 2026-XX

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF GILROY AMENDING

THE CITY OF GILROY COMPREHENSIVE FEE SCHEDULE
WHEREAS, the City of Gilroy has authority under law to collect user fees to recover the actual costs of providing services to users; and
WHEREAS, the City Council periodically approves a Master User Fee Schedule adopting a comprehensive list of user fees to uphold efforts associated with transparency and financial responsibility; and
WHEREAS, the City Council has adopted Fiscal and Budget Policies setting guidelines for approved user fee calculation methodologies and cost recovery; and WHEREAS, the Downtown Banner Policy and Program Guidelines includes incorporating a fee for Streetlight Pole Banners; and
WHEREAS, the City Council held a Public Hearing and received a public presentation regarding the proposed user fee changes and recommended changes to the fees; and WHEREAS, the Public Hearing was properly noticed to maximize public participation; and NOW, THEREFORE, BE IT RESOLVED, that the City Council of the City of Gilroy authorizes the necessary changes to the City’s Fiscal Year 2026-2027 Comprehensive Fee Schedule to add Streetlight Pole-mounted fees of 1) Monterey Street at $1,000 and 2) Monterey Street and any/all side streets at $1,500, to become effective immediately upon adoption of the resolution.

NOW, THEREFORE BE IT FURTHER RESOLVED, that the City Council of the City of Gilroy further authorizes that the established fees are subject to annual automatic Consumer Price Index (CPI) adjustments pursuant to Gilroy City Code Section 17.4 – Schedule of fees and service charges.

PASSED AND ADOPTED this 3rd day of August 2026 by the following roll call vote:

AYES: COUNCIL MEMBERS:

NOES: COUNCIL MEMBERS:

ABSTAIN: COUNCIL MEMBERS:

ABSENT: COUNCIL MEMBERS:

APPROVED:
___________________

Resolution No. 2026-XX
Resolution Amending the City of Gilroy Comprehensive Fee Schedule City Council Regular Meeting | August 3, 2026

Greg Bozzo, Mayor
ATTEST:
_______________________
Kim Mancera, City Clerk

CERTIFICATE OF THE CLERK
I, KIM MANCERA, City Clerk of the City of Gilroy, do hereby certify that the attached Resolution No. 2026-XX is an original resolution, or true and correct copy of a City Resolution, duly adopted by the Council of the City of Gilroy at a Regular Meeting of said Council held on Monday, August 3, 2026, with a quorum present.

IN WITNESS WHEREOF, I have hereunto set my hand and affixed the Official Seal of the City of Gilroy this Tuesday, August 4, 2026.
____________________________________
Kim Mancera
City Clerk of the City of Gilroy

City of Gilroy
Downtown Gilroy Street
Banner Policy and
Program Guidelines
Council Policy
Issue Date: April 1, 2013
Revision Date: May 18, 2026
Prepared By: Bryan Rodriguez, Management Analyst Trainee Approved By:

City of Gilroy Downtown Street Banner Policy and Program Guidelines

1. Purpose
Banners are displayed to inform the general public of upcoming community events.

The goals of the Downtown Street Banner Program Guidelines are as follows:
• To use well-designed banners on designated City light poles and across City streets as an effective tool to accentuate city streetscapes and convey important City messages regarding upcoming community events to the public;
• To welcome visitors to Gilroy’s downtown;
• To announce and publicize events that are open to the public, including special community events, cultural facilities, and market the downtown to visitors and locals alike;
• To establish uniform procedures for the design, installation, and removal of banners and costs associated; and
• To limit and regulate the use of banners pursuant to these Program Guidelines in order not to adversely impact the primary purposes of the use of City rights of way, which is the safe and effective travel of vehicles, bicycles, and pedestrians on public streets and sidewalks.

This policy shall not apply to any City Park which is subject to the use requirements of Gilroy City Code Chapter 18. Banners placed on private property are regulated by the City’s Sign Ordinance in Gilroy City Code Chapter 30.37. The City Council hereby authorizes the City Administrator, his or her designee to implement the Street Banner Program Guidelines in accordance with the following goals, policies, procedures, and guidelines.

2. Program Eligibility
The City may use banners in the Downtown Banner Area to promote the following:
• Significant community events
• Holiday or seasonal community events
• Cultural facilities open to the public
• Marketing opportunities for the downtown
The City will not allow banners to be used to promote any activity that is not open to the public, any activity for which the City is precluded from spending public funds (such as political campaigns or religious messages), any activity that is not in compliance with any local, State, or federal law, or any image or message that is inconsistent with the Street Banner Program Guidelines.

City of Gilroy Downtown Street Banner Policy and Program Guidelines

2.1 Application Submittal Requirements
The following information shall be submitted as part of an applicant’s application to demonstrate compliance with the provisions of the street banner program guidelines:
• A completed banner application form
• The name of the organization requesting the permit (the “applicant”), and the name, mailing address, email address, and telephone number of the person authorized to act on behalf of the applicant
• A proposed schedule for installing and removing the banners • The number of banners proposed
• A map identifying the location of the proposed banners • Colored rendering of the proposed banner design, including dimensions and materials used.
• Other information as indicated on the application form or determined by the City to ensure compliance with these guidelines
• The application must be signed by the designated signature authority of the applicant (e.g., president, chair, etc.)
• Insurance Requirements
• Pay associated fees
The Public Works Department will review applications on a first-come, first-served basis. If a time conflict occurs between an approved permit and any subsequent permit application may modify their request. The Public Works Director may also determine that certain timeframes will be reserved for particular City messages for which no application has been provided to the City. The pending applicant will be provided an opportunity to request an alternate timeframe.

Applications will generally be reviewed within 30 days of receipt by the City.

3. Over-the-Street Banner

3.1 Design Requirements
Banners spanning a City street shall meet the following design requirements:
• Designed with a minimum 18 oz. canvas or other approved material. • Banner shall be two-sided, 3 ft. high, and no longer than 40 ft. • Contain a continuous 1/4” or 3/8” nylon rope sewn into the edges in the top and bottom of the banner. The rope will be a total length of 60 feet for ease of installation with the banner centered in the middle, there should be minimum 20 ft beyond each end of the banner.
• Metal grommets of a hole opening of ½” or ¾”, spaced at approximately 2 ft intervals, shall be placed at the top of the banner and, and one grommet at

City of Gilroy Downtown Street Banner Policy and Program Guidelines

each lower corners of the banner shall be reinforced so the grommets do not pull out.
• 18-inch diameter half round air slots/flaps shall be spaced approximate every 4 feet, located approximately at the horizontal centerline of the banner.
• Banners shall be designed in a manner that does not interfere with traffic safety or create confusion with official traffic control devices. Materials shall be non-reflective, and designs shall avoid the use of colors, shapes, or symbols that resemble regulatory, warning, or guide signs. All banners shall be constructed to withstand high winds, typical weather conditions, and meet City-approved specifications for size, materials, and durability. • The City reserves the right to require design modifications to ensure compliance with safety standards.

3.2 Locations
An Over-The-Street Banner will be hung across the Monterey Street right-of-way using the City-owned poles located mid-block between Fourth & Fifth and between Fifth & Sixth Streets. Banners shall not be displayed in another location in the public right of way, unless specifically authorized by the Public Works Director.

3.3 Installation and Removal
All banners shall be installed and removed by the Public Works Department. The applicant shall be responsible for delivering the banner to the Public Works Department at City Hall at least 10 working days prior to its date of display. Failure to deliver the banner within 10 days will delay the schedule for hanging the banner.

Banners not retrieved from the Public Works Department by the applicant or sponsoring agency within 10 working days of removal will be discarded by the City.

3.4 Display Time
Banners shall be installed for a period of three calendar weeks. The Public Works Department may approve a longer time period at the Public Works Director’s sole discretion.

4.0 Streetlight Pole-Mounted Vertical Banner

4.1 Design Requirements
Streetlight Pole-Mounted Vertical Banners shall meet the following design requirements:
• Designed with a minimum 18 oz. block out canvas or other approved material.

City of Gilroy Downtown Street Banner Policy and Program Guidelines

• Banner shall be two-sided and measure 51.5” in length by 24” in width. • Contain a continuous 1/4” or 3/8” nylon rope sewn into the edges in the top and bottom of the banner.
• At the bottom and top of the banner, a vinyl loop shall be sewn into the sign such that the loop can slide over a 2-inch diameter pole with approximately 18” to 1/4” additional diameter to allow for installation. Loop stitching on each end shall be triple overlap with double stitching. • Banners shall be designed in a manner that does not interfere with traffic safety or create confusion with official traffic control devices. Materials shall be non-reflective, and designs shall avoid the use of colors, shapes, or symbols that resemble regulatory, warning, or guide signs. All banners shall be constructed to withstand typical weather conditions and meet Cityapproved specifications for size, materials, and durability. • The City reserves the right to require design modifications to ensure compliance with safety standards.

4.2 Locations
The City has various City-owned streetlight poles equipped with two horizontal bars that accommodate the display of vertical banner signs in the Downtown, including Monterey Rd, Lewis Road, and adjacent side streets. Banners shall not be displayed in another location in the public right-of-way, unless specifically authorized by the Public Works Director.

Standard banner hardware has been installed on numerous light poles in the Downtown Banner Area. If an applicant proposes to install banners on light poles that do not currently contain banner hardware, the applicant may may request approval to install additional hardware at their own expense, subject to review and approval by the Public Works Director. All hardware shall be installed in accordance with City Specifications, including required mounting height to maintain consistency with existing installations. The City will retain ownership of all banner hardware once installed. The hardware specifications will be provided by the City of Gilroy.

4.3 Installation and Removal
This section establishes the requirements and procedures for the installation and removal of banners within the public right-of-way by either private contractors or the City of Gilroy. To ensure public safety, protect City infrastructure, and maintain an orderly and consistent appearance throughout the community, all banner activities must be conducted in accordance with established permitting, insurance, and coordination requirements. Applicants are responsible for complying with all applicable regulations, whether utilizing a qualified private installer or coordinating installation through the City’s Public Works Department. It is the discretion of the permit applicant whether to acquire a private installer or use Public Works Staff.

City of Gilroy Downtown Street Banner Policy and Program Guidelines

4.3.1 Contract Qualified Installation
• The applicant shall contract with a qualified installer (e.g., a private sign company or a banner company) to install the banners and any required hardware, to perform any necessary maintenance while the banners are installed, and to remove the banners when required under the terms of the permit. Qualified installers must hold a C-42 Sign Contractor License or equivalent qualifications. The applicant is responsible for payment to the installer. The installer is required to obtain a City of Gilroy business license from the City’s Finance Department and an encroachment permit from the City’s Public Works Department, including the provision of the required insurance certificates and payment of an encroachment permit fee as a requirement of issuance of a permit. A banner permit application shall be completed and submitted to the Public Works Department for approval, accompanied by the associated fees.
• From time to time, it may be necessary for an applicant (through its installer) to remove a set of existing banners, while a new applicant (through its installer) is installing new banners. The City encourages all applicants to work cooperatively with other organizations when installing, removing and/or re-installing banners so that there is no lapse in display time. City staff will coordinate the installation process with the affected applicants and installers. Coordination with the installers will minimize impacts to hardware as well as disruptions to pedestrians and businesses during installation.

4.3.2 City of Gilroy Installation & Removal
• All banners may be installed and removed by the Public Works Department. The applicant shall be responsible for delivering the banner to the Public Works Department at City Hall at least 10 working days prior to its date of display. Failure to deliver the banner within 10 days will delay the schedule for hanging the banner.
• Banners not retrieved from the Public Works Department by the applicant or sponsoring agency within 10 working days of removal will be discarded or recycled by the City.
• Applicant will be responsible for all costs associated with hanging the banners which will be based on fully burdened personnel rates.

4.5 Display Time
The maximum time limit for banners on City light poles will be based upon the purpose and promotional focus of the banners. Banners with general promotional messages or designated geographic areas relating to the downtown, (e.g., Visit Gilroy) will not have specific time limits, but will be subject to scheduling and requests on a first-come, first-served basis. Banners that promote a specific event or date-specific activities shall be limited to thirty (30) days.

City of Gilroy Downtown Street Banner Policy and Program Guidelines

The Public Works Director may authorize an applicant to extend the time a banner is installed, considering requests from other banner applicants and physical condition of the banners

OVER THE STREET BANNER HANGING PERMIT APPLICATION

1. Applications for Banner Permits are accepted at the City of Gilroy Public Works Department, City Hall, 7351 Rosanna St, Gilroy, CA, 95020, between the hours of 8:30 a.m. and 4:00 p.m., Monday through Thursday, or by mail, 408-846-0223.

2. Only banners which publicize events that are open to the public, significant cultural or community events, or market the downtown are allowed.

3. Banners may be displayed for a three-week period.

4. Banners must comply with banner specifications.

5. Banner application and hanging fee:
•$ 748.00 for one (1) over-the-street banner
•$1,440.00 for two (2) over-the-street banners

6. Banner applications must be submitted with a colored rendering of banner, including dimensions and materials used.

7. All banners are installed and removed by City personnel.

8. There are no refunds on banner application and hanging fees.

9. Applications to display banners may be filed up to twelve (12) months but no later than thirty (30) days prior to the scheduled event.

10. A Certificate of Insurance with an endorsement naming the City, its officers, officials, employees and volunteers, as additional insured in a minimum amount of Two Million Dollars ($2,000,000).

11. The City of Gilroy assumes no responsibility for damage to banners while they are on display.

12. Applicants must deliver the banner to City Hall, 7351 Rosanna St, Gilroy, CA, 95020 thirty (10) working days prior to the installation date. Banners not retrieved from the Public Works Department by the applicant or sponsoring agency within ten (10) working days of removal will be discarded or recycled by the City.

DATE:

NAME OF PERSON:

NAME OF ORGANIZATION:

PHONE NO.: (HOME) (WORK)
Office Use Only:

APP. FEE:

SKETCH:

INS.:

BANNER HANGING FEE:

CITY APPROVAL:

FAX NO.: E-MAIL ADDRESS:

ADDRESS:

EVENT ADVERTISED:

PURPOSE OF EVENT:

DATE(S) OF EVENT:

REQUESTED DATES FOR BANNER HANGING:

LOCATION(S) ON MONTEREY ROAD: FOURTH & FIFTH STREETS MIDBLOCK FIFTH & SIXTH STREETS MIDBLOCK PLEASE ATTACH COLORED RENDORING OF BANNER, INCLUDING DIMENSIONS AND MATERIALS USED. (Rev. 07-22-26)

Nylon rope sewn into
banner
Banner
Support ringssupplied by city
Existing support cable 1-1/4" Grommets every 2 ft. Not to scale 1/4” or 3/8” Notes: 1. Designed with a minimum 18 oz. canvas or other approved material. 2. Banner shall be two-sided, 3 ft. high, and no longer than 40 ft. 3. Contain a continuous 1/4” or 3/8” nylon rope sewn into the edges in the top and bottom of the banner. The rope will be a total length of 60 feet for ease of installation with the banner centered in the middle, there should be minimum 20 ft beyond each end of the banner. 4. Metal grommets of a hole opening of ½” or ¾”, spaced at approximately 2 ft intervals, shall be placed at the top of the banner and, and one grommet at each lower corners of the banner shall be reinforced so the grommets do not pull out.

5. 18-inch diameter half round air slots/flaps shall be spaced approximate every 4 feet, located approximately at the horizontal centerline of the banner.

6. Banners shall be designed in a manner that does not interfere with traffic safety or create confusion with official traffic control devices.

Monterey St. Banner Detail
Rope (see Note 2b) Grommets (see Note 2c)
.---,_.....,_--see Detail A 2 ft.
____ o _____ o _____ o _____ o ______ o --- f -------- o _____ o _____ o 1- 4 ft. - 1 j
3 ft. \(J \(J , \(J \(J
, Air Slots (see Note 2d) I /
o~ ================================ ~ ===================re NOTES: Detail A

1. Banner shall be 3 ft. high and no longer than 40 ft.

2. The banner shall be fabricated to meet the following specifications a. Banner material shall be 16-oz. double sided, block-out light canvas or synthetic material that can withstand strong winds. b. A synthetic rope shall be sewn into the top and bottom of the banner, extending approximately 20 ft beyond each end.
c. 1-inch diameter, No. 4 grommets shall be placed at the top of the banner at approximately every 2 feet.
d. 18-inch diameter half round air slots/flaps shall be spaced approximate every 4 feet, located approximately at the horizontal centerline of the banner City of Gilroy Public Works Department
Revised 4.3.26

STREELIGHT POLE-MOUNTED VERTICAL BANNER HANGING PERMIT APPLICATION

1. Applications for Banner Permits are accepted at the City of Gilroy Public Works Department, City Hall, 7351 Rosanna St, Gilroy, CA, 95020, between the hours of 8:30 a.m. and 4:00 p.m., Monday through Thursday, or by mail, 408-846-0223.

2. Only banners which publicize events that are open to the public, significant cultural or community events, or market the downtown are allowed.

3. Banners may be displayed for a three-week period.

4. Banners must comply with banner specifications.

5. Banner application and hanging fee:
•$ 120.00* *Fee is per banner installation and removal by Public Works Staff. •$ 420.00 for Encroachment permit if using private contractor for installation and removal.

6. Banner applications must be submitted with a colored rendering of banner, including dimensions and materials used.

7. Applicants may use a qualified installer (at your own cost) to install and removed banners or use Public Works Staff (to be reimbursed).

8. There are no refunds on banner application and hanging fees.

9. Applications to display banners may be filed up to twelve (12) months but no later than thirty (10) working days prior to the scheduled event.

10. A Certificate of Insurance with an endorsement naming the City, its officers, officials, employees, and volunteers, as additional insured in a minimum amount of Two Million Dollars ($2,000,000). Additional insurance requirements for private contractor installation and removal include a minimum of One Million Dollars ($1,000,000) automobile liability and Workers Compensation and Employers’ Liability insurance per statue at One Million Dollars ($1,000,000).

11. The City of Gilroy assumes no responsibility for damage to banners while they are on display.

12. Applicants must deliver the banner to City Hall, 7351 Rosanna St, Gilroy, CA, 95020 thirty (10) working days prior to the installation date. Banners not retrieved from the Public Works Department by the applicant or sponsoring agency within ten (10) working days of removal will be discarded or recycled by the City.

DATE:

NAME OF PERSON:

NAME OF ORGANIZATION:

PHONE NO.: (HOME) (WORK)
Office Use Only:

APP. FEE:

SKETCH:

INS.:

BANNER HANGING FEE:

CITY APPROVAL:

FAX NO.: E-MAIL ADDRESS:

ADDRESS:

EVENT ADVERTISED:

PURPOSE OF EVENT:

DATE(S) OF EVENT:

REQUESTED DATES FOR BANNER HANGING:

INSTALLATION: CONTRACT QUALIFED INSTALLTION CITY OF GILROY PERSONNEL PLEASE COMPLETE THE PROPOSED BANNER LOCATIONS CHECKBOX MAP. PLEASE ATTACH COLORED RENDORING OF BANNER, INCLUDING DIMENSIONS AND MATERIALS USED.
(Rev. 04-08-26)

I I I I

I I I I
3rd
I I
I I
4th
I I
I I

I I I I
Monterey Rd.

I
5th
I I
6th
Eigleberry St.

I
I
Home Town Hero Banners
Banners
>,
0 ...
a
-0
0 I I
I I
7th
Street Light Pole Banners on available poles on Monterey St between 3rd and 7th Streets . "
*Map not to scal·e
Train Station
I I I
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8th

City of Gilroy

STAFF REPORT
Agenda Item Title: Consideration of the Report of Abatement of Weeds and Refuse Within the City of Gilroy and Adoption of a Resolution Confirming the Imposition of Assessment Liens Against the Land
Meeting Date: August 3, 2026
From: Matt Morley, City Administrator
Department: Community Development
Submitted by: Sharon Goei, Community Development Director Prepared by: Jonathan Crick, Fire Marshal
STRATEGIC PLAN GOALS: Not Applicable

RECOMMENDATION
Adopt a resolution allowing the assessment of fees, minus any qualifying objections, as reported by the Santa Clara County Weed Abatement Program.

EXECUTIVE SUMMARY
This hearing is the third part of the annual weed abatement process pursuant to Chapter 12 of the Gilroy City Code. City Council should take action on the costs associated with removing weeds on specific properties. Such costs constitute a lien on the property until paid, and according to the City Code, will be collected as part of the following tax roll. At the February 9, 2026 meeting, the City declared weeds and accumulated refuse a nuisance and began the annual weed abatement process through the County’s contract for weed abatement services and associated fees. At the April 20, 2026 meeting, the City Council set May 15th as the deadline to abate weeds for locations identified on the property abatement list. Properties inspected and found in compliance are assessed the regular inspection fee. Those locations not abated before the May 15, 2026 deadline are assessed additional fees as noted in the staff report below.

BACKGROUND
Resolution No. 2026-09 was adopted by Council on February 9, 2026, to declare

weeds a nuisance and to begin the annual weed abatement process. Under a contract with the County’s Office of Vegetation Management, the County Weed Abatement Program provides the weed abatement listing, letters of notification, lot inspections and documentation, and arranges abatement services if needed. Following City Council adoption of Resolution No. 2026-09, the County Weed Abatement Program had a preliminary list of lots requiring abatement. This includes lots on the previous list that have had failed inspections within the past three years and additional lots added based on non-abatement during the prior season. The County sent all owners of the lots listed a weed abatement notice, fee information, and an instruction letter.

On April 20, 2026, the City Council held a public hearing to allow any owner of a listed lot to remove their lot from the program. Subsequently, the City Council adopted Resolution No. 2026-23, approving the list of properties subject to weed abatement and setting the abatement deadline to May 15, 2026. The County conducted its inspections after the May 15th deadline. Property owners could communicate directly with the County if they had problems getting their lot abated. Any lot found with weeds after the deadline was sent a notice and the County assessed a failed inspection fee. The property owners were given an additional two weeks to perform abatement before becoming subject to abatement by the County.

ANALYSIS
Pursuant to Gilroy City Code Section 12.54, attached is a report of the inspected lots, those assessed a failed inspection fee, and those that have been abated to date. All sites on the list are assessed the applicable inspection fee. Sites with failed inspections are assessed an additional failed inspection fee, and lots requiring City/County abatement are assessed the applicable administrative fee in addition to the contractor's abatement costs.

For 2026, there are a total of 118 properties on the weed abatement list, a reduction of three properties from 2025. In 2016, there were 297 properties on the list. Development of vacant properties contributes significantly to this reduction in numbers.

For 2026, the program assessed 71 properties with inspection only fees ranging from $105 to $296. Twelve properties were assessed inspection and failed inspection fees ranging from $592 to $802. Thirty properties were assessed upper-mid category fees ranging from $1,545 to $4,439, which may include the previously mentioned fees or other fees. Five properties were assessed various fees mentioned, ranging from $6,214 to $8,513, reflecting properties that required City/County contracted weed abatement and the associated administrative and abatement costs. Some properties may also include unpaid fees carried forward from previous years.

The property owners listed for fee assessment were sent a copy of the proposed assessment against their property in July. They have had the opportunity to call, email, or meet with the Gilroy Fire Marshal and County Weed Abatement Program Manager on or before August 3, 2026, to discuss, object to, or obtain additional information about their assessment. Any property owner that did not object or did not provide a substantial reason why they should not be assessed still has an opportunity to raise objections at the lien hearing. Staff will present information at the hearing on any property owner who

met with, called, or emailed their objection and where staff determined there was a mistake or cause for dismissing the assessment fee. Staff recommends approval of the proposed resolution to process the assessment report, including any necessary modifications resulting from the hearing.

ALTERNATIVES
There are no alternatives since this process is dictated by Chapter 12 of the Gilroy City Code. Property owners may have many reasons that their lot was not abated; however, unless the County made a mistake in identifying a lot’s ownership, there are few acceptable reasons to waive the County’s fees. All owners were notified of deadlines and costs, as required by the City Code.

FISCAL IMPACT/FUNDING SOURCE
The Weed Abatement Program is administered annually through a contract with the County of Santa Clara. Adoption of the resolution authorizes the County Assessor's Office to levy the assessments as liens against the listed properties. The assessments are paid by the property owners and collected by the County through the annual property tax bills. If the County does not collect sufficient revenue to fully fund the program, it may allocate a proportional share of the program shortfall to the participating jurisdictions based on each jurisdiction's percentage of the total enrolled properties.

Because abatement activities continue through October, any program surplus or deficit is not determined until later in the calendar year.

Historically, the program has operated on a cost recovery basis administered by the County. However, in 2025 the County Weed Abatement Program experienced a budget shortfall that is expected to be allocated among the participating jurisdictions. In response, the Santa Clara County Fire Marshals' Association submitted a letter to the County expressing concerns regarding the program's fiscal management. The letter recommends improved cost accounting, enhanced fiscal oversight, earlier communication with participating agencies, and collaborative annual program reviews to promote the long-term financial and operational stability of the County Weed Abatement Program.

PUBLIC OUTREACH
The City has sent out weed abatement wildfire safety messaging in March and May.

Targeted mailers and letters have been mailed in May, June, and July and are expected to continue as needed. The Community Development Department Fire Prevention Division webpage is being updated periodically.

NEXT STEPS
This is the final step in this year’s planned abatement process. Any new assessments would be included in next year’s process.

Attachments:

1. Draft resolution, including the 2026 Gilroy Assessment Report Exhibit

RESOLUTION NO. 2026-XX

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

GILROY CONFIRMING THE REPORT OF THE ABATEMENT

OF WEEDS SETTING FORTH THE DESCRIPTION OF

PROPERTY, NAMING THE OWNERS THEREOF, AND THE

COST OF ABATING THE NUISANCE CAUSED BY THE

GROWING OF WEEDS AND ACCUMULATION OF REFUSE ON

THE PROPERTY, AND PROVIDING THAT SUCH COST SHALL

CONSTITUTE ASSESSMENTS AGAINST THE LAND
WHEREAS, pursuant to Article III of Chapter 12 of the Gilroy City Code, the City Council of the City of Gilroy on February 9, 2026 adopted Resolution No. 2026-09 designating certain weeds growing or existing in the City of Gilroy, and refuse accumulating in the City, to be a public nuisance and ordering the Chief of the Fire Department to give notice of the passage of said resolution by posting and publication in the same manner and for the same time as set forth in Section 12.48 of said code, and the Chief of the Fire Department, through the Community Development Department, did cause said notice to be so given; and WHEREAS, pursuant to Resolution No. 2026-09, the property owners as stated on the latest tax assessor's roll of the lots or parcels determined to have weeds growing or existing, and/or refuse accumulating were duly noticed that: (1) said weeds and refuse have been determined to constitute a public nuisance, (2) a public hearing would be held at which the City Council would hear and consider any and all objections to the proposed destruction or removal of said weeds or refuse, and (3) weeds and refuse not removed by the property owners will be removed by City authorities, in which case the cost of such destruction and/or removal will be assessed upon the lots and lands from which, or from the front or rear of which, such weeds and accumulation of refuse have been destroyed or removed, and such costs will constitute a lien upon such lots or lands until paid, and will be collected upon the next tax roll upon which general municipal taxes are collected; and
WHEREAS , the City Council fixed April 20, 2026, at the hour of 6:00 o'clock p.m., or as soon as thereafter, in the Council Chambers in the City Hall at 7351 Rosanna Street, in the City of Gilroy, as the time and place for the hearing provided for in Section

12.50 of said Code, and the notice given included a statement of the said time and place of hearing; and
WHEREAS, the hearing was held on that date in accordance with the City Code and no objections were made to the proposed removal and destruction of the weeds and refuse, and the City Council thereafter adopted Resolution No. 2026-23 requiring the Chief of the Fire Department to abate said nuisance by having the weeds destroyed and the refuse removed as provided in Section 12.51 of the Gilroy City Code; and
WHEREAS, the Chief of the Fire Department, through the Community Development Department, has filed his report with the City Council, setting forth the actions taken in abating the nuisance, stating an account of the cost of the abatement and an assessment list and identification of each separate lot or parcel of land by description, together with the expense proposed to be

assessed against each separate lot or parcel and the name of the owners or reputed owners (“Owners”) thereof attached hereto as Exhibit “A” and incorporated herein by this reference; and WHEREAS, the Chief of the Fire Department has taken all actions required of him in abating said nuisance and removing said weeds and refuse and that the cost thereof as shown in said report is correct and should be confirmed; and
WHEREAS, the City Clerk fixed August 3, 2026 at the hour of 6:00 o'clock p.m., or as soon thereafter as the item can be heard, in the Council Chambers in the City Hall at 7351 Rosanna Street, in the City of Gilroy, as the time and place for the hearing provided for in Section

12.53 of the Gilroy City Code; and
WHEREAS, the Owners were duly noticed of the hearing, at which the City Council would be presented with the report and assessment list for consideration and confirmation, the abatement costs proposed to be assessed upon the Owners and the right of all persons interested, having any objections to the report and assessment list, or to any matter or thing contained therein, to appear and be heard; and
WHEREAS, this hearing was held in accordance with the Gilroy City Code.

NOW THEREFORE, BE IT RESOLVED, that a certified copy of this resolution and of the Exhibit A report of the abatement of weeds be turned over to the County Director of Finance, who constitutes the Assessor and Tax Collector for the City of Gilroy, and the amounts shown on said report as the cost of the removal of the weeds and refuse from each of the respective properties and certified as unpaid shall be and constitute a lien on the property for the amount of such assessment respectively, and the Assessor and Tax Collector add the amount thereof to the next regular bill for taxes levied against respective lots and parcels of land for municipal purposes.

PASSED AND ADOPTED on this 3rd day of August 2026 by the following roll call vote:

AYES: COUNCIL MEMBERS:

NOES: COUNCIL MEMBERS:

ABSTAIN: COUNCIL MEMBERS:

ABSENT: COUNCIL MEMBERS:

APPROVED:

ATTEST: Greg Bozzo, Mayor
Kim Mancera, City Clerk

CERTIFICATE OF THE CLERK
I, KIM MANCERA, City Clerk of the City of Gilroy, do hereby certify that the attached Resolution No. 2026-XX is an original resolution, or true and correct copy of a City Resolution, duly adopted by the Council of the City of Gilroy at a Regular Meeting of said held on Council held Monday, August 3, 2026, with a quorum present.

IN WITNESS WHEREOF, I have hereunto set my hand and affixed the Official Seal of the City of Gilroy this Date.

Kim Mancera
City Clerk of the City of Gilroy (Seal)

Exhibit A
Situs APN Tax Roll Amt
1 VERBENA DR, GILROY CA 95020 783-03-070 $296.00
2 8351 WINTER GREEN CT, GILROY, CA 95020 783-03-077 $296.00 3 8341 WINTER GREEN CT, GILROY, CA 95020 783-03-081 $296.00 4 HECKER PASS HWY, GILROY, CA 95020 783-04-032 $296.00
5 820 SUNRISE DR, GILROY, CA 95020-9608 783-20-049 $296.00 6 1885 HOLLYHOCK LN, GILROY, CA 95020 783-45-014 $296.00 7 1920 MANTELLI DR, GILROY, CA 95020-7919 783-45-016 $2,557.71 8 0 HOLLYHOCK LN, GILROY, CA 95020 783-45-044 $1,973.25 9 2280 CORAL BELL CT, GILROY, CA 95020-7903 783-46-026 $592.00 10 STRAWBERRY LN, GILROY, CA 95020 783-46-079 $3,495.20 11 0 SUNFLOWER CL, GILROY, CA 95020 783-47-003 $1,545.00 12 1463 PHEASANT DR, GILROY, CA 95020-8219 783-50-058 $802.00 13 8745 WILD IRIS DR, GILROY, CA 95020 783-52-032 $296.00 14 1350 PEREGRINE DR, GILROY, CA 95020 783-55-021 $296.00 15 9246 DOVE CT, GILROY, CA 95020 783-57-004 $296.00
16 9231 N EGRET CT, GILROY, CA 95020 783-58-044 $296.00 17 2363 BANYAN ST, GILROY, CA 95020 783-64-029 $296.00
18 2333 BANYAN ST, GILROY, CA 95020 783-64-032 $296.00
19 2354 BANYAN ST, GILROY, CA 95020 783-65-022 $296.00
20 9141 GUNNERA LN, GILROY, CA 95020 783-65-023 $296.00 21 1820 CAROB CT, GILROY, CA 95020 783-72-017 $2,821.29 22 1810 CAROB CT, GILROY, CA 95020 783-72-018 $296.00
23 9145 TEA TREE WY, GILROY, CA 95020 783-72-020 $296.00 24 9035 TEA TREE WY, GILROY, CA 95020 783-72-025 $296.00 25 9025 MIMOSA CT, GILROY, CA 95020 783-72-027 $296.00
26 8955 MIMOSA CT, GILROY, CA 95020 783-72-036 $296.00
27 2203 BANYAN CT, GILROY, CA 95020 783-72-040 $296.00
28 9210 MAHOGANY CT, GILROY, CA 95020 783-72-045 $296.00 29 2273 BANYAN CT, GILROY, CA 95020 783-72-051 $296.00
30 2283 BANYAN CT, GILROY, CA 95020 783-72-052 $296.00
31 95 FARRELL AV, GILROY, CA 95020-7615 790-07-085 $296.00 32 103 FARRELL AV, GILROY, CA 95020-7615 790-07-086 $1,545.00 33 111 FARRELL AV, GILROY, CA 95020-7615 790-07-087 $1,545.00 34 119 FARRELL AV, GILROY, CA 95020-7615 790-07-088 $1,545.00 35 171 RONAN AV, GILROY, CA 95020-7219 790-15-009 $592.00 36 1375 1ST ST, GILROY, CA 95020 790-39-019 $296.00
37 7733 MONTEREY RD, GILROY, CA 95020 799-03-054 $2,781.04 38 7711 MONTEREY RD, GILROY, CA 95020 799-03-055 $2,993.05 39 0 EIGLEBERRY ST, GILROY, CA 95020 799-10-042 $1,959.83 40 CHURCH ST, GILROY, CA 95020 799-11-069 $296.00
41 7421 HANNA ST, GILROY, CA 95020-5723 799-18-031 $592.00 42 6700 CHURCH ST, GILROY, CA 95020-6508 799-33-001 $592.00 43 0 FILBRO DR, GILROY, CA 95020 799-44-093 $296.00
44 0 ROYAL WY, GILROY, CA 95020 799-44-094 $296.00
2026 WEED ABATEMENT PROGRAM

CITY OF GILROY

ASSESSMENT REPORT

Exhibit A
45 0 ROYAL WY, GILROY, CA 95020 799-44-095 $296.00
46 0 ROYAL WY, GILROY, CA 95020 799-44-096 $296.00
47 0 ROYAL WY, GILROY, CA 95020 799-44-097 $296.00
48 0 ROYAL WY, GILROY, CA 95020 799-44-098 $296.00
49 0 THOMAS RD, GILROY, CA 95020-9503 799-44-109 $296.00 50 321 W LUCHESSA AV, GILROY, CA 95020 799-44-110 $296.00 51 1410 1ST ST, GILROY, CA 95020-4737 808-01-021 $296.00 52 7890 SANTA TERESA BL, GILROY, CA 95020 808-01-022 $592.00 53 1490 1ST ST, GILROY, CA 95020 808-01-023 $296.00
54 0 PONDEROSA DR, GILROY, CA 95020 808-01-024 $296.00
55 LUCHESSA AV, GILROY, CA 95020 808-19-030 $296.00
56 6482 GREENFIELD DR, GILROY, CA 95020-9503 808-20-008 $296.00 57 10 W LUCHESSA AV, GILROY, CA 95020-9503 808-21-009 $296.00 58 6301 BERRYBUSH CT, GILROY, CA 95020-9504 808-40-024 $296.00 59 MONTEREY RD, GILROY, CA 95020 808-49-078 $296.00
60 VINTNER ST, GILROY, CA 95020 808-58-005 $296.00
61 2740 HECKER PASS RD, GILROY, CA 95020-9402 810-20-033 $1,545.00 62 2480 HECKER PASS HY, GILROY, CA 95020 810-20-037 $296.00 63 2300 HECKER PASS HY, GILROY, CA 95020 810-20-039 $592.00 64 6675 EAGLE RIDGE CT, GILROY, CA 95020 810-60-018 $1,545.00 65 6685 EAGLE RIDGE CT, GILROY, CA 95020 810-60-019 $1,545.00 66 6695 EAGLE RIDGE CT, GILROY, CA 95020 810-60-020 $1,545.00 67 6694 EAGLE RIDGE CT, GILROY, CA 95020 810-60-021 $296.00 68 6535 EAGLE RIDGE CT, GILROY, CA 95020 810-72-021 $1,545.00 69 6615 EAGLE RIDGE CT, GILROY, CA 95020 810-72-029 $296.00 70 6625 EAGLE RIDGE CT, GILROY, CA 95020 810-72-030 $296.00 71 6635 EAGLE RIDGE CT, GILROY, CA 95020 810-72-031 $296.00 72 6645 EAGLE RIDGE CT, GILROY, CA 95020 810-72-032 $592.00 73 6651 EAGLE RIDGE CT, GILROY, CA 95020 810-72-033 $296.00 74 6655 EAGLE RIDGE CT, GILROY, CA 95020 810-72-034 $1,545.00 75 6671 EAGLE RIDGE CT, GILROY, CA 95020 810-72-035 $1,545.00 76 MONTEREY RD, GILROY, CA 95020 835-01-034 $2,523.33
77 MONTEREY RD, GILROY, CA 95020 835-01-035 $2,809.83
78 0 FOREST ST, GILROY, CA 95020 835-01-050 $296.00
79 0 MURRAY AV, GILROY, CA 95020 835-01-059 $296.00
80 0 LEAVESLEY RD, GILROY, CA 95020-3605 835-01-064 $296.00 81 MONTEREY RD, GILROY, CA 95020 835-02-014 $8,513.14
82 SAN YSIDRO AV, GILROY, CA 95020 835-04-064 $296.00
83 LAS ANIMAS AV, GILROY, CA 95020 835-04-067 $1,545.00 84 MURRAY AV, GILROY, CA 95020 835-04-068 $1,545.00
85 9096 SAN YSIDRO AV, GILROY, CA 95020 835-04-087 $3,605.81 86 9090 SAN YSIDRO AV, GILROY, CA 95020 835-04-088 $3,696.34 87 9120 MURRAY AV, GILROY, CA 95020-3510 835-05-004 $296.00 88 315 LAS ANIMAS AV, GILROY, CA 95020 835-05-006 $296.00 89 MURAOKA DR, GILROY, CA 95020 835-31-032 $105.00
90 MONTEREY RD, GILROY, CA 95020 841-02-046 $7,642.04
91 395 LEWIS ST, GILROY, CA 95020-5220 841-03-062 $1,545.00 92 0 SOUTH VALLEY FY, GILROY, CA 95020 841-10-039 $296.00

Exhibit A
93 430 OLD GILROY ST, GILROY, CA 95020-6215 841-11-075 $1,545.00 94 0 SOUTH VALLEY FY, GILROY, CA 95020 841-14-058 $3,929.00 95 0 SOUTH VALLEY FY, GILROY, CA 95020 841-14-059 $4,438.97 96 0 SOUTH VALLEY FY, GILROY, CA 95020 841-14-060 $6,511.80 97 MONTEREY RD, GILROY, CA 95020 841-14-072 $7,940.00
98 5870 MONTEREY RD, GILROY, CA 95020 841-14-080 $296.00 99 6900 CAMERON BL, GILROY, CA 95020 841-17-100 $296.00 100 VENTURE WA, GILROY, CA 95020 841-17-121 $296.00
101 0 PACHECO PASS HY, GILROY, CA 95020 841-18-082 $6,214.00 102 951 RENZ LN, GILROY, CA 95020 841-18-095 $296.00
103 981 RENZ LN, GILROY, CA 95020 841-18-096 $296.00
104 402 HADLEY CT, GILROY, CA 95020-5839 841-53-032 $296.00 105 HOOVER CT, GILROY, CA 95020 841-53-066 $296.00
106 0 HOLLOWAY RD, GILROY, CA 95020 841-70-005 $296.00
107 0 SILACCI WY, GILROY, CA 95020 841-70-012 $296.00
108 850 HOLLOWAY RD, GILROY, CA 95020 841-70-026 $1,545.00 109 555 HOLLOWAY RD, GILROY, CA 95020 841-70-037 $296.00 110 6970 CAMINO ARROYO, GILROY, CA 95020 841-70-059 $296.00 111 5885 ROSSI LN, GILROY, CA 95020 841-72-001 $2,001.90 112 560 ROSSI CT, GILROY, CA 95020 841-72-008 $592.00
113 5855 ROSSI LN, GILROY, CA 95020 841-72-009 $592.00
114 5835 ROSSI LN, GILROY, CA 95020 841-72-010 $592.00
115 5815 ROSSI LN, GILROY, CA 95020 841-72-011 $592.00
116 0 E LUCHESSA AV, GILROY, CA 95020 841-73-005 $296.00 117 5980 TRAVEL PARK CL, GILROY, CA 95020 841-75-011 $296.00 118 300 OBATA CT, GILROY, CA 95020 841-79-006 $296.00
TOTAL $131,266.53

City of Gilroy

STAFF REPORT
Agenda Item Title: Adoption of an Urgency Ordinance of the City Council of the City of Gilroy Establishing a Temporary Moratorium on the Issuance of New Tobacco Retailer Permits Citywide Through December 31, 2026
Meeting Date: August 3, 2026
From: Matt Morley, City Administrator
Department: Community Development
Submitted by: Sharon Goei, Community Development Director Prepared by: Bryce Atkins, Deputy Director of Community Development STRATEGIC PLAN GOALS: Not Applicable

RECOMMENDATION
Adopt an Urgency Ordinance of the City Council of the City of Gilroy establishing a temporary moratorium on the issuance of new Tobacco Retailer Permits Citywide through December 31, 2026.

EXECUTIVE SUMMARY
The City Council has previously considered and acted on several tobacco retailer permit and smoking-related policy items in response to concerns regarding the number, concentration, and operation of tobacco retailers and smoke shops within the City. The proposed urgency ordinance would provide a short-term pause on new Tobacco Retailer Permits while staff completes additional review of amendments to the City’s tobacco retailer permitting regulations, including review of proposed youth-oriented facilities provisions and other non-zoning regulatory approaches.

This action is intentionally drafted as a City Charter Section 602 urgency ordinance and is not adopted pursuant to Government Code Section 65858. At the June 1, 2026 City Council meeting, the Council provided direction not to pursue a zoning amendment at this time, to further evaluate the proposed youth-oriented facilities provisions, and to bring forward a moratorium on the issuance of new Tobacco Retailer Permits. The

proposed urgency ordinance is therefore grounded in the City’s Charter authority, police power, and authority to regulate City-issued licenses and permits under Chapter 13, Article VIII of the Gilroy City Code.

BACKGROUND
In 2014, the City Council adopted Ordinance No. 2014-14 establishing the City’s Tobacco Retailer Permit program. The program requires a person operating as a tobacco retailer within the City to obtain and maintain a valid Tobacco Retailer Permit for each location at which tobacco retailing occurs. The existing ordinance includes operational requirements, application requirements, issuance criteria, renewal procedures, compliance monitoring, penalties, and suspension or revocation procedures.

Since 2025, the City Council has considered several staff reports and ordinance actions related to tobacco retailer permitting, smoke shops, youth access, density, enforcement, and the City’s smoking pollution control regulations. The following summary is provided to place the proposed urgency ordinance in context.

Date Summary Relevance to Current Item
November 17,
2014
Council adopted Ordinance No. 2014-
14, adding Chapter 13, Article VIII to
establish the City’s Tobacco Retailer
Permit program.

Provides the existing permit
framework that the temporary
moratorium would pause for new
permit issuance.

February 27,
2023
Council adopted City Code
amendments prohibiting smoking in
and at multi-unit residential properties
and imposing related
landlord/business responsibilities.

Shows the City’s prior use of
local regulatory authority to
address tobacco and smokingrelated public health impacts.

August 4,
2025
Council received a policy report
regarding potential revisions to
Chapter 19B and Chapter 13, Article
VIII. Direction was provided to bring
back revisions focused on tobacco
retailer density, flavored tobacco
restrictions, and related public health
concerns.

Initiated the current sequence of
tobacco prevention policy work
and review of the City’s TRP
regulations.

November 3,
2025
Council adopted Ordinance No. 2025-
08, a 45-day urgency interim
ordinance prohibiting issuance of new
Tobacco Retailer Permits within the
Downtown Specific Plan area.

First moratorium action
responding to the concentration
of tobacco retailers and smoke
shops in a defined area.

December 8,
2025
Council adopted Ordinance No. 2025-
11 extending the downtown
Expanded the policy discussion
from downtown-specific

moratorium and directed staff to
prepare a separate urgency interim
ordinance for a citywide prohibition on
new Tobacco Retailer Permits.
concerns to citywide regulation.

January 5,
2026
Council adopted Ordinance No. 2026-
01 prohibiting the issuance of new
Tobacco Retailer Permits citywide for
45 days.

Established a temporary citywide
pause while staff studied
potential code amendments and
additional regulations.

February 9,
2026
Council adopted Ordinance No. 2026-
02 extending the citywide moratorium
for six months and fifteen days, with an
expiration date of August 24, 2026.

Maintained the citywide pause
while staff continued evaluating
potential zoning and tobacco
retailer permit amendments.

June 1, 2026 Council considered the proposed
Chapter 30 zoning amendments and
the draft Chapter 13 TRP
amendments. Council direction
included not pursuing zoning
amendments at this time, further
reviewing youth-oriented facilities, and
returning with a moratorium.

Resulted in the current
recommendation to proceed with
a moratorium under the City’s
licensing and Charter authority
rather than as a zoning
moratorium.

ANALYSIS
Continued Moratorium on New Tobacco Retailer Permits
The current moratorium on new tobacco retailer permits is scheduled to expire on August 24, 2026. At the June 1, 2026 City Council meeting, the Council directed staff not to pursue a zoning amendment at this time, to further review the proposed youthoriented facilities provisions, and to maintain a moratorium on the issuance of new tobacco retailer permits while that review continues.

The existing moratorium was adopted under California Government Code Section 65858, which governs interim urgency ordinances related to land use and planning matters. That prior moratorium was tied to the City’s review of potential zoning amendments related to tobacco retailers and smoke shops. Because the Council has now directed staff not to proceed with a zoning amendment at this time, the proposed ordinance is not presented as an extension of the prior Government Code Section 65858 moratorium and is not intended to operate as a zoning or land use ordinance.

Instead, the proposed ordinance would establish a new, limited moratorium under the City’s independent authority, including the City Charter, the City’s police power, and the City’s authority to regulate City-issued tobacco retailer permits and business licenses.

The purpose of the ordinance is to preserve the status quo while staff continues its nonPage 589 of 650

zoning regulatory review of the City’s tobacco retailer permit regulations, including additional analysis of potential provisions for youth-oriented facilities.

The proposed urgency ordinance includes findings that the prevalence and concentration of tobacco retailers may contribute to adverse public health, safety, welfare, enforcement, and nuisance impacts. The findings also recognize prior City concerns related to stand-alone smoke shops, youth-oriented marketing, illegal products, enforcement activity, theft and vandalism concerns, and litter and environmental impacts associated with tobacco product waste.

Authority for the Proposed Urgency Ordinance
City Charter Section 602 authorizes the City Council to introduce and adopt an emergency ordinance at the same meeting when the ordinance is declared necessary to preserve the public peace, health, or safety, contains a statement of the reasons for its urgency, and receives at least five affirmative votes. The proposed ordinance contains the required urgency findings and is drafted to take effect immediately upon adoption.

This action is separate from, and not an extension of, the previously adopted Government Code Section 65858 interim zoning ordinance. Because the proposed ordinance is not based on Section 65858, staff is not presenting it as a Section 65858 extension. Rather, the ordinance is a new urgency ordinance focused on City-issued tobacco retailer permits and licenses while staff continues its review of non-zoning regulatory options.

Scope of the Moratorium
Through December 31, 2026, the proposed ordinance would prohibit the City from accepting for filing, processing, approving, or issuing any new Tobacco Retailer Permit, license, or other City authorization required to commence, transfer, relocate, or physically expand a tobacco retailer business within the City of Gilroy.

The moratorium is limited in scope. It would not apply to the timely renewal of a valid, existing Tobacco Retailer Permit for the same permittee and same location, provided the permittee remains in compliance with applicable law. It also would not restrict any permit issuance required by state or federal law, court order, or as determined by the City Attorney.

The ordinance also preserves the City’s existing enforcement authority. During the moratorium, the City may continue to investigate, inspect, cite, suspend, revoke, deny renewal of, or otherwise enforce against any tobacco retailer business or permittee under applicable law.

ALTERNATIVES
The Council may alternatively choose the following:

1. Do not adopt the urgency ordinance. New Tobacco Retailer Permit applications could be accepted, processed, approved, or issued while staff continues reviewing potential regulatory amendments.

2. Provide direction to prepare a regular ordinance. The current moratorium will expire in August. A regular ordinance would not take effect immediately and would not sustain the current pause for the brief gap between the expiration of the current moratorium and the new moratorium, unless paired with an urgency ordinance or other interim action.

3. Adopt the urgency ordinance with modifications. Council may modify the scope, findings, exemptions, or direction to staff, subject to review by the City Attorney.

4. Provide direction on permanent amendments only. Staff could continue drafting amendments to Chapter 13 without a temporary moratorium, but new permits could be issued before Council completes policy review.

FISCAL IMPACT/FUNDING SOURCE
There is no direct fiscal appropriation associated with the adoption of the urgency ordinance. The ordinance may temporarily delay new permit fee revenue associated with new Tobacco Retailer Permit applications, but renewals of existing valid permits would continue to be allowed. Staff time will be required to administer the moratorium, respond to inquiries, and complete the continued regulatory review directed by Council.

Any future permanent amendments may have separate fiscal impacts depending on the scope of enforcement, inspection, and administrative requirements. These would be presented as part of the agenda item to adopt such future amendments.

PUBLIC OUTREACH
The City Council has considered tobacco retailer permit and smoking-related policy issues at multiple public meetings since 2025, including the August 4, 2025 policy discussion, the November 3, 2025 downtown urgency ordinance, the December 8, 2025 extension and citywide direction, the January 5, 2026 citywide urgency ordinance, the February 9, 2026 extension, and the June 1, 2026 tobacco retailer and smoke shop items. Public comment will be accepted on this agenda item before Council action in accordance with the City’s standard meeting procedures. This item was included on the publicly posted agenda for this meeting.

NEXT STEPS
If the urgency ordinance is adopted, staff will immediately implement the temporary

moratorium and update the direction to permit intake staff and the City’s business license administrator that no new Tobacco Retailer Permit applications are to be accepted, processed, approved, or issued during the moratorium, except as expressly allowed by the ordinance.

Staff will continue evaluating amendments to the City’s tobacco retailer permitting regulations and return to the City Council with recommendations. Follow-up actions include a future ordinance with permanent amendments to Chapter 13, Article VIII, or other Council-directed regulatory actions.

Attachments:

1. Tobacco Retailer Permit Moratorium Urgency Ordinance

ORDINANCE NO. 2026-XX

AN URGENCY ORDINANCE OF THE CITY COUNCIL OF THE CITY OF GILROY

ESTABLISHING A TEMPORARY MORATORIUM ON THE ISSUANCE OF NEW TOBACCO RETAILER PERMITS CITYWIDE THROUGH DECEMBER 31, 2026 WHEREAS, the City of Gilroy ("City") is a municipal corporation duly organized as a Charter City under the California Constitution and laws of the State of California; and
WHEREAS, the City Council has broad authority under the California Constitution, Article XI, Section 5, the City Charter, and the City's police powers to legislate for public purposes and for the general welfare, including, but not limited to, matters of public peace, health, safety, and welfare; and WHEREAS, City Charter Section 200 provides that the City has the power to make and enforce all laws and regulations with respect to municipal affairs, subject only to the restrictions and limitations provided in the Charter and the California Constitution; and
WHEREAS, City Charter Section 602 authorizes an ordinance declared by the City Council to be necessary as an emergency measure for preserving the public peace, health, or safety, and containing a statement of the reasons for its urgency, to be introduced and adopted at one and the same meeting if passed by at least five affirmative votes; and
WHEREAS, on November 17, 2014, the City adopted an ordinance requiring all tobacco retailers to obtain a "Tobacco Retailer Permit" to ensure that retailers comply with tobacco control laws and City business standards (Ord. No. 2014-14; Gilroy Code Section 13.66 et seq.); and
WHEREAS, California has adopted statewide restrictions intended to limit youth access to tobacco products, cannabis products, and related products, and the City has a substantial local interest in preventing youth access to such products and protecting the public health, safety, and welfare of the community; and WHEREAS, smoking is a leading cause of preventable disease and mortality, and smokeless tobacco is associated with increased risk for several cancers; and WHEREAS, staff has found a higher per capita concentration of tobacco retailers in the City as compared to neighboring cities and county areas, including the City of Morgan Hill, the City of Hollister, the unincorporated area of Santa Clara County, and San Benito County; and
WHEREAS, the prevalence and concentration of tobacco retail establishments

Ordinance No. 2026-XX
Temporary Moratorium on Tobacco Retailer Permits
City Council Regular Meeting | August 3, 2026

-2-
may contribute to adverse effects because of associated health risks and density in walkable areas where minors frequent; and
WHEREAS, social and economic burdens due to smoking-related illnesses place demands on community health resources and increase healthcare costs, and cigarette butts and packaging contribute to litter and environmental degradation and negatively impact the character of the City; and
WHEREAS, tobacco retailer businesses can also be targets for theft and vandalism, and may be associated with the sale of illegal cannabis products, drug paraphernalia, and other products that encourage or facilitate unlawful activity; and WHEREAS, hemp-derived products have also been found to be sold in tobacco retailer businesses and smoke shops, with marketing aimed toward children featuring colorful packaging designs and sweet candy flavors; and WHEREAS, tobacco retail stores have been a source of unlawful activities in the City, including in April 2025, when the California Department of Tax and Fee Administration (CDTFA) and the City of Gilroy confiscated flavored tobacco products and hallucinogenic psilocybin that are illegal to sell from certain local tobacco retail businesses within the city limits; and
WHEREAS, on June 1, 2026, the City Council considered issues related to tobacco retailer regulation and provided direction to not pursue a zoning amendment at this time, to further review the proposed youth-oriented facilities provisions, and to bring forward a continued moratorium on the issuance of new Tobacco Retailer Permits while tobacco retailer permit regulations are under consideration; and WHEREAS, the City is reviewing potential amendments to its tobacco retailer permitting and licensing regulations, including, without limitation, standards related to youth-oriented facilities, compliance requirements, enforcement, transfer, relocation, expansion, permit issuance, and other measures intended to protect minors and the public health, safety, and welfare; and
WHEREAS, because the City Council has directed that a zoning amendment not be pursued at this time, this Ordinance is not adopted pursuant to California Government Code Section 65858 and is not intended to operate as a zoning or land use moratorium; and
WHEREAS, the City Council finds that, absent immediate adoption of this Ordinance, additional Tobacco Retailer Permits could be issued before the City has completed its review of appropriate permanent amendments to its tobacco retailer permitting and licensing regulations; and

Ordinance No. 2026-XX
Temporary Moratorium on Tobacco Retailer Permits
City Council Regular Meeting | August 3, 2026

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WHEREAS, the City Council finds that issuance of additional Tobacco Retailer Permits before completion of that review would frustrate the purpose of the City's ongoing regulatory review and may worsen the adverse public health, safety, and welfare impacts described in this Ordinance; and
WHEREAS, considering the foregoing findings and events that have taken place, the City Council finds that there is a current and immediate threat to the public peace, health, safety, and welfare, and that approval or issuance of additional Tobacco Retailer Permits would result in and exacerbate that threat; and WHEREAS, the City Council further finds that immediate adoption of this Ordinance as an urgency ordinance is necessary to preserve the public peace, health, and safety by temporarily maintaining the status quo while the City reviews potential amendments to its tobacco retailer permitting and licensing regulations; and WHEREAS, on August 3, 2026, the City Council provided due consideration of all evidence presented and provided in the entire administrative record and took testimony regarding this urgency ordinance.

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

SECTION I. Recitals.

The above recitals are true and correct and hereby adopted as the City Council's findings.

SECTION II. Purpose and Authority.

In the interest of protecting the public peace, health, safety, and welfare of the residents of the City of Gilroy, it is the purpose and intent of this urgency ordinance to place a temporary moratorium on the issuance of any new Tobacco Retailer Permit, license, or other City authorization required to commence a new tobacco retailer business within the City of Gilroy.

This Ordinance is adopted pursuant to City Charter Section 602, the City's police power, and the City's authority to regulate City-issued tobacco retailer permits and licenses.

This Ordinance is not adopted pursuant to California Government Code Section 65858 and shall not be construed as a zoning ordinance or land use moratorium.

SECTION III. Findings and Statement of Urgency.

The City Council hereby finds and determines that additional or future tobacco retailer businesses in the City of Gilroy may constitute an immediate threat to the public peace,

Ordinance No. 2026-XX
Temporary Moratorium on Tobacco Retailer Permits
City Council Regular Meeting | August 3, 2026

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health, safety, and welfare. The issuance of additional Tobacco Retailer Permits under the City's current regulations, before the City has completed its review of potential amendments to its tobacco retailer permitting and licensing regulations, may further threaten the public peace, health, safety, and welfare.

This Ordinance is necessary as an emergency measure because new Tobacco Retailer Permits may otherwise be issued before the City can complete its review of regulations related to youth-oriented facilities, youth access, compliance, enforcement, permit issuance, transfer, relocation, expansion, and other public health and safety standards.

The immediate effect of this Ordinance is necessary to preserve the public peace, health, and safety by temporarily maintaining the status quo while that review is completed.

SECTION IV. Temporary Moratorium on New Tobacco Retailer Permits.

After the effective date of this Ordinance through December 31, 2026, no officer, employee, department, commission, or other agency of the City shall accept for filing, process, approve, or issue any new Tobacco Retailer Permit, license, or other City authorization required to commence a new tobacco retailer business, or transfer, relocate, or physically expand a tobacco retailer business, within the City of Gilroy.

For purposes of this Ordinance, "Tobacco Retailer Permit" means a permit issued pursuant to Chapter 13, Article VIII of the Gilroy City Code, including Gilroy Code Section 13.66 et seq., and any successor provision governing the City's tobacco retailer permitting requirements.

This temporary moratorium shall apply to new Tobacco Retailer Permits and to any permit issuance that would authorize the establishment of a new tobacco retailer business, a new permittee, a new location, the relocation of an existing tobacco retailer business, or the physical expansion of an existing tobacco retailer business. This temporary moratorium shall not apply to the timely renewal of a valid, existing Tobacco Retailer Permit for the same permittee and same location, provided the permittee remains in compliance with all applicable laws, or to any permit issuance required by state or federal law, court order, or as determined by the City Attorney.

This Ordinance shall not limit the City's ability to investigate, inspect, cite, suspend, revoke, deny renewal of, or otherwise enforce against any tobacco retailer business or permittee under any applicable law, ordinance, permit condition, or administrative procedure.

SECTION V. Violation.

Except as otherwise permitted under this Ordinance, the establishment of a tobacco retailer business or operation of a tobacco retailer business without a required Tobacco

Ordinance No. 2026-XX
Temporary Moratorium on Tobacco Retailer Permits
City Council Regular Meeting | August 3, 2026

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Retailer Permit within the City limits is declared to be a public nuisance. Violations of this Ordinance may be enforced by any applicable laws or ordinances, including, but not limited to, injunctions, administrative remedies, civil remedies, or criminal penalties under the Gilroy City Code.

SECTION VI. Direction to Staff.

During the term of this temporary moratorium, City staff is directed to continue reviewing potential amendments to the City's tobacco retailer permitting and licensing regulations, including further review of proposed youth-oriented facilities provisions and alternative regulatory approaches not requiring a zoning amendment, and to return to the City Council with any appropriate recommendations.

SECTION VII. Severability.

If any section, subsection, subdivision, sentence, clause, or phrase of this Ordinance is for any reason held to be unconstitutional or otherwise void or invalid by any court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of this Ordinance. The City Council hereby declares that it would have passed this Ordinance and each section, subsection, subdivision, sentence, clause, or phrase thereof, irrespective of the fact that any one or more sections, subsections, subdivisions, sentences, clauses, or phrases may be declared unconstitutional or otherwise invalid by a court of competent jurisdiction.

SECTION VIII. CEQA Determination.

The adoption of this Ordinance is not a project subject to environmental review under the California Environmental Quality Act (CEQA), or is exempt from environmental review under the common sense exemption in CEQA Guidelines Section 15061(b)(3), because it can be seen with certainty that the temporary moratorium on the issuance of new Tobacco Retailer Permits will not have a significant effect on the environment. The Ordinance temporarily preserves the status quo while the City reviews potential amendments to its tobacco retailer permitting and licensing regulations.

SECTION IX. Effective Date and Term.

This Ordinance is declared to be an urgency ordinance necessary as an emergency measure for preserving the public peace, health, and safety within the meaning of City Charter Section 602. This Ordinance contains a statement of the reasons for its urgency and may be introduced and adopted at one and the same meeting if passed by at least five affirmative votes of the City Council.

This Ordinance shall take effect immediately upon adoption and shall remain in effect through December 31, 2026, unless earlier repealed or superseded by subsequent City

Ordinance No. 2026-XX
Temporary Moratorium on Tobacco Retailer Permits
City Council Regular Meeting | August 3, 2026

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Council action.

PASSED AND ADOPTED this 3rd day of August, 2026, by the following roll call vote:

AYES: COUNCIL MEMBERS:

NOES: COUNCIL MEMBERS:

ABSENT: COUNCIL MEMBERS:

ABSTAIN: COUNCIL MEMBERS:

APPROVED:

______________________________
Greg Bozzo, Mayor
ATTEST:

Kim Mancera, City Clerk

Ordinance No. 2026-XX
Temporary Moratorium on Tobacco Retailer Permits
City Council Regular Meeting | August 3, 2026

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CERTIFICATE OF THE CLERK
I, Kim Mancera, City Clerk of the City of Gilroy, do hereby certify that the attached Ordinance No. 2026-XX is an original ordinance, or a true and correct copy of a City Ordinance, duly adopted by the Council of the City of Gilroy at a Regular Meeting of said Council held on Monday, August 3, 2026, with a quorum present.

IN WITNESS WHEREOF, I have hereunto set my hand and affixed the Official Seal of the City of Gilroy this DATE.
____________________________________
Kim Mancera
City Clerk of the City of Gilroy

City of Gilroy

STAFF REPORT
Agenda Item Title: Consideration of Tobacco Retailer Permit Prohibited Areas Around Youth-Oriented Facilities
Meeting Date: July 27, 2026
From: Matt Morley, City Administrator
Department: Community Development
Submitted by: Sharon Goei, Community Development Director Prepared by: Bryce Atkins, Deputy Director of Community Development STRATEGIC PLAN GOALS: Not Applicable

RECOMMENDATION
Council provide direction regarding the definition of youth-oriented facilities and its desire to prohibit new tobacco retailers from opening in those areas.

EXECUTIVE SUMMARY
The City Council is being asked to provide direction on whether to expand the City’s existing tobacco retailer youth-protection regulations by prohibiting new Tobacco Retailer Permits within 1,000 feet of youth-oriented facilities, in addition to the current 1,000-foot restriction around schools. The proposed definition of youth-oriented facilities would include public libraries, public playgrounds, youth centers, public recreation facilities, public parks, and licensed child-care facilities or preschools, excluding smalland large-family day care homes. The attached analysis identifies 46 potential youthoriented facility locations in Gilroy and recommends using the same parcel-to-parcel measurement method currently applied to schools. Staff further recommends that any new restriction apply prospectively to new permit applications, relocations, physical expansions, and applications following suspension, revocation, or failure to timely renew, while allowing existing lawfully operating retailers to continue renewing permits at the same location if they remain compliant.

BACKGROUND
In 2014, the City Council adopted Ordinance No. 2014-14 establishing the City’s Tobacco Retailer Permit program. The program requires each tobacco retailer to obtain and maintain a valid Tobacco Retailer Permit for each fixed retail location. The ordinance also provides that a Tobacco Retailer Permit is a limited, conditional privilege rather than a vested right to conduct tobacco retailing in violation of law.

The existing ordinance includes a youth-protection provision prohibiting new tobacco retailer permits within 1,000 feet of a school, measured by a straight line from the nearest point of the school parcel property line to the nearest point of the applicant’s business parcel property line. Existing lawfully operating tobacco retailers were exempted from this requirement, and the original ordinance also included an exemption for the arm’s-length sale of a lawfully operating tobacco retail business.

In 2025 and 2026, the City Council revisited tobacco retailer regulation in response to concerns regarding the number, concentration, and operation of tobacco retailers and smoke shops. The City’s public moratorium project page identifies the sequence of Council actions, including the November 3, 2025 downtown moratorium, the December 8, 2025 extension and direction to prepare a citywide moratorium, the January 5, 2026 citywide urgency ordinance, and the February 9, 2026 extension of the citywide prohibition on new tobacco retailer permits through August 24, 2026.

Prior staff reports have framed the policy work around reducing tobacco retailer density, addressing flavored tobacco restrictions, evaluating smoke shops, improving enforcement, and protecting youth-sensitive areas. The June 1, 2026 staff report identified youth-oriented facility protections and enhanced enforcement as key ordinance themes, including stronger tools to address illegal products, controlled substances, unlawful cannabis products, untaxed tobacco products, drug paraphernalia, chronic nuisance activity, and other unlawful activity associated with tobacco retail locations.

ANALYSIS
The original proposed definition and distance requirement, if adopted, would extend the City’s existing youth-protection approach beyond schools to other locations where children and youth regularly gather. The purpose is not to regulate the youth-oriented facilities themselves, but to determine where new tobacco retailers should be prohibited from opening under the City’s licensing and permitting authority.

The City already uses a 1,000-foot standard for schools. Applying the same distance to youth-oriented facilities would establish a consistent standard for youth-sensitive locations and avoid setting separate buffer distances for different types of youth-serving facilities. Below is the original proposed definition of a youth-oriented facility.

“Youth-Oriented Facility” means a parcel in the city that is occupied by:

1. A library open to the public;

2. A playground open to the public;

3. A youth center, defined as a facility where children, ages six to seventeen, inclusive, come together for programs and activities;

4. A recreation facility open to the public, defined as an area, place, structure, or other facility that is used either permanently or temporarily for community recreation, even though it may be used for other purposes;

5. A park open to the public;

6. A licensed child-care facility or preschool (other than a small-family day care home or a large-family day care home [as defined in California Health & Safety Code § 1596.78]).

Identified Facilities
The attached list identifies 46 possible youth-oriented facility locations in Gilroy. The facilities are grouped as follows:

Facility Type Number of Known Locations
Library 1
Playground 1
Park 22
Youth Center 5
Recreation Facility 1
Licensed Child-Care Facility or Preschool 16
TOTAL 46
Additionally, maps indicating the prohibited areas for each classification are attached to this report. The maps were derived from an interactive GIS map produced and available online at the following link: Youth-Oriented Facilities GIS Interactive Map.

Measurement Method
Staff recommends using the same measurement method currently used for schools: a straight-line measurement from the nearest point of the property line of the parcel occupied by the youth-oriented facility to the nearest point of the property line of the parcel on which the applicant’s proposed tobacco retailer business would be located.

The existing school buffer in Ordinance No. 2014-14 uses this parcel-to-parcel method.

Using the same measurement method would make the ordinance easier to administer and would reduce ambiguity when reviewing future applications. However, Council may

direct staff to evaluate alternative measurement methods, such as building-to-building, entrance-to-entrance, or suite-to-suite measurements. Those alternatives may reduce the size of the restricted area but would likely increase administrative complexity.

Effect on Existing Tobacco Retailers
Staff recommends that any new youth-oriented facility buffer apply prospectively. Under this approach, the ordinance would prohibit new tobacco retailers from opening within the restricted area but would not require existing, lawfully operating tobacco retailers to close solely because they are located within 1,000 feet of a youth-oriented facility.

Staff recommends that the prohibition apply to:
• New Tobacco Retailer Permit applications;
• Relocations of tobacco retailers;
• Physical expansions that require City authorization; and • Permit applications following suspension, revocation, or failure to timely renew.

Staff recommends that the ordinance not apply to timely renewals of valid existing permits for the same permittee and same location, provided the permittee remains in compliance with applicable law.

ALTERNATIVES
Council may alternatively choose the following:

1. Take no action. Council may direct staff not to prepare or include youth-oriented facility buffer regulations in the update to the tobacco retailer permit regulations.

The existing school restriction would remain unchanged.

2. Modify the definition of a youth-oriented facility. Council may remove or add facility categories, limit the definition to facilities open to the public, narrow the definition of youth centers, or provide additional criteria for licensed child-care facilities and preschools.

3. Use a different distance. Council may direct staff to evaluate a distance other than 1,000 feet.

FISCAL IMPACT/FUNDING SOURCE
There is no direct fiscal impact associated with providing direction. Staff time will be incurred for the full ordinance process and vendor educational materials. A minimal cost for legal advertising or public notice may be incurred, but within the fiscal impact of the broader initiative.

Depending on the final ordinance, the City may receive fewer new Tobacco Retailer

Permit applications in the future. Existing renewal revenue would not be affected.

PUBLIC OUTREACH
This item has been included on the publicly posted City Council agenda, and public comment will be accepted during deliberations of this agenda item. Tobacco retailer permit issues have also been discussed at multiple prior public meetings as part of the City’s broader work on tobacco retailer permits, smoke shops, density, enforcement, and the moratorium.

NEXT STEPS
Staff will proceed to implement any direction received from the Council.

Attachments:

List of Possible Youth-Oriented Facility Locations in Gilroy Maps of Youth-Oriented Facilities

List of Possible Youth-Oriented Facility Locations in Gilroy 1 Type Address Description
Library 350 W. Sixth Street Santa Clara County Library
Playground 250 W. Sixth Street Wheeler Center Tot Lot
Recreation Facility 250 W. Sixth Street Wheeler Community Center Park 602 Old Gilroy Street Butcher Park
Park 1701 Crest Hill Way Carriage Hills Park
Park 7050 Miller Avenue Christmas Hill Park
Park 7049 Miller Avenue Christmas Hill Park Ranch Site
Park 985 Charles Lux Drive Cydney Casper Park
Park 9001 Calle Del Rey Del Rey Park
Park Santa Teresa Blvd. to W.

Luchessa
Dennis Debell Uvas Creek Park
Preserve
Park 7355 Monterey Road Donald "Elvis" Prieto Park
Park 7550 Wren Avenue El Roble Park
Park 9400 Wren Avenue Farrell Avenue Park
Park 7325 Forest Street Forest Street Park
Park 1500 Hecker Pass Gateway Park
Park 5925 Monterey Frontage Gilroy Sports Park
Park 1798 Third Street Hecker Pass Park
Park 400 Mantelli Drive Las Animas Veterans Park
Park 801 Moro Drive Los Arroyos Park
Park 7851 Carmel Street Miller Park
Park 780 Mantelli Rainbow Park
Park 8140 Hanna Street Renz Park
Park 7700 Murray Avenue San Ysidro Park
Park 9525 Saddler Drive Sunrise Park
Park 1502 Third Street Village Green Park
Youth Center 7598 Monterey Highway,
Suite 150
Gilroy Youth Impact Center
operated by Youth Alliance
Youth Center 7900 Church Street St. Mary Youth Center
Youth Center 290 IOOF Rebekah Children's Services
Youth Center 311 First Street CARAS Youth Hub
Youth Center 7365 Monterey Road South County Youth Task Force Licensed Child-Care
Facility or Preschool
305 Bloomfield Avenue Christopher Ranch Head Start
Licensed Child-Care
Facility or Preschool
95 Fourth Street Creative Play Learning Center
Licensed Child-Care
Facility or Preschool
8335 Church Street Footsteps Preschool
Licensed Child-Care
Facility or Preschool
7151 Hanna Street Gateway / SJB Gateway Child
Development Center

List of Possible Youth-Oriented Facility Locations in Gilroy 2 Type Address Description
Licensed Child-Care
Facility or Preschool
9300 Wren Avenue Gilroy Head Start
Licensed Child-Care
Facility or Preschool
8755 Kern Avenue Gilroy Unified School District Rod
Kelley Preschool
Licensed Child-Care
Facility or Preschool
480 W. 8th Street Glenview Head Start
Licensed Child-Care
Facility or Preschool
8985 Monterey Road Happy Hearts Preschool
Licensed Child-Care
Facility or Preschool
8455 Wren Avenue Hearts and Hands Christian
Childcare & Preschool
Licensed Child-Care
Facility or Preschool
885 Moro Drive Los Arroyos Child Development
Center / Go Kids Los Arroyos
Licensed Child-Care
Facility or Preschool
902 Arizona Circle Ochoa Child Development Center /
Go Kids Ochoa
Licensed Child-Care
Facility or Preschool
8387 Wren Avenue One World / One World Preschool
Licensed Child-Care
Facility or Preschool
6000 Miller Avenue Pacific Point Christian Schools
Preschool
Licensed Child-Care
Facility or Preschool
245 Farrell Avenue State Preschool at Antonio Del
Buono
Licensed Child-Care
Facility or Preschool
475 W. 9th Street State Preschool at Glen View
Licensed Child-Care
Facility or Preschool
1735 Hecker Pass Road Vineyard Preschool

10.2. City of Gilroy

STAFF REPORT
Agenda Item Title: Report on GilroyConnect/SeeClickFix: Service Level Performance Update, Benchmarking Comparison, and
Communication Protocols
Meeting Date: August 3, 2026
From: Matt Morley, City Administrator
Department: Administration
Submitted by: Bryce Atkins, Deputy Director of Community Development Prepared by: Kylie Katsuyoshi, Management Analyst Trainee STRATEGIC PLAN GOALS: Ensure Neighborhood Equity from City Services Maintain and Improve City Infrastructure

RECOMMENDATION
Council receive the report.

EXECUTIVE SUMMARY
GilroyConnect, the City’s SeeClickFix-based service request platform, has continued to strengthen performance since its launch in March 2025. The system has processed over 4,100 requests with improving response and closure times, reaching an 83% SLA compliance rate in the most recent 30-day period. While staff conducted a benchmarking review of other California agencies, differences in category structures, workflows, and SLA practices made an external comparison unreliable. As a result, the City is prioritizing analyzing internal performance trends, which clearly demonstrate continuous improvement since system launch. Standardized operational practices implemented across departments have further strengthened consistency, communication, and service delivery.

BACKGROUND

10.2. SeeClickFix is a digital communications platform that enables users to report nonemergency neighborhood issues to local government bodies. SeeClickFix functions as a Customer Relationship Management (CRM) system that receives and tracks resident service requests. This community engagement tool and request management system helps bridge the gap between residents and cities by increasing interactions, improving communication, and strengthening the delivery of City services.

The system operates through a website, and a mobile app. Gilroy’s mobile app is called GilroyConnect. Residents and other users can access the platform online via desktop or smartphone to submit service requests, track progress, and receive updates.

The launch of this service request portal reflects the City of Gilroy’s commitment to enhancing the customer service experience for residents by improving responsiveness and transparency.

ANALYSIS
City of Gilroy Performance Overview
As of July 1, 2026, GilroyConnect has received 4,104 service requests since its launch on March 31, 2025, with a 98.7% closure rate.

As of June 30, 2026, the system has identified 410 constituents or user accounts, and the user base has continued to increase each month since the launch. The 410 constituent accounts excludes users who have submitted requests anonymously or as guests, meaning the actual number of constituents served is likely higher. Exhibit A shows the number of new accounts per month since launch in March of 2025. The average number of new users per month is 26 and shows steady growth over the last 16 months.

The average number of service requests reported per constituent is approximately four, and about 94% of constituents (384 out of 410) have submitted five or fewer service requests. Constituents or account holders submitted 1,704 of the 4,104 total service requests, representing approximately 42% of all requests. The remaining 2,400 requests, or 58%, were submitted anonymously or by guest users.

10.2. The chart above shows the ten highest-volume request categories since the system was launched. Of the 4,104 service requests submitted since launch, 2,549 (approximately 62%) were submitted within the ten above categories. This indicates that most service requests are concentrated in a small number of service areas.

Five of the ten highest volume categories are managed by the Police Department, accounting for a significant share of overall service demand. Four of the ten categories are managed by the Public Works Department, and one category is managed by the Community Development Department.

Service Level Agreements
A Service Level Agreement (SLA) is the expected response time for resolving a reported issue. In GilroyConnect/SeeClickFix, SLAs are only visible to internal staff and serve as a metric, allowing department heads and leadership to monitor workflow performance and evaluate efficiency. SLAs also assist staff in prioritizing requests and allow them to track which requests are falling outside of that expectation.

SLA times can be set in days and weeks, are calculated Monday through Friday, 9 a.m. to 5 p.m., and account for federal holidays. SeeClickFix does not allow staff to modify the work hours or the holidays the system accounts for. SLAs begin counting once a request is created and stop when the request is marked as closed, ensuring that completion metrics reflect true and accurate staff response times.

SLAs are configured at the category level, allowing City staff to tailor response expectations based on the type and urgency of the reported issue. For each of the City

10.2. of Gilroy’s active service request categories, there is a set SLA. See Exhibit B to view the City of Gilroy’s SLA Master List with all request categories and their associated SLAs (updated May 2026).

Gilroy’s Service Level Agreement Performance
Exhibit C provides an overview of service level agreement performance by service request category. The table summarizes the number of requests created during each period and the percentage of requests closed within the established SLA timeframe.

Performance is shown across five timeframes: all time data, trailing 12 months, trailing 6 months, trailing 3 months, and trailing 30 days. This comparison provides insight into how consistently service requests have been completed within established SLAs and allows staff to evaluate performance trends over time.

Time Frame Requests Created Average Days to
Close
% Closed within SLA
All Time 4104 15.01 61.6%
Trailing 12 Months 3108 13.39 64.5%
Trailing 6 Months 1541 9.16 76.0%
Trailing 3 Months 809 8.79 75.1%
Trailing 30 Days 307 7.02 83.4%
*Data pulled on 07-23-2026
Over the trailing 12 months, the average closure time drops to 13 days, and in the trailing 6 months it decreases further to 9 days, with 76% closed within SLA. In the most recent 30 days, the average closure is just 7 days, with 83% of requests meeting SLA deadlines. This reflects increased efficiency and improved alignment with SLA expectations.

This data is also depicted in the chart below.

10.2. The data shows consistent improvement in both closure time and SLA performance.

Average days to close have steadily decreased across all time frames, while the percentage of requests closed within the SLA has increased, indicating more efficient response and resolution processes. Staff believe the trailing 6 months establishes an accurate baseline and from here staff will pursue the 80% as the next target through operational adjustments and efficiencies. For example, Public Works has not integrated its Computerized Maintenance Management System (CMMS) City Works with GilroyConnect to streamline the flow of information.

10.2. Building on the comparison, the chart above also demonstrates improvement in SLA compliance over time. Across the ten categories shown, the percentage of requests closed within the SLA is consistently higher in the trailing 6 Months than in the all time average. Most categories show substantial gains, with increases ranging from approximately 10 to 50 percentage points.

Benchmarking Comparison
Staff conducted a benchmarking review of 21 California agencies using the SeeClickFix platform to evaluate how the City of Gilroy’s Service Level Agreements (SLAs) compared to peer jurisdictions. The benchmarking comparison was not reliable enough to serve as a meaningful one-to-one evaluation. Differences in how agencies define, structure, and apply service request categories, along with the lack of publicly available information, limit the accuracy of direct comparisons.

Given these limitations, staff focused on analyzing Gilroy’s own performance data since the platform launched. For the full comparison and details, please see Exhibits D1 through D4.

City of Gilroy Standard Practices
To ensure consistent, transparent, and timely handling of service requests, the City of Gilroy implemented a set of standardized practices for GilroyConnect. These standard practices were developed in collaboration with the GilroyConnect Working Group, a team of representatives from each department that meet regularly to discuss system updates, challenges, and other items.

Exhibit E provides a comprehensive list of the 11 implemented practices, last updated in March of this year. These practices establish clear expectations for departments and promote accountability throughout the request lifecycle.

First, each department is responsible for assigning and managing its own service requests. The Administration Department no longer dispatches requests on behalf of others. Instead, departments must review incoming requests, recategorize them when necessary, and redirect them only after confirming the correct recipient. This eliminates “cold reassignments” and ensures that requests are not transferred without acknowledgment from the receiving division.

Departments are also required to communicate actively with requesters. Within five business days, staff must provide a resolution plan that explains how the issue will be addressed, including either an estimated completion date or the date of the next update.

Ongoing communication must continue at least once per week, unless a future update date has already been provided. Public comments are limited to managers and supervisors to maintain message consistency and accuracy, with department head approval required for other staff to comment.

The GilroyConnect Standard Practices also specify when requests should be closed.

Requests may be closed due to lack of information after two outreach attempts and one

10.2. week without a response. Requests that fall outside the City’s jurisdiction are documented and referred to the correct agency before being closed, as the City does not track the progress of external entities. Additionally, tickets that involve long-term planning, evaluation, or queued capital projects can be closed once documented internally and responded to, since ongoing tracking of these extended timelines is not appropriate within the platform.

Once a request is resolved, staff are expected to close the ticket promptly and document the outcome. Where possible, photos of completed work are added to provide visual confirmation and reinforce transparency.

Finally, requests submitted by City Council members follow the same standards as those submitted by the public. They must be treated with professionalism and urgency but are not subject to expedited workflows or enhanced priority beyond established service expectations.

Overall, these practices create a unified framework that supports efficient operations, consistent communication, and improved customer service across City departments.

Adjustments to be Implemented
Communication Protocol Revisions
Staff will adjust their communication protocol to provide updates on GilroyConnect service requests. Under the current practice, each department is expected to provide an update on open requests at least once per week. Departments have not been able to consistently meet this requirement, particularly when a request reaches a point of delay, such as services waiting for materials or administrative procedural delays.

Under the revised protocol, staff will focus on completing and closing each service request within the applicable SLA timeframe. A separate update will not be required while the request remains within that initial SLA period. However, the requestor will still receive automatic system notifications anytime there is a status change (ticket changed to acknowledged, in progress, recategorized, etc.) during the SLA period. The requestor will receive an initial email when submitting the ticket that identifies the communication timeline expectation.

If the request is not completed by the end of the applicable SLA timeframe, staff will provide a status update at the end of that period and at each subsequent SLA-length interval until the request is resolved and closed. For example, a request with a sevenday SLA would receive an update after the first seven days if it remains unresolved, followed by additional updates every seven days. A request with a 20-day SLA would similarly receive an update every 20 days until resolution. Again, any change in the status of the ticket will receive an automatic email update generated by the system, regardless of how far along the SLA interval is.

This protocol will not apply to requests that are closed in GilroyConnect because they have been transferred to another work-order, tracking, or project-management system.

10.2. Examples include sidewalk repair requests or traffic-control-device requests that require longer-term evaluation, budgeting, design, or capital improvements. In such categories, the GilroyConnect request may be closed after the transfer is documented and the requester is informed of the process that will be used to track the matter going forward, consistent with current practice for these requests.

Adjustments to SLAs
Based on the data evaluated, it is evident that several categories require adjustments to their SLAs. For example, Parks – Irrigation, Water Leak/Flow Issue, Traffic Calming Requests, Signs – Regulatory Broken/Damaged, and Parks – Play Structures all have SLAs between one and three days. Although some of these requests can be resolved within that timeframe, it is not a realistic standard that can be met consistently.

Because an SLA begins as soon as a service request is submitted, staff need time to acknowledge the request, assess the issue, and communicate with the requester before the SLA expires. In some instances, requests are submitted under incorrect categories, resulting in the correct department not receiving the request until after the SLA has already passed.

Categories such as Sidewalks and Traffic Calming Requests have extended resolution timelines due to their complexity, budget constraints, and established procedural requirements. An adjustment to the SLA is necessary to establish timeframe that more accurately reflects the complexity of the work and coordination required.

10.2. ALTERNATIVES
None. This is an informational report.

FISCAL IMPACT/FUNDING SOURCE
None. This is an informational report.

PUBLIC OUTREACH
None. This is an informational report.

NEXT STEPS
Staff will schedule recurring annual updates on performance using established metrics in GilroyConnect. Adjustments will continue to be made to maximize performance within resource constraints. The City’s performance target is to close 80% of service requests within the designated SLA timelines.

Attachments:

1. Exhibit A - GilroyConnect User Accounts by Month

2. Exhibit B – Service-Level-Agreement Master List

3. Exhibit C – Gilroy’s SLA Performance Overview

4. Exhibit D1 through D4 – Benchmarking Review

5. Exhibit E – GilroyConnect Standard Practices

2025 March 3
2025 April 48
2025 May 27
2025 June 32
2025 July 32
2025 August 21
2025 September 23
2025 October 27
2025 November 22
2025 December 28
2026 January 28
2026 February 18
2026 March 20
2026 April 40
2026 May 19
2026 June 22
Total 410
New GilroyConnect Accounts Created by Month
2025
2026
Exhibit A

Request Category Department SLA Day/Days
Blight Community Development 30 days
Chemical Spill Community Development 2 days
City Facility Damage Administrative Services 4 days
Fire Hydrants Utilities 5 days
Flooding Public Works 1 day
Food Trucks/Food Vendors Community Development 15 days
Garbage - In a Park Public Works 2 days
Garbage - On Private Property Community Development 30 days Garbage - On Public Right-of-Way Public Works 3 days
Graffiti - In a Park Public Works 1 day
Graffiti - On City Property Police Department 20 days
Graffiti - On Private Property Police Department 25 days Graffiti - On the Street/Sidewalk Public Works 7 days
Inoperable/Abandoned Vehicles - On Private Property Community Development 30 days Inoperable/Abandoned Vehicles - On Public Right-of-Way Police Department 20 days Parking Issues - On Private Property Community Development 15 days Parking Issues - On Public Right-of-Way Police Department 20 days Parks Public Works 14 days
Parks - Bench/Table Repairs Public Works 7 days
Parks - Irrigation Public Works 1 day
Parks - Landscaping Public Works 14 days
Parks - Play Structures Public Works 1 day
Parks - Restrooms Public Works 1 day
Parks - Trees Public Works 15 days
Recreational Vehicles - On Private Property Community Development 30 days Recreational Vehicles - On Public Right-of-Way Police Department 20 days Sewer Issues Utilities 1 day
Maintenance Requests
Exhibit B
SLA Master List
Updated 2026-05-26

Shopping Carts - on Public Right-of-Way Public Works 7 days Sidewalks Public Works 10 days
Signs - On Private Property Community Development 20 days Signs - Regulatory Broken/Damaged (example: stop signs) Public Works 2 days Signs - Signs on the Public Right-of-Way Public Works 10 days Signs - Wayfinding Broken/Damaged Public Works 10 days
Smoking Violation Community Development 10 days
Spills and Illicit Discharge Community Development 2 days Storm Drains Public Works 7 days
Streetlights Public Works 14 days
Streets Public Works 14 days
Traffic Calming Requests Public Works 3 days
Traffic Signals Public Works 14 days
Trees Public Works 15 days
Unhoused Encampments Police Department 20 days
Unpermitted Construction Community Development 45 days
Water Leak/Flow Issue Utilities 1 day
Weeds - In a Park Public Works 14 days
Weeds - On Private Property Community Development 20 days Weeds - Streets/Median Public Works 14 days
Weeds - Vacant Lots Community Development 30 days
Request Category Department SLA Days/Weeks
Claim Form Request Administrative Services Department 2 days Email the City Administration Department 7 days
Emergency Preparedness Presentation Request Administration Department 7 days Proclamation/Certificate Request Administration Department 7 days Special Event Permit Process Economic Development Department 7 days Customer Service Requests