Grover Beach City Council
January 27, 2025

Section 1 Objectives
This Exhibit details the process by which Maximum Service Rates are adjusted annually to provide fair and adequate compensation to Franchisee for collection of solid waste and other services provided to Customers and the City per the Agreement. The annual rate adjustment methodology described herein fulfills key objectives established by the City and Franchisee, including rate stability, predictability, fairness, transparency, ease of administration, and cost-effectiveness.

Section 2 Index-Based Rate Adjustments
Except in the case of a Cost-Based Rate Adjustment (see Section 3, below) Franchisee’s Maximum Service Rates shall be adjusted via the Index-Based Rate Adjustment methodology described in this section. The Index-Based Rate Adjustment methodology shall be used to adjust Maximum Service Rates effective each January 1 of 2026, 2027, 2028, and 2029 and any subsequent year during which a CostBased Rate Adjustment is not allowed or not requested by the City or the Franchisee.

In years during which Maximum Services Rates are to be adjusted pursuant to this Index-Based Rate Adjustment methodology, Franchisee shall submit a report to the City on or before September 1 detailing its calculations of Index-Based Rate Adjustment. City shall have the right to review Franchisee’s calculations of Index-Based Rate Adjustment for mathematical accuracy and adherence to the terms and conditions of this Exhibit. City shall prepare written findings regarding adjustments to the Franchisee’s calculations of Index-Based Rate Adjustment that are required for mathematical accuracy and adherence to the terms and conditions of this Exhibit on or before October 30.

Index-Based Rate Adjustments shall be prepared and calculated in accordance with the steps described below. All Index-Based percentages shall be rounded to the nearest hundredth of a percent, and all cost calculations shall be rounded to the nearest dollar.

A. Calculation of CPI Adjustment to Franchisee’s Collection Services and Post-Collection Services
Franchisee’s prior year cost projections for Collection Services and Post-Collection Services shall be adjusted in accordance with the Consumer Price Index (CPI) for Garbage and Trash Collection, U.S. City average, Bureau of Labor Statistics Series I.D. CUUR0000SEHG02.

The CPI Adjustment shall be equal to the percentage change in the average 12-month CPI value ending June of the current year and compared to the average 12-month CPI value ending June of the prior year.

For example, the CPI used to set the 2026 rates shall be calculated as follows:
(Average CPI from July 1, 2024 to June 30, 2025) − (Average CPI from July 1, 2023 to June 30, 2024) Average CPI from July 1, 2023 to June 30, 2024
If the percentage change is below 2%, the applicable CPI Adjustment shall be 2%, with the difference in the amount below 2% being carried forward as a credit on the rates and applied to the subsequent year. If the percentage change is above 5%, the applicable CPI Adjustment shall be 5%, with the difference in the amount above 5% being carried forward and applied to the rates in subsequent years. Franchisee’s prior year cost projections for Collection Services and PostCollection Services shall be escalated by the resultant CPI Adjustment, rounded to the nearest dollar.

Franchisee’s 2025 cost projection for Collection Services is $1,574,059 and Franchisee’s 2025 cost projection for Post-Collection Services is $884,245. For 2026, by way of example, if the percentage change in the average 12-month CPI value ending June 2026 compared to the average 12-month CPI value ending June of 2025 is 5%, then Franchisee’s 2026 cost projection for Collection Attachment 1
Annual Rate Adjustment Methodology

Services shall be $1,652,762 and Franchisee’s 2026 cost projection for Post-Collection Services shall be $928,457. Likewise, if the percentage change in the average 12-month CPI value ending June 2026 compared to the average 12-month CPI value ending June of 2025 is 2%, then Franchisee’s 2026 cost projection for Collection Services shall be $1,605,540 and Franchisee’s 2026 cost projection for Post-Collection Services shall be $901,930.

Example Calculation for application of amounts above cap on CPI increases applied to Collection Services component of CPI Adjustment (noting that cap on CPI increases also applies to PostCollection Services):

Year 1
Collection Services: $1,574,059
12-month average CPI index increase: 6.00%
$1,574,059 x (1+5.00%*) = $1,652,762
*5% cap on CPI increases. 1% difference carried over to next year Year 2
Collection Services: $1,652,762
12-month average CPI index increase: 6.00%
$1,652,762 x (1+5.0%*) = $1,735,400
*5% cap on CPI increases. 1% difference carried over to next year Year 3
Collection Services: $1,735,400
12-month average CPI index increase: 3.00%
$1,735,400 x (1+5.0%*) = $1,822,170
*3.00% + 1.00% carried forward from Year 1 + 1.00% carried forward from Year 2 The above is also demonstrated in Table 1, on the following page.

Annual Rate Adjustment Methodology

Table 1 – Example of CPI Cap and Carryforward
2025 2026 2027 2028
Collection Services $1,574,059 $1,652,762 $1,735,400 $1,822,170 12-Month Average CPI 6.00% 6.00% 3.00%
CPI Adjustment (5% Cap) 5.00% 5.00% 5.00%
B. Calculation of Profit Allowance
The Index-Based Rate Adjustment methodology includes a component for Franchisee’s fair and reasonable Profit Allowance. Profit Allowance is used for the purposes of calculating Index-Based Rate Adjustments and does not constitute a guarantee of profit to the Franchisee.

Franchisee’s Profit Allowance for the purposes of Index-Based Rate Adjustments is calculated as a function of Franchisee’s current year cost projection for Collection Services. For 2025, Franchisee’s Profit Allowance is 9% of the cost projection for Collection Services and in 2026 and thereafter, Franchisee’s Profit Allowance shall be 10% of the cost projection for Collection Services.

Franchisee’s 2025 cost projection for Collection Services is $1,574,059; therefore, Franchisee’s Profit Allowance for 2025 is $1,574,059 times 9%, rounded to the nearest dollar, equaling $141,665. Using the first example from Section 2.A above, if Franchisee’s 2026 cost projection is $1,652,762 (corresponding to a 5% CPI Adjustment), Franchisee’s 2026 Profit Allowance for the purposes of calculating Index-Based Rate Adjustment shall be $165,276. Likewise, and using the second example from Section 2.A above, if Franchisee’s 2026 cost projection is $1,605,540 (corresponding to a 2% CPI Adjustment), Franchisee’s 2026 Profit Allowance for the purposes of calculating Index-Based Rate Adjustment shall be $160,554.

C. Calculation of Franchise Fee
Franchisee pays the City a Franchise Fee of 10% of Franchisee’s gross revenues received from Customers in the City. For the purposes of Index-Based Rate Adjustments, the Franchise Fee is calculated as 10% of Franchisee’s annual Total Cost Projection, per Section 2.E below, rounded to the nearest dollar. For 2025, Franchisee’s annual Total Cost Projection is $2,888,854, yielding Franchise Fee component of $288,885. Actual Franchise Fee payments made by Franchisee to City shall be calculated as a function of Franchisee’s gross revenues received from Customers in the City and may differ from the amount used in calculating adjustments to the Maximum Service Rates.

D. Calculation of Annual Revenue Reconciliation
Starting with the 2027 Index-Based Rate Adjustment, the difference between the Franchisee’s annual Total Cost Projection and the Franchisee’s actual annual total billings to Customers in the City shall be included in the annual Index-Based Rate Adjustment as an Annual Revenue Reconciliation.

For example, for the 2027 Index-Based Rate Adjustment, the difference between Franchisee’s 2025 Total Cost Projection and Franchisee’s total 2025 billings to Customers in the City shall be included in the 2027 annual Total Cost Projection. By way of example, if Franchisee’s 2025 total billings to Customers in the City is a shortfall of 1% (-$28,889) then $28,889 will be added to Franchisee’s Total Cost Projection for 2027. Conversely, if Franchisee’s 2025 total billings to Customers in the City is a surplus of 1% (+$28,889) then $28,889 will be subtracted from Franchisee’s Total Cost Projection for 2027.

Table 2, on the following page, provides an example of the case in which there is a 1% shortfall of billed revenues in 2025, which is added to the Total Cost Projection in 2027. The table shows a continuation of 1% shortfalls being added in 2028 and 2029 for example purposes only, and Annual Rate Adjustment Methodology

assumes the CPI adjustment to Collection Services, Post-Collection Services, and AB 939 Fee at the 5% cap. Table 2a on the following page, provides an example of the case in which there is a 1% surplus of billed revenues in 2025, which is added to the Total Cost Projection in 2027. The table shows a continuation of 1% surpluses being added in 2028 and 2029 for example purposes only, and assumes the CPI adjustment to Collection Services, Post-Collection Services, and AB 939 Fee at the 5% cap.

Table 2 – Example Revenue Reconciliation of -1% Annually 2025 2026 2027 2028 2029
Collection Services $1,574,059 $1,652,762 $1,735,400 $1,822,170 $1,913,278 Profit Allowance $141,665 $165,276 $173,540 $182,217 $191,328 Post-Collection Services $884,245 $928,457 $974,880 $1,023,624 $1,074,805 Franchise Fee $288,885 $305,166 $323,634 $339,836 $356,864 Revenue Reconciliation Example N/A N/A $28,889 $30,517 $32,363 Total Cost Projection $2,888,854 $3,051,661 $3,236,343 $3,398,364 $3,568,639 Indexed Rate Adjustment 5.64% 6.05% 5.01% 5.01%
Annual Rate Adjustment Methodology

Table 2a – Example Revenue Reconciliation of +1% Annually 2025 2026 2027 2028 2029
Collection Services $1,574,059 $1,652,762 $1,735,400 $1,822,170 $1,913,278 Profit Allowance $141,665 $165,276 $173,540 $182,217 $191,328 Post-Collection Services $884,245 $928,457 $974,880 $1,023,624 $1,074,805 Franchise Fee $288,885 $305,166 $317,215 $333,055 $349,743 Revenue Reconciliation
Example N/A N/A $(28,889) $(30,517) $(31,721)
Total Cost Projection $2,888,854 $3,051,661 $3,172,146 $3,330,549 $3,497,433 Indexed Rate Adjustment 5.64% 3.95% 4.99% 5.01%
Significant, unexpected increases or decreases in revenue may be included or excluded from the Annual Revenue Reconciliation if deemed reasonable by the parties. As a one-time exercise, the Franchisee may request to review the entirety of its revenue earnings with the City as a check-in to evaluate alignment with its revenue forecast and conditions outlined in this exhibit. By no later than September 30, 2025, the Franchisee shall provide the City with documentation of actual todate receipts or billings, accompanied by an analysis of all corresponding service trends. Upon receipt of these materials, the City and the Franchisee shall engage in a good-faith meet-andconfer process to discuss and determine an appropriate resolution, which may include a rate adjustment in January 2026 if necessary.

E. Calculation of Total Cost Projection
Franchisee’s annual Total Cost Projection shall be the sum of the resultant values from Section 2.A through 2.D above. For 2025, the Total Cost Projection is $2,888,854. Table 3 below demonstrates the 2026 Total Cost Projection if the percentage change in the average 12-month CPI value ending June 2026 compared to the average 12-month CPI value ending June of 2025 is 5%. Table 4, on the following page, demonstrates the 2026 Total Cost Projection in the percentage change in the average 12-month CPI value ending June 2026 compared to the average 12-month CPI value ending June of 2025 is 2%.

Table 3 – 2026 Total Cost Projection at 5% CPI Value for 2026 2025 2026
Collection Services $1,574,059 $1,652,762
Profit Allowance $141,665 $165,276
Post-Collection Services $884,245 $928,457
Franchise Fee $288,885 $305,166
Total Cost Projection $2,888,854 $3,051,661
Table 4 – 2026 Total Cost Projection at 2% CPI Value for 2026 Annual Rate Adjustment Methodology

2025 2026
Collection Services $1,574,059 $1,605,540
Profit Allowance $141,665 $160,554
Post-Collection Services $884,245 $901,930
Franchise Fee $288,885 $296,447
Total Cost Projection $2,888,854 $2,964,471
F. Calculation of Annual Index-Based Rate Adjustments
The Index-Based Rate Adjustment shall be calculated as function of the Franchisee’s forthcoming annual Total Cost Projection divided by the then current year Total Cost Projection, minus 100%, rounded to the nearest hundredth of a percent.

For example, taking the results shown in Table 3, on the prior page, the Index-Based Rate Adjustment for 2026 would be $3,051,661, divided by $2,888,854, minus 100%, yielding a 5.64% adjustment to the Maximum Service Rates effective January 1, 2026. Using the results of Table 4, above as an example, the Index-Based Rate Adjustment for 2026 would be $2,964,471, divided by $2,888,854, minus 100%, yielding a 2.62% adjustment to the Maximum Service Rates effective January 1, 2026.

This Index-Based Rate Adjustment calculation described herein shall repeat in 2027, 2028, and 2029, with the addition of the Annual Revenue Reconciliation amounts calculated pursuant to Section 2.D of this Exhibit. Rate adjustments shall be effective on January 1st of each year (unless otherwise agreed to in writing by the parties) and any delay in rate change approval not caused by Franchisee will result in additional adjustments so that all required revenues are billed within the rate year. Any delay in rate change approval that is caused by Franchisee shall not result in additional adjustments corresponding with the delay in approval.

Section 3 Cost-Based Rate Adjustments
Franchisee or City shall have the right to request a Cost-Based Rate Adjustment effective January 1, 2030. Franchisee’s request for Cost-Based Rate Adjustment in 2030 shall be requested in writing on or before January 15, 2029 and City’s request for Cost-Based Rate Adjustment in 2030 shall be requested in writing on or before January 31, 2029. To the extent possible any City request for Cost-Based Rate Adjustment shall be coordinated with the other agencies in San Luis Obispo County that follow the rate adjustment methodology described in this Exhibit, with all such agencies opting to request Cost-Based Rate Adjustment effective in the same rate year
Upon request by either party for Cost-Based Rate Adjustment, Franchisee shall prepare and submit financial records and calculations to the City in accordance with this Section by April 30, 2029. City shall have the right to review Franchisee’s financial records related to the Cost-Based Rate Adjustment and calculations of Cost-Based Rate Adjustment for mathematical accuracy and adherence to the terms and conditions of this Section. City shall prepare written findings regarding adjustments to the Franchisee’s calculations of Cost-Based Rate Adjustment that are required for mathematical accuracy and adherence to the terms and conditions of this Exhibit on or before June 30, 2029. City shall make every effort to seek City Council authorization of Cost-Based Rate Adjustment prior to August 30, 2029. If neither party requests a Cost-Based Rate Adjustment in writing as specified above, then an Index-Based Rate Adjustment shall be applied for adjustments to Maximum Service Rates effective January 1, 2030 and subject to the terms and conditions of Section 2 of this Exhibit.

Annual Rate Adjustment Methodology

Franchise or City shall have the right to request subsequent Cost-Based Rate Adjustments no more frequently than every five (5) years following the prior Cost-Based Rate Adjustment. For example, if a Cost-Based Rate Adjustment is requested as stipulated in above in January, 2029 (and effective January 1, 2030) then the next Cost-Based Rate Adjustment may not be requested by either party until January, 2034 (for effectiveness in 2035). The schedule from the following paragraph would also apply: Franchisee would prepare and submit financial records and calculations by April 30, 2034, City would prepare written findings regarding adjustments to Franchisee’s calculations of Cost-Based Rate Adjustment that are required for mathematical accuracy and adherence to the terms and conditions of this Exhibit by June 30, 2034, and City would make every effort to seek City Council authorization of Cost-Based Rate Adjustment prior to August 30, 2034.

Notwithstanding the above, nothing shall prevent the parties from mutually agreeing to conduct CostBased Rate Adjustments in other years (i.e., years other than 2030 and 2035), provided that both parties agree in writing to waive the five (5) year limitation on Cost-Based Rate Adjustments expressed herein. If neither party requests Cost-Based Rate Adjustments in subsequent years pursuant to the five (5) year schedule described above, then Index-Based Rate Adjustments shall be applied for adjustments to Maximum Service Rates in such years, subject to the terms and conditions of Section 2 of this Exhibit.

Franchisee shall provide all financial information and supporting documentation required by this review in a format acceptable to City (or City’s designated consultant) in a timely manner. Franchisee shall not require City (or City’s designated consultant) to review any such documents at Franchisee’s worksite but shall instead allow for all required information and supporting documentation to be provided to City (or its designated consultant) via physical mail, e-mail, or any other delivery method approved by City.

Cost-Based Rate Adjustments shall be prepared and calculated in accordance with the steps described below.

A. Projection of Collection Services and Post-Collection Service Costs Franchisee shall prepare financial records and calculations of Cost-Based Rate Adjustment using audited financial statements prepared in accordance with Generally Accepted Accounting Principles (GAAP) for Franchisee’s immediately preceding three (3) fiscal years. Such financial records and calculations shall include Franchisee’s projected costs for Collection Services and Post-Collection Services as well as Franchisee’s projected gross revenues at then-current Maximum Service Rates for the forthcoming year (e.g., 2030 at the earliest).

Franchisee shall promptly assemble, provide, and submit such information that is reasonably necessary to support the assumptions made by the Franchisee with regard to the assumptions underlying the forecast. Upon submission of such information, the City holds the ability to make appropriate changes for non-allowable costs, large unsupported variances in cost projections including but limited to corporate transactions and allocations, large variances in inter-company and related party transactions and allocations, unjustifiable variances in any cost category, non-conformance with agreed upon depreciation terms, nonconformance agreed upon profit allowances, and other customary and reasonable adjustments as detailed in the Agreement. Cost projections for Collection Services and PostCollection Services prepared by Franchisee must be justifiable, supportable with financial information, and provide accountability for all expenditures. In preparing such cost projections, Franchisee shall assemble and submit its forecasts of:
a. Revenues at current Maximum Service Rates for the then-current year, including delineation of revenues by sector (single-family residential vs. commercial and multifamily) and with details of the number of subscribers by type within each sector. b. Projected costs of Collection Services for the then-current year and the forthcoming year, with comparison to and explanation of any variances to actual costs for Collection Services in the prior three (3) fiscal years. Costs for Collection Services include labor, corporate overhead, depreciation (with rolling stock at 10-year depreciation lifespan), and general and administrative costs and shall be delineated as per the primary cost categories included in Franchisee’s Audited Financial Annual Rate Adjustment Methodology

Statements. Franchisee must provide documentation of, and explanation for, material variances in any cost category. Projected costs for the forthcoming year shall be based on Franchisee’s actual costs per Audited Financial Statements and escalated by the CPI Adjustment described in Section 2.A of this Exhibit, with the exception that Franchisee may adjust projections to account for other documentable changes in costs. Corporate overhead costs shall be limited to be less than 4% of Franchisee’s Total Cost Projection for the forthcoming year and Franchisee must provide documentation and justification for any amounts of Corporate Overhead above 3% of Franchisee’s Total Cost Projection for the forthcoming year. City retains the right to make appropriate adjustments to cost projections to cost categories for which Franchisee does not or cannot provide adequate documentation and explanation of material variances compared to prior years.
c. Projected costs of Post-Collection Services for the then-current year and the forthcoming year, with comparison to and explanation of any variances to actual costs for Collection Services in the prior three (3) fiscal years. Costs for Post-Collection Services include landfill disposal, organics processing, recyclables processing and marketing, related-party transportation, and related-party rent and shall be delineated as per the primary cost categories included in Franchisee’s Audited Financial Statements. Franchisee must provide documentation of, and explanation for, material variances in any cost category. Projected costs for the forthcoming year shall be based on Franchisee’s actual costs per Audited Financial Statements and escalated by the CPI Adjustment described in Section 2.A of this Exhibit, with the exception that Franchisee may adjust projections to account for other documentable changes in costs. City retains the right to make appropriate adjustments to cost projections to cost categories for which Franchisee does not or cannot provide adequate documentation and explanation of material variances compared to prior years. d. Franchisee shall not include any non-allowable costs in its cost projections for Collection Services or Post-Collection Services. Non-allowable costs include but are not limited to:
i. Entertainment and non-work related travel expenses, unless authorized in advance by City.
ii. Advertising for services not within the scope of this Agreement or outside of the service area of the City of Grover Beach.
iii. Fines or penalties of any nature.
iv. Liquidated damages assessed under this Agreement.
v. Federal or State income taxes.
vi. Profit sharing payments not related to an IRS approved pension program. vii. Charitable or political donations.
viii. Attorneys’ fees and other expenses incurred by Franchisee in any court proceeding in which City and Franchisee are adverse parties, unless Franchisee is the prevailing party in said proceedings. ix. Attorneys’ fees and other expenses incurred by Franchisee in any court proceeding in which Franchisee’s own negligence, violation of law or regulation, or other wrongdoing, is in issue and occasions part of the attorneys’ fees and expenses claimed, provided, however, such attorneys’ fees will be allowed to the extent Franchisee can demonstrate they were reasonable and necessary and a cost of doing business, and were not the result of any intentional or willful misconduct by Franchisee or its employees; and attorneys’ fees and expenses incurred by Franchisee in a court proceeding in which the legal theory or statute providing a basis of liability Annual Rate Adjustment Methodology

against Franchisee also provides for separate strict liability for City arising from the action of its citizens or ratepayers (such as in a CERCLA lawsuit). x. Payments to related party entities for products or services (other than lease expense, calculated as provided below), in excess of the fair market value for those products or services. For purposes of this Agreement, related party expenses are those resulting from transactions between Franchisee and another company (companies) that has (have) common ownership or management control.
e. Franchisee’s audited financial statements, and any other documentation as deemed necessary by the City, will be reviewed to determine Franchisee’s cost projections for each of the foregoing categories during the year involved. City will use the financial statements to determine that costs have actually been incurred and have been assigned to the appropriate category.
f. City may adjust the actual costs in two ways: (1) to exclude any non-allowable costs, set out below, and (2) to exclude and/or reduce any costs that were actually incurred but which are not reasonable and necessary in keeping with industry standard best practices.

B. Calculation of Profit Allowance
Franchisee’s Profit Allowance shall be 10% of the cost projection for Collection Services, rounded to the nearest dollar.

C. Calculation of Franchise Fee
Calculation of Franchise Fee shall be calculated in accordance with Section 2.C, above, for the applicable year as appropriate.

D. Calculation of Annual Revenue Reconciliation
Calculation of Annual Revenue Reconciliation shall be calculated in accordance with Section 2.D, above, for the applicable year as appropriate.

E. Calculation of Total Cost Projection
Calculation of Total Cost Projection shall be calculated in accordance with Section 2.E, above, for the applicable year as appropriate.

F. Calculation of Cost-Based Rate Adjustment
The Cost-Based Rate Adjustment shall be the calculated as function of the Franchisee’s forthcoming annual Total Cost Projection divided by the then current year Total Cost Projection, minus 100%, rounded to the nearest hundredth of a percent. This is the same calculation described in Section 2.F, above. The resultant percentage shall be applied to the then-current Maximum Service Rates and be effective January 1 of the forthcoming year.

Rate adjustments shall be effective on January 1st of each year (unless otherwise agreed to in writing by the parties) and any delay in rate change approval not caused by Franchisee will result in additional adjustments so that all required revenues are billed within the rate year. Any delay in rate change approval that is caused by Franchisee shall not result in additional adjustments corresponding with the delay in approval.

Section 4 Annual Audited Financial Statements
Franchisee shall annually prepare Audited Financial Statements in accordance with Generally Accepted Accounting Principles (GAAP) for its operations in the San Luis Obispo County region. Franchisee shall provide City with copies of the annual Audited Financial Statements upon request and with any CostBased Rate Adjustment submittal.

Annual Rate Adjustment Methodology

Section 5 Extraordinary Adjustments
Except as provided herein, Franchisee may not request adjustments to Maximum Service Rates in years during which Index-Based Rate Adjustments are scheduled to be applied and must follow the timeline described in Section 3. Notwithstanding the above, Franchisee may request extraordinary adjustments to Maximum Service Rates due to changes in law affecting collection operations, including for compliance with the California Air Resource Board’s (CARBS’s) Advanced Clean Fleet (ACF) electrification mandate.

The City may, but is not obligated to, consider requests for extraordinary adjustment to Maximum Service Rates due to changes in law affecting Post-Collection Services. Requests for extraordinary changes in Maximum Service Rates are subject to good faith negotiations between City and Franchisee.

In the event of any Change in Scope or Change in Law (each as described below) that results in an material increase or decrease in Franchisee’s costs or revenues, in the event of an Extraordinary Cost Increase (as defined below), or in the event of any Change in Fees (as described below), an appropriate adjustment will be made to the Maximum Service Rates in order to compensate, to the maximum extent possible, for such increase or decrease in costs, revenues or Fees, commencing from the Effective Date(s) such increase or decrease first occurs. Any adjustment to Maximum Service Rates due to a Change in Scope, a Change in Law or an Extraordinary Cost Increase shall be in the reasonable discretion of the City.

A. “Change in Scope” shall mean any change in the services provided by the Franchisee under the Agreement whether proposed by the Franchisee or by the City.

B. “Change in Law” shall mean the enactment, adoption, promulgation, issuance, modification or written change in any law, regulation, order or judgment of any governmental body that affects the Franchisee’s performance of services under the Agreement including, without limitation, the issuance of final regulations under existing laws.

C. “Change in Fees” shall mean any change in franchise fees, vehicle impact fees and other fees charged to the Franchisee by the City connection with the services provided by the Franchisee under the Agreement the cancellation of any existing fees, and the adoption of any new fees.

D. “Extraordinary Cost Increase” shall mean a substantial increase in the Franchisee’s operating or capital costs or expenses that is outside of the Franchisee’s control but not due to a Change in Scope or Change in Law.

E. “Effective Date” shall mean the date in which the Franchisee notifies the City of the reasons for the cost estimate associated with a Change in Law, Change in Fees, and/or Extraordinary Cost Increase or when the Franchisee begins incurring costs for the Change in Law, Change in Fees, or Extraordinary Cost Increase, whichever is later.

In the case of a Change in Scope, a Change in Law or an Extraordinary Cost Increase, the Franchisee shall provide the City with projected operational, cost and revenue data reflecting the entire financial effect of such Change. The City reserves the right to require that the Franchisee supply any additional operational, cost and revenue data, or any other information it may reasonably need, to ascertain the appropriate financial impact of the Change and any necessary adjustment to Maximum Service resulting from such Change.

Extraordinary adjustments to Maximum Service Rates for a qualifying Change in Scope or Change in Law, for a Change in Fees, or for an Extraordinary Cost Increase shall take effect as of the beginning of the next year and will include all impacts of the extraordinary adjustment from the Effective Date of the impact; provided, however, that, in the case of any Change in Fees charged by the City, the Extraordinary adjustment shall take effect as of the Effective Date of such Change in Fees. The underlying service, cost, revenue or Fee changes supporting any rate adjustment under this Section 5 will be added to the appropriate category under Sections 2 and 3 above for purposes of future cost projections.

SLIDE
11 Regional Comparison
Monthly 32-Gallon Cart Rates
$0
$10$20$30$40$50$60
Attachment 2
SLIDE
12 Regional Comparison
Monthly 64-Gallon Cart Rates
$0
$10$20$30$40$50$60$70$80$90
SLIDE
13 Regional Comparison
Monthly 96-Gallon Cart Rates
$0
$20$40$60$80
$100$120$140
SLIDE
14 $0
$50
$100$150$200$250$300$350
Regional Comparison
Monthly 2-CY Bin Rates
This notice is intended to inform you that the City of Grover Beach (the “City”) will hold a public hearing regarding rate adjustments (the “Proposed Rate Adjustments”) proposed by South County Sanitary Service (the “Garbage Company”) for properties and customers receiving solid waste, recycling, and green waste services within the City. The Proposed Rate Adjustments will be considered by the Grover Beach Council at the date, time, and location specified below. Consistent with the requirements of Proposition 218, this notice also provides you with the following information:
• The Date, Time, and Place of the Public Hearing;
• The Reason for the Proposed Rate Adjustments;
• The Effective Date of the Rate Adjustment if Approved; • The Basis for the Proposed Rate Adjustments; and
• The Majority Protest Procedures.

January 27, 2025 6:00 pm
Grover Beach City Hall located at 154 South 8th St, Grover Beach The Proposed Rate Adjustment for 2025 is based on the Garbage Company’s documented cost of providing solid waste services and is a 5.02% increase above current solid waste rates. This cost-based adjustment is necessary PARA UNA VERSIÓN EN ESPAÑOL DE ESTE “AVISO DE AUDENCIA PÚBLICA SOBRE LOS AUMENTOR PROPUESTOS DE LA TASA DE RESIDUOS SÓLIDOS”, UTILICE EL SIGUIENTE ENLACE AL SITIO WEB:
https://www.sanluisgarbage.com/assets/docs/uploads/articles/groverbeach-prop-218-notice-2025-spanish.pdf Attachment 3
for the Garbage Company to continue to provide safe, environmentally sound and reliable solid waste removal, transportation and disposal services to the residents and businesses of the City. The adjustments are requested due to:
• Increases in organics processing costs – Third-party costs for the organic waste post-collection processing facility operated by the company formerly named Hitachi Zosen INOVA, and which are not within the Garbage Company’s control, have doubled since 2022. The change in cost is the result of changes in facility capital and operating costs.
• Increases in landfill disposal costs – Related party costs for landfill waste disposal at Cold Canyon have remained flat since 2016. The 2025 rate adjustment reflects a market adjustment to these costs, from a per ton tipping fee of $41 per ton (in place since 2016) to a per ton tipping fee of $70. The Garbage Company provided market comparison demonstrating the applicability of the $70 per ton market tipping fee.
• Collection costs including labor, vehicles, operating expenses and overhead – These costs are increasing approximately 4.21% in 2025.
• Adjustments necessary for moving to a new methodology for annual rate adjustments that provides for increased rate stability, predictability, fairness, transparency, ease of administration, and costeffectiveness. These include updated depreciation lifespans for solid waste collection vehicles, removal of a limitation on corporate overhead costs for legal, tax, payroll, human resources, engineering, compliance, IT, training and recruiting programs, and updated profit allowance inkeeping with industry standards. • Adjustments for new service enhancements, including the ability for residents to exchange a solid waste collection cart once annually at no additional cost, no charge collection for one bulky item during clean-up weeks, and a rate assistance program providing a 20% low-income discount provided to residential customers using 32-gallon cart service (using existing jurisdictional practices on lowincome relief for their offered utility type services).

The Proposed Rate Adjustments for 2025 applicable to residential solid waste customers are shown in the table below.
32-gallon $24.23 $25.45 $1.22
64-gallon $32.74 $34.38 $1.64
96-gallon $41.23 $43.30 $2.07
In addition, commencing each January 1 of 2026, 2027, 2028 and 2029 solid waste rates will be adjusted based on the following:
• Annual change in the Bureau of Labor Statistics’ Consumer Price Index (CPI) for Garbage and Trash Collection in the U.S all city average, with a minimum 2% adjustment and a maximum 5% adjustment.

Amounts below the minimum or above the maximum will carry forward to the following year. • Calculation of a 10% profit allowance starting in 2026 (estimated at additional 0.67% to 0.69% adjustment in 2026).
• Addition of a revenue balancing mechanism starting in 2027, wherein actual revenues from solid waste rates over or under projections carry forward as additions to, or offsets against, the annual CPI adjustment.
• Rate adjustments for January 1, 2026, 2027, 2028 and 2029 are not expected to exceed 7%.

The Proposed Rate Adjustments have been independently reviewed for consistency with the City of San Luis Obispo Rate Setting Process and Methodology Manual for Integrated Solid Waste Management dated June 1994 and in accordance with the provisions of the City’s Franchise Agreement with the Garbage Company, as amended, governing solid waste service within the boundaries of the City. The Proposed Rate Adjustments contemplate implementation of a new methodology for annual rate adjustments which is described in New Solid Waste Rate Adjustment Methodology and 2025 Rates report authored by independent reviewer, R3 Consulting Group, Inc. The consultant’s report and the complete set of proposed 2025 solid waste rates is available at the City Clerk’s office located at Grover Beach City Hall located at 154 South 8th St, Grover Beach.

Pursuant to Section 6 of Article XIII D of the California Constitution, the following persons may submit a written protest against the Proposed Rate Adjustments to the City Clerk before the close of the Public Hearing referenced above.
§ An owner(s) of property (parcel(s)) receiving solid waste, recycling, and green waste services within the City limits. If the person(s) signing the protest, as an owner, is not shown on the last equalized assessment roll as the owner of the parcel(s) then the protest must contain or be accompanied by written evidence that such person signing the protest is the owner of the parcel(s) receiving services; or
§ A tenant(s) whose name appears on the Garbage Company’s records as the customer of record for the corresponding parcel receiving solid waste, recycling, and green waste services within the City limits (tenant-customer).

A valid written protest must contain a statement that you protest the Proposed Rate Adjustments, the address or Assessor’s Parcel Number (APN) of the parcel or parcels which receive solid waste, recycling, and green waste services, and a signature by either the owner or the tenant-customer of the parcel or parcels. One written protest per parcel shall be counted in calculating a majority protest to the Proposed Rate Adjustments subject to the requirements of Section 6 of Article XIII D of the California Constitution. Written protests will not be accepted by e-mail or by facsimile. Verbal protests will not be counted in determining the existence of a majority protest. To be counted, a protest must be received in writing by the City Clerk before the close of the Public Hearing referenced above.

Written protests regarding the solid waste rate adjustments may be mailed to:

Written protests may also be personally delivered to the City Clerk at Grover Beach City Hall located at 154 South 8th St, Grover Beach, California.

If valid written protests are presented by a majority of owners and/or tenants-customers of parcels receiving solid waste, recycling, and green waste services within the City limits, then the City will not adjust the rates for the services.

The Garbage Company coordinated additional informational sessions as an opportunity for the public to learn more and ask questions regarding the rate adjustments. These informational sessions will be done prior to the public hearing as shown below.

Date: December 18, 2024
Time: 5:00PM – 6:30PM
Place: Ramona Garden Park Center
993 Ramona Avenue
Grover Beach, CA 93433
Date: January 20, 2025
Time: 5:00PM – 6:30PM
Place: Grover Beach Community Center
1230 Trouville Avenue
Grover Beach, CA 93433
For additional questions or inquiries outside of these informational sessions, please feel to contact the Garbage Company at (805) 489-4246 and one of our customer service representatives will be able to assist you. Please note, written protests must be received or mailed to the City Clerk at Grover Beach City Hall prior to the rate hearing date.

Si tiene preguntas o consultas adicionales, no dude en comunicarse con la compañía de basura al (805) 489- 4246 y uno de nuestros representantes de servicio al cliente podrá ayudarlo.

PARA UNA VERSIÓN EN ESPAÑOL DE ESTE “AVISO DE AUDENCIA PÚBLICA SOBRE LOS AUMENTOR PROPUESTOS DE LA TASA DE RESIDUOS SÓLIDOS”, UTILICE EL SIGUIENTE ENLACE AL SITIO WEB:
https://www.sanluisgarbage.com/assets/docs/uploads/articles/groverbeach-prop-218-notice-2025-spanish.pdf

SOUTH COUNTY SANITARY SERVICE
RATE ADJUSTMENT EFFECTIVE JANUARY 1, 2025

CITY OF GROVER BEACH
Service Description Pickups Per Week Monthly Rates
Effective
01/01/2024
Proposed Rate
Adjustment
Monthly Rates
Effective
01/01/2025
RESIDENTIAL SINGLE FAMILY DWELLING AND MULTI-UNIT (4 UNITS OR LESS):
32 Gallon Waste Wheeler 1 $24.23 1.22 $25.45
64 Gallon Waste Wheeler 1 $32.74 1.64 $34.38
96 Gallon Waste Wheeler 1 $41.23 2.07 $43.30
TWO-64 Gallon Waste Wheelers 1 $49.76 2.50 $52.26
ONE 64 & ONE 96 Gallon 1 $58.26 2.92 $61.18
TWO-96 Gallon Waste Wheelers 1 $66.77 3.35 $70.12
Residential customers must use the waste wheelers provided by the garbage company. This solid service fee for residential trash collections (container with black or gray lid) includes once a week pick-up of one greenwaste/organics container (green lid), and one recycling container (blue lid).

MULTI-FAMILY (5 or MORE)
Rates are the same as commercial dumpsters and waste wheeler rates (below).

COMMERCIAL DUMPSTERS - ALL AREAS:
1 yd dumpster 1 $113.14 5.68 $118.82
1 yd dumpster 2 $168.23 8.45 $176.68
1 yd dumpster 3 $229.18 11.50 $240.68
1 yd dumpster 4 $290.11 14.56 $304.67
1 yd dumpster 5 $342.30 17.18 $359.48
1 yd dumpster 6 $409.07 20.54 $429.61
1 yd dumpster 7 $499.60 25.08 $524.68

1.5 yd dumpster 1 $130.55 6.55 $137.10

1.5 yd dumpster 2 $205.98 10.34 $216.32

1.5 yd dumpster 3 $290.11 14.56 $304.67

1.5 yd dumpster 4 $377.16 18.93 $396.09

1.5 yd dumpster 5 $461.25 23.15 $484.40

1.5 yd dumpster 6 $548.29 27.52 $575.81

1.5 yd dumpster 7 $667.07 33.49 $700.56
2 yd dumpster 1 $147.95 7.43 $155.38
2 yd dumpster 2 $243.68 12.23 $255.91
2 yd dumpster 3 $356.80 17.91 $374.71
2 yd dumpster 4 $469.97 23.59 $493.56
2 yd dumpster 5 $574.37 28.83 $603.20
2 yd dumpster 6 $687.54 34.51 $722.05
2 yd dumpster 7 $840.70 42.20 $882.90
3 yd dumpster 1 $176.96 8.88 $185.84
3 yd dumpster 2 $339.44 17.04 $356.48
3 yd dumpster 3 $469.97 23.59 $493.56
3 yd dumpster 4 $612.10 30.73 $642.83
3 yd dumpster 5 $728.17 36.55 $764.72
3 yd dumpster 6 $864.50 43.40 $907.90
3 yd dumpster 7 $1,100.96 55.27 $1,156.23
4 yd dumpster 1 $229.18 11.50 $240.68
4 yd dumpster 2 $388.71 19.51 $408.22
4 yd dumpster 3 $556.98 27.96 $584.94
4 yd dumpster 4 $728.17 36.55 $764.72
4 yd dumpster 5 $896.43 45.00 $941.43
4 yd dumpster 6 $1,067.56 53.59 $1,121.15
4 yd dumpster 7 $1,362.59 68.40 $1,430.99

SOUTH COUNTY SANITARY SERVICE
RATE ADJUSTMENT EFFECTIVE JANUARY 1, 2025

CITY OF GROVER BEACH
Service Description Pickups Per Week Monthly Rates
Effective
01/01/2024
Proposed Rate
Adjustment
Monthly Rates
Effective
01/01/2025
6 yd dumpster 1 $343.77 17.26 $361.03
6 yd dumpster 2 $583.05 29.27 $612.32
6 yd dumpster 3 $835.47 41.94 $877.41
6 yd dumpster 4 $1,092.26 54.83 $1,147.09
6 yd dumpster 5 $1,344.68 67.50 $1,412.18
6 yd dumpster 6 $1,601.36 80.39 $1,681.75
6 yd dumpster 7 $2,043.91 102.60 $2,146.51

8 yd dumpster 1 $458.37 23.01 $481.38
8 yd dumpster 2 $777.43 39.03 $816.46
8 yd dumpster 3 $1,113.97 55.92 $1,169.89
8 yd dumpster 4 $1,456.37 73.11 $1,529.48
8 yd dumpster 5 $1,792.87 90.00 $1,882.87
8 yd dumpster 6 $2,135.16 107.19 $2,242.35
8 yd dumpster 7 $2,725.17 136.80 $2,861.97
The rates shown above include the monthly container rental fee and a semi-annual dumpster cleaning.

COMMERCIAL - OTHER CHARGES:

Rates for all commercial customers include recycling or greenwaste/organics pickup once per week, included with the garbage service rate. Customers can choose from a 64 or 96 gallon blue commingled recycle waste wheeler or a 32 or 64 gallon organics waste wheeler included with the garbage service rate (96 gallon waste wheelers can only be used with green waste due to weight). If you need a bin for recycling there is a charge (see below).

If you need more frequent recycling, including organics/greenwaste service, it can be provided at a 50% discount from the garbage service rates for the specified level of service required.

COMMERCIAL GARBAGE CANS - ALL AREAS:
32 Gallon Waste Wheeler 1 $31.91 1.60 $33.51
64 Gallon Waste Wheeler 1 $58.03 2.91 $60.94
96 Gallon Waste Wheeler 1 $72.54 3.64 $76.18
Re-deliver bin to stopped acct $54.16 2.72 $56.88
MISCELLANEOUS CHARGES - ALL CUSTOMERS:

Overstacked Garbage & extra bags
Minimum/unit
each $7.56 0.38 $7.94
Overstacked Greenwaste & extra
bags Minimum/unit
each $3.79 0.19 $3.98
Overstacked Blue Bin & extra bags
Minimum/unit
each $3.80 0.19 $3.99
In yard service (per can or
commodity) IN ADDITION TO

STANDARD GARBAGE RATES
per month $18.88 0.95 $19.83
Monthly charge for additional 32, 64
or 96-gallon green waste/organics
service
per month $5.23 0.26 $5.49
Monthly charge for additional 32, 64
or 96-gallon recycle service
per month $2.14 0.11 $2.25
Vacant Rate per month $17.62 0.88 $18.50
Waste wheeler cleaning each time $28.17 1.41 $29.58
Trip charge each time $18.89 0.95 $19.84
Non-payment downsize service each time $18.89 0.95 $19.84 Non-payment redeliver waste
wheeler
each time $45.41 2.28 $47.69
Non-payment reconnect service each time $45.41 2.28 $47.69 Small item pickup (TV, toilet) each $44.31 2.22 $46.53
Appliance pickup-residential each $62.49 3.14 $65.63

SOUTH COUNTY SANITARY SERVICE
RATE ADJUSTMENT EFFECTIVE JANUARY 1, 2025

CITY OF GROVER BEACH
Service Description Pickups Per Week Monthly Rates
Effective
01/01/2024
Proposed Rate
Adjustment
Monthly Rates
Effective
01/01/2025
Lock Charge per month $10.52 0.53 $11.05
City Clean Up each $16.44 0.83 $17.27
Garbage extras on your scheduled
pickup day
per yard $15.94 0.80 $16.74
Garbage extras -NOT ON YOUR

SCHEDULED PICKUP DAY
per yard $44.00 2.21 $46.21
Commercial Waste Wheeler rent per month $5.85 0.29 $6.14 Re-deliver bin on stopped acct each time $54.16 2.72 $56.88 Compactors per yard $21.48 1.08 $22.56
Sunday Service (in additional to
garbage service level)
per month $94.55 4.75 $99.30
Recycle bin rental per month $65.28 3.28 $68.56
Stand by time per hour $90.63 4.55 $95.18
Extra bin cleaning $84.51 4.24 $88.75
Damage/Destruction of bins or waste
wheelers
Replacement/repair at market price
Short Term Dumpsters:

Delivery & Pickup-Bin $54.16 2.72 $56.88
Delivery & Pickup-Waste Wheeler $18.88 0.95 $19.83
Rental Per Day $5.85 0.29 $6.14
Empties Per Yard $44.00 2.21 $46.21
Mattress:

Twin PER SET $24.59 1.23 $25.82
Double PER SET $24.59 1.23 $25.82
Queen PER SET $24.59 1.23 $25.82
King PER SET $24.59 1.23 $25.82
ADDITIONAL INFORMATION ALL CUSTOMERS:

1. Customers requesting Temporary Bins or Roll-off Box Service can call the office for current rates

2. Polystyrene (Styrofoam, Plastic #6) is not collected for recycling and should be thrown away as trash. Please bag Styrofoam packing peanuts before placing in trash container.

3. It is encouraged to bag your trash in the garbage container but do not bag your recyclables or green waste in their respective containers and keep it loose.

4. Recycling, Greenwaste/Organcis and Garbage containers should spaced 3 feet apart away from any obstacles (i.e mailboxes, cars, etc) before 6:00am on collection service day.

5. The fee schedule above only includes the Garbage Company rates and does not include IWMA fees, which are separately noted on the billings.

6. Cleaning fees will be billed on a time and materials basis

7. Late Fees are imposed for residential customers over 30 days delinquent. The fee is 1.5% per month of the outstanding charge, with a minimum fee of $5.00. No prior notice is required, as this late fee policy is stated at the bottom of every bill.

8. Customers can be charged for contamination fees in the trash, recycling and/or the greenwaste/organics containers.

Any additional recycling, including greenwaste/organic services are charged out at 50% of the garbage rate of equivalent size and frequency.

South County Sanitary Services
4388 Old Santa Fe Road
San Luis Obispo, CA 93401
Standard
US Postage
PAID
Santa Barbara, CA
Permit No. 800
RESOLUTION NO. 25-

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF GROVER BEACH,

CALIFORNIA, ESTABLISHING INTEGRATED SOLID WASTE RATES FOR JANUARY 1, 2025, AND EACH SUBSEQUENT JANUARY 1ST THROUGH 2029 WHEREAS, The City of Grover Beach (“City”) and South County Sanitary Service (“SCSS”), Inc. entered into a Franchise Agreement for collection, diversion and disposal of solid waste, dated November 1, 1997 (“Prior Solid Waste Agreement”); and WHEREAS, the City and SCSS also entered into a Recycling Franchise Agreement (“Prior Recycling Agreement”) and a Greenwaste Franchise Agreement in November 1997; and
WHEREAS, the City and SCSS entered into an Amended and Restated Solid Waste Collection Franchise Agreement, dated July 7, 2008, which amended the and restated the Prior Solid Waste Agreement and incorporated, amended and restated the Prior Recycling Agreement and Greenwaste Franchise Agreement; and WHEREAS, The City and SCSS entered into a First Amendment to the Amended and Restated Solid Waste Collection Agreement, dated June 20, 2016; and WHEREAS, SCSS has submitted a rate increase application (“Application”) in accordance with the Amended and Restated Solid Waste Collection Franchise Agreement; and
WHEREAS, the rate increase request compared with the rate in effect at the date of the agreement exceeds the cumulative cost of living increase from that same date, giving the City the option of terminating the SCSS Franchise Agreement within nine months following approval of the requested rate increase (Section 8.3 of the Franchise Agreement) (hereinafter, the “Termination Option”); and WHEREAS, due to the fact that a detailed review has concluded the rates have been calculated in accordance with the Rate Manual, that the costs identified are reasonable, and that the City will continue to maintain one of the lowest rates in the Central Coast, for this period and fee increase only, the City will not pursue the Termination Option; and
WHEREAS, notices of the proposed rate increase were sent to property owners and tenants in accordance with the requirements of Proposition 218; and WHEREAS, on January 27, 2025, the City Council conducted a Public Hearing, considered testimony, and at the conclusion of the protest hearing determined that a majority protest to the proposed rate increase did not exist.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF GROVER BEACH, CALIFORNIA, DOES DELARE, DETERMINE, AND ORDER AS FOLLOWS:

1. The application for a rate increase is hereby approved and solid waste collection service rates set forth in Exhibit “A” attached to this Resolution and incorporated by Attachment 4
Resolution No. 25- Page 2
reference shall become effective on January 1, 2025, and each subsequent January 1st through 2029.

2. In addition to the rate adjustments set forth in Exhibit “A”, commencing each January 1st of 2026, 2027, 2028 an d2029 solid waste rates will be adjusted based on the following:
a. Annual change in the Bureau of Labor Statistics Consumer Price Index for Garbage and Trash Collection in the U.S. all city average (“CPI”), with a minimum two percent (2%) adjustment and a maximum five percent (5%) adjustment. Amounts below the minimum or above the maximum will carry forward to the following year.
b. Calculation of negotiated profit allowance starting in 2026. c. Addition of a revenue balancing mechanism starting in 2027, wherein actual solid waste revenues that exceed or fall short of projections will carry forward as additions to, or deductions from, the annual CPI adjustment.

3. Due to the reasonableness of the requested rate increase, the City will not pursue the termination option set forth in Section 8.3 of the City’s Franchise Agreement with SCSS.

On motion by Council Member _____, seconded by Council Member ____, and on the following roll-call vote, to wit:

AYES: Council Members –
NOES: Council Members –
ABSENT: Council Members –
ABSTAIN: Council Members –
RECUSED: Council Members –
the foregoing Resolution was PASSED, APPROVED, and ADOPTED at a regular meeting of the City Council of the City of Grover Beach, California this 27TH day of January 2025.

KASSI DEE, MAYOR
Attest:

WENDI B. SIMS, CITY CLERK

SOUTH COUNTY SANITARY SERVICE
RATE ADJUSTMENT EFFECTIVE JANUARY 1, 2025

CITY OF GROVER BEACH
Service Description Pickups Per Week Monthly Rates
Effective
01/01/2024
Proposed Rate
Adjustment
Monthly Rates
Effective
01/01/2025
RESIDENTIAL SINGLE FAMILY DWELLING AND MULTI-UNIT (4 UNITS OR LESS):
32 Gallon Waste Wheeler 1 $24.23 1.22 $25.45
64 Gallon Waste Wheeler 1 $32.74 1.64 $34.38
96 Gallon Waste Wheeler 1 $41.23 2.07 $43.30
TWO-64 Gallon Waste Wheelers 1 $49.76 2.50 $52.26
ONE 64 & ONE 96 Gallon 1 $58.26 2.92 $61.18
TWO-96 Gallon Waste Wheelers 1 $66.77 3.35 $70.12
Residential customers must use the waste wheelers provided by the garbage company. This solid service fee for residential trash collections (container with black or gray lid) includes once a week pick-up of one greenwaste/organics container (green lid), and one recycling container (blue lid).

MULTI-FAMILY (5 or MORE)
Rates are the same as commercial dumpsters and waste wheeler rates (below).

COMMERCIAL DUMPSTERS - ALL AREAS:
1 yd dumpster 1 $113.14 5.68 $118.82
1 yd dumpster 2 $168.23 8.45 $176.68
1 yd dumpster 3 $229.18 11.50 $240.68
1 yd dumpster 4 $290.11 14.56 $304.67
1 yd dumpster 5 $342.30 17.18 $359.48
1 yd dumpster 6 $409.07 20.54 $429.61
1 yd dumpster 7 $499.60 25.08 $524.68

1.5 yd dumpster 1 $130.55 6.55 $137.10

1.5 yd dumpster 2 $205.98 10.34 $216.32

1.5 yd dumpster 3 $290.11 14.56 $304.67

1.5 yd dumpster 4 $377.16 18.93 $396.09

1.5 yd dumpster 5 $461.25 23.15 $484.40

1.5 yd dumpster 6 $548.29 27.52 $575.81

1.5 yd dumpster 7 $667.07 33.49 $700.56
2 yd dumpster 1 $147.95 7.43 $155.38
2 yd dumpster 2 $243.68 12.23 $255.91
2 yd dumpster 3 $356.80 17.91 $374.71
2 yd dumpster 4 $469.97 23.59 $493.56
2 yd dumpster 5 $574.37 28.83 $603.20
2 yd dumpster 6 $687.54 34.51 $722.05
2 yd dumpster 7 $840.70 42.20 $882.90
3 yd dumpster 1 $176.96 8.88 $185.84
3 yd dumpster 2 $339.44 17.04 $356.48
3 yd dumpster 3 $469.97 23.59 $493.56
3 yd dumpster 4 $612.10 30.73 $642.83
3 yd dumpster 5 $728.17 36.55 $764.72
3 yd dumpster 6 $864.50 43.40 $907.90
3 yd dumpster 7 $1,100.96 55.27 $1,156.23
4 yd dumpster 1 $229.18 11.50 $240.68
4 yd dumpster 2 $388.71 19.51 $408.22
4 yd dumpster 3 $556.98 27.96 $584.94
4 yd dumpster 4 $728.17 36.55 $764.72
4 yd dumpster 5 $896.43 45.00 $941.43
4 yd dumpster 6 $1,067.56 53.59 $1,121.15
4 yd dumpster 7 $1,362.59 68.40 $1,430.99
Exhibit "A"

SOUTH COUNTY SANITARY SERVICE
RATE ADJUSTMENT EFFECTIVE JANUARY 1, 2025

CITY OF GROVER BEACH
Service Description Pickups Per Week Monthly Rates
Effective
01/01/2024
Proposed Rate
Adjustment
Monthly Rates
Effective
01/01/2025
6 yd dumpster 1 $343.77 17.26 $361.03
6 yd dumpster 2 $583.05 29.27 $612.32
6 yd dumpster 3 $835.47 41.94 $877.41
6 yd dumpster 4 $1,092.26 54.83 $1,147.09
6 yd dumpster 5 $1,344.68 67.50 $1,412.18
6 yd dumpster 6 $1,601.36 80.39 $1,681.75
6 yd dumpster 7 $2,043.91 102.60 $2,146.51
8 yd dumpster 1 $458.37 23.01 $481.38
8 yd dumpster 2 $777.43 39.03 $816.46
8 yd dumpster 3 $1,113.97 55.92 $1,169.89
8 yd dumpster 4 $1,456.37 73.11 $1,529.48
8 yd dumpster 5 $1,792.87 90.00 $1,882.87
8 yd dumpster 6 $2,135.16 107.19 $2,242.35
8 yd dumpster 7 $2,725.17 136.80 $2,861.97
The rates shown above include the monthly container rental fee and a semi-annual dumpster cleaning.

COMMERCIAL - OTHER CHARGES:

Rates for all commercial customers include recycling or greenwaste/organics pickup once per week, included with the garbage service rate. Customers can choose from a 64 or 96 gallon blue commingled recycle waste wheeler or a 32 or 64 gallon organics waste wheeler included with the garbage service rate (96 gallon waste wheelers can only be used with green waste due to weight). If you need a bin for recycling there is a charge (see below).

If you need more frequent recycling, including organics/greenwaste service, it can be provided at a 50% discount from the garbage service rates for the specified level of service required.

COMMERCIAL GARBAGE CANS - ALL AREAS:
32 Gallon Waste Wheeler 1 $31.91 1.60 $33.51
64 Gallon Waste Wheeler 1 $58.03 2.91 $60.94
96 Gallon Waste Wheeler 1 $72.54 3.64 $76.18
Re-deliver bin to stopped acct $54.16 2.72 $56.88
MISCELLANEOUS CHARGES - ALL CUSTOMERS:

Overstacked Garbage & extra bags
Minimum/unit
each $7.56 0.38 $7.94
Overstacked Greenwaste & extra
bags Minimum/unit
each $3.79 0.19 $3.98
Overstacked Blue Bin & extra bags
Minimum/unit
each $3.80 0.19 $3.99
In yard service (per can or
commodity) IN ADDITION TO

STANDARD GARBAGE RATES
per month $18.88 0.95 $19.83
Monthly charge for additional 32, 64
or 96-gallon green waste/organics
service
per month $5.23 0.26 $5.49
Monthly charge for additional 32, 64
or 96-gallon recycle service
per month $2.14 0.11 $2.25
Vacant Rate per month $17.62 0.88 $18.50
Waste wheeler cleaning each time $28.17 1.41 $29.58
Trip charge each time $18.89 0.95 $19.84
Non-payment downsize service each time $18.89 0.95 $19.84 Non-payment redeliver waste
wheeler
each time $45.41 2.28 $47.69
Non-payment reconnect service each time $45.41 2.28 $47.69 Small item pickup (TV, toilet) each $44.31 2.22 $46.53
Appliance pickup-residential each $62.49 3.14 $65.63

SOUTH COUNTY SANITARY SERVICE
RATE ADJUSTMENT EFFECTIVE JANUARY 1, 2025

CITY OF GROVER BEACH
Service Description Pickups Per Week Monthly Rates
Effective
01/01/2024
Proposed Rate
Adjustment
Monthly Rates
Effective
01/01/2025
Lock Charge per month $10.52 0.53 $11.05
City Clean Up each $16.44 0.83 $17.27
Garbage extras on your scheduled
pickup day
per yard $15.94 0.80 $16.74
Garbage extras -NOT ON YOUR

SCHEDULED PICKUP DAY
per yard $44.00 2.21 $46.21
Commercial Waste Wheeler rent per month $5.85 0.29 $6.14 Re-deliver bin on stopped acct each time $54.16 2.72 $56.88 Compactors per yard $21.48 1.08 $22.56
Sunday Service (in additional to
garbage service level)
per month $94.55 4.75 $99.30
Recycle bin rental per month $65.28 3.28 $68.56
Stand by time per hour $90.63 4.55 $95.18
Extra bin cleaning $84.51 4.24 $88.75
Damage/Destruction of bins or waste
wheelers
Replacement/repair at market price
Short Term Dumpsters:

Delivery & Pickup-Bin $54.16 2.72 $56.88
Delivery & Pickup-Waste Wheeler $18.88 0.95 $19.83
Rental Per Day $5.85 0.29 $6.14
Empties Per Yard $44.00 2.21 $46.21
Mattress:

Twin PER SET $24.59 1.23 $25.82
Double PER SET $24.59 1.23 $25.82
Queen PER SET $24.59 1.23 $25.82
King PER SET $24.59 1.23 $25.82
ADDITIONAL INFORMATION ALL CUSTOMERS:

1. Customers requesting Temporary Bins or Roll-off Box Service can call the office for current rates

2. Polystyrene (Styrofoam, Plastic #6) is not collected for recycling and should be thrown away as trash. Please bag Styrofoam packing peanuts before placing in trash container.

3. It is encouraged to bag your trash in the garbage container but do not bag your recyclables or green waste in their respective containers and keep it loose.

4. Recycling, Greenwaste/Organcis and Garbage containers should spaced 3 feet apart away from any obstacles (i.e mailboxes, cars, etc) before 6:00am on collection service day.

5. The fee schedule above only includes the Garbage Company rates and does not include IWMA fees, which are separately noted on the billings.

6. Cleaning fees will be billed on a time and materials basis

7. Late Fees are imposed for residential customers over 30 days delinquent. The fee is 1.5% per month of the outstanding charge, with a minimum fee of $5.00. No prior notice is required, as this late fee policy is stated at the bottom of every bill.

8. Customers can be charged for contamination fees in the trash, recycling and/or the greenwaste/organics containers.

Any additional recycling, including greenwaste/organic services are charged out at 50% of the garbage rate of equivalent size and frequency.

RESOLUTION NO. 25-

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF GROVER BEACH,

CALIFORNIA, APPROVING THE SECOND AMENDMENT TO THE AMENDED AND

RESTATED SOLID WASTE COLLECTION FRANCHISE AGREEMENT WITH SOUTH COUNTY SANITARY SERVICE, INC.

WHEREAS, the City of Grover Beach (“City”) and South County Sanitary Service, Inc. (“SCSS”) entered into an Amended and Restated Solid Waste Collection Franchise Agreement dated July 7, 2008, which was subsequently amended by the First Amendment dated June 20, 2016 (together, the “Agreement”); and
WHEREAS, the Agreement currently provides for a rate setting methodology according to the “City of San Luis Obispo Rate Setting Process and Methodology Manual for Integrated Solid Waste Management Rates” established in 1994; and
WHEREAS, the City of San Luis Obispo has developed a new rate adjustment methodology entitled “Annual Rate Adjustment Methodology” through consultation with R3 Consulting Group, Inc.; and
WHEREAS, the City and SCSS desire to adopt this new rate adjustment methodology to ensure a more current and efficient process for adjusting solid waste collection rates; and WHEREAS, the City and SCSS have negotiated the Second Amendment to the Agreement to implement this new rate adjustment methodology and make other necessary updates to the Agreement.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF GROVER BEACH, CALIFORNIA, DOES DELARE, DETERMINE, AND ORDER AS FOLLOWS:

1. The Second Amendment to the Amended and Restated Solid Waste Collection Franchise Agreement between the City and SCSS is approved in substantially the form presented to the City Council and as attached as Exhibit “A” and incorporated by reference.

2. The City Manager is authorized to take all necessary actions to implement the Second Amendment and the Annual Rate Adjustment Methodology described therein.

3. This Resolution shall become effective immediately upon adoption.

On motion by Council Member _____, seconded by Council Member ____, and on the following roll-call vote, to wit:

AYES: Council Members –
NOES: Council Members –
ABSENT: Council Members –
ABSTAIN: Council Members –
RECUSED: Council Members –
Attachment 5
Resolution No. 25- Page 2
the foregoing Resolution was PASSED, APPROVED, and ADOPTED at a regular meeting of the City Council of the City of Grover Beach, California this 27TH day of January 2025.

KASSI DEE, MAYOR
Attest:

WENDI B. SIMS, CITY CLERK
{00120837.DOCX.}1

SECOND AMENDMENT TO

AMENDED AND RESTATED

SOLID WASTE COLLECTION FRANCHISE AGREEMENT
This SECOND AMENDMENT TO AMENDED AND RESTATED SOLID WASTE COLLECTION FRANCHISE AGREEMENT (the “Second Amendment”) is made and entered into this ___ day of January, 2025, by and between the City of Grover Beach, a California municipal corporationpolitical subdivision of the State of California (the “City”), and South County Sanitary Service, Inc., a California corporation (the “Contractor”). The City and Contractor are collectively referred to herein as the “Parties” and each individually as a “Party.” Capitalized terms not otherwise defined herein shall have the respective meanings ascribed to them in the Agreement (as defined below).

RECITALS
WHEREAS, the City and Contractor are parties to that certain Amended and Restated Solid Waste Collection Franchise Agreement, dated July 7, 2008, as amended by that certain First Amendment to Amended and Restated Solid Waste Collection Franchise Agreement, dated June 20, 2016, (together, the “Agreement”);
WHEREAS, the Agreement originally provided for a rate setting methodology according to the “City of San Luis Obispo Rate Setting Process and Methodology Manual for Integrated Solid Waste Management Rates,” which was originally established in 1994 (the “1994 Rate Manual”); WHEREAS, the City of San Luis Obispo contracted with R3 Consulting Group, Inc. to support development and negotiation of a new rate adjustment methodology; WHEREAS the new rate adjustment methodology, entitled “Annual Rate Adjustment Methodology,” is available for consideration and use by other public agencies in San Luis Obispo County; WHEREAS, the Parties have, in good faith, negotiated changes to the Agreement necessary to support the transition to a new rate setting methodology using the Annual Rate Adjustment Methodology, attached hereto as Appendix 1, and mutually desire to amend the Agreement to incorporate the Annual Rate Adjustment Methodology in place of the 1994 Rate Manual.

AGREEMENT

NOW, THEREFORE, FOR GOOD AND VALUABLE CONSIDERATION, THE RECEIPT AND

SUFFICIENCY OF WHICH ARE HEREBY ACKNOWLEDGED, THE PARTIES AGREE TO AMEND THE AGREEMENT AS FOLLOWS:

1. Amendment to Article 1. Article 1 of the Agreement is hereby amended to add the following definition:
“Manual” means Appendix 1, “Annual Rate Adjustment Methodology,” attached hereto and incorporated herein by reference, as supplemented by the “New Solid Waste Rate Adjustment Methodology and 2025 Rates,” commissioned by the City of San Luis Obispo and prepared by R3 Consulting Group, Inc., dated November 1, 2024, provided that in the event of a conflict between the two documents, the “Annual Rate Adjustment Methodology” attached as Appendix 1 shall prevail. Any direct or indirect references to the “’City of San Luis Obispo Rate Setting Process and Methodology Manual for Integrated Exhibit A
{00120837.DOCX.}2
Solid Waste Management Rates’ dated June 1994” in the Agreement shall be replaced with “Manual.”

2. Amendment to Section 4.5.1. Section 4.5.1 of the Agreement is hereby deleted in its entirety and replaced with the following:

4.5.1 General. City may request Contractor to perform additional services (including new diversion programs, etc.) or modify the manner in which it performs existing services. Pilot programs and innovative services that may entail new Collection methods, different kinds of services and/or new requirements for Waste Generators are included among the kinds of changes that City may request. Contractor shall present, within thirty (30) days of a request to do so by City, a proposal to provide additional or expanded diversion services pursuant to the terms of Article 4.5.2 (New Diversion Programs). Contractor shall be entitled to an adjustment in its compensation for providing such additional or modified services in accordance with the Manual’s procedures for extraordinary adjustments for “Change in Scope” (as that term is defined in the Manual).

3. Amendment to Article 8. Article 8 of the Agreement is hereby deleted in its entirety and replaced with the following:

8.1 General
Contractor’s compensation provided for in this Article shall be the full, entire and complete compensation due to Contractor pursuant to this Agreement for all labor, equipment, materials and supplies, taxes, insurance, bonds, overhead, transfer and transport, processing, division, disposal, profit and all other things necessary to perform all the services required by this Agreement in the manner and at the times prescribed. Contractor will not be entitled to any further rate adjustments as a result of customer delinquencies and other bad debt issues.

Contractor does not look to the City for payment of any sums under this Agreement in consideration of the right to charge and collect from customers for services rendered at rates not higher than those approved by the City from time to time. The City shall have the right to structure those rates as it deems appropriate so long as the revenues forecasted to be received by Contractor from charging such rates can reasonably be expected to generate sufficient revenues to provide for Contractor's compensation as calculated in accordance with the Manual.

8.2. Collection Rates
Service rates caps shall be established by Resolution adopted by the City Council.

Contractor shall provide the services required by this Agreement and charge no more than the rates authorized by City Resolution.

8.3 Rate Review and Allowable Profit
Ordinary and extraordinary rate reviews shall be submitted and considered in accordance with the procedures described in the Manual, except as that may be modified by the City from time to time. In addition to the procedures contained in the Manual, Contractor shall submit any and all data requested by and in the format prescribed by the City. In the event Contractor shall fail to meet the schedule set forth in Manual, a revision of rates for the {00120837.DOCX.}3
following year shall not be authorized until the 1st day of the first calendar month following a 120 day period from the date that the complete application is submitted and such revision shall contain no consideration for Contractor's failure to submit the in accordance application with the schedule set forth in the Manual.

If at any time during the term of this Contract, the Contractor requests and is granted a rate increase by the City that when the new rate is compared to the rate at the effective date of this Contract exceeds the cumulative cost of living increase from the effective date of the Contract, the City shall have the option of terminating the Agreement. The cumulative cost of living increase from the effective date of the Contract shall be calculated in accordance with the Manual. Such option shall be available for a period of nine (9) months following the granting of the rate increase.

8.4 Publication of Rates
Contractor shall provide written notice to subscribers of all rate changes, prior to implementation. If appropriate, this notice should include reasons and background for the rate change.

4. Amendment to Section 9.6. The first paragraph of Section 9.6 is hereby revised and amended as follows:

Contractor shall submit to the City annual audited financial statements prepared at Contractor's expense by an independent Certified Public Accountant not later than one hundred eighty (180) days following the expiration of the Contractor’s fiscal year. Pursuant to the Manual, at the time a rate application request is submitted to City, the financial forms contained in the rate application must be reconciled to the audited financial statements to provide assurance that all of the Contractor's activities are accounted for.

5. Reaffirmation and Entire Agreement. The Parties hereby reaffirm their agreement with all the terms and provisions of the Agreement as amended by this Second Amendment. The Agreement and this Second Amendment represent the entire agreement among the Parties with respect to the matters that are the subject hereof. All the terms and provisions of the Agreement not amended hereby, either expressly or by necessary implication, shall remain in full force and effect.

6. Conflicting Provisions and Severability. In the event of any conflict between the terms of the Agreement, the First Amendment, and/or this Second Amendment, the terms of this Second Amendment shall prevail, and the terms of Appendix 1 shall prevail in the event of a conflict relating to rate setting procedures among or between any of the foregoing documents. The provisions of this Second Amendment shall be deemed severable. If any provision of this Second Amendment is invalid or unenforceable, such provision shall be of no force or enforceability and the Second Amendment shall otherwise continue in full force and effect.

7. Counterparts. This Second Amendment may be executed in one or more facsimile or original counterparts, each of which shall be deemed an original and both of which together shall constitute one and the same instrument.

8. Authorization. Each Party executing this Second Amendment represents and warrants that it is duly authorized to cause this Second Amendment to be executed and delivered. [Signature Page Follows]
{00120837.DOCX.}4
IN WITNESS WHEREOF, City and Contractor have executed this Second Amendment on the day and year first hereinabove set forth.

CITY:

CITY OF GROVER BEACH
By: ____________________
Name: ____________________
Title: ____________________
CONTRACTOR:

SOUTH COUNTY SANITARY
SERVICE, INC.

By: ____________________
Name: ____________________
Title: ____________________
Attest:

By: ____________________
Name: ____________________
Title: ____________________
Approved as to Form:

By: ____________________
Name: ____________________
Title: ____________________
Agenda Item No. 10

CITY COUNCIL STAFF REPORT
TO: Honorable Mayor and City Council DATE: January 27, 2025 FROM: Matthew Bronson, City Manager
PREPARED BY: Kristin Eriksson, Assistant City Manager
SUBJECT: State Legislation Update and 2025 Legislative Platform

RECOMMENDATION
Receive a presentation on recently adopted State legislation and approve the 2025 City of Grover Beach Legislative Platform.

BACKGROUND
Legislation at the State and Federal level often affects cities’ revenue sources, mandated services and local control of governance. The purpose of a City Council-approved Legislative Platform is to clearly set forth the City’s positions on proposed legislation and other State and Federal issues that impact City operations on which the City could advocate. The timeframe to respond to proposed legislation often does not allow for full Council approval at a regularly scheduled City Council meeting. As a result, the Legislative Platform authorizes the City Manager to work with the Mayor to take positions on legislation on behalf of the City that are consistent with the platform to allow for quick response communications, through opposition or support letters, to legislators when time is of the essence. The priorities expressed in the platform are also intended to assist the Council and staff to appropriately address legislation to promote the City’s interests. 2024 Legislative Update
The City works with the League of California Cities (Cal Cities) to track legislation that impacts local government. In line with the City’s 2024 Legislative Platform, the City issued letters of opposition and letters urging a veto for the following bills in 2024 as seen in Attachment 1:
• AB 1886 – Housing Element Requirements
• SB 1037 - Planning and zoning: housing element: enforcement Additionally, on September 23, 2024, the Council took official positions of support for two 2024 ballot measures: Proposition 4, which provides the State authority to issue a $10 billion climate bond for programs aimed at mitigating the impacts of climate change; and Proposition 36 which increased penalties for repeat retail theft and repealed punishment reductions enacted pursuant to prior Proposition 47.

Attachment 2 includes a summary of approved and enacted legislation which will impact City operations and codes along with planned City actions.

Staff Report: Legislation Update and 2025 Legislative Platform Page 2 January 27, 2025

2025 Legislative Platform
Similar to previous platforms, the proposed 2025 Legislative Platform shown in Attachment 3 is organized in the following topic-based categories and informed by the advocacy priorities established by Cal Cities shown in Attachment 4:
1) General Government – Generally supports local control to address local needs and opposes State preemption of local authority and unfunded or underfunded mandates; 2) Local Government Finance – Generally supports legislation protecting or enhancing City revenues and opposes unfunded mandates, restrictions on revenues and restrictions on contracting for cities;
3) Public Safety – Generally supports funding and support for emergency response and crime reduction programs;
4) Transportation and Public Works – Generally supports funding and expedited processes capital and infrastructure projects, supports funding for key water supply projects, and funding for implementation of organic waste disposal requirements; 5) Community Development – Generally supports funding and programs to address homelessness, supports legislation to reform cannabis regulations and supports protection of transient occupancy tax revenue.

One substantive change to the 2025 Legislative Platform is a requested item from the San Luis Obispo Council of Governments (SLOCOG) regarding funding for regional transportation needs.

SLOCOG is requesting support from each local jurisdiction in San Luis Obispo County to seek State legislation that would provide an exemption to the 2% Bradley Burns sales tax cap rate for a future transportation measure that may be proposed to the voters.

Sales tax levels in California vary from 7.25% to 10.75%. With 7.25% as the base, local agencies are allowed to increase this base level by up to 2% with voter approval with legislation needed to exceed the 2% cap. Currently, six jurisdictions in San Luis Obispo County have a sales tax approved by voters at 8.75% including Grover Beach. With only 0.5% remaining, a proposed SLOCOG measure could be impeded due to potential other measures from a city or the County or through another regional measure or a citizens’ initiative. Each is allowable under current law but if any jurisdiction reaches 9.25% or if several cities want to retain their future funding options, then no other regionwide sales tax can be pursue unless special legislation is sought and approved.

This effort does not approve or institute a tax or change how a tax may be approved. The proposed legislation would provide an exemption from the 2% cap imposed to allow a transportation measure (proposed by SLOCOG or a citizens’ initiative) to be placed on a future ballot for voter consideration. Such a measure would allow San Luis Obispo County voters to consider approval of a countywide sales tax to address transportation safety, maintenance, mobility, and infrastructure needs.

FISCAL IMPACT
There is no fiscal impact associated with these actions.

Staff Report: Legislation Update and 2025 Legislative Platform Page 3 January 27, 2025

ALTERNATIVES
The Council has the following alternatives to consider:
1) Receive a presentation on recently adopted State legislation and approve the 2025 City of Grover Beach Legislative Platform; or
2) Approve a modified version of the 2025 City of Grover Beach Legislative Platform; or 3) Do not approve the 2025 City of Grover Beach Legislative Platform, or 4) Provide alternative direction to staff.

PUBLIC NOTIFICATION
The agenda was posted in accordance with the Brown Act.

Attachments

1. 2024 Letters of Support

2. 2024 Legislation Impacts

3. 2025 Proposed City of Grover Beach Legislative Platform (tracked changes)

4. 2025 Cal Cities Advocacy Priorities
City of Grover Beach
Mayor Karen Bright Mayor Pro Tem Robert Robert
Council Member Daniel Rushing, Council Member Clint Weirick, Council Member Zach Zimmerman Matthew Bronson
City Manager
154 South Eighth Street  Grover Beach, California 93433  www.groverbeach.org Administrative Services/Water (805) 473-4550  City Council/City Manager (805) 473-4567  City Clerk (805) 473-4568 Community Development - Building, Planning & Economic Development (805) 473-4520  Human Resources (805) 473-4564 Parks & Recreation (805) 473-4580  Police/Non-Emergency (805) 473-4511  Public Works (805) 473-4530 May 10, 2024
The Honorable Assemblymember Dawn Addis
1021 O St., Ste. 5350
PO Box 942849
Sacramento, CA 94249-0030
RE: AB 1886 (Alvarez) Housing Element Law: Substantial Compliance Notice of Opposition (As of April 1, 2024)
Dear Assemblymember Addis,
Th City of Grover Beach regretfully must oppose measure AB 1886 (Alvarez), because it turns its back to a fundamental provision of housing element law: A city may disagree with HCD; explain why its housing element is in substantial compliance with the law; and then adopt that housing element which is thereafter considered “in substantial compliance with housing element law.” For decades, cities have worked with HCD to draft housing plans that accommodate their fair share of housing at all income levels. These extensive and complex plans can take years to develop, include public involvement and engagement, and environmental review. Cities go to great lengths to ensure that their housing element substantially complies with the law, even if HCD disagrees. Current law acknowledges this fact by allowing cities to “self-certify” their housing element or take the issue to court and have a judge make the final determination of substantial compliance.

AB 1886 encourages “builder’s remedy” projects by eliminating self-certification for the purpose of what it means to have a housing element “in substantial compliance with the law.” The “builder’s remedy” allows a developer to choose any site other than a site that is identified for very low-, low-, or moderate-income housing, and construct a project that is inconsistent with both the city’s general plan and zoning. AB 1886 facilitates such projects for those cities that have a good faith disagreement based in substantial evidence.

The City of Grover Beach believes that AB 1886 is counterproductive. What is really needed is for HCD to partner with cities to provide meaningful direction that helps them finalize their housing elements and put those plans to work so that much needed housing construction can occur. For these reasons, the City of Grover Beach must oppose AB 1886 (Alvarez).

Sincerely,
Karen Bright, Mayor
Cc: The Honorable David A. Alvarez
David Mullinax, League Regional Public Affairs Manager (via email) League of California Cities, [email protected]







 


 




 Attachment 1
City of Grover Beach
Mayor Karen Bright Mayor Pro Tem Robert Robert
Council Member Daniel Rushing, Council Member Clint Weirick, Council Member Zach Zimmerman Matthew Bronson
City Manager
154 South Eighth Street  Grover Beach, California 93433  www.groverbeach.org Administrative Services/Water (805) 473-4550  City Council/City Manager (805) 473-4567  City Clerk (805) 473-4568 Community Development - Building, Planning & Economic Development (805) 473-4520  Human Resources (805) 473-4564 Parks & Recreation (805) 473-4580  Police/Non-Emergency (805) 473-4511  Public Works (805) 473-4530 May 10, 2024
The Honorable Senator John Laird
1021 O St., Ste. 8720
Sacramento, CA 95814
RE: AB 1886 (Alvarez) Housing Element Law: Substantial Compliance Notice of Opposition (As of April 1, 2024)
Dear Senator Laird,
Th City of Grover Beach regretfully must oppose measure AB 1886 (Alvarez), because it turns its back to a fundamental provision of housing element law: A city may disagree with HCD; explain why its housing element is in substantial compliance with the law; and then adopt that housing element which is thereafter considered “in substantial compliance with housing element law.” For decades, cities have worked with HCD to draft housing plans that accommodate their fair share of housing at all income levels. These extensive and complex plans can take years to develop, include public involvement and engagement, and environmental review. Cities go to great lengths to ensure that their housing element substantially complies with the law, even if HCD disagrees. Current law acknowledges this fact by allowing cities to “self-certify” their housing element or take the issue to court and have a judge make the final determination of substantial compliance.

AB 1886 encourages “builder’s remedy” projects by eliminating self-certification for the purpose of what it means to have a housing element “in substantial compliance with the law.” The “builder’s remedy” allows a developer to choose any site other than a site that is identified for very low-, low-, or moderate-income housing, and construct a project that is inconsistent with both the city’s general plan and zoning. AB 1886 facilitates such projects for those cities that have a good faith disagreement based in substantial evidence.

The City of Grover Beach believes that AB 1886 is counterproductive. What is really needed is for HCD to partner with cities to provide meaningful direction that helps them finalize their housing elements and put those plans to work so that much needed housing construction can occur. For these reasons, the City of Grover Beach must oppose AB 1886 (Alvarez).

Sincerely,
Karen Bright, Mayor
Cc: The Honorable David A. Alvarez
David Mullinax, League Regional Public Affairs Manager (via email) League of California Cities, [email protected]







 


 





City of Grover Beach
Mayor Karen Bright Mayor Pro Tem Robert Robert
Council Member Daniel Rushing, Council Member Clint Weirick, Council Member Zach Zimmerman Matthew Bronson
City Manager
154 South Eighth Street  Grover Beach, California 93433  www.groverbeach.org Administrative Services/Water (805) 473-4550  City Council/City Manager (805) 473-4567  City Clerk (805) 473-4568 Community Development - Building, Planning & Economic Development (805) 473-4520  Human Resources (805) 473-4564 Parks & Recreation (805) 473-4580  Police/Non-Emergency (805) 473-4511  Public Works (805) 473-4530 September 19, 2024
The Honorable Gavin Newsom
Governor, State of California
1021 O Street, Suite 9000
Sacramento, CA 95814
RE: AB 1886 (Alvarez) Housing Element Law: Substantial Compliance Request for VETO
Dear Governor Newsom,
The City of Grover Beach writes to strongly request that you VETO AB 1886 (Alvarez) because it turns its back to a fundamental provision of housing element law: A city may disagree with HCD; explain why its housing element is in substantial compliance with the law; and then adopt that housing element which is thereafter considered “in substantial compliance with housing element law.”
For decades, cities have worked with HCD to draft housing plans accommodating their fair share of housing at all income levels. These extensive and complex plans can take years to develop, including public involvement and engagement and environmental review. Cities go to great lengths to ensure that their housing element substantially complies with the law, even if HCD disagrees.

Unfortunately, this measure fails to address the key struggles cities deal with when trying to comply with the law, including unclear guidance from HCD, staff turnover, and inconsistent guidance regarding what cities must do to comply with the law. Current law acknowledges this by allowing cities to “self-certify” their housing element or take the issue to court and have a judge determine substantial compliance. This measure eliminates the “self-certification” process and gives HCD more power to determine when a city is certified without requiring them to provide detailed findings as to how the local jurisdictions can come into compliance. In addition, AB 1886 fails to provide a grace period for cities acting in good faith but are still unable to meet the statutory deadline for adopting a compliant housing element.

Particularly for smaller cities with limited resources, the provisions of this bill create an undue burden. We also feel this bill is contrary to cooperation between the State and local governments in meeting our housing needs.





 

 






The City of Grover Beach believes that AB 1886 is counterproductive. What is really needed is for HCD to partner with cities to provide meaningful direction that helps them finalize their housing elements in a timely manner and put those plans into action so that much-needed housing construction can occur. For these reasons, the City of Grover Beach requests your veto on AB 1886. If you have any questions, do not hesitate to contact me at [email protected] or 805-473-4567.

Sincerely,
Karen Bright, Mayor
City of Grover Beach
Cc: The Honorable David Alvarez (Via email: [email protected]) David Mullinax, League Regional Public Affairs Manager (via email) League of California Cities (via email: [email protected]) 




 

 






City of Grover Beach
Mayor Karen Bright Mayor Pro Tem Robert Robert
Council Member Daniel Rushing, Council Member Clint Weirick, Council Member Zach Zimmerman Matthew Bronson
City Manager
154 South Eighth Street  Grover Beach, California 93433  www.groverbeach.org Administrative Services/Water (805) 473-4550  City Council/City Manager (805) 473-4567  City Clerk (805) 473-4568 Community Development - Building, Planning & Economic Development (805) 473-4520  Human Resources (805) 473-4564 Parks & Recreation (805) 473-4580  Police/Non-Emergency (805) 473-4511  Public Works (805) 473-4530 May 10, 2024
The Honorable Assemblymember Dawn Addis
1021 O St., Ste. 5350
PO Box 942849
Sacramento, CA 94249-0030
RE: SB 1037 (Wiener) Planning and zoning: housing element: enforcement Notice of Opposition (As of April 25, 2024)
Dear Assemblymember Addis,
The City of Grover Beach regretfully must oppose measure SB 1037 (Wiener), which would allow the Attorney General to take legal action against a city and seek fines up to $50K a month for failure to adopt a compliant housing element or if the city does not follow state laws that require ministerial approval of certain housing projects.

Under existing law cities can be subject to significant fines and penalties for violating certain housing laws. However, before fines are imposed, a city has the ability to correct the action. Additionally, enhanced fines are not imposed unless the city fails to follow a court’s order or acts in bad faith.

Unfortunately, as currently drafted, SB 1037 does not provide an opportunity for cities to correct an honest mistake or address a genuine difference in interpreting the law. Even those jurisdictions acting in good faith could be subject to significant fines and be required to pay the Attorney General for all costs investigating and prosecuting the action, including expert witness fees and attorney’s fees.

Instead of creating new fines and penalties, lawmakers and the Department of Housing and Community Development should provide cities with clear guidance and technical assistance to help them finalize their housing elements and put those plans to work so much-needed housing construction can occur.

For these reasons, the City of Grover Beach must oppose SB 1037.

Sincerely,
Karen Bright, Mayor
Cc: The Honorable Scott Wiener
David Mullinax, League Regional Public Affairs Manager (via email) League of California Cities, [email protected]







 


 





City of Grover Beach
Mayor Karen Bright Mayor Pro Tem Robert Robert
Council Member Daniel Rushing, Council Member Clint Weirick, Council Member Zach Zimmerman Matthew Bronson
City Manager
154 South Eighth Street  Grover Beach, California 93433  www.groverbeach.org Administrative Services/Water (805) 473-4550  City Council/City Manager (805) 473-4567  City Clerk (805) 473-4568 Community Development - Building, Planning & Economic Development (805) 473-4520  Human Resources (805) 473-4564 Parks & Recreation (805) 473-4580  Police/Non-Emergency (805) 473-4511  Public Works (805) 473-4530 May 10, 2024
The Honorable Senator John Laird
1021 O St., Ste. 8720
Sacramento, CA 95814
RE: SB 1037 (Wiener) Planning and zoning: housing element: enforcement Notice of Opposition (As of April 25, 2024)
Dear Senator Laird,
The City of Grover Beach regretfully must oppose measure SB 1037 (Wiener), which would allow the Attorney General to take legal action against a city and seek fines up to $50K a month for failure to adopt a compliant housing element or if the city does not follow state laws that require ministerial approval of certain housing projects.

Under existing law cities can be subject to significant fines and penalties for violating certain housing laws. However, before fines are imposed, a city has the ability to correct the action. Additionally, enhanced fines are not imposed unless the city fails to follow a court’s order or acts in bad faith.

Unfortunately, as currently drafted, SB 1037 does not provide an opportunity for cities to correct an honest mistake or address a genuine difference in interpreting the law. Even those jurisdictions acting in good faith could be subject to significant fines and be required to pay the Attorney General for all costs investigating and prosecuting the action, including expert witness fees and attorney’s fees.

Instead of creating new fines and penalties, lawmakers and the Department of Housing and Community Development should provide cities with clear guidance and technical assistance to help them finalize their housing elements and put those plans to work so much-needed housing construction can occur.

For these reasons, the City of Grover Beach must oppose SB 1037.

Sincerely,
Karen Bright, Mayor
Cc: The Honorable Scott Wiener
David Mullinax, League Regional Public Affairs Manager (via email) League of California Cities, [email protected]







 


 





City of Grover Beach
Mayor Karen Bright Mayor Pro Tem Robert Robert
Council Member Daniel Rushing, Council Member Clint Weirick, Council Member Zach Zimmerman Matthew Bronson
City Manager
154 South Eighth Street  Grover Beach, California 93433  www.groverbeach.org Administrative Services/Water (805) 473-4550  City Council/City Manager (805) 473-4567  City Clerk (805) 473-4568 Community Development - Building, Planning & Economic Development (805) 473-4520  Human Resources (805) 473-4564 Parks & Recreation (805) 473-4580  Police/Non-Emergency (805) 473-4511  Public Works (805) 473-4530 September 19, 2024
The Honorable Gavin Newsom
Governor, State of California
1021 O Street, Suite 9000
Sacramento, CA 95814
RE: SB 1037 (Wiener) Planning and zoning: housing element: enforcement Request for VETO
Dear Governor Newsom,
The City of Grover Beach regretfully requests a veto on SB 1037 (Wiener), which would allow the Attorney General to take legal action against a city and seek fines up to $50K a month for failure to adopt a compliant housing element or if the city does not follow state laws that require ministerial approval of certain housing projects.

Under existing law cities can be subject to significant fines and penalties for violating certain housing laws. However, before fines are imposed, a city has the ability to correct the action.

Additionally, enhanced fines are not imposed unless the city fails to follow a court’s order or acts in bad faith.

Unfortunately, as currently drafted, SB 1037 does not provide an opportunity for cities to correct an honest mistake or address a genuine difference in interpreting the law. Even those jurisdictions acting in good faith could be subject to significant fines and be required to pay the Attorney General for all costs investigating and prosecuting the action, including expert witness fees and attorney’s fees.

Particularly for smaller cities with limited resources, the provisions of this bill create an undue burden. We also feel this bill is contrary to cooperation between the State and local governments in meeting our housing needs.

The City of Grover Beach believes that instead of creating new fines and penalties, lawmakers and the Department of Housing and Community Development should provide cities with clear guidance and technical assistance to help them finalize their housing elements and put those plans to work so much-needed housing construction can occur.





 

 






For these reasons, the City of Grover Beach requests your veto on SB 1037. If you have any questions, do not hesitate to contact me at [email protected] or 805-473-4567.

Sincerely,
Karen Bright, Mayor
City of Grover Beach
Cc: The Honorable Scott Wiener (Via email: [email protected]) David Mullinax, League Regional Public Affairs Manager (via email) League of California Cities (via email: [email protected]) 




 

 






2024 Legislation Impacts
General Government
Human Resources
• AB 2561 – Local Public Employees: Vacant Positions. Requires public agencies to present the status of vacancies and recruitment and retention efforts at a public hearing at least once per fiscal year prior to budget adoption and entitles recognized employee organizations to be present at the hearing. If the total vacancies exceeds 20% of the total number of authorized full-time positions, the employee organization may request specific information at the public hearing.
o Impact: Staff will schedule a public hearing in accordance with this provision prior to the budget hearing each year.
• AB 1976 – Occupational Safety and Health Standards: First Aid Materials: Opioid Antagonists. Requires agencies to include opioid antagonists (ie: naloxone) in first aid materials by December 1, 2027.
o Impact: Staff will ensure this standard is met by the required date. • AB 2123 – Disability Compensation: Paid Family Leave. Prohibits employers from requiring an employee to take two weeks of vacation leave before accessing benefits under the California Paid Family Leave program for any disability commencing on or after January 1, 2025.
o Impact: Staff will ensure this standard is met by the required date. • AB 2499 – Employment: Unlawful Discrimination and Paid Sick Days: Victims of Violence. Provides employees who are or whose family member is a victim of violence the right to use job-protected leave, including the use of sick leave, up to a cap of twelve weeks.
o Impact: The above statutes will be implemented in the City’s employee handbook and leave practices.

Brown Act
• AB 2302 – Open Meetings: Local Agencies: Teleconferences. Allows members of a legislative body to attend a public meeting remotely for “just cause” and “emergency circumstances” without noticing their teleconference location or making that location public for up to five meetings per year.
o Impact: Council Members will be permitted to attend up to five public meetings per year remotely for specified cause without noticing or making public their teleconference location.

Attachment 2
Public Safety
Crime
• Proposition 36. Increases penalties for repeat retail theft and repeals reductions in punishment enacted by Proposition 47. Directs specified drug offenders to treatment, rather than incarceration, increases penalties for drug-related crimes and adds fentanyl to the list of drugs subject to felony charges.
•
o Impact: Will require an increased number of bookings in the county jail. When this occurs, officers will be taken out of service for an extended period of time (1- 4+ hours) and there will be a reduced number of available officers in the city. • Retail theft package (14 bills: AB 1779, AB 1794, AB 1802, AB 1960, AB 1972, AB 2943, AB 3209, SB 1144, SB 1416, SB 905, SB 982, SB 1242, SB 1320, SB 1385). Includes stricter penalties for retail and property theft and sentencing enhancements for largescale operations. Where these statutes conflict with Proposition 36, the Proposition will control.
o Impact: Same impact as Proposition 36 above.

Cannabis
• SB 1064 – Cannabis: Operator and Separate Premises Licenses. Allows combined cannabis activities under one license at a single premises for operators, with the exception of laboratory testing activities.
o Impact: Minimal impact. For existing operators, will likely streamline the local renewal process. For new cannabis applications, will streamline the licensing process at the State level. May require an update to the City’s municipal code, permitting processes, and inspection protocols. For renewal applications, minor administrative staff burden to update record of existing licenses. Staff to coordinate with the City Attorney and Police Department to ensure appropriate amendments are in compliance with State law.
• AB 1775 – Cannabis: Retail Preparation, Sale and Consumption of Non-Cannabis Food and Beverage Products. Authorizes local jurisdictions to allow for the sale of noncannabis food or beverage products in an area where cannabis consumption is allowed.

Also authorizes the sale of tickets for performances on the premises of a licensed cannabis retailer where cannabis consumption is allowed. o Impact: AB 1775 creates a legal framework for the inclusion of non-cannabis food and beverages at licensed cannabis businesses. Local agencies maintain authority to regulate or prohibit this practice. The Council must explicitly allow such sales by Ordinance. If so, an update to the City’s Municipal Code, Article 3, Chapter 18, and Article IX, Chapter 4, Section 4.10.045. Potential updates to Article X – Revenue and Taxation, may be appropriate.

Transportation and Public Works
Climate and Water Projects
• SB 867 – Safe Drinking Water, Wildlife Fire Prevention, Drought Preparedness, and Clean Air Bond Act of 2024. Enacts Proposition 4, approved by voters in the November 2024 election, to allow the State to issue $10 billion in bonds to finance projects for safe drinking water, wildfire prevention, drought preparation, flood protection, extreme heat mitigation, clean energy and workforce development programs. o Impact: Staff will evaluate state requirements and grant programs under this bond program once they are issued by the State for future potential project eligibility.

Water and Sewer Services
• SB 1072 – Local Government: Proposition 218: Remedies. Provides that if a court determines a local agency fee for a property-related service violations the California Constitution, including Proposition 218, the agency must credit the amount of the fee that is attributable to the violation.
o Impact: Staff will continue to endeavor to meet at requirements of Proposition 218 as applicable.
• SB 1210 – New Housing Construction: Electrical, Gas, Sewer and Water Service:

Service Connection Information. Requires utilities to post estimated fees and timeframes for new service connections for new housing construction projects on their website on or before January 1, 2026.
o Impact: The City’s Master Fee Schedule is posted to the City’s website and outlines new service connection charges. The City’s Public Works Department will coordinate with Administrative Services to update the website to post timeframes for new connections for certain housing construction projects (i.e., ADUs, mixed-use, multifamily, and single-family developments). Generally, upon completion of inspection and acceptance of public improvements, applicants would have immediate sewer and water service.
• AB 2427 – Electric Vehicle Charging Stations: Permitting: Curbside Charging. Requires local agencies without approved locations within the public right-of-way for installation of an electric vehicle charging station to publish that information on a publicly accessible website maintained by the agency.
o Impact: Police, Public Works, and Community Development Departments along with the Five Cities Fire Authority will need to collaborate on a “feasibility study” on appropriate locations within the public-right-of way to allow EV charging stations. Staff will need to develop a checklist that includes all of the information required for a complete application for a permit or other authorization to install an electric vehicle charging station within the public right-of-way; identify all applicable fees and charges as part of the permitting or authorization process; and identify any criteria adopted by the governing body of the local agency to determine appropriate locations within the public right-of-way for installation of an electric vehicle charging station. Should the City not find any appropriate locations within the public right-of-way, this information and findings will need to be posted/published to the City’s website by January 1, 2029.

Community Development
General Plan Element Requirements
• AB 1886 – Housing Element Law: Substantial Compliance. Reversed cities’ ability to “self-certify” Housing Elements if they believe they are in compliance with State law. The legislation also prevents cities from legally challenging the Department of Housing and Community Development’s (HCD) finding of noncompliance of Housing Elements. The legislation also removes the grace period for statutory deadlines for cities acting in good faith to bring noncompliant Housing Elements into compliance. • AB 2023 – Housing Element: Inventory of Land: Substantial Compliance: Rebuttable Presumptions. Creates a higher legal standard for local agencies to challenge HCD’s finding that a local agency does not have a certified Housing Element. Also requires that any amendments by a local agency in response to HCD’s findings must go back to HCD for 90 days of review and 30 days of public comment.
• SB 1037 – Planning and Zoning: Housing Element Enforcement. Allows the State Attorney General to take legal action against a city and seek fines up to $50,000 per month for failure to adopt a compliant Housing Element or if the city fails to follow State laws requiring ministerial approval of certain housing projects. o Impacts: Together, the above bills make the development of Housing Elements far more difficult and subject the City to penalties, including severe fines. Staff will continue to work diligently with HCD to produce compliant Housing Elements to avoid these consequences going forward. The City’s Housing Element is considered in “substantial compliance” with State law. Preparation of a Housing Element can take 2 to 3 years; the next cycle will cover the period from 2028 to 2036. Staff will begin preparation of the next cycle in 2026 to allow adequate time for community outreach, data gathering and site inventory, HCD coordination, and preparation of the document. Staff will work diligently with HCD to produce a compliant Housing Element.
• AB 2667 – Affirmatively Furthering Fair Housing: Housing Element: Reporting. Requires local agencies to make a draft of their site inventory available to HCD and the public at least 90 days prior to a Housing Element’s initial adoption if the site inventory has changed in the seventh RHNA cycle. Requires local agencies to report the number of units approved in the previous year within an opportunity area annually. Requires local agencies to make the inventory of sites available online and notify individuals and organizations that have expressed interest in the issue by email. o Impact: Staff will update the General Plan Annual Report and include the reporting requirements in compliance with AB 2667.
• AB 1889– Conservation Element: Wildlife Connectivity. Requires local government agencies to include a wildlife connectivity element within the conservation element in their next general plan update after January 1, 2028.
o Impact: The City’s next General Plan update will likely be the 7th Cycle 2028- 2036 Housing Element. As part of this effort, subject to available resources (i.e., staffing and funding), staff will pursue an update to its Conservation Element and include a wildlife connectivity element. Depending on whether these efforts are completed concurrently, SB 1000 would require the City to also prepare an Environmental Justice Element or incorporate EJ goals, policies into other adopted elements.
• AB 2684 – Safety Element: Extreme Heat. Requires local government agencies to update and include in their general plans a plan to address the hazard of extreme heat in the housing element or local hazard mitigation plan after January 1, 2028. o Impact: The City is a partner with San Luis Obispo County and the six other incorporated communities to update the Multi-jurisdictional Local Hazard Mitigation Plan. This effort is tentatively scheduled to be complete in summer 2025 and will include plans to address the hazard of extreme heat. Staff will incorporate those same policies and plans within the next housing element update.
• AB 3093 – Land Use: Housing Element. Requires local governments to account for the housing needs of unhoused people in their Housing Elements by adding two new income categories to the seventh RHNA cycle: acutely low income and extremely low income.
o Impact: Staff will coordinate with the San Luis Obispo Council of Goverments (SLOCOG) and HCD to ensure the two income categories are included with the 7th Cycle Housing Element update.

Permitting
• AB 1893 – Housing Accountability Act: Housing Disapprovals. Prohibits cities from using objective standards to render a builder’s remedy project infeasible. o Impact: Cities with a compliant Housing Element are not directly impacted by AB 1893. “Builders Remedy” is a legal tool that allows developers to bypass certain local zoning and other regulatory constraints when a jurisdiction has not complied with its State-mandated housing goals (i.e., does not have a certified Housing Element, or has not met its RHNA goals). This bill would limit the ways a local agency could block a housing project that may not meet local zoning or general plan requirements. This would only affect the City if it had a noncompliant Housing Element. The City will continue to work diligently with HCD to produce compliant housing elements.
• SB 1123 – Planning and Zoning: Subdivisions: Ministerial Review. Requires local agencies to ministerially approve the subdivision of a parcel map for up to 10 housing units and to allow the ministerial approval of any housing units on-site that are in vacant, single-family zoned sites, beginning July 1, 2025.
o Impact: The most recent Development Code Update included provisions from SB 684, which requires local agencies to ministerially approve the subdivision of a parcel map for up to 10 housing units, aiming to accelerate the housing production process and remove unnecessary delays in local agency review. Staff will review its ordinance with SB 1123 to ensure consistency and compliance with State law prior to the effective date.
• AB 2533 – ADUs: Junior ADUs: Unpermitted Developments. Prohibits local agencies from denying a permit for an unpermitted ADU or JADU constructed before January 1, 2020 unless not correcting the violation would otherwise deem the building substandard.

Requires local agencies to inform the public about this provision including in permit checklists identifying how a building is deemed substandard, on the agency’s website and in communication with homeowners before submitting their application. Prohibits the imposition of impact fees or capacity charges on an unpermitted ADU unless utility infrastructure is necessary to not make the project substandard. o Impact: Implementation will require amendments to application checklists and the City’s ADU programs page.
• SB 450 – Housing Development: Approvals. Prohibits local governments from denying a SB 9 project for objective standards on a specific project and instead only allows objective standards to apply to the underlying zone on which the main lot is located.

Prohibits local agencies from denying SB 9 projects for impacts on the physical environment. Requires local agencies to approve or reject a project application within 60 days of receipt of a completed application or it is automatically deemed approved. o Impact: The City processes SB 9 applications within the 60-day approval window and implements review times in compliance with SB 9 (60-day approval window).

Changes associated with SB 450 will require additional staff research to understand how the Development Code may need to be amended in compliance with the law. For example, the City has adopted Objective Design Standards (ODS) for two-unit housing projects associated with an SB 9 urban lot split; based on SB 450, a local agency must apply ODS uniformly to development within the underlying zone. Staff could not reject or deny an application simply because a feature (e.g., roof shape, building materials) of the project does not meet ODS for two-unit development if it meets ODS for single-unit development; but could recommend revisions to the applicant to comply with the adopted two- unit standards. If the applicant refused to comply, staff is required by SB 450 to prepare clear and objective standards that justifies the denial (likely related to health, safety, or public welfare). For this, staff may need to coordinate with the City Attorney and amend the Development Code language in Article IX, Chapter

8.160 – Urban Lot Splits, and Chapter 4.25, et.al – Residential and Mixed-Use Objective Design Standards.
• SB 1395 – Shelter Crisis: Low Barrier Navigation Centers Use By Right. Reduces building requirements for shelters that are non-congregate and relocatable, in line with reduced requirements for traditional homeless shelters. o Impact: This bill aims to make it easier and faster to deploy shelters to meet urgent or emergency housing needs and allows City’s to adopt by ordinance reasonable local standards and procedures for the design, site development, and operation of homeless shelters to the extent that strict compliance with State and local law would prevent development of the shelter. Said ordinance would be, at a minimum, required to meet the standards in Appendix X of the Residential Code and Appendix O of the Building Code. Permit processing of applications for LBNC could become faster and more efficient, potentially reducing the workload of staff who typically review applications. May also reduce the need for extensive oversight and inspections by inspectors. However, staff will need to verify compliance with health and safety standards, namely fire safety, in coordination with the Five Cities Fire Authority, to ensure the safety of its residents. • AB 1820 – Housing Development Projects: Applications: Fees and Exactions. Requires local agencies to provide a preliminary fee and exaction estimate to any requesting development proponent within 30 business days of a request during the preliminary application process. Requires local agencies to provide a total sum of fees and exactions within 30 days of final approval of a project. o Impact: During the preliminary application process, and if requested, staff will provide a preliminary estimate of fees that may be required for their development project. Staff will adjust its procedures to include the total sum amount within the 30-day timeframe for housing development projects.
• AB 3012 – Development Fees: Fee Schedule Template: Fee Estimate Tool. Requires local agencies of our size to make a fee estimate tool available on their website that the public can use to estimate fees and exactions for a proposed housing development by January 1, 2032.
o Impact: In coordination with neighboring jurisdictions, staff will explore options for fee estimate tools and software. Staff will also reach out to its current contractor, Tyler Technologies, to identify opportunity to develop a fee estimate tool through the Enterprise Permitting and Licensing (EPL) software. • SB 937 – Development Projects: Fees and Charges. Requires local agencies to defer payment of mitigation fees until certificate of occupancy or final inspection for specified affordable housing projects. Requires developers who receive such deferrals to break ground on the project within five years.

Impact: Mitigation fees are typically imposed on developers to offset specific environmental or infrastructure impacts of their development, such as traffic mitigation, parks, or other public improvements. This does not include Development Impact Fees.

While this bill aims to incentivize developers to pursue affordable housing projects, implementation will result in a delay of funds impacting the City’s ability to offset the costs of public infrastructure and community services.
• AB 98 – Planning and Zoning: Logistics Use-Truck Routes. Beginning January 1, 2026, prescribes statewide warehouse design and build standards for any proposed new or expanded logistics use developments. Requires a facility operator to establish and submit for approval a truck routing plan to and from the State highway system, based on the city’s latest truck route map prior to issuance of a certificate of occupancy. o Impact: This bill requires an applicant to submit a truck routing plan to California Department of Transportation (Caltrans) for review and approval before issuance of a certificate of occupancy. The routing plan can be based on the City’s latest truck routing map; however, it appears each individual project/application will require Caltrans review and approval. This could lead to delay in issuance of certificate of occupancy for building permits contingent on Caltrans review times.

Staff will coordinate with Caltrans to strategize successful integration into the City’s current permitting process and avoid any delay in permit issuance subject to AB 98 approval.

City of Grover Beach
2024 2025 Legislative Platform
Approved by City Council February 13January 27, 20242025 Attachment 3
Contents
SECTION 1 – INTRODUCTION ................................................................................................... 1

1.1 General Purpose ............................................................................................................ 1

1.2 Authority ......................................................................................................................... 1

1.2.1 Adoption. ................................................................................................................. 1

1.2.2 City Manager Authority. ........................................................................................... 1

1.2.3 Limit to City Manager Authority. .............................................................................. 1

1.3 Distribution...................................................................................................................... 1 SECTION 2 – GENERAL GOVERNMENT ................................................................................... 1

2.1 Local Control .................................................................................................................. 1 SECTION 3 – LOCAL GOVERNMENT FINANCE........................................................................ 2 SECTION 4 – PUBLIC Safety....................................................................................................... 2

4.1 Emergency Response .................................................................................................... 2

4.2 Crime Reduction............................................................................................................. 2

4.3 Victim’s Rights ................................................................................................................ 3 SECTION 5 – TRANSPORTATION AND PUBLIC WORKS......................................................... 3

5.1 General Infrastructure..................................................................................................... 3 SECTION 6 – RESOURCES AND ENVIRONMENT .................................................................... 3

6.1 Water Resiliency............................................................................................................. 3

6.2 Organic Waste Disposal ................................................................................................. 3 SECTION 7 – COMMUNITY DEVELOPMENT............................................................................. 3

7.1 Housing and Homelessness........................................................................................... 3

7.2 Commercial Cannabis .................................................................................................... 4

7.3 Travel and Tourism......................................................................................................... 4 1 SECTION 1 – INTRODUCTION

1.1 General Purpose
The City of Grover Beach Legislative Platform (Platform) is adopted to formalize Council priorities and allow for expedient promotion of the City’s interests in legislative matters.

The Platform is designed to guide the Council and staff in taking appropriate action on legislative proposals and actions in the State and Federal governments.

1.2 Authority

1.2.1 Adoption - The Platform is developed with input from all City departments and is adopted by the City Council annually.

1.2.2 City Manager Authority – The City Manager or designee may take actions to support or oppose proposed legislation without prior approval of the City Council when consistent with the platform, provided that the City Council may set or change the City’s established position on any specific legislation even it inconsistent with this Platform’s general position.

1.2.3 Limit to City Manager Authority – The City Council will maintain sole authority to establish an initial position for any proposed legislation that would result in the matter coming before voters as a statewide ballot measure, such as California constitutional amendments, a statewide bond measure, or a measure amending a previously-approved statewide ballot measure.

1.3 Distribution
Upon the Council’s annual approval, the Legislative Platform shall be distributed to California’s U.S. Senators, U.S. Congressmembers, as well as all California State Constitutional offices representing the City, all California State Senator(s) and Assemblymember(s) representing the City, the National League of Cities and the League of California Cities.

SECTION 2 – GENERAL GOVERNMENT

2.1 Local Control
• Support legislation that enhances local control for various permitting, land use, contracting and discretionary actions and allows cities to address the needs of local communities within a framework of regional cooperation
• Oppose legislation that preempts local authority and impedes the City’s ability to address community needs.
• Oppose legislation that imposes unfunded or insufficiently funded mandates by the State.
2 SECTION 3 – LOCAL GOVERNMENT FINANCE
• Support legislation that protects, increases and/or modernizes revenue streams for local priorities.
• Support legislation to provide full and prompt reimbursement to all local agencies for all state-mandated programs and/or infractions and losses associated with local revenue shifts.
• Support legislation that creates streamlined and less competitive funding opportunities for cities with smaller budgets, geographical size and population, such as the City. • Support legislation that fully funds positions in State and Federal agencies that can accelerate the prompt administration of funding and reimbursements from those agencies to the City.
• Support legislation that sustains funding for grants awarded by the State or Federal government.
• Support legislation that allows for a future, voter-approved, SLOCOG transportationspecific revenue measure to be waived from the 2% local sales tax limits in San Luis Obispo County.
• Oppose legislation that mandates new duties, responsibilities or obligations to a City under state realignment.
• Oppose legislation that increases the threshold for voters to pass new or increased state or local taxes needed to fund local services and infrastructure. • Oppose legislation that eliminates or restricts control of or creates barriers to the City’s revenue sources.
• Oppose legislation that restricts the City’s ability to contract for goods or services or otherwise increases costs of contracting for goods or services.

SECTION 4 – PUBLIC SAFETY

4.1 Emergency Response
• Support legislation to provide funding for disaster prevention efforts, emergency response planning, and training and equipment for response and recovery efforts. • Support legislation to develop and implement statewide-integrated public safety communication systems.

4.2 Crime Reduction
• Support legislation to allow for greater crime reduction in the community. 3 • Support legislation to add fentanyl to the list of illegal substances subject to the existing weight enhancements for criminal sentencing.

4.3 Victim’s Rights
• Support legislation increasing the rights of victims of crimes.

SECTION 5 – TRANSPORTATION AND PUBLIC WORKS

5.1 General Infrastructure
• Support legislation providing funding for revolving loan fund programs to assist with financing capital costs of infrastructure improvements, including facility replacements. • Support legislation to expedite project delivery processes and expand project delivery methods for use by all cities for facilities and infrastructure. • Support legislation that secures state and federal fees and taxes originally programmed for roadway repairs, highway congestion management and transportation improvement projects.
• Oppose legislation that slows, impairs or eliminates funding for public infrastructure.

SECTION 6 – RESOURCES AND ENVIRONMENT

6.1 Water Resiliency
• Support legislation and administrative actions that provide funding or grant programs for energy and water efficiency improvements.
• Support legislation that provides funding for key water supply and infrastructure grant and loan programs.

6.2 Organic Waste Disposal
• Support legislation that provides additional funding or other assistance to implement organic waste disposal requirements.
• Support legislation providing funding for smaller cities to pursue carbon neutral solutions.

SECTION 7 – COMMUNITY DEVELOPMENT

7.1 Housing and Homelessness
• Support legislation to streamline all types of housing development while protecting the City’s permitting, fees and regulatory processes.
• Support legislation to providing funding mechanisms for infrastructure needed for housing development.
4 • Support legislation providing funding for homeless services and shelter projects and operations.
• Support legislation to allow the City more flexibility in creating shelters and temporary and permanent housing.
• Support legislation to provide funding for cleanup efforts as a result of homeless encampments.

7.2 Commercial Cannabis
• Support legislation that provides for reforms of regulatory barriers to the legal cannabis industry
• Support legislation that allows for the sale of food and non-alcoholic drinks at cannabis retailers that permit onsite consumption of cannabis products.

7.3 Travel and Tourism
• Oppose legislation that would reduce or eliminate online travel agencies or platforms from collecting and remitting Transient Occupancy Tax to local jurisdictions.

League of California Cities 2025 Advocacy Priorities

1. Protect local revenues and expand economic development tools. Safeguard and modernize revenue streams for local priorities. Pursue new economic development opportunities that bolster local economies and cultivate a strong local workforce, including expanded workforce recruitment and retention tools.

2. Strengthen climate change resiliency and disaster preparedness. Support city efforts to prepare, prevent, and adapt to natural disasters and the impacts of climate change, including wildfires, drought, sea level rise, and other extreme weather events. Increase transparency and access to insurance policies, especially following a natural disaster.

3. Strengthen and modernize critical infrastructure. Dedicate new resources and protect existing funding to maintain and improve essential infrastructure, including bridges, roads, broadband, and the state’s water supply and energy grid.

4. Secure investments to prevent and reduce homelessness and increase the supply of affordable housing. Secure dedicated funding to bolster cities’ long-term planning efforts to support unhoused residents and accelerate the construction of affordable housing. Strengthen state and regional partnerships to expand access to wraparound services and improve the housing element planning process. Ensure cities have the flexibility and decision-making authority to meet their community and state housing goals and reduce homelessness.

Attachment 4
Agenda Item No. 11

CITY COUNCIL STAFF REPORT
TO: Honorable Mayor and City Council DATE: January 27, 2025 FROM: Matthew Bronson, City Manager
PREPARED BY: Greg Ray, City Engineer/Public Works Director Erin Wiggin, CIP Project Manager
SUBJECT: Street Repair Update

RECOMMENDATION
Receive an update on the status of street maintenance and rehabilitation efforts along with an update on private streets south of Farroll Road

BACKGROUND
The City Council has identified “Street Maintenance and Complete Streets” as one of the Council’s FY 2023-25 Major City Goals. Since 2014, major maintenance or rehabilitation projects on residential streets have been completed using voter-approved Measure K-14 bond proceeds. The City is approaching the 10th year of the Measure K-14 program which provides up to $48 million in bond funds for repair of residential streets with an estimated timeframe of 25 years. Work on the remainder of city streets, which are generally arterial streets referred to as “major streets,” including 4th Street, Oak Park Boulevard, El Camino Real, West Grand Avenue, Farroll Road and The Pike, are funded from other sources including the General Fund, Gas Tax funds allocated by the State, Local Transportation Funds (LTF) allocated by the San Luis Obispo Council of Governments (SLOCOG), and outside grants. The City also currently spends approximately $180,000 annually in Gas Tax and LTF funds on localized asphalt repairs and pothole patching on both residential and major streets as a temporary solution until the street is fully rehabilitated.

These repairs are contracted out due to a lack of adequate staffing and equipment necessary to perform this work in house by City maintenance employees.

Measure K-14 Projects
To date, the City has completed maintenance or rehabilitation of nearly 320 city blocks, which represents over 70 percent of the streets included in the Measure K-14 program. Construction of the most recent Measure K-14 project was completed in June 2024 on Capital Improvement Program (CIP) 2295-16, which included rehabilitation of 20 blocks including portions of Front Street, N. 2nd Street, Saratoga Avenue, and Ramona Street. CIP 2295-18, a maintenance sealcoat project on streets previously repaired under the Measure K-14 program, is scheduled for this fiscal year. In general, the City is on a cycle of completing about one Measure K-14 project per fiscal year to continue the extensive progress in improving residential streets.

Staff would note that bid documents have been prepared for the next Measure K-14 street repair project (CIP 2295-17) which includes rehabilitation of 14 blocks including portions of N. 9th, N. 11th, and 12th Streets, Brighton and Ramona Avenues, and Moss Beach and Alma Courts.

However, construction on this project has been put on hold since 2024 due to the delay in related sewer upgrade work on affected streets caused by the uncertainty in sewer rates necessary to fund these improvements. This uncertainty continued with passage of Measure G-24 which Staff Report: Street Repair Update Page 2
January 27, 2025

reverted sewer rates to the rate structure adopted in 2021. Staff would not recommend proceeding with this street repair project until the sewer rate structure is modified to fund these necessary improvements or the Council provided direction to advance other street projects in place of this project or carry out these street improvements now and then dig up the streets later to do the sewer improvements.

Attachment 1 shows the Measure K-14 projects that have been completed and remaining residential streets to repair in the Measure K-14 program. Staff believes the remaining projects could be completed by 2032, which is ahead of the original program completion date of 2040.

However, continued project delays for utility work ahead of the street projects would delay this anticipated completion date. Looking ahead, approximately $13 million in available funding remains from the $48 million bond funding with nine more projects planned to address all residential streets. Since 2020, inflation has increased significantly, and construction costs have escalated on average 10-15% per year. Given the escalating construction costs, staff is forecasting a funding shortage of $3-4 million to fully complete the programmed Measure K-14 projects by 2032. This forecast is based on the assumption that inflation will stabilize to the typical 2%-4% range within the next 1-2 years. Additional funding to complete these projects would need to come from other sources including the General Fund. No immediate action on this long-term funding gap is needed as there is sufficient funding for more immediate projects though staff will continue to engage the Council over time in ways to address this funding gap in completing all residential street repairs.

Upon completion of all Measure K-14 projects, the estimated cost to maintain residential streets in good condition, a Pavement Condition Index (PCI) value of 65 or better, is $1.5 million per year.

The City has begun programming maintenance of previously rehabilitated Measure K-14 funded streets in the Capital Improvement Program starting in FY 2026-27 with a recurring annual maintenance project funded by the General Fund (CIP 2250-1). Additional projects and ongoing funding will need to be included in annual budgets in future years. Staff plans to conduct an updated field assessment of all Measure K-14 streets in FY 2025-26 to provide more accurate information on street conditions and an updated estimate of costs which will be used to inform the budget process for future maintenance and rehabilitation needs.

Lastly, the City’s sidewalk infill public/private partnership program has been available for property owner participation on streets where Measure K-14 projects are being completed. With this program, the City will fund half of the cost to construct concrete sidewalk, curb, and gutter improvements. As a result of this program, the number of property owners funding sidewalk improvements has increased from 1-2 per project to an average of 6-7 per project. The City’s contribution is funded with an annual budget allocation of between $50,000-$100,000 depending on the scope of the planned Measure K-14 project from the General Fund.

Major Streets Projects
Improvements to major arterial streets have been historically limited due to lack of resources for these repairs. However, in recent years, the City has received additional general revenues including cannabis tax revenues after the approval of Measure X-06 in 2016 and increased sales tax revenues particularly through the additional 1% sales tax approved with Measure F-20 in 2020.

As a result, the Council has allocated additional general revenue funding for major streets projects with a priority on streets that are heavily used or located with numerous businesses and residents.

Following recent improvements on South Oak Park Boulevard between West Grand Avenue and Mentone Avenue, the City has been working on the West Grand Avenue Streetscape Project (CIP 2287) which has been under construction since June 2024. This long-standing and significant Staff Report: Street Repair Update Page 3
January 27, 2025
project in the City’s primary commercial corridor includes pavement rehabilitation, landscaped medians, sidewalk and crosswalk improvements, street trees, and installation of storm drains along West Grand Avenue from 4th Street to 8th Street. Improving this section of West Grand Avenue is important to enhance the vibrancy of this commercial corridor as well as enable redevelopment focused on housing and commercial uses. Work on this project has experienced delays due to unplanned repairs needed on water mains given aging infrastructure and to upgrade the sewer main in South 4th Street including in the intersection of West Grand Avenue. The project’s utility work is complete with pavement work almost completed and the project is expected to be fully completed by April.

Three additional major street projects are programmed in the FY 2025-29 CIP over the next three years including North 4th Street (West Grand Avenue to Ocean View Avenue), West Grand Avenue (11thStreet to Oak Park Boulevard), and South Oak Park Boulevard (Mentone Avenue to The Pike). However, based on recent bid experience, the cost for these projects is anticipated to increase which could delay their construction timeline. More information will be shared with the Council on March 24 when the updated CIP is brought to the Council for review. The CIP also lists the unfunded needs for paving major streets which include El Camino Real, Farroll Road, The Pike, and S. 4th Street from Farroll Road to the southern City limit next to Oceano for a total estimated need of $12 million along with $500,000 in annual maintenance costs for all major streets. As of now, there is no funding identified for improvements on these major streets which is a challenge as these streets will need to be improved in the future.

Lastly, South 4th Street south of Highland Way to the city limit is particularly challenging given the condition of the street and underlying drainage issues from adjacent properties. This street section has historically been lightly traveled given the proximity to Highway 1 and 13th Street and has been closed to through traffic since early 2023 given storm damage. Repairing this street section requires a complex redesign to address the challenges with flooding and debris with a total estimated repair cost of approximately $5 million. Staff is preparing a grant application for a Feasibility Study to improve this street and add bike and pedestrian improvements. Pending the outcome of this study, the City may be in a better position to apply for a large grant, such as an Active Transportation Program grant for significant improvements. Staff will continue to engage the Council over time on ways to identify additional funding to meet these repair needs as part of the City’s CIP program.

Streets South of Farroll Road
The Council has previously provided direction to include the streets south of Farroll Road as part of the Measure K-14 street program. However, the program’s street projects approved by the Council lists these streets south of Farroll Road in the last set of projects due to issues regarding existing easements, dedications and ownership of streets in the area between private property owners and the City. Staff has conducted a thorough analysis of the City’s vested interest in the roads south of Farroll Road. While these roads were initially reserved for developers and their successors in interest according to the applicable 1926 resubdivision map of the area, identified as the Pismo Beach Gardens on the original subdivision map, the City has established significant vested rights through its long-term maintenance and improvement activities on these roads.

Support of the City’s vested rights is found in California Civil Code § 1009(d), which provides that a governmental entity can acquire vested rights in private land through public improvement and maintenance. The statute specifically states that when a governmental entity uses private lands through the expenditure of public funds on visible improvements and conducts maintenance related to public use in a manner where the owner knows or should know of such use, these actions confer upon the governmental entity a vested right to continue such use after five years, Staff Report: Street Repair Update Page 4
January 27, 2025
provided the owner neither gives express permission nor takes steps to prohibit such use.

Importantly, these rights include “any public use reasonably related to the purposes of such improvement.”
The City has firmly established these vested rights through its historical construction of the roads, ongoing improvements to the road infrastructure, and regular maintenance activities, all funded through public expenditure. These activities clearly meet the statutory requirements as they constitute visible improvements and maintenance related to public use. The long-term nature of these activities, extending well beyond the five-year statutory period, has solidified these rights.

The City's vested rights in these roadways, while substantial, are limited to the existing established road footprint and do not constitute ownership of the underlying property. These rights encompass basic road maintenance, traffic and parking regulation, street lighting installation and maintenance, drainage system implementation, and other standard street-related improvements necessary for public safety and convenience. While the City may utilize these roads for additional public infrastructure that could be considered "reasonably related to the purposes of such improvement," the determination of what constitutes a reasonable use is not definitive. The potential scope may include underground utilities such as water lines, sewer connections, storm drainage systems, electrical conduits, and telecommunications infrastructure, as well as surface improvements like sidewalks, pedestrian facilities, bicycle lanes, street lighting, and traffic calming measures. These uses may be considered reasonable as they relate to the road's primary purpose of providing public transportation infrastructure and align with modern street requirements. However, without property ownership, the City cannot expand beyond the established roadway footprint and any improvements must remain within these physical constraints.

It should also be noted that the City’s vested rights can be challenged by the private landowners to whom the land was reserved within the 1926 resubdivision map. Staff continues to explore opportunities to secure full ownership of these roadways through appropriate mechanisms, which would provide the City with comprehensive control and enable implementation of improvements typically associated with dedicated public rights-of-way, thereby enhancing the City's ability to serve the public interest effectively.

At this time, given the City's extensive history of maintaining and improving these roads, staff concludes that the City has established vested rights in the Pismo Beach Gardens roads and that these rights provide the City with the authority to continue maintaining and improving these roads as part of the larger street improvement program. Staff would add that currently there is not funding allocated for maintenance work on these streets prior to full rehabilitation in the future but this is something that could be included in the FY 2025-27 budget.

FISCAL IMPACT
There are no immediate fiscal impacts associated with this update.

ALTERNATIVES
The Council has the following alternatives to consider:

1. Receive an update on the status of Measure K-14 street rehabilitation projects and Major Street rehabilitation projects; or

2. Provide alternative direction to staff.

Staff Report: Street Repair Update Page 5
January 27, 2025

PUBLIC NOTIFICATION
The agenda was posted in accordance with the Brown Act.

Attachments

1. Map of Measure K-14 Street Projects

2. List of Future Measure K-14 Street Projects
Completed Projects
2295-1 thru 2295-16
Current Projects
2295-17
(project delayed due to sewer work delay)
Future Projects
2295-18 – 2295-24
(projects identified, not yet scheduled)
Map Rev 10-2-24
Attachment 1
Attachment 2

Agenda Item No. 12

CITY COUNCIL STAFF REPORT
TO: Honorable Mayor and City Council DATE: January 27, 2025 FROM: Matthew Bronson, City Manager
PREPARED BY: Matthew Bronson, City Manager
SUBJECT: West Grand Avenue Business Grant Program

RECOMMENDATION
Receive an overview of a potential grant program for businesses in the West Grand Avenue streetscape construction project work zone and adopt a Resolution to approve and implement the program.

BACKGROUND
On January 13, 2025 the Council directed staff to schedule an agenda item at the January 27, 2025 meeting regarding a grant program for businesses within the West Grand Avenue streetscape construction project zone from 9th Street to Highway 1. The Council expressed a desire to help businesses within this project area who have been experiencing loss of sales during the project construction time through providing direct City financial assistance. Such assistance would align with the City’s previous methods of supporting these businesses through Buy Local, Business Bingo, and Shop and Win programs carried out from June through December 2024.

Staff would note that the City also provided grants in 2020-2021 to businesses citywide experiencing financial hardships during the unprecedented COVID pandemic using a mix of funding sources including CARES Act funds, SB 1090 Diablo Canyon closure funds, American Rescue Plan Act funds, and the City’s General Fund.

Public funding for business support must be strictly limited to circumstances with a clearly defined and specific public purpose to avoid setting broader precedents. In this unique case, any consideration of a business grant program would be solely predicated on the unprecedented scope and duration of the West Grand Avenue streetscape project, the most extensive singlestreet improvement undertaking in the City’s history, and the distinctive impacts of this project on adjacent businesses. The extraordinary nature of this project and its prolonged effects on these specific businesses creates a narrowly defined situation that would justify contemplating such assistance.

This project is far more complex than a typical street repair project as it has involved extensive utility work both scheduled as part of the project scope such as the storm drain installation and unscheduled including several water main breaks due to aging infrastructure. There have been paving challenges as well given the need for adequate paving foundation for a street with 15,000- 20,000 car trips daily. As a result, the project has frequently blocked street and driveway access to numerous businesses at various times which has impacted customer access. In addition, nearby businesses outside of the direct construction zone (4th to 8th streets) have reported loss of sales from customers not wanting to travel in or through the construction zone to get to their business. While the project is anticipated to be completed by April, there is concern among businesses about lingering financial impacts from the construction and reticence by some customers in returning to this area.

Staff Report: West Grand Avenue Business Grant Program Page 2 January 27, 2025

Pursuant to Council direction, staff proposes a grant program where, similar to the COVID grant and other business support initiatives, the City would work with the South County Chambers of Commerce (Chamber) in coordinating, promoting, and administering this program. The Chamber would create an online application form that businesses could complete and submit similar to the online applications used for the COVID grants. Any business in the project area could apply with a recommended priority given to businesses that are public facing such as restaurants, cafes, and personal care services.

The recommended grant amount is up to $2,000 and is intended to cover employee costs, rent, utilities, or other operating expenses. Staff proposes that the City provide up to 20 grants through this program with applications reviewed by a City-Chamber review committee, including at least one member of the Council. Applications should include documented examples of financial hardships which would be the primary criteria for determining grant awards. Recommended recipients will then be brought to the Council for approval with checks distributed shortly afterwards with grant reporting at a later date. Recipients must have a valid Business Tax Certificate. Funding for this grant program will come from General Fund reserves as a mid-year adjustment brought to the Council for approval in February.

Below is a summary of potential timeframes for this program if approved by the Council:
• Open application process: Week of February 10
• Close application process: March 7
• Review applications: Mid-Late March
• Recommend recipients for approval: April 14
• Disburse checks to recipients: April 30
• Grant reporting deadline for recipients: June 30

FISCAL IMPACT
The fiscal impact of this program is estimated to be $45,000 assuming $2,000 per grant for 20 recipients along with reimbursement of administrative costs to the Chamber. The funding for this program is recommended to come from General Fund reserves.

ALTERNATIVES
The Council has the following alternatives to consider:

1. Receive an overview of a potential grant program for businesses in the West Grand Avenue streetscape construction project work zone and adopt a Resolution to approve and implement the program; or

2. Provide alternative direction to staff.

PUBLIC NOTIFICATION
The agenda was posted in accordance with the Brown Act.

Attachments

1. Resolution Approving Business Assistance Grant
RESOLUTION NO. 25-

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF GROVER BEACH,

CALIFORNIA, ESTABLISHING A ONE-TIME BUSINESS ASSISTANCE GRANT

PROGRAM FOR BUSINESSES IMPACTED BY THE WEST GRAND AVENUE

STREETSCAPE PROJECT
WHEREAS, the City of Grover Beach (“City”) is undertaking the West Grand Avenue Streetscape Project from 9th Street to Highway 1, representing the most extensive single-street improvement project in the City’s history; and
WHEREAS, this extraordinary infrastructure project has involved complex utility work, including both planned storm drain installation and emergency responses to multiple water main breaks, along with substantial paving requirements to accommodate daily traffic volumes of 15,000-20,000 vehicles; and
WHEREAS, the unprecedented scope and duration of this project has resulted in unique and substantial impacts to businesses located within and adjacent to the project area through restricted access, disrupted operations, and decreased customer traffic; and WHEREAS, the City Council recognizes that the extraordinary circumstances of this specific project have created distinctive hardships for affected businesses that warrant consideration of targeted assistance; and
WHEREAS, any public funding to support private businesses must be strictly limited to circumstances with a clearly defined and specific public purpose to avoid setting broader precedents; and
WHEREAS, the City Council finds that maintaining the economic vitality of the West Grand Avenue corridor during and immediately following this unprecedented public infrastructure project serves a specific and narrow public purpose.

NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Grover Beach, California as follows:

1. The City Council hereby establishes a one-time West Grand Avenue Business Assistance Grant Program specifically limited to businesses located within or immediately adjacent to the West Grand Avenue Streetscape Project area that can demonstrate financial impacts directly related to the project construction.

2. The program parameters shall include:
a. Individual grants not to exceed $2,000 per business; b. A total program allocation not to exceed $45,000 from General Fund reserves; c. Eligibility limited to businesses with valid Business Tax Certificates; d. Priority consideration for public-facing businesses such as restaurants, cafes, and personal care services;
e. Required documentation of financial hardship directly related to the project; and f. Final approval of grant recipients by the City Council.

Attachment 1
Resolution No. 25- Page 2

3. The City Manager or designee is hereby authorized and directed to:
a. Develop and implement program policies and procedures consistent with Council’s intent and direction in creating this program;
b. Create necessary application forms and documentation requirements; c. Enter into an agreement with the South County Chambers of Commerce for program administration; and
d. Take all other actions necessary for program implementation consistent with this Resolution.

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

On motion by Council Member _____, seconded by Council Member ____, and on the following roll-call vote, to wit:

AYES: Council Members –
NOES: Council Members –
ABSENT: Council Members –
ABSTAIN: Council Members –
RECUSED: Council Members –
the foregoing Resolution was PASSED, APPROVED, and ADOPTED at a regular meeting of the City Council of the City of Grover Beach, California this 27TH day of January 2025.

KASSI DEE, MAYOR
Attest:

WENDI B. SIMS, CITY CLERK