Approved October 1, 2020
3 Planning Commission Regular Meeting September 3, 2020 Minutes Assistant Planner Jeremy Loh presented the staff report.
Stuart Welty, project architect, presented the project, noting that they met with the neighbors and made design revisions to address their concerns.
Public Comment
Elizabeth Lee, appellant, noted that she had withdrawn the appeal based on the design revisions, but expressed concerns about the condition of the site and requested that it be cleaned up.
Linda Membreno, a neighbor, expressed concerns about the debris on the property and condition of the pool and requested that it be cleaned up.
Gil Heydari, a neighbor, expressed concerns about the condition of the site.
Stuart Welty noted that the owner had plans to clean the site and drain the pool.
Chair Patel closed the PUBLIC HEARING.
Commission Discussion
Commissioner Waschura expressed general support for the revised project design but expressed concern about the poor condition of the site.
Commissioner Couperus expressed support for the revised project design but noted that the poor condition of the site could constitute a public nuisance.
Vice-Chair Indaco, Commissioner Smith and Chair Patel agreed with the earlier comments.
MOTION MADE AND SECONDED: Motion by Commissioner Waschura to deny the Appeal and approve Site Development Permit #SD18-0063, as indicated in the staff report with the updated design, subject to the conditions of approval in Attachment 1.
The motion was seconded by Vice-Chair Indaco.
AYES: Commissioner Couperus, Commissioner Smith, Commissioner Waschura, Vice-Chair Indaco, Chair Patel
NOES: None
ABSENT: None
ABSTAIN: None
MOTION: Carried 5-0
4.2 Municipal Code Amendment – File #SP20-0008 – Town of Los Altos Hills Consider amendments of the Town of Los Altos Hills Municipal Code to relocate the tree and landscape regulations from Chapter 2 in title 12 (Trees, Shrubs and Plants) to Chapter 1 in Title 10 (Zoning), expand the species of the trees that are protected and require a permit to remove; update requirements related to replacement trees and tree protection during construction, and update requirements related to enforcement of nonPage 129 of 406 Approved October 1, 2020
4 Planning Commission Regular Meeting September 3, 2020 Minutes permitted tree removals.
Project Planner: Jeremy Loh
Before opening the public hearing on this agenda item, Chair Patel advised members of the public that the goal on this item was to hear public feedback and explained the process for this hearing.
Chair Patel opened the PUBLIC HEARING.
Planning Director Dahl noted that staff from the Los Altos Hills Fire District were present and available to answer questions related to fire prevention issues.
Assistant Planner Jeremy Loh presented the staff report.
The Commissioners asked clarifying questions of staff.
Environmental Design and Protection members Vijay Chawla and Peter Brown presented the Committee’s recommendations for amending the Town’s Tree Protection Ordinance and provided background information on why the recommendations were being made.
Public Comment
Phil Mahoney, a Los Altos Hills resident, spoke against expanding the tree protection ordinance to include additional tree species, noting that the focus should be fire safety.
Kit Gordon, a Los Altos Hills resident, spoke in favor of expanding the tree protection ordinance to include additional native tree species
Bob Sandor, a Los Altos Hills resident, spoke against expanding the tree protection ordinance.
Susie Mielke, a Los Altos Hills resident, spoke against the proposal of expanding the tree protection ordinance to include additional tree species, noting that the focus should be fire safety.
Neal Mielke, a Los Altos Hills resident, spoke against the proposal of expanding the tree protection ordinance to include additional tree species, noting that property owners should be allowed to remove smaller trees without a permit.
Sasha Zbozek, a Los Altos Hills resident, spoke against the proposal of expanding the tree protection ordinance to include additional tree species, noting that requiring a permit to remove a dead oak was excessive.
Bridget Morgan, a Los Altos Hills resident, read a statement from the founders from the Town and stated her opposition to expanding the tree protection ordinance.
SC Miao, a Los Altos Hills resident, spoke against expanding the tree protection ordinance.
A. James Scholz, a Los Altos Hills resident, spoke against expanding the tree
Approved October 1, 2020
5 Planning Commission Regular Meeting September 3, 2020 Minutes protection ordinance, noting that the focus should be fire safety.
Carol Gottlieb, a Los Altos Hills resident, spoke in favor of a public dialogue to determine how best to update the tree protection ordinance and provided background on the EDPC’s recommendation to protect additional native tree species.
Chuen-Der Lien, a Los Altos Hills resident, spoke against expanding the tree protection ordinance, noting that the focus should be on improving fire safety.
S. Jones, a Los Altos Hills resident, would like to thoroughly review the current tree ordinance and the proposed changes.
Peter Brown, on behalf of the EDPC, offered a rebuttal to comments and provided additional information about the basis for the recommendations.
Commissioner Couperus provided clarification about the roles of the Los Altos Hills Fire District and Santa Clara County Fire District regarding fire safety and brush/tree removals.
Denise Gluhan, a Los Altos Hills Fire District Consultant, spoke about the Los Altos Hills Fire District and addressed resident concerns regarding fire safety.
Chair Patel closed the PUBLIC HEARING.
Commission Discussion
Chair Patel noted that the goal of this hearing was to receive public comment and provide staff with direction on how to proceed with updates to the Town’s current tree protection ordinance.
Commissioner Couperus offered responses to some public comments with regard to fire safety concerns and expressed interest in expanding protections to other native tree species but noted the need to reassess the proposed list of protected trees.
Commissioner Waschura noted the need to have a tree protection ordinance that works for Los Altos Hills, regardless of what neighboring communities have adopted, that fire safety should be incorporated, that the size of a protected oak tree should be increased, focus should be on protecting large native trees, and consider adding a definition of nuisance trees as a way to promote fire safety.
Commissioner Smith expressed opposition to expanding the list of protected trees, noting that it would be hard to enforce that that volunteer oak trees should not be protected.
Vice-Chair Indaco shared a presentation and highlighted the delicate balance with the multitude of issues facing residents and new development projects. She suggested a formation of a committee with different interests represented that could be a path forward. She proposed to keep the Heritage Oak protection sections the same and separate even if redundant. As well as, review the proposed tree ordinance for accuracy and clarity.
Approved October 1, 2020
6 Planning Commission Regular Meeting September 3, 2020 Minutes Chair Patel offered his comments regarding the cost of fire safety enforcement.
Chair Patel expressed interest in expanding the ordinance to protect mature native trees, but noted that fire safety needed to be a consideration, any expanded tree protections must be balanced with property owners ability to manage their property, and that he supported increasing the size of protected oak trees.
Following a final discussion, Chair Patel provided a summary of the Commission’s direction that should staff consider when updating the draft of Tree Protection Ordinance:
• Do not change the size of a protected Heritage Oaks;
• Provide an updated list of native trees species with a size that can be used to define mature that the Commission can consider;
• Consult with an arborist to determine an appropriate size for when a mature native trees species should be protected;
• The Fire District and/or the Fire Department should review the updated ordinance and provide input with regard to fire safety; and
• Provide a definition for a nuisance tree with regard to fire safety.
NO MOTION
5. REPORTS FROM THE CITY COUNCIL MEETINGS
5.1 Past Meetings
• August 20, 2020 – Chair Patel
Chair Patel provided a summary of the August City Council meeting.
5.2 Upcoming Meeting Assignments
• September 17, 2020 – Commissioner Waschura
• October 15, 2020 – Commissioner Couperus
• November 19, 2020 – Vice-Chair Indaco
Chair Patel confirmed meeting assignments with the Commission.
6. REPORTS FROM FAST TRACK / SITE DEVELOPMENT MEETINGS
6.1 August 11, 2020
• 26685 Purissima Road – File #SD20-0030 – Lands of Stemm and Hsia Site Development Permit for a new 3,542 sq.ft. two-story residence with an attached two-car garage.
• 24490 Amigos Court – File #SD20-0033 – Lands of Teng
Site Development Permit for a new 5,076 sq.ft. single story residence with an attached garage, detached 663 sq.ft. accessory dwelling unit (ADU), and 600 sq.ft. pool. • 24160 Dawnridge Drive – File #SD20-0040 – Lands of Andrews Site Development Permit for a new 5,351 sq.ft. two-story residence with a 3,729 sq.ft.
Approved October 1, 2020
7 Planning Commission Regular Meeting September 3, 2020 Minutes basement and attached ADU.
6.2 August 18, 2020
• 12830 Deer Creek Lane – File #SD20-0051 – Lands of Badhwar Site Development Permit for a new 880 sq.ft. pool and spa and related hardscape improvements.
6.3 September 1, 2020
• 13505 Burke Road – File #SD20-0049 – Lands of Williams Site Development Permit for landscape screening and new fencing for an approved single-story residence and pool house.
Planning Director Dahl provided a brief summary of the past three Site Development Fast Track Public Hearings.
7. PLANNING DIRECTOR REPORT
Planning Director Dahl provided an update on the status of the Town’s Accessory Dwelling Unit Ordinance, noting that the State had required that additional changes be made prior to adoption.
8. ADJOURNMENT
Meeting was adjourned at 10:40PM.
Respectfully submitted,
Digitally signed by Keren Brunner
Keren Brunner
Planning Technician
The minutes of the September 3, 2020 Regular Planning Commission Regular meeting were approved as presented at October 1, 2020 Planning Commission Regular meeting.
TOWN OF LOS ALTOS HILLS March 20, 2025
Staff Report to the City Council
SUBJECT: RESOLUTION AWARDING A CONSTRUCTION CONTRACT TO SMELLY MEL’S PLUMBING, INC. FOR 2025 SANITARY SEWER REPAIR AND REPLACEMENT PROJECT FOR $720,000, INCLUDING CONSTRUCTION
CONTINGENCY
FROM: WooJae Kim, Public Works Director
Daniel Liang, Utility Engineering Manager
APPROVED: Peter Pirnejad, City Manager
RECOMMENDATION: That the City Council approve a resolution (Attachment 1) that:
1. Award a construction agreement for the 2025 Sanitary Sewer Repair and Replacement Project to Smelly Mel’s Plumbing, Inc., the lowest responsible and responsive bidder, not to exceed $601,580 and authorize the City Manager to execute a construction agreement; and
2. Approve project contingency funds of $118,420 and authorize the Public Works Director to approve potential contract change orders within the said fund.
BACKGROUND:
The annual sanitary sewer repair and rehabilitation program is to maintain and improve the Town’s sanitary sewer system to allow safe and reliable conveyance of wastewater to the Palo Alto Regional Water Quality Control Treatment Plant through the collection systems of the Cities of Palo Alto and Los Altos. The proposed project will replace damaged and deteriorated sanitary sewer main pipes located within street right-of-ways and easement areas at various locations throughout the Town.
As approved in the Adopted Operating and Capital Budgets for FY 2024-2025 and FY 2025-2026, $900,000 of Sewer Funds are appropriated for each fiscal year for the annual sanitary sewer repair and rehabilitation projects. On January 29, 2025, the City Council approved the Plans and Specifications for the 2025 Sanitary Sewer Repair and Replacement Project and authorized staff to advertise the project for formal bid.
Per the newly updated Purchasing System Ordinance, Town’s Municipal Code section 2-
4.04(b)(2), states “procurement of public projects valued at more than two hundred thousand dollars ($200,000) shall be submitted for formal bidding.” For formal bids, “the notice for inviting bids shall be advertised upon authority of the City Council, and such advertisement shall be published two times in a newspaper of general circulation published nearest to the Town, and in ITEM 5E
WK
DL
PP
Staff Report to City Council Page 2
2025 Sewer Repair and Replacement Contract Award
March 20, 2025
addition, invitations to bid may be mailed to prospective vendors at the discretion of the City Manager.”
In 2024, the Town prepared the Collection System Asset Management Plan (CSAMP) working with V.W. Housen & Associates to develop a mathematical risk management model to calculate a risk score for each gravity flow sewer segment based on “likelihood and consequence of failure paraments” such as unresolved sewage spills, structural and operations/maintenance defects, Pipeline Assessment & Certification Program (PACP) scores, liquefaction potential, pipe capacity, level of service, proximities to waterways/main roadways/schools, pipe diameter, and pipe material. The different paraments are given criteria for weighted scores, and the sewer main segment risk score is tabulated from the summation of all criteria scores. A risk score can range from 1 to 3150, with 1 being of the lowest risk of failure. Through the risk model, 33 sewer pipe segments with a risk score of over 800 were identified, 800 being an arbitrary risk score set to trigger repairs or improvements needed.
DISCUSSION:
Project Description
The project will improve ten sewer segments, install two new manholes, locate an existing buried manhole, reconnect a sewer lateral to remove a protruding pipe, and repair one existing manhole.
Six of the ten sewer pipe segments in the 2025 sewer project have a CSAMP risk score of over 800.
The ten segments comprise of 1,887 linear feet of sewer pipes, which include 489 linear feet of existing sewer pipes to be improved by the trenchless pipe bursting method, 1,232 linear feet by the open trench method, and 166 linear feet by the Cured-in-place method. See Attachment 2 for the sewer segments and manholes.
Advertising-Bid Process and Results
Staff prepared the bid documents and estimate in-house. A Notice to Bidders was published twice in the Los Altos Town Crier and posted on the Town's website. Staff sent the Notice to Bidders to Builders Exchanges, covering Alameda County, Santa Clara County, Contra Costa County, the Peninsula area, and the San Francisco Bay Area.
Four (4) bids were received and opened on February 20, 2025. The low bid is determined by the total of base bids and add alternates. The lowest responsible bidder is established as Smelly Mel’s Plumbing, Inc., with the bid amount of $601,580. The lowest bid is below the engineer’s estimate is $765,000. A detailed breakdown of all bid items is included as Attachment 3. The bids received are summarized as follows:
Staff Report to City Council Page 3
2025 Sewer Repair and Replacement Contract Award
March 20, 2025
No Company Base Add Alternates TOTAL
1 Smelly Mel’s Plumbing $ 395,620 $ 202,960 $ 601,580
2 APB General Engineering $ 347,175 $ 281,650 $ 628,825 3 EPS Inc dba Express Plumbing $ 434,310 $ 225,650 $ 659,960 4 California Trenchless Inc. $ 985,080 $ 385,000 $ 1,370,080 Recommendations
Staff recommends that the City Council approve a resolution to accept Smelly Mel’s Plumbing as the lowest responsible and responsive bidder for the 2025 Sanitary Sewer Repair and Replacement Project and authorize the City Manager to execute a construction agreement not to exceed $601,580 (Attachment 4); and approve project contingency funds of $118,420 for the Public Works Director to approve potential change orders within the said fund.
Staff will inspect and manage the construction of this project in-house. The breakdown of construction project costs is as follows:
Construction Contract $ 601,580.00
Project Contingency $ 118,420.00
Total Estimated Construction Cost $ 720,000.00
Project Schedule
The following is the tentative schedule for this project. An actual schedule will be developed and confirmed with the contractor based on completion of the required contract documents, approval of pre-submittals, and their availability.
Award Construction Contract March 20, 2025
Begin Construction May 2025
Complete Construction October 2025
ENVIRONMENTAL REVIEW
Repair and maintenance of publicly owned utilities used to provide sewerage is defined under California Environmental Quality Act (CEQA) Section 15301(b) as Categorically Exempt. 2024-25 CITY COUNCIL WORK PLAN:
This action is identified on the 2024 and 2025 City Council Work Plan under Protect & Maintain Infrastructure Priority for Sewer Rehabilitation and Repair.
Staff Report to City Council Page 4
2025 Sewer Repair and Replacement Contract Award
March 20, 2025
FISCAL IMPACT:
There is no fiscal impact associated with the recommendation. The amount appropriated for the annual Sanitary Sewer Replacement and Rehabilitation Project is $900,000 from the Sewer Enterprise Funds for FY2024-25, and another $900,000 for FY2025-26. There is also approximately $330,750 in carry forward funds from previous fiscal years. The 2025 Sanitary Sewer Repair and Replacement Project will span two fiscal years. No additional appropriation is needed for this project.
ATTACHMENTS
1. Resolution
2. List of Project Segments
3. Detailed Bid Summary
4. Construction Agreement – Smelly Mel’s Plumbing, Inc.
RESOLUTION NO. ____-25
A RESOLUTION OF THE CITY COUNCIL OF THE
TOWN OF LOS ALTOS HILLS AWARDING A CONSTRUCTION
AGREEMENT OF THE 2025 SANITARY SEWER REPAIR AND
REPLACEMENT PROJECT
WHEREAS, per the Adopted Operating and Capital Budgets for FY 2024-2025 and FY 2025-2026, $900,000 of Sewer Funds are appropriated for each fiscal for the annual sanitary sewer repair and rehabilitation projects; and
WHEREAS, on January 29, 2025, the City Council approved the Plans and specifications for the 2025 Sanitary Sewer Repair and Replacement Project and authorized staff to advertise the project for formal bid; and
WHEREAS, Notice to Bidders were advertised for the project on February 5, 2025, and four bids were received and opened on February 20, 2025; and WHEREAS, the Utility Engineering Manager of the Town of Los Altos Hills did, in open session, duly examine and consider all bids submitted to it for the construction of the 2025 Sanitary Sewer Repair and Replacement Project; and
WHEREAS, staff recommends that the construction agreement for said project be awarded to the lowest responsible bidder, Smelly Mel’s Plumbing, Inc., in the amount of $601,580; and
WHEREAS, staff recommends that funds of $118,420 be made available for construction contingency.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the Town of Los Altos Hills that:
1. A construction agreement for the 2025 Sanitary Sewer Repair and Replacement Project is awarded to Smelly Mel’s Plumbing, Inc., the lowest responsible and responsive bidder for $601,580, and the City Manager is hereby authorized to execute the construction agreement.
2. The Public Works Director is hereby authorized to approve potential contract change orders not to exceed $118,420.
The above and foregoing resolution was passed and adopted by the City Council of the Town of Los Altos Hills at a regular meeting held on the 20th day of March 2025 by the following vote:
AYES:
NOES:
ITEM 5E, Attachment 1
ABSTAIN:
ABSENT:
By:
Kavita Tankha, Mayor
ATTEST:
Arika Birdsong-Miller, City Clerk
ATTACHMENT 2
2025 Sanitary Sewer Repair and Replacement Project
List of Project Segments
Drawing Location USMH DSMH
Repair
Length (ft) Method Nearest Street
C-101 1 EMH1171 EMH1174 292 Open trench St Francis Rd
C-102 2 OMH1064 OMH1065 233 Pipe bursting La Loma Dr
C-103 3 KMH1083 KCO1084 154 Pipe bursting Ridgewood Ln
C-104 4 EMH1155 EMH1154 102 Pipe bursting St Francis Rd C-105 5 CMH1001 CMH1002 118 Open trench Saltamontes Way C-106 6 PMH1124 PMH1127 78 Open trench Oak Park Ct
C-107 7 BMH1041 BMH1037 166 CIPP Ohlone Ln
C-108 8 ECO1024 New Manhole Beaver Ln
C-109 9 ACO1002 New Manhole Liddicoat Cir
C-110 10 OMH1079 OMH1080 296 Point Repair La Loma Dr
C-111
Alternate 1 11 LMH1119 LMH1120 180 Open trench Adobe Ln C-112
Alternate 2 12 OMH1049 OMH1050 322 Open trench Rhus Ridge Dr C-113
Alternate 3 13 PMH1136 PMH1135 242 Open trench Dawson Dr C-114
Alternate 4 14 KMH1123 Manhole Repair Moody Rd
C-115
Alternate 5 15 LMH1034 Manhole Repair Normandy Ln
ITEM 5E, Attachment 2
ATTACHMENT 3: DETAILED BID SUMMARY
2025 Sanitary Sewer Repair and Replacement Project
3/3/2025
Item No. Description Quantity UNIT Unit Price Amount Unit Price Amount Unit Price Amount Unit Price Amount 1 Location 1 – St Francis Rd (Easement) Open Trench - Replace existing 6" VCP with 8" PVC SDR26 292 LF $ 240 $ 70,080 280$ $ 81,760 300$ $ 87,600 1,400$ $ 408,800 2 Location 2 – La Loma Dr (Easement) Pipe Bursting - Replace existing 6" VCP with 8" HDPE SDR-17 233 LF $ 240 $ 55,920 195$ $ 45,435 200$ $ 46,600 450$ $ 104,850 3 Location 3 – Ridgewood Ln (Easement) Pipe Bursting - Replace existing 6" VCP with 8" HDPE SDR-17 154 LF $ 240 $ 36,960 195$ $ 30,030 200$ $ 30,800 450$ $ 69,300 4 Location 4 – St Francis Rd (Street) Pipe Bursting - Replace existing 6" VCP with 8" HDPE SDR-17 102 LF $ 240 $ 24,480 210$ $ 21,420 215$ $ 21,930 350$ $ 35,700 5 Location 5 – Saltamontes Way (Street & Easement) Open Trench - Replace existing 6" VCP with 10” PVC SDR26 118 LF $ 320 $ 37,760 325$ $ 38,350 315$ $ 37,170 885$ $ 104,430 6 Location 6 – Oak Park Ct (Easement with AC Pavement) Open trench - Replace existing 6" VCP with 8" PVC SDR26 78 LF $ 240 $ 18,720 280$ $ 21,840 315$ $ 24,570 250$ $ 19,500 7 Location 7 – Ohlone Ln (Street shoulder) Cured-in-place - Rehabilitate existing 8" CIP 166 LF $ 200 $ 33,200 240$ $ 39,840 240$ $ 39,840 250$ $ 41,500 8 Location 8 – Beaver Ln (Street), New manhole 1 LS $ 15,000 $ 15,000 6,500$ $ 6,500 $ 18,000 $ 18,000 8,000$ $ 8,000 9 Location 9 – Liddicoat Cir (Easement), New manhole 1 LS $ 15,000 $ 15,000 4,500$ $ 4,500 $ 18,000 $ 18,000 8,000$ $ 8,000 10 Location 10 – La Loma Dr (Easement)Point repair – Reconnect existing sewer lateral to 8”HDPE Main with new electrofusion saddle 1 LS $ 10,000 $ 10,000 8,500$ $ 8,500 4,500$ $ 4,500 8,000$ $ 8,000 11 Reconnect existing sewer lateral to 8” HDPE Main with electrofusion saddle at Location 2 1 EA $ 5,000 $ 5,000 1,000$ $ 1,000 4,500$ $ 4,500 6,000$ $ 6,000 12 Reconnect existing sewer lateral to 8” PVC Main with inline 8”x4” PVC inline fitting at Locations 1 and 6 2 EA $ 7,500 $ 15,000 1,000$ $ 2,000 4,000$ $ 8,000 6,000$ $ 12,000 13 Reconnect existing sewer lateral to 10” PVC Main with inline 10”x4” PVC inline fitting at Location 5 1 EA $ 7,500 $ 7,500 1,500$ $ 1,500 4,500$ $ 4,500 15,000$ $ 15,000 14 Raise the frame for Manhole CMH1002 by 1 ft with 3-inch concrete risers, and construct a concrete collar around at Location 5 1 LS $ 5,000 $ 5,000 1,500$ $ 1,500 4,800$ $ 4,800 5,000$ $ 5,000 15 Reconnect sewer main to existing manhole, and modify concrete flow channel in manhole at Locations 1 to 6 11 EA $ 2,000 $ 22,000 1,000$ $ 11,000 4,500$ $ 49,500 6,500$ $ 71,500 16 Mobilization/Demobilization 1 LS $ 20,000 $ 20,000 $ 25,000 $ 25,000 $ 20,000 $ 20,000 50,000$ $ 50,000 17 Post-Installation cleaning, and color CCTV inspection at Locations 1 to 7 7 EA $ 1,000 $ 7,000 1,000$ $ 7,000 2,000$ $ 14,000 2,500$ $ 17,500 18 ALTERNATE 1 (Location 11 Adobe Lane) Open Trench – replace 6” ACP with 10” PVC SDR26, 180 LF 1 LS $ 57,600 $ 57,600 $ 60,900 $ 60,900 $ 56,000 $ 56,000 85,000$ $ 85,000 19 ALTERNATE 2 (Location 12 Rhus Ridge Dr) Open Trench – replace 6” ACP with 8” PVC SDR26, 322 LF 1 LS $ 77,280 $ 77,280 $ 131,250 $ 131,250 $ 92,000 $ 92,000 $ 161,000 $ 161,000 20 ALTERNATE 3 (Location 13 Dawson Dr) Open Trench – replace 6” VCP with 8” PVC SDR26, 242 LF 1 LS $ 58,080 $ 58,080 $ 84,000 $ 84,000 $ 68,650 $ 68,650 $ 133,000 $ 133,000 21 ALTERNATE 4 (Location 14 Moody Rd) Remove protruding sewer main in the manhole 1 LS $ 5,000 $ 5,000 2,750$ $ 2,750 4,200$ $ 4,200 3,500$ $ 3,500 22 ALTERNATE 5 (Location 15 Normandy Ln) Raise manhole frame and cover to grade. 1 LS $ 5,000 $ 5,000 2,750$ $ 2,750 4,800$ $ 4,800 2,500$ $ 2,500 Base $ 347,175 398,620 $ 434,310 $ 985,080 $
Add Alternates $ 281,650 202,960 $ 225,650 $ 385,000 $
Total $ 628,825 601,580 $ 659,960 $ 1,370,080 $
SMP APB General Engr EPS California Trenchless
ITEM 5E, Attachment 3
TOWN OF LOS ALTOS HILLS
STATE OF CALIFORNIA
CONTRACT
2025 SANITARY SEWER REPAIR AND REPLACEMENT PROJECT
THIS AGREEMENT, made, executed, and entered into this _____ day of _____________, 2025, by and between the Town of Los Altos Hills a General Law City, hereinafter referred to as the Town, and SMELLY MEL’S PLUMBING, INC. , hereinafter referred to as the Contractor.
W I T N E S S E T H
ARTICLE 1. That for and in consideration of the payments and agreements hereinafter mentioned to be made and performed by the Town, the Contractor agrees at its own cost and expense to do all the work and furnish all materials necessary to complete in a good workmanlike and substantial manner all that certain work involved and concerned with the 2025 SANITARY SEWER REPAIR AND REPLACEMENT PROJECT said work shall be done in manner and according to the terms of the Contract as the same is defined in Article 4 herein.
ARTICLE 2. Said Contractor agrees to receive and accept the following prices as full compensation for furnishing all materials and doing all the work contemplated and embraced in this agreement; also for all loss or damage arising out of the nature of the work aforesaid, or from the acts of the elements, or from any unforeseen difficulties or obstructions which may arise or be encountered in the prosecution of the work until its acceptance by the Town and for all risks of every description connected with the work; also for all expenses incurred by or in consequence of the suspension or discontinuance of the work and for well and faithfully completing the work and the whole thereof, in the manner and according to the plans and specifications, to wit, according to Contractor’s proposal for “TOTAL BASE BID PLUS ALTERNATE BID ITEMS (1 – 22)” to the City Council, entitled EXHIBIT "A”, BID PROPOSAL TO THE CITY COUNCIL and attached hereto.
Bid Description
Estimated
Quantity UNIT
Total
(in figures)
BASE Bid Items 1 through 17 (Locations 1 to 10) 1 LS $ 398,620 ALTERNATE 1 Bid Item 18 (Location 11 Adobe Lane) 1 LS $ 57,600 ALTERNATE 2 Bid Item 19 (Location 12 Rhus Ridge Dr) 1 LS $ 77,280 ALTERNATE 3 Bid Item 20 (Location 13 Dawson Dr) 1 LS $ 58,080 ALTERNATE 4 Bid Item 21 (Location 14 Moody Rd) 1 LS $ 5,000 ALTERNATE 5 Bid Item 22 (Location 15 Normandy Ln) 1 LS $ 5,000 TOTAL $601,580
Six Hundred One Thousand Five
Hundred and Eighty Dollars
ARTICLE 3. The Town hereby promises and agrees with the Contractor, to employ, and does employ, hereby, said Contractor to provide the materials and to do the work according to the terms and conditions herein contained and referred to, for the prices aforesaid, and hereby contracts to pay the same at the time, in the manner and upon the conditions above set forth; and the said parties for themselves, their heirs, executors, administrators, successors, and assigns, do hereby agree to the full performance of the covenants herein contained.
ITEM 5E, Attachment 4
ARTICLE 4. The complete Contract consists of the following documents: Notice to Bidders, Proposal, Contract, Specifications and the Plans and/or Drawings. The rights and obligations of the parties herein are governed by all of said documents, which are to be construed as a single Contract. The decision of the Public Works Director of the Town of Los Altos Hills as to the interpretation of said Contract shall be final and binding on the parties hereto.
ARTICLE 5. It is further expressly agreed by and between the parties hereto that the work shall be completed within ONE HUNDRED AND TEN (110) working days and after the commencement of said work.
ARTICLE 6. It is expressly stipulated and agreed that all legal and statutory requirements relating to the execution of this Contract and the notice inviting bids have been met. Any alleged defect or omission in the proceedings preceding the execution of this Contract is hereby waived by the Contractor.
ARTICLE 7. Every contractor will be required to secure the payment of workers compensation to his or her employees. Labor Code Section 1860. The contractor shall post the applicable prevailing wage rate on the project site. Labor Code Section 1771.4. The project is subject to prevailing wages. The applicable wage rates are available at www.dir.ca.gov and the agency also has access to the applicable prevailing wage rate at www.losaltoshills.ca.gov.
IN WITNESS WHEREOF, the parties have executed this instrument the year and date first above written.
TOWN OF LOS ALTOS HILLS
A General Law City
City Manager
ATTEST:
City Clerk, Town of Los Altos Hills
CONTRACTOR
By
Title
NOTARIAL ACKNOWLEDGMENT OF PRINCIPAL
STATE OF CALIFORNIA )
) ss.
COUNTY OF ____________ )
On , before me, a Notary Public, personally appeared,
personally known to me (or proved to me on the basis of satisfactory evidence) to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Notary Public
(Seal)
TOWN OF LOS ALTOS HILLS March 20, 2025
Staff Report to the City Council
SUBJECT: RESOLUTION APPROVING AND AUTHORIZING EXECUTION OF THE FROM:
OLD RANCH LANE SANITARY SEWER REIMBURSEMENT AGREEMENT
BETWEEN THE TOWN OF LOS ALTOS HILLS AND WILLIAM LITTLE AND
KATHLEEN MORAN, TRUSTEES OF THE LUTZ FAMILY TRUST
WooJae Kim, Public Works Director WK
Daniel Liang, Utility Engineering Manager DL
APPROVED: Peter Pirnejad, City Manager
RECOMMENDATION:
That the City Council adopt a resolution (Attachment 1) approving and authorizing execution of the Old Ranch Lane Sanitary Sewer Reimbursement Agreement (Agreement) between the Town of Los Altos Hills (Town) and William Little and Kathleen Moran, Trustees of the Lutz Family Trust.
BACKGROUND:
On June 20, 2024, the City Council approved Resolution 31-24 (Attachment 2) approving the Old Ranch Lane Sanitary Sewer Main Extension Project and the Sewer Construction and Dedication Agreement with the property owner at 11540 Old Ranch Lane. In October 2024, construction of the Old Ranch Lane Sanitary Sewer Main Extension Project (approximately 384 linear feet) was completed by property owner. In February 2025, the Property Owners submitted the necessary documents required to establish a reimbursement agreement.
DISCUSSION:
The attached Old Ranch Lane Sanitary Sewer Reimbursement Agreement (Attachment 3) is an agreement between the Town and William Little and Kathleen Moran, Trustees of the Lutz Family Trust, who is the Property Owner that installed the sewer main extension. The Agreement was prepared based on the Town’s Policy, Procedures and Guidelines for Sanitary Sewer Reimbursement Agreements, originally adopted by the City Council on June 7, 2001. The term of the Agreement is twenty-five (25) years per the Town’s Municipal Code Section 6-4.503, which reads “In no event shall a reimbursement agreement extend beyond 25 years and in no event shall the Town be liable to a property owner for the failure to collect reimbursement costs.”
The reimbursement agreement consists of two installers and three future users as provided in Exhibit B of the Agreement. The future users are those properties with frontage along the gravity sanitary sewer main and connect directly via a single lateral to the sewer main.
PP
ITEM 5F
Staff Report to City Council Page 2
Old Ranch Lane Sewer Reimbursement Agreement
March 20, 2025
The usage fee for each future user is based on the pro-rata share of initial costs incurred by the installers plus the annual Construction Cost Index (CCI) adjustment, and a five percent (5%) Administrative Fee as set forth in the Future Users table of Exhibit B.
Staff recommend approval of the Old Ranch Lane Sanitary Sewer Reimbursement Agreement between the Town and William Little and Kathleen Moran, Trustees of the Lutz Family Trust.
ENVIRONMENTAL REVIEW
The action being considered does not constitute a "project" within the meaning of the California Environmental Quality Act ("CEQA") pursuant to CEQA Guidelines section 15378(b). 2024 -25 CITY COUNCIL WORK PLAN:
This action was not identified on the 2024-2025 City Council Work Plan, but it supports the council priority for Project & Maintain Infrastructure.
FISCAL IMPACT:
The Town would collect the five percent (5%) Administrative Fee to cover the costs to manage the Agreement and facilitate collection and transfer of funds from future users. There is no fiscal impact associated with this recommendation.
ATTACHMENTS:
1. Resolution
2. Resolution 31-24
3. Old Ranch Lane Sanitary Sewer Reimbursement Agreement
RESOLUTION -
A RESOLUTION OF THE CITY COUNCIL OF THE TOWN OF LOS ALTOS HILLS
APPROVING AND AUTHORIZING EXECUTION OF THE OLD RANCH LANE
SANITARY SEWER REIMBURSEMENT AGREEMENT BETWEEN THE TOWN OF
LOS ALTOS HILLS AND WILLIAM LITTLE AND KATHLEEN MORAN, TRUSTEES
OF THE LUTZ FAMILY TRUST
WHEREAS, the City Council of the Town of Los Altos Hills (“Town”) has read and considered that the Old Ranch Lane Sanitary Sewer Reimbursement Agreement (“Agreement”) between the Town and William Little and Kathleen Moran, Trustees of the Lutz Family Trust.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the Town of Los Altos Hills that:
1. Public interest and convenience and the promotion of sewer system improvements support the Town entering into the Agreement described above.
2. The Town of Los Altos Hills hereby approves the Agreement and the City Manager is hereby authorized on behalf of the Town to execute the Agreement between the Town of Los Altos Hills and William Little and Kathleen Moran, Trustees of the Lutz Family Trust.
The above and foregoing Resolution was passed and adopted by the City Council of the Town of Los Altos Hills at a regular meeting held on the 20th day of March 2025 by the following vote:
AYES:
NOES:
ABSTAIN:
ABSENT:
BY:
Kavita Tankha, Mayor
ATTEST:
Arika Birdsong-Miller, City Clerk
ITEM 5F, Attachment 1
RESOLUTION 31- 24
RESOLUTION OF THE CITY COUNCIL OF THE TOWN OF LOS ALTOS HILLS
APPROVING THE SEWER CONSTRUCTION AND DEDICATION AGREEMENT
FOR OLD RANCH LANE SANITARY SEWER MAIN EXTENSION
WHEREAS, pursuant to Los Altos Hills Municipal Code Section 6- 4. 446, sewer main facilities may be extended by an applicant in accordance with plans and specifications approved by the City Engineer; and
WHEREAS, the Town of Los Altos Hills received an application from the property owners at 11540 Old Ranch Lane ( APN 331- 01- 008) for construction of the Old Ranch Lane Sanitary Sewer Main Extension at the applicant' s sole cost and expense for the benefit of the applicant; and
WHEREAS, the applicant desires to dedicate the Old Ranch Lane Sanitary Sewer Main Extension to the Town upon completion of construction; and WHEREAS, Town staff prepared the Sewer Construction and Dedication Agreement for the proposed work to ensure that the ownership and maintenance responsibilities of the newly constructed sewer are transferred to the Town; and
WHEREAS, the City Engineer has reviewed the application and plans for the project and recommends that the Council approve the Sewer Construction and Dedication Agreement for the proposed sewer improvements.
NOW, THEREFORE, BE IT RESOLVED, that the City Council of the Town of Los Altos Hills does hereby approve the Sewer Construction and Dedication Agreement for the Old Ranch Lane Sanitary Sewer Main Extension.
The above and foregoing Resolution was passed and adopted by the City Council of the Town of Los Altos Hills at a regular meeting held on the 201h day of June 2024 by the following vote:
AYES: Mok, Schmidt, Tankha, Tyson
NOES: None
ABSTAIN: None
ABSENT: Swan
ATTEST:
C IC iYL Q
Aka Birdsong -Mille), City Cleric
ITEM 5F, Attachment 2
OLD RANCH LANE SANITARY SEWER REIMBURSEMENT AGREEMENT
This Sanitary Sewer Reimbursement Agreement (“Agreement”) is entered into this ____ day of _____________, 2025, by and between the Town of Los Altos Hills, a municipal corporation of the State of California (“Town”) and William Little and Kathleen Moran, Trustees of the Lutz Family Trust (“Property Owner”).
RECITALS:
A. Property Owner constructed a sanitary sewer extension commonly known as the Old Ranch Lane Sanitary Sewer Main Extension within the Town as more particularly shown on Exhibit A, attached hereto (“Sanitary Sewer Extension”).
B. Section 6–4.503 of the Town’s Municipal Code allows the Town’s Sanitary Sewer Reimbursement Policy Dated June 7, 2001 permit the Town to enter into a reimbursement agreement with property owners so that the property owners may be reimbursed for the responsible portion of the costs of a sanitary sewer extension by future users of the extension as set forth in Exhibit B.
C. After due consideration of all relevant factors such as the location and nature of the Sanitary Sewer Extension, the area to be served by the Sanitary Sewer Extension, the developable areas potentially served by the Sanitary Sewer Extension and the residential unit flow of sewage, the City Engineer has found and determined, after proper application by Property Owner, that the Sanitary Sewer Extension will benefit not only the lands of Property Owner, but also other lands which may be served by the Sanitary Sewer Extension at a future date (“Benefiting Lands”). The Benefiting Lands are more particularly set forth in Exhibit B, attached hereto. The current and future owners of Benefiting Lands who later request a hook-up to the Sanitary Sewer Extension, or who are required by the Town to connect to the Sanitary Sewer Extension, shall be hereinafter collectively referred to as “Future Users”.
D. The Town and Property Owner now desire to provide for reimbursement to Property Owner by each Future User for that Future User’s pro-rata share of Sanitary Sewer Extension costs (“Usage Fee”) as shown in Exhibit B, attached hereto. Usage Fee shall be subject to annual adjustments by the Town as specified in the then current “Town of Los Altos Hills Policy, Procedures and Guidelines – Sanitary Sewer Reimbursement Agreement” document, Exhibit C attached hereto, or its replacement document. The Town and Property Owner acknowledge that the total amount that the Property Owner may be reimbursed for the Sanitary Sewer Extension is an amount totaling two hundred thirty six thousand five hundred fifty dollars and zero cents ($236,550) plus (1) annual Construction Cost Index (“CCI”) adjustments as set forth in Exhibit B; and (2) an additional five percent (5%) for Town administrative fees as defined in Exhibit B.
ITEM 5F, Attachment 3
AGREEMENT
NOW, THEREFORE, for good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties hereby agree as follows:
1. The Town will collect the Usage Fee for each Future User as indicated in Exhibit B upon a request by a Future User to connect to the Sanitary Sewer Extension (“Connection Request”), or upon notice to a Future User that it is subject to a Town requirement that the Future User connect to the Sanitary Sewer Extension (“Connection Requirement Notice”). The Town shall be entitled to collect the Usage Fee at any time after a Connection Request or Connection Requirement Notice, and prior to a hook-up by a Future User to the Sanitary Sewer Extension.
2. All Usage Fees collected from Future Users shall include an additional administrative fee equal to five percent (5%) of the Usage Fee amount as annually adjusted based on CCI to pay the costs incurred by the Town in connection with the administration of this Agreement. (“Administrative Fee”).
3. Within sixty (60) days of the end of each year during which this Agreement is in effect, the Town shall pay to Property Owner any and all funds collected pursuant to Paragraph 1 above, less the Administrative Fee. The Town shall make the check payable to William Little and Kathleen Moran, Trustees of the Lutz Family Trust and shall send such check to Property Owner at 1294 Kifer Road, Suite 708, Sunnyvale, CA 94086.
4. Property Owner agrees to indemnify and hold harmless the Town from any claims, costs or expenses incurred by the Town in connection with any claim by any person or entity with respect to this Agreement, the associated costs or the Usage Fees.
5. All regulations and applicable ordinances of the Town shall apply to this Agreement and to the performances hereunder.
6. If by decision of a court of competent jurisdiction or by California law it shall be declared or become unlawful or unconstitutional to require Future Users to reimburse Property Owner for the Sanitary Sewer Extension, then (a) the Town’s obligations to collect and account for any further Usage Fee(s) shall automatically terminate; and (b) Property Owners and their successors or assigns shall indemnify and hold harmless the Town from any claims or liability to Future Users for the legally required return of any Usage Fee.
7. In the event of a dispute between any Future User and the Town with respect to the payment of the Usage Fee, the Town may, at its option, take any appropriate action against such Future User to collect the Usage Fee. It is agreed that no Future User shall be allowed to connect to the Sanitary Sewer Extension prior to payment in full of the Usage Fee as specified in Exhibit B during the term of this Agreement.
8. Property Owner and its agents shall hold harmless the Town for any failure by the Town to collect the Usage Fee from any Future User, and nothing in this Agreement shall be construed as imposing any obligation upon the General Fund of the Town and payments shall be made to Property Owner only to the extent funds are actually received and collected by the Town pursuant to this Agreement.
9. This Agreement, and the obligations of the Town hereunder, whether or not all of the Reimbursement Amount or any portion thereof has been collected and remitted to Property Owner or its agents hereunder, shall terminate on the twenty-fifth (25th) anniversary of the date of this Agreement.
10. Prior to execution of this Agreement by the Town, the Property Owner shall pay all legal fees and costs incurred by the Town in connection with preparing this Agreement.
11. This Agreement shall be binding upon the successors, heirs and assigns of the parties hereto, but Property Owner shall not assign any of its rights under this Agreement without the prior written consent of the Town, which consent shall not be unreasonably withheld.
12. The Exhibits attached hereto are hereby incorporated into this Agreement by this reference.
13. All negotiations and agreements previously made by the parties and their agents with respect to this transaction are merged into this Agreement which completely sets forth the obligations of the parties.
The parties hereto have executed this Agreement effective as of the date written above.
ATTEST: TOWN OF LOS ALTOS HILLS
___________________________
Arika Birdsong-Miller, City Clerk
____________________________
Peter Pirnejad, City Manager
____________________________
Steve Mattas, City Attorney
PROPERTY OWNERS
____________________________
William Little and Kathleen Moran, Trustees of the
Lutz Family Trust
1294 Kifer Road, Suite 708, Sunnyvale, CA 94086
Exhibit A
Engineering As-Built Plans for OLD RANCH LANE SANITARY SEWER MAIN EXTENSION, prepared by Lea & Braze Engineering, Inc., dated 10/15/2024 consisting of nine (9) sheets on file with the Engineering Department of the Town of Los Altos Hills
Exhibit B
FUTURE USERS
Address APN# Usage Fee
11540 Old Ranch Ln 331-01-008 Installer
11545 Old Ranch Ln 331-01-012 [$118,275 + CCI*%] + 5% AF* 11569 Old Ranch Ln 331-01-011 [$118,275 + CCI*%] + 5% AF* *CCI% is Construction Cost Index adjustment from prior year which is applied to the base Usage Fees in the first year of the Agreement and to the cumulative CCI-adjusted prior year Usage Fees on June 30th annually thereafter; 5% AF is Administrative Fee as set forth in Paragraph 2 of the Agreement.
1 TOWN OF LOS ALTOS HILLS
POLICY, PROCEDURES AND GUIDELINES FOR
SANITARY SEWER REIMBURSEMENT AGREEMENTS
Adopted June 7, 2001
Amended October 27, 2011
Policy:
The Town of Los Altos Hills wishes to encourage the availability of public sanitary sewers for all Town residents in a fair and rational way. In order to facilitate this goal, the Town will enter into an agreement with property owners willing or required to construct public sanitary sewer infrastructure in order to reimburse those constructers for a fair share of the direct cost of construction collected from properties that directly benefit from that construction.
Reference:
Title 6, “Sanitation and Health”; Chapter 4 “Sewage”; Article 5, “Sewer Improvement Reimbursement “; Los Altos Hills Municipal Code
Procedures and Guidelines:
1) A Property owner, or legal entity, in the Town of Los Altos Hills may make application to the Town to enter into a Reimbursement Agreement. If Property Owners are outside the Town limits they must apply for annexation or an out-of-services agreement and work with LAFCO.
2) Applications for a Reimbursement Agreement shall include the applicant’s name and address, two (2) sets of the approved, engineered plans for the construction, an engineer’s estimate of the cost of construction (See 6 below, the estimated cost is only used as an indicator of the expected size of the project.), and a list of the proposed future users with supporting documentation. Supporting documentation may include a Town topographic map or a topographic map prepared by a licensed civil engineer for the area of the Reimbursement Agreement at the discretion of the City Engineer. (See 9 below).
After receiving and checking the submitted information, the City Engineer will meet with the Property Owner and provide any comments regarding the submitted information to the Property Owner.
Thereafter the City Engineer will send the Property Owner a letter confirming the Town’s intent to enter into a Reimbursement Agreement with the Property Owner. 3) Reimbursement Agreements may be created retroactively for a period of 10 years after the date of construction and acceptance by the Town, upon submittal of the information indicated in 2) above. The Town will not collect reimbursement fees nor be responsible for connections made before the creation of the Reimbursement Agreement.
2 4) Reimbursement Agreements shall utilize a standard form agreement prepared and approved by the City Attorney. A blank standard form agreement is available to applicants for their information.
5) Reimbursement Agreements will only be submitted to the City Council for approval after the final project cost has been determined, the list of future users has been reviewed and approved by the staff and the construction has been accepted by the Town. 6) The final project cost shall include only the following items:
a) Design costs,
b) Construction costs,
c) Construction services such as construction inspection, compaction testing, and staking, etc,
d) Town and City of Los Altos permit fees,
e) Other documented Governmental Agency fees,
f) Attorney fees as required for the Reimbursement Agreement but limited to 5% of the final construction cost and supported by documentation, g) Land acquisition costs limited to the appraised cost of the land as determined by a certified, Town approved property appraiser.
Interest and other costs shall not be included. In case of questions, the City Engineer will make the determination of applicability. Itemized invoices describing work performed shall be submitted to the City Engineer for review and approval at the completion of the project.
7) The properties included in the list of future users will generally be referred to as the Reimbursement Agreement Service Area and shall be approved by the City Engineer. 8) The term of a Reimbursement Agreement shall be 25 years. 9) Future users shall only include those properties that will directly benefit from the construction as follows. (Future users may include properties not currently within the Town limits.)
a) For gravity sanitary sewer mains, future users are all those properties that have frontage along the gravity sewer main and can connect directly, via a single lateral, to the gravity sanitary sewer main.
The minimum length of sanitary sewer main extension that the City Engineer will permit to be constructed in the public right of way shall be 200 lineal feet. b) For public lift stations and force mains, future users shall be all of those properties within the basin that will need to use the lift station and force main for public sanitary sewer service
3 Lift stations with a service area of 25 properties or more, may be public and those with a service area of fewer then 10 properties shall be private. The determination of public or private status for lift stations with a service area of between 10 and 24 properties will be made by the staff on a case-by-case basis. Guidance for service areas may be obtained from the Lift Station Master Plan by Robinson and Associates, dated May 16, 2000.
c) The property of initial investors in a Reimbursement Agreement shall be included in the Reimbursement Agreement Service Area for the purposes of calculating reimbursement amounts but will be deemed to have paid the reimbursement amount by virtue of being an initial investor. A list of initial investors shall be submitted with the final project cost. 10) The Property Owner may, at the Property Owners option, extend the gravity sanitary sewer main past the Owner’s property to include additional properties into the Reimbursement Agreement Service Area.
11) Reimbursable costs shall be apportioned equally to the properties in the Reimbursement Agreement service area. Should a lot in a service area be subsequently subdivided, each subsequent lot shall pay a prorated share of the original reimbursement amount upon connection.
12) The Town Engineering Department will maintain a list of all properties in approved Reimbursement Agreement service areas with assessor parcel numbers (APN), address, date of expiration of the Reimbursement Agreement and the reimbursement amount. A copy of this list shall be given to the Building Department and Finance Department each time the list is revised or at a minimum on June 30 each year. The Reimbursement Agreement list will be revised each time a new Reimbursement Agreement is approved or when an existing agreement has expired. On June 30th of each year the reimbursement amount on the list of properties shall be adjusted for the Construction Cost Index for the prior year.
13) Before issuing a Building Permit or a Plumbing Permit for a sewer connection, the Building Department will determine if the property is on the Reimbursement Agreement list and refer the prospective permittee to the Engineering Department for payment of any applicable reimbursement amount before issuing the permit. Likewise the Engineering or Public Works Departments shall check the list and collect the applicable reimbursement amount before issuing an Encroachment Permit for a sewer lateral connection.
TOWN OF LOS ALTOS HILLS March 20, 2025
Staff Report to the City Council
SUBJECT: RESOLUTION APPROVING THE PLANS AND SPECIFICATIONS
FOR THE MATADERO CREEK RESTORATION AND BANK
STABILIZATION PROJECT; AUTHORIZING STAFF TO ADVERTISE
THE PROJECTS FOR FORMAL BID; AND TRANSFERRING $200,000
FROM THE GENERAL FUND CAPITAL PROJECTS RESERVE
FUNDS TO SUPPLEMENT THE DRAINAGE IN-LIEU FUNDING
SOURCE
FROM: WooJae Kim, Public Works Director WK
Daniel Liang, Utility Engineering Manager DL
APPROVED: Peter Pirnejad, City Manager PP
RECOMMENDATION: That the City Council adopt a resolution (Attachment 1):
1. Approving the Plans and Specifications for the Matadero Creek Restoration and Bank Stabilization Project; and
2. Authorize staff to advertise the project for formal bid; and
3. Transferring $200,000 from the General Fund Capital Projects Reserve funds for the project to supplement the Drainage in-Lieu funding source.
BACKGROUND:
During winter storms of late 2009 and early 2010, high flows in Matadero Creek eroded a section of the embankment adjacent to the southbound lane of Page Mill Road. The location is approximately one-quarter mile west of Interstate 280 just south of Berry Hill Court and downstream of the Matadero Creek box/bridge culvert crossing. This section of Page Mill Road is located within the California Department of Transportation (Caltrans) right-of-way; however, the Town has maintenance responsibilities due to the “Freeway Maintenance Agreement” executed in 1970.
The Matadero Creek Erosion project was first initiated in FY2011-12 to repair the eroded embankment and rehabilitate the creek bed. The funding sources for the project were the Drainage in-Lieu and CIP/General Fund in amounts of $1,269,790 and $314,500 respectively. Drainage in-Lieu fees collected from developments are accrued in Town’s Storm Drain Fund.
In 2012, a secant pile retaining wall was constructed as an emergency project to prevent the undermining of Page Mill Road. This emergency project was referred to as Phase 1 of the Matadero Creek Erosion project in the Town budget documents. The remaining scope ITEM 5G
Staff Report to City Council Page 2
Matadero Creek Restoration and Bank Stabilization
March 20, 2025
of the Matadero Creek Erosion project entails restoring and improving the creek bed to prevent further erosion.
On May 16, 2024, the City Council adopted a resolution approving the Plans and Specifications for the Matadero Creek Restoration and Bank Stabilization Project; approving the Plans and Specifications for the Matadero Creek Restoration Offsite Mitigation Planting and Fencing Project at Byrne Preserve; authorizing staff to advertise the projects for formal bids; and approving the covenant deed restrictions on two Town parcels, APN 182-32-008 and APN 182-32-021. The offsite mitigation at Byrne Preserve and deed restrictions are mitigation measures required by the California State Water Resources Control Board (Water Board) for the permanent impacts from the project.
Through the annual budget process, $200,000 of additional Drainage in-Lieu budget was added to the project FY2024-25 to cover the additional services for the consultant for design and construction management and for the offsite mitigation measures required by the Water Board for the project.
On July 2, 2024, the Town received four bids for the Matadero Creek Restoration and Bank Stabilization Project. The bid price ranged from $762,523 to $1,032,640. The scope of work includes regrading of the creek, installation of a soldier pile retaining wall, and placement of new riprap for creek bedding. The lowest bid was 21% higher than the Engineer’s Estimate of $632,180. On July 18, 2024, the City Council adopted a resolution rejecting all bids received for the project, and directed staff to value engineer the design for rebid in Spring 2025.
DISCUSSION:
The original design for the Matadero Creek Restoration and Bank Stabilization Project, which Council approved on May 16, 2024, included installation of a new soldier pile retaining wall to widen the street by four to five feet within the project segment on Page Mill Road between Berry Hill Court and Baleri Ranch Road (just south of the box/bridge culvert structure). The widening is to accommodate on-road bicycle lanes (Class II bicycle lanes). However, the new retaining wall has a high price tag. The average of retaining wall item bids received on July 2 last year was over $292,000.
Value Engineering
On October 22, 2024, staff provided an update with a technical memorandum to the City Council on the project (Attachment 2). The technical memorandum provided findings from staff’s value engineering and a more cost-effective design to stabilize and restore the eroded section of Matadero Creek without constructing a new soldier pile retaining wall, as the existing secant pile retaining wall constructed in 2012 is structurally robust and sufficient to support the roadway.
In addition, by re-aligning the new creek flowline within the Town’s storm drain easement and raising the flow channel base elevation by one foot, the eroded creek bank of Page Mill Road can be restored with earthen embankment without constructing a new retaining wall.
Staff Report to City Council Page 3
Matadero Creek Restoration and Bank Stabilization
March 20, 2025
The new design substantially reduces the scope of work and construction cost of the project.
Status of Regulatory Permits and Mitigation Measures
In February 2025, the Town’s Consultant, ENGEO, notified Caltrans and the Water Board of design changes on the project. On February 14, 2025, staff submitted a revised streambed alteration agreement with design changes to the California Department of Fish and Wildlife (CDFW) through their online portal. The Water Board has given approval for the updated Matadero Creek project to proceed. Caltrans has also approved design changes and will be issuing an encroachment permit. Staff and ENGEO are working with CDFW to secure approval of the agreement and permit before the start of construction.
The Matadero Creek project will result in temporary and permanent impacts to the creek.
Temporary impacts include placing cofferdams upstream and downstream of the grading limits and clearing understory riparian vegetation around the project limits. Permanent impact is related to the grading work for the restoration of the creek. All temporary impacted areas are to be returned to pre-project conditions within one year of construction.
For permanent impacts, the Water Board is requiring both on-site and off-site mitigations.
The on-site mitigation would be provided through the creation of a 190-square-foot floodplain within the project area, which is incorporated in the Plans and Specifications.
Off-site mitigations include preservation of Town lands along Matadero Creek (APN 182- 32-008 and APN 182-32-021) through deed restrictions and enhancements of the riparian habitat along the 1.96 acres of a tributary to Mood Creek at Byrne Preserve. The deed restrictions approved by Council are being processed, and the planting and fencing work at Byrne Preserve for the riparian habitat enhancement was completed in January 2025 and is currently under the two-year maintenance period through a contractor.
Improvements to Box Culvert
Installation of Class II bicycles lanes on Page Mill between Berry Hill Court and Baleri Ranch Road would require improvements or reconstruction of the box/bridge culvert where there is a narrow roadway. Such improvements would be a substantially larger capital project that would cost over a million dollars with new environmental studies and regulatory permits that would take multiple years to secure. The regulatory agencies would assess new mitigation measures for impacts. Given that this stretch of Page Mill Road is within Caltrans right-of-way, such a significant capital improvement project would ideally be led or sponsored by Caltrans. In the future, staff can propose a new capital project to further investigate options for the culvert structure and to widen the roadway pending resources available.
Matadero Creek Restoration and Bank Stabilization Project The Matadero Creek Restoration and Bank Stabilization project includes stabilizing the creek bank by grading and installing riprap along the creek bed to restore the flow channel of the creek downstream of the Matadero Creek bridge crossing. This project will create a flood plain within the project area to reduce flow velocities within Matadero Creek, control
Staff Report to City Council Page 4
Matadero Creek Restoration and Bank Stabilization
March 20, 2025
creek bank erosion, and stabilize the channel within the watershed. The Plans and Specifications for the project is available for review on the Town website at https://www.losaltoshills.ca.gov/579/City-Council-Meeting-Documents.
Authorization to Advertise for Formal Bid
The Plans and Specifications for the Matadero Creek Restoration and Bank Stabilization Project is completed and ready for formal bids. The engineer’s estimate for the construction cost of the Matadero Creek Restoration and Bank Stabilization Project including contingency is approximately $484,000.
Article (2) of the Town’s Municipal Code section 2-4.04 states “Formal Bid Procedures for Procurement of Public Projects. Procurement of public projects valued at more than two hundred thousand dollars ($200,000.00) shall be submitted for formal bidding. The notice inviting bids shall be advertised upon authority of the City Council, and such an advertisement shall be published two (2) times in a newspaper of general circulation published nearest to the Town, and in addition, invitations to bid may be mailed to prospective vendors at the discretion of the City Manager. Notice inviting formal bids shall state the time and place for the receiving and opening of sealed bids and distinctly describe the project. The notice shall be published at least fourteen (14) calendar days before the date of opening the bids. The notice inviting formal bids shall also be sent electronically, if available, by either facsimile or e-mail and mailed to all construction trade journals specified in Public Contract Code Section 22036. The notice shall be sent at least fifteen (15) calendar days before the date of opening the bids. The bids submitted shall be received by the City Clerk, to be opened by the City Manager at the time designated.” Staff is recommending that the City Council approve the Plans and Specifications for the Matadero Creek Restoration and Bank Stabilization Project and authorize staff to advertise the project for formal bid.
Once authorized, a Notice to Bidders will be published twice in the Los Altos Town Crier and posted on the Town's website. Staff will send the Notice to Bidders to the Builders Exchanges, covering Alameda County, Santa Clara County, Contra Costa County, the Peninsula area, and the San Francisco Bay Area. Staff will also reach out to qualified contractors via telephone calls and emails to notify them of the project.
Project Timeline
Once authorized by Council, here are the anticipate timelines for the two projects:
Matadero Creek Restoration and Bank Stabilization
Authorization to Bid March 20, 2025
Advertise for Bid April 10, 2025
Open Bids May 1, 2025
Council Award Construction Contract May 15, 2025
Begin Construction June/July 2025
Staff Report to City Council Page 5
Matadero Creek Restoration and Bank Stabilization
March 20, 2025
Construction Completion November 2025
ENVIRONMENTAL REVIEW
In conformance with CEQA requirements, an initial Study/Mitigated Negative Declaration has been prepared for the project. Copies of the Mitigated Negative Declaration were forwarded to State Clearinghouse and a Notice of Intent to adopt a Mitigated Negative Declaration was published in the Town Crier on October 21, 2015. In addition, the Mitigated Negative Declaration was posted on the Town’s website on October 23, 2015.
The notice was submitted to the Santa Clara County Clerk’s Office for a 30-day public review period on October 21, 2015. Based on the Initial Study, staff concluded that the proposed project, as mitigated, will not have a significant effect on the environment. 2024-25 CITY COUNCIL STRATEGIC PRIORITIES:
This action was identified on the 2024 and 2025 City Council Priorities under “Protect and Maintain Infrastructure” for the construction Matadero Creek Restoration and Bank Stabilization.
FISCAL IMPACT:
The total project funding and actual/estimated costs for the Matadero Creek Erosion capital project since its inception are as follows:
Approved Funding Source Cost
Storm Drain Fund (includes $200k additional
appropriation approved for FY2024/25)
$ 1,469,790
CIP/General Fund $ 314,500
Total $ 1,784,290
Cost Items Cost
Phase 1 Design (actual) $ 172,126
Phase 1 Construction (actual) $ 338,490
Phase 2
ENGEO Original Design Agreement $ 199,800
First Amendment to ENGEO Agreement for
Construction Management $ 230,000
Matadero Creek Restoration and Bank Stabilization
Construction (value engineered) $ 440,000
Construction Contingency (10%) $ 44,000
Construction Administration $ 20,000
Matadero Creek Restoration Offsite Mitigation and
Fencing Project at Byrne Preserve $ 130,000
Total $ 1,574,416
Staff Report to City Council Page 6
Matadero Creek Restoration and Bank Stabilization
March 20, 2025
Budget to Remain $ 209,874
The total Drainage in-Lieu budget for the project is $1,469,790. An expenditure report through the end of February 2025 for the project reflected Drainage in-Lieu budget expenditure of $799,626, meaning $670,164 is the remaining balance of the Drainage inLieu budget for the project.
Since staff is anticipating $209,874 of the project budget to be saved with the value engineered design, only $460,290 of Drainage in-Lieu budget is needed to complete the project. Although the Town is accruing Drainage in-Lieu fees through developments, the Storm Drain Fund (with a current balance of $516,203) may be depleted to a balance of around $60,000 at the end of the Matadero Creek Erosion project.
Staff is looking to update the Drainage in-Lieu Fee in the near future with other development fee studies. In the meantime, staff is recommending supplementing the budget for the Matadero Creek Erosion project with $200,000 from the General Fund Capital Projects Reserve, which currently has a sufficient balance of $2,504,440. Provided the bids come in as expected, this would retain approximately $260,000 in the Storm Drain Fund at the project completion to maintain an operational balance for other storm related infrastructure projects.
Proposed Funding Sources Cost
Drainage in-Lieu Budget (expended to date) $ 799,626
Drainage in-Lieu Budget (to remain) $ 260,290
Capital Reserve Fund (proposed to supplement) $ 200,000 CIP/General Fund $ 314,500
Total Budget
$ 1,574,416
ATTACHMENTS
1. Resolution
2. Value Engineering Technical Memorandum
RESOLUTION -25
A RESOLUTION OF THE CITY COUNCIL OF THE TOWN OF LOS ALTOS
HILLS APPROVING THE PLANS AND SPECIFICATIONS FOR THE
MATADERO CREEK RESTORATION AND BANK STABILIZATION
PROJECT; AUTHORIZING STAFF TO ADVERTISE THE PROJECT FOR FORMAL BID; AND TRANSFERING $200,000 FROM CAPITAL PROJECTS
RESREVE FUNDS TO SUPPLEMENT THE DRAINAGE IN-LIEU FUNDING SOURCE
WHEREAS, the Matadero Creek Erosion Repair has been approved in the Adopted Operating and Capital Budgets for FY2024-2025 and FY2025-2026; and WHEREAS, the updated and value engineered Plans and Specifications for the Matadero Creek Restoration and Bank Stabilization for the erosion repair work have been completed for rebid; and
WHEREAS, staff recommends that the City Council approve the Plans and Specifications for the Matadero Creek Restoration and Bank Stabilization Project and authorize staff to advertise the project for formal bid; and
WHEREAS, for fiscal prudence and to maintain an operational balance in the Storm Drain Fund at the end of the project, staff is recommending transferring $200,000 from the General Fund Capital Projects Reserve funds to the project budget to supplement the Drainage in-Lieu budget approved for the project.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the Town of Los Altos Hills that:
1. The Plans and Specifications for the Matadero Creek Restoration and Bank Stabilization Project are approved; and
2. Staff is authorized to advertise the project for formal bid; and
3. $200,000 of the General Fund Capital Projects Reserve is approved to be transferred to the project to supplement the Drainage in-Lieu funding source The above and foregoing Resolution was passed and adopted by the City Council of the Town of Los Altos Hills at a regular meeting held on the 20th day of March 2025 by the following vote:
AYES:
NOES:
ABSTAIN:
ABSENT:
ITEM 5G, Attachment 1
Staff Report to City Council Page 8
Matadero Creek Restoration and Bank Stabilization
March 20, 2025
BY: _______________________________
Kavita Tankha, Mayor
ATTEST:
______________________________
Arika Birdsong-Miller, City Clerk
1 of 3
Updated 10/10/24
TECHNICAL MEMORANDUM, TOWN OF LOS ALTOS HILLS
Date: October 7, 2024
To: WooJae Kim, Public Works Director
From: Daniel Liang, Utility Engineering Manager
RE: Value Engineering for Matadero Creek Restoration and Bank Stabilization Project This technical memorandum provides findings and recommendations of value engineering for the Matadero Creek Restoration and Bank Stabilization Project.
Background:
In the winter storms of late 2009 and early 2010, high flows in Matadero Creek eroded a section of the embankment adjacent to the westbound lane of Page Mill Road. The location is approximately one-quarter mile west of Interstate 280, just downstream of the Matadero Creek bridge crossing. This section of Page Mill Road is located within Caltrans’ right-ofway. Caltrans was initially going to make the repairs. Two years later, Caltrans turned the project over to the Town of Los Altos Hills due to the maintenance agreement “Freeway Maintenance Agreement” executed in 1970 that requires the Town to maintain the roadway.
In 2012, the Town hired WRECO to prepare technical studies and develop PS&E to stabilize the creek bank with a secant pile wall without disturbing or entering the creek. This will allow the project to be expedited and be completed before winter rainstorms and avoid further eroding into Page Mill Road.
On September 25, 2012, the Town entered a contract with Case Pacific Company to construct the secant pile wall along the western edge of Page Mill Road. The wall is 62.5 ft long, consisting of fourteen 30-inch diameter shear pin piles and thirteen 24-inch diameter dummy piles. The shear pin piles are 34.5’ deep and the dummy piles are 20’ deep.
In October of 2012, Case Pacific Company mobilized onsite and completed the wall construction.
On July 16, 2014, the Town entered a contract with ENGEO to review existing documents, coordinate and obtain necessary permits from regulatory agencies, prepare PS&E, and develop a planting plan for the project. The goal is to provide a long-term solution to restore Matadero Creek and stabilize the creek bank adjacent to the southbound lane and provide exclusive bicycle lanes for both directions on Page Mill Road.
On May 16, 2024, the Town council approved the Plans and Specifications for the project to ITEM 5G, Attachment 2
2 of 3
Updated 10/10/24
On July 2, 2024, the Town received four bids for the Matadero Creek Restoration and Bank Stabilization project. The lowest responsible bidder is Michael Glynn Construction Services, Inc. with the bid amount of $762,522.50. This bid amount is 21% higher than the engineer’s estimate of $632,180.
On July 18, 2024, the Town council approved a resolution to reject all bids.
Findings of Value Engineering:
The design of the Matadero Creek Restoration and Bank Stabilization project includes a 74- ft soldier pile wall parallel to Page Mill Road with a 4-ft separation from the existing secant pile wall. The new wall consists of thirteen CIDH piles with lumber lagging panels. Each pile is 36.5 ft deep with a 36-inch diameter drilled shaft. The piles are spaced at 6 ft on-center.
The design also includes a new guardrail to be installed between the new and existing retaining walls.
Findings of our value engineering are as follows:
1. The new soldier pile retaining wall alongside Page Mill Road is not needed as the existing parallel secant pile retaining wall appears to be adequate. The secant pile wall constructed in 2012 consists of 27 piles installed side by side and is structurally robust.
Without the new retaining wall, the engineer’s estimate for the project construction cost is $380,000. The cost saving is approximately $382,000.
2. The main purpose of the new retaining wall is to provide a wider road in the southbound direction of Page Mill Road. The conceptual design of the “Page Mill Road Bike Lanes” prepared by Alta in 2011 calls for exclusive 5-ft bicycle lanes with 11-ft travel lanes on Page Mill Road, between Berry Hill Court and Baleri Ranch Road. This design requires an existing oak tree to be removed and an existing power pole to be relocated. Based on our analysis, exclusive 4-ft bicycle lanes with 11-ft travel lanes can be achieved without constructing a new retaining wall.
3. Based our studies, the Town owns a 33 ft wide storm drain easement from the Caltrans right-of-way boundary. By re-aligning the flowline, the project can restore the eroded creek bank of Page Mill Road with earthen embankment and reduce earthwork oH-haul.
4. The Alta design with a roadway cross section of 32 ft, with two 11-ft travel lanes and two 5-ft bicycle lanes, does not account for an existing pedestrian path in the northbound direction of the Page Mill Road bridge crossing.
Recommendations
be advertised.
3 of 3
Updated 10/10/24
1. Revise the design for the Matadero Creek Restoration and Bank Stabilization project without the new soldier pile retaining wall.
2. Align the flow line of the riprap flow channel away from Page Mill Road and restore the eroded bank by constructing a new embankment with the maximum side slope of 2H:1V.
3. Install a new Midwest guardrail system along Page Mill Road, with the posts outside of the existing retaining wall.
4. Revise the Caltrans right-of-way boundary per topo survey and include the 33-ft storm drain easement with the private property of 14172 Amherst Court, Los Altos Hills.
5. Reduce the rock size for riprap from 500-lb rocks to 150-lb rocks, and reduce the depth of the riprap flow channel from 3.5 ft to 2 ft.
6. Do not demolish the existing sackcrete, as it is adequate.
7. As a separate project, widen and restripe Page Mill Road, between Berry Hill Court and Baleri Ranch Road, to provide exclusive bicycle lanes, modify the existing storm drain, and provide an exclusive pedestrian path. The existing box culvert structure at the creek crossing is not wide enough to accommodate these improvements. There are two options: The first option is to replace the existing box culvert structure with a wider structure. This will involve Caltrans, and the bridge is owned by Caltrans. The second option is to keep the existing box culvert structure and provide a separate pedestrian bridge crossing adjacent to the northbound travel lane.
From:
To: Arika Miller
Subject: March 20, 2025 Regular Council Meeting Consent Calendar Agenda Item 5G: MATADERO CREEK RESTORATION Date: Thursday, March 20, 2025 11:11:24 AM
Hi Arika,
Please attach this email to the Agenda Packet for the March 20, 2025 Regular Council Meeting.
Thank you.
Best,
Allan
Consent Calendar Agenda Item 5G: RESOLUTION APPROVING THE PLANS AND
SPECIFICATIONS FOR THE MATADERO CREEK RESTORATION AND BANK STABILIZATION PROJECT; AUTHORIZING STAFF TO ADVERTISE THE PROJECTS FOR FORMAL BID; AND TRANSFERRING $200,000 FROM THE GENERAL FUND CAPITAL PROJECTS RESERVE
FUNDS TO SUPPLEMENT THE DRAINAGE IN-LIEU FUNDING SOURCE If transferring funds from the Capital Reserve remains part of this resolution, then this item should be pulled from the Consent Calendar for discussion.
The council should pass a resolution approving advertising the project for a formal bid.
The council should not transfer $200,000 from the General Fund Capital Projects Reserve funds to supplement the drainage in-lieu funding for the following reasons:
Appropriated funds already exceed planned project expenditure by over $200,000.
Funds are not needed. Drainage Fund balance exceeds the estimated remaining project expense.
Authorized General Fund transfers of $514,500 to supplement Drainage Fund project expenditures have not yet been made.
Premature. Construction is scheduled to start in June/July and finish in November.
Majority of payments will not be made until the new fiscal year. Actual costs are unknown; bids have not been received.
Reserve/commitment levels should be determined on a comprehensive basis considering townwide needs during the budget process in conjunction with the FIC. FY’26 Budget will be reviewed in the next couple of months, before construction starts. Review of capital planning and spending is the focus of this year’s budget effort.
Adequacy of Capital Fund Reserve is unknown.
Recommended $200,000 transfer amount is arbitrary. Additional Drainage Fund expenditures have not been identified.
ITEM 5G, Supplement 1
TOWN OF LOS ALTOS HILLS March 20, 2025
Staff Report to the City Council
SUBJECT: RESOLUTION AUTHORIZING THE CITY MANAGER TO ISSUE A REQUEST FOR PROPOSAL FOR THE FY2025-2027 LANDSCAPE
MAINTENANCE SERVICES
FROM: WooJae Kim, Public Works Director
APPROVED: Peter Pirnejad, City Manager
RECOMMENDATION:
That the City Council adopt a resolution (Attachment 1) authorizing the City Manager to issue a Request for Proposal for the FY2025-2027 Landscape Maintenance Services.
BACKGROUND:
On May 17, 2023, the City Council awarded the Landscape Maintenance Services Agreement for the Town Hall, Arastradero Path, Edith Park, Foothill College and El Monte Pedestrian and Bike Path, Fremont Road Path, and Westwind Community Barn landscape maintenance services agreement for Fiscal Years 2023-2025 to Bayscape Landscape Management not to exceed $220,000. This agreement for the landscape maintenance services expires June 30, 2025.
DISCUSSION:
Staff is planning to issue a Request for Proposal (RFP) to solicit proposals from qualified landscaping maintenance companies with expertise in vegetation management, irrigation, water management, landscaping, pest control without harmful chemicals, soils, and fertilizers to maintain the landscaping at the Town Hall, Arastradero Path, Edith Park, Foothill College and El Monte Pedestrian and Bike Path, Fremont Road Path, and Westwind Community Barn in a scheduled and professional manner.
Staff will seek proposals from landscaping maintenance companies to perform weekly maintenance of Town’s sites that involves a full range of landscaping activities including irrigation systems operation. The landscaping activities encompass tree, shrub, and ground covering trimming, edging, fertilization, soil deficiency remediation, weeding, weed abatement, and pest control (without the use of harmful chemicals). Irrigation systems operations include the maintenance, adjustment, installation, and repair of a variety of components, such as: irrigation controllers, valves, moisture sensing devices and sprinkler heads of a variety of manufactured brands and models.
WK
PP
ITEM 5H
Staff Report to City Council Page 2
FY2025-2027 Landscaping Maintenance Services RFP
March 20, 2025
The scope of services includes all work involved in performing the landscape maintenance at six (6) described in the table below for a period of two years starting July 1, 2025, with an option to extend the contract one additional year.
Site ID No Site name Address
S-01
LAH Town Hall 26379 Fremont Road
S-02 Arastradero Path Arastradero Rd. and Stirrup
S-03 Fremont Road Path Fremont Road Concepcion Rd. to Edith Ave.
S-04 Edith Park
Edith Ave. & Fremont Rd.
S-05
Foothill College & El Monte
Pedestrian and Bike Path
El Monte Road
Moody Rd. to Stonebrook
S-06 Westwind Community Barn 27210 Altamont Road
Staff will return to Council in May or June 2025 with a recommendation of an award for the FY2025-2027 Landscaping Maintenance Services agreement after solicitation and review of proposals.
ENVIRONMENTAL REVIEW
Maintenance of existing landscaping is defined under California Environmental Quality Act (CEQA) Section 15301(h) as Categorically Exempt.
2024-25 CITY COUNCIL WORK PLAN:
This action was not identified on the 2024-25 City Council Work Plan, but it supports the council priority to Maintain Quality of Life and protect and maintain infrastructure.
FISCAL IMPACT
The cost for the current landscaping maintenance for the six sites is $110,000 a year.
Factoring in inflation, the estimated annual landscape maintenance cost may escalate up to $130,000. If costs increase substantially, staff can investigate a lower frequency of maintenance for certain sites to be supplemented with Town maintenance staff efforts.
The landscaping maintenance agreement would be funded through General, Pathways, and Westwind Barn Funds accordingly.
Staff Report to City Council Page 3
FY2025-2027 Landscaping Maintenance Services RFP
March 20, 2025
ATTACHMENTS
1. Resolution
2. Draft Request for Proposal
RESOLUTION NO.__________
A RESOLUTION OF THE CITY COUNCIL OF THE TOWN OF LOS ALTOS
HILLS AUTHORIZING THE CITY MANAGER TO ISSUE A REQUEST FOR PROPOSAL FOR FY2025-2027 LANDSCAPE MAINTENANCE SERVICES WHEREAS, the landscape maintenance services agreement between the Town of Los Altos Hills and the current landscaping contractor is set to expire on June 30, 2025; and WHEREAS, the Town of Los Altos Hills (Town) is seeking the services of an experienced and qualified landscape maintenance company with expertise in vegetation management, irrigation, water management, landscaping, pest control without harmful chemicals, soils, and fertilizers to maintain the landscaping at the Town Hall, Arastradero Path, Edith Park, Foothill College and El Monte Pedestrian and Bike Path, Fremont Road Path, and Westwind Community Barn in a scheduled and professional manner; and WHEREAS, the scope of services includes all work involved in performing the landscape maintenance at six landscape sites for a period of two years starting July 1, 2025, with an option to extend the contract one additional year; and WHEREAS, the FY2025-2027 Landscaping Maintenance Services would be funded through General, Pathways, and Westwind Barn Funds accordingly.
NOW, THEREFORE, the City Council of the Town of Los Altos Hills does hereby authorize the City Manager to issue a Request for Proposal for the FY2025-2027 Landscaping Maintenance Services.
The above and foregoing resolution was passed and adopted by the City Council of the Town of Los Altos Hills at a regular meeting held on the 20th day of March 2025 by the following vote:
AYES:
NOES:
ABSTAIN:
ABSENT:
By:
Kavita Tankha, Mayor
ITEM 5H, Attachment 1
ATTEST:
Arika Birdsong-Miller, City Clerk
Town of Los Altos Hills
Public Works Department
26379 Fremont Road
Los Altos Hills, CA 94022
Request for Proposal
FY2025-2027 Landscape Maintenance
Services
Issue: March 24, 2025
Proposals Due:
April 22, 2025, at 4:00PM PDT
Pre-Proposal Meeting (Mandatory)
Tuesday, April 8, 2025, at 2:00 p.m.
Contact: Melissa Elian
Phone: (650) 947-2517
Email: [email protected]
ITEM 5H, Attachment 2
RFP – FY2025-2027 Landscaping Maintenance Services
Town of Los Altos Hills Page 1
Town of Los Altos Hills
REQUEST FOR PROPOSAL – FY2025-2027 LANDSCAPING MAINTENANCE
SERVICES
PURPOSE
The Town of Los Altos Hills (Town) is seeking the services of an experienced and qualified Landscape Maintenance Contractor with expertise in vegetation management, irrigation, water management, landscaping, soils, and fertilizers to maintain the assigned Town properties in a scheduled and professional manner for a period of two years, starting July 1, 2025, with an option to extend the service one additional year.
PROJECT
The scope of services includes all work to perform landscape maintenance at six (6) landscape sites with the seventh site (Purissima Park) as an optional site (pending proposal and budget) as described on the attached Exhibit “B” titled, “Town Los Altos Hills Landscape Sites Listing and Mapping.” Landscape Sites Listing are subject to update by the Town at any time. The contractor shall perform weekly maintenance of Town’s specified sites for a period of one year starting July 1, 2023, with an option to extend one additional year. The Town’s seven (7) sites require a full range of professional knowledge in various landscaping activities including irrigation systems operation.
Purissima Park (Map ID S-07), including the parking lot and paths, is an optional site that Town will consider including in the Annual Landscaping Maintenance Services agreement depending on the proposals and the Town’s budget. In addition to typical maintenance, Purissima Park will require maintenance twice a week during the baseball season, which is January to June and September to November.
The landscaping activities encompass tree/shrub/ground covering trimming, edging, fertilization, soil deficiency remediation, weeding, weed abatement, and pest control (without using harmful pesticide chemicals). Irrigation systems operations includes the maintenance, adjustment, installation and repair of a variety of components, such as: irrigation controllers, valves, moisture sensing devices, and sprinkler heads of a variety of manufactured brands and models. The selected contractor will work closely with the Public Works staff. The complete list of the scope of services and the requirements for such are included in Exhibit “A.” The scope of service included in Exhibit “A” will become part of the executed agreement.
Contractor must self-perform all required work without subcontractor services.
REQUEST FOR PROPOSAL (RFP) AND CONTRACT AWARD TIMELINE
Mandatory Job Walk/Pre-Proposal Meeting 04/8/2025 2:00 p.m.
Deadline to Submittal questions 04/16/2025, 4:00 p.m.
Response to Questions 04/18/2025
Submission Deadline for Proposal 04/22/2025, 4:00 p.m.
RFP – FY2025-2027 Landscaping Maintenance Services
Town of Los Altos Hills Page 2
MANDATORY JOB WALK/PRE-PROPOSAL MEETING
A mandatory pre-proposal site visit will be held at 2:00 p.m. on Tuesday, April 8, 2025.
Prospective Proposers will meet at Town Hall located at 26379 Fremont Road, Los Altos Hill, CA 94022. After congregating at the Town Hall at 2:00 p.m., Town staff and attendees will visit the following sites:
MapIDNo Site name Address
S-01 LAH Town Hall 26379 Fremont Road Los Altos Hills
S-02
Arastradero path Arastradero Rd. and Stirrup Way Los Altos Hills S-03
Fremont Road Path
Fremont Road
Concepcion Rd. to Edith Ave. Los Altos Hills
S-04 Edith Park Edith Ave. & Fremont Rd. Los Altos Hills S-05
Foothill College & El Monte
Pedestrian and Bike path
El Monte Road
Moody Rd. to Stonebrook Dr. Los Altos Hills
S-06 Westwind Community Barn 27210 Altamont Road Los Altos Hills S-07
Purissima Park including
Parking Lot and Paths 27500 Purissima Road Los Altos Hills There will be a sign in sheet for the pre-proposal meeting.
REQUIREMENTS AND DETAILS
Contractors participating in the RFP process must meet the following minimum qualifications to be considered:
1. The contractor will be a financially sound company primarily engaged in professional landscape maintenance in the State of California.
2. Have successfully completed a minimum of three (3) projects of comparable size and scope to this project, within the past five (5) years with references provided in proposal.
3. The contractor shall be able to provide personnel who have been fully trained in all phases of landscaping and irrigation systems operation, maintenance, adjustment and repair.
Contractor’s personnel should also have familiarity with all types of components including irrigation controllers, valves, moisture sensing devices and sprinkler heads of a variety of brands and models. The contractor and staff shall have expertise and experience in vegetation management, irrigation, water management, landscaping, pest control (without harmful chemicals), soils, and fertilizers.
RFP – FY2025-2027 Landscaping Maintenance Services
Town of Los Altos Hills Page 3
a. The contractor’s personnel shall include a manager/superintendent with experience in landscape maintenance supervision, who is able to receive and carry out instructions, either verbal or written, as given by the Town. b. The contractor’s staffing shall include at least one irrigation manager and one dedicated irrigation specialist.
4. Contractor shall hold a valid C-27 (Landscaping Contractor) California Contractor’s License and meet all current licensing and registration requirements, as may be required by the State of California Contractor State License Board (CSLB), the California Department of Industrial Relations (DIR), and the Town of Los Altos Hills without any official unresolved record of complaints registered or filed with the California Department of Consumer Affairs.
5. Able to provide proof of current insurance coverage in accordance with the Town’s insurance requirements.
6. Able to sign the completed Agreement shown in the TERMS AND CONDITIONS, Exhibit “E.” Town will not accept any requests for revisions to the Agreement terms.
7. Contractor shall provide a current and acceptable Injury and Illness Prevention Program (IIPP) to the Town.
8. Contractor shall abide by Ordinance 606 (Exhibit F) describing allowed use of Leaf Blowers including reduced noise which becomes effective July 1, 2023.
SUBMISSION REQUIREMENTS
For the proposal to be considered responsive, the contractor must submit all information requested in this RFP in the proposal. Failure to submit all required information, forms and documents in the proposal may result in disqualification. Proposals must be submitted on or before the closing date and time. Proposals received after the closing date and time will be considered non- responsive. It is the contractor’s responsibility to ensure that their proposal has been received by the Town.
The following information, forms and documents are to be submitted with the Proposal:
1. Services Detail Statement: A detailed scope of services, methodology, and frequency of services that comprehensively defines and describes the individual tasks involved in performing the Landscaping Maintenance services. This statement may be based on, but is not limited to, the information provided in the SCOPE OF SERVICES, Exhibit “A” of this RFP.
The Services Detail Statement should be on company letterhead and be no longer than 15 pages.
2. Fee Schedule: The Contractor shall provide a Fee Schedule table showing fully burdened labor rates for all labor categories of employees envisioned to provide services that align with the work.
RFP – FY2025-2027 Landscaping Maintenance Services
Town of Los Altos Hills Page 4
The Fee Schedule shall provide a fee for each site grouped by “Job No” shown by Exhibit “B” and then summed to a TOTAL FEE. The Fee Schedule shall also provide rates and/or unit prices for any corrective work as described in Exhibit “A.” Please present information legibly and ensure all calculations are correct, as this Fee Table will be utilized to review invoices.
Prices/rates shall be valid for the term of the proposal contract and include all labor, equipment, materials, fees, permits, traffic control, tools and equipment, transportation, overhead, travel, profit, insurance, sales and other taxes, license, incidentals, and all other related costs necessary to meet the work requirements described in Exhibit A.
The Town makes no guarantees that the full value of the contract will be paid to the contractor. The Town will compensate the Contractor based on the sites and work performed and the unit prices in the Fee Schedule provided in the proposal.3. Contractor’s Business Statement and References, Exhibit C: Provide details of contractor’s company, references of relevant projects (minimum of 6) including comprehensive project/contract description, valid project contact information, qualifications and current pre-qualified vendor status. If necessary, extra pages may be attached to the provided form to expand on contractor’s profile or references. Include copies of any required licenses or certifications, as separate attachments.
4. Submission of Proposal: The contractor’s proposal must be mailed or hand-delivered (three hardcopies) to the following address in a sealed envelope or emailed to the Town Contact (single electronic copy) on or prior to the Submission Deadline:
Town of Los Altos Hills – Public Works Department
26379 Fremont Road
Los Altos Hills
CA 94022
Attention: Melissa Elian-Carrillo
Town Contact Email: [email protected] It is the contractor’s responsibility to confirm that the Town is in receipt of proposal. Late proposals will not be accepted. Faxed proposals will not be accepted.
EVALUATION PROCESS AND SELECTION CRITERIA
Selection of the Contractor will be based upon a competitive selection process. All elements of the pricing proposal will be considered include responsiveness of proposal and price. Criteria to be evaluated shall include the following:
1. Experience, references, and past performance under a similar scope of Services
2. Cost to perform the required services stated in the SCOPE OF SERVICES, Exhibit “A” and identified in the contractor provided Fee Schedule.
RFP – FY2025-2027 Landscaping Maintenance Services
Town of Los Altos Hills Page 5
3. Contractor capabilities and references as related to the requirements in the Scope of Services.
PREVAILING WAGES
Certain labor categories under this project are subject to prevailing wages as identified in the State of California Labor Code Sections 1720 et seq and 1770 et seq. which require the payment of prevailing wage rates and the performance on certain “public works” and “maintenance” project, as defined by the Prevailing Wage Laws, and if the total compensation is $1,000 or more, contractor agrees, to fully comply with such Prevailing Wage Laws, if applicable.
The contractor to whom a contract for the work is awarded shall comply with the provision of the California Labor Code.
CONTRACTOR REGISTRATION
Contractors submitting proposals on this project must be registered with the Department of Industrial Relations pursuant to the requirements of Sections 1725.5 and 1771.1 of the California Labor Code. Contractor registration information can be found at http://www.dir.ca.gov/PublicWorks/PublicWorks.html. Contracts entered into with any contractor in violation of Section 1771.1(a), shall be subject to cancellation by the Town at the sole discretion of the Town consistent with Section 1771.1(e).
Contractors submitting proposals on this project must be registered with the Department of Industrial Relations pursuant to the requirements of Sections 1725.5 and 1771.1 of the California Labor Code prior to submitting a Proposal.
DIR Registration numbers shall be provided by Contractor on Contractor’s Business Statement and References, Exhibit C, when submitting Proposal.
Contractors submitting proposals on this project acknowledge that this project is subject to compliance monitoring and enforcement by the Department of Industrial Relations.
GENERAL
Town is not committed to any course of action as a result of its issuance of this RFP and/or its receipt of a proposal from any contractor in response to it. In particular, contractors shall note that Town may:
1. Reject any proposal that does not conform to instructions and specifications, which are issued herein.
2. Not accept proposals after the stated submission deadline.
3. Waive any informality, irregularity, immaterial defects or technicalities in any proposals or other responses received.
4. Reject all proposals.
5. Cancel the RFP at anytime.
6. Award a contract in connection with this RFP at any time.
RFP – FY2025-2027 Landscaping Maintenance Services
Town of Los Altos Hills Page 6
7. Make no award of contract.
8. Negotiate agreement terms with the awarded contractor at the Town’s discretion.
Town will not reimburse any organization for proposal preparation costs or other work performed in connection with this RFP, whether or not the contractor is awarded a contract.
Proposals (including accompanying materials) will become the property of Town. Proposals will be held in confidence to the extent permitted by law. After award of a contract or after rejection of all proposals, the proposals will be public record subject to disclosure under the California Public Records Act (Government Code Section 6250 et seq.). The Proposal together with copies of all documents pertaining to any award, if issued, shall be opened to public inspection. All information submitted as a part of a Proposal will be open to public inspection (except items marked as trade secrets and considered a trade secret under the California Public Records Act) after the award has been made. Town reserves the right to request additional information from prospective contractors prior to final selection and to consider information about a firm other than that submitted in the proposal.
Pricing shall remain firm-fixed for the first year of the Contract. Pricing for the potential subsequent years of the contract will be reviewed four months prior to the expiration date. All Proposals shall remain valid offers open for the Town acceptance for a minimum of 120 days following the RFP due date.
If any contractor response to this RFP contains trade secrets that you do not want disclosed to the public or used by the Town for any purpose other than evaluation of your approach, then mark the top of each sheet of such information with the following legend: “CONFIDENTIAL INFORMATION”
Should a request be made to Town for information that has been designated confidential by the contractor and, on the basis of that designation, Town denies the request for information, the contractor may be responsible for all legal cost, necessary to defend such action if the denial is challenged in a court of law.
Any changes, additions, or deletions to the RFP will be in the form of a written addendum issued by Town’s Public Works Department and forwarded to all contractors. Except as stated in this provision, no person is authorized to amend or revise any part of this RFP, in any respect, either in writing or by oral statement.
QUESTIONS
Contractors are responsible for reading carefully and understanding fully the terms and conditions of this RFP. Requests for clarification or additional information must be made to the Town Contact below before the deadline:
RFP – FY2025-2027 Landscaping Maintenance Services
Town of Los Altos Hills Page 7
Melissa Elian-Carrillo – Assistant Engineer: (650) 947-2517 Email Question to [email protected] in the Subject line of email type “FY2025-2027 Landscape Maintenance Services Question(s)” Only written communications relative to this RFP shall be considered. It is incumbent upon contractors to verify Town is in receipt of their questions. Misinterpretation of the contract documents by the contractor shall not relieve an awarded contractor of responsibility to perform the contract.
To the extent that a question causes a change to any part of this RFP, an addendum shall be issued addressing such.
Deadline to for Submittal questions 4/16/2025, 4:00 p.m.
Response to Questions 4/18/2025
RFP – FY2025-2027 Landscaping Maintenance Services
Town of Los Altos Hills Page 8
EXHIBIT “A”
SCOPE OF SERVICES
The scope of services includes all work to perform landscape maintenance at numerous landscape sites shown on the attached, Exhibit “B” for a period of two years starting July 1, 2025. The Town will have an option to extend the agreement and services for one additional year. Contractor will be responsible to keep walkways, driveways, gutters, parking lots, and pathways within the sites clear of debris, trim ground cover, prune shrubs and trees, control insects and diseases, fertilize all plant materials, weed and remove litter and debris from all landscaping areas, eliminate rodents, maintain irrigation systems in good working order and adhere to all safety requirements and personal protective equipment (PPE) requirements. The contractor shall consider the following specific maintenance activities in their proposed scope of work:
1. EDGING
All ground cover and shrubs adjacent to walkways and curbs shall be trimmed to maintain a crisp, manicured appearance.
2. GROUND COVER
All ground cover shall be kept low, trimmed, and weed free. Ground cover shall be kept from covering valve boxes, irrigation control boxes, mainline valves, air-vac boxes, meters, and backflow devices.
3. WATERING
Irrigation systems shall be turned off manually or confirmed to turn off, if automated, during long periods of rain. The contractor will adjust irrigation timers to eliminate excess run-off and over spray at all water sites. All sites will be irrigated during the hours of 9:00 p.m. to 6:00 a.m.
4. WEED CONTROL
Weeding in shrub areas and ground cover planters will be done by hand or as deemed necessary for the sites listed.
5. WEED ABATEMENT
Weed abatement consists of pulling and/or cutting weeds on an as deemed necessary for the sites listed.
6. PEST CONTROL
Contractor shall provide pest control without harmful chemicals as necessary. Pest control may include, but not limited to, aphids, snails, wireworms, grasshoppers. The contractor shall also provide pest control with the presence of ground squirrel or evidence of gopher.
RFP – FY2025-2027 Landscaping Maintenance Services
Town of Los Altos Hills Page 9
If the Contractor is handling any chemicals, it shall be done in accordance with all applicable Federal, State, County and Local laws and including mandated regulations and label requirements.
If any chemicals are being handled, Contractor will provide Town with all Safety Data Sheets (SDS) prior to starting work.
7. SHRUBS
Contractor shall trim or prune shrubs as needed and shape shrubs in either a formal or informal manner, dependent upon plant species. Contractor shall keep shrubs clear of all Town appurtenances including water meters, backflow devices, fire hydrants, air vacs, mainline valve cans, irrigation control valves, and irrigation control clocks.
Contractor shall apply fertilizer as deemed necessary.
Contractor shall keep areas of decomposed granite raked and weed free at all times.
8. DECOMPOSED GRANITE
Areas eroded shall be addressed immediately. All asphalt and decomposed granite areas are to be kept weed free at all locations.
9. TREES
All trees shall be monitored on the frequency noted in Exhibit “B” and/or as deemed necessary.
Contractor shall maintain all ties and stakes. All support devices shall be removed and/or replaced should tree growth no longer require support or the tree becomes damaged due to the support.
Contractor shall supply all support devices, wires and ties when required.
Trees up to 15 feet tall shall be pruned during the dormant season. Supplemental pruning throughout the year shall be performed to eliminate low growth or cross branches. Sucker growth at the base of trees shall be removed promptly. Contractor shall maintain adequate watering basins around all trees in open ground to facilitate deep watering and moisture retention.
Fertilizer will be applied, as deemed necessary.
10. IRRIGATION AND DRAINAGE
Contractor shall notify Town's staff of repair on sprinkler heads, irrigation lines, and valves, and obtain Town approval before repairs service are rendered. Vandalism to irrigation control clocks and backflow devices will be considered vandalism and must be brought to the attention of the Town for further action.
Contractor shall be responsible for proper adjustment of sprinklers and maintain adequate coverage.
Contractor shall adjust irrigation timers to eliminate excessive run-off and overspray at all water sites.
Contractor shall monitor all irrigation and watering systems at the time of maintenance to ensure proper working order. Contractor shall observe the full watering cycle to ensure correct irrigation
RFP – FY2025-2027 Landscaping Maintenance Services
Town of Los Altos Hills Page 10
duration. Irrigation timers shall be set to water landscaping during the hours of 9:00 p.m. to 6:00 a.m.
Contractor will provide and maintain adequate surface drainage at all times. Deficiencies in drainage shall be corrected promptly. Contractor shall inspect, at the time of maintenance, all existing drainage structures to insure proper working order. Contractor shall clean all catch basins, v ditches, drainage pipes, and other drainage facilities located within landscaped areas, as necessary.
11. CLEAN UP
Contractor shall properly dispose of all clippings, trash and other waste, in a manner consistent with local laws, ordinances or codes.
All trash shall be collected from the sites as necessary. Leaves shall be kept clear from all walkways as necessary. Driveways and gutters at all sites shall be cleared of all debris as necessary.
12. PATHS AND PARKING LOT
Contractor shall properly maintain paths and parking lots removing, dead vegetation and debris.
Contractor shall keep paths and parking lot clean and clear. All leaf blowers shall abide by Ordinance 606 (Exhibit F) which discusses use of leaf blowers including reduced noise leaf blowers. Ordinance 606 is in effect as of July 1, 2023.
13. ADDITIONAL RESPONSIBILITIES OF THE CONTRACTOR
Contractor shall provide all labor, equipment, tools, chemicals, and supervision required to perform all work including, but not limited to:
All necessary Town, County, and State permits and/or licenses for equipment and personnel. Hours worked at Town sites must adhere to local ordinances. Contractor shall maintain at all times a 24-hour emergency contact telephone number. Contractor shall comply with Town insurance requirements. Contractor work crews shall perform work in a safe, orderly, and professional manner.
Contractor shall have work crew wearing garment that identifies worker as an employee of contractor.
Contractor shall be experienced in landscape maintenance and have formal education in horticulture or a closely related field. Contractor shall maintain such experience at the appropriate level of responsibility during the work at the Town sites
EXHIBIT “B”
TOWN OF LOS ALTOS HILLS
LANDSCAPE SITE LISTING AND MAPPING
MapIDNo Site name Address
S-01 LAH Town Hall 26379 Fremont Road Los Altos Hills
S-02
Arastradero Path Arastradero Rd. and Stirrup Way Los Altos Hills S-03
Fremont Road Path
Fremont Road
Concepcion Rd. to Edith Ave. Los Altos Hills
S-04 Edith Park Edith Ave. & Fremont Rd. Los Altos Hills S-05
Foothill College & El Monte
Pedestrian and Bike path
El Monte Road
Moody Rd. to Stonebrook Dr. Los Altos Hills
S-06 Westwind Community Barn 27210 Altamont Road Los Altos Hills Optional
S-07
Purissima Park
27500 Purissima Road Los Altos Hills
EXHIBIT “C”
BUSINESS STATEMENT AND REFERENCES
This form must be completed and signed by the Contractor proposed to participate in this award. Attach additional copies of this form as required.
Company Name:
Mailing Address:
Town: State: Zip:
Telephone No.: Fax No.:
Contact Person’s Name:
Telephone No.: Fax No.:
Email Address:
Business License No.: Town:
State: Expiration Date:
Federal ID No. or Social Security No.:
DIR Registration Number:
Telephone No.: Fax No.:
Mailing Address:
Town: State: Zip:
Type of Organization: (Check all that apply)
□ Corporation, under the laws of the State of
□ Individual
□ Joint Venture
□ Municipal, State, or Federal
□ S Corporation
□ General Partnership
□ Limited Partnership
□ Non-Profit Corporation
□ Small Business Enterprise: A business enterprise that is independently owned and operated; organized for profit; is not dominant in its field; and meets the criteria set forth by the Small Business Administration in Title 13, Code of Federal Regulations, Part 121.
Company representative authorized to sign contracts.
Name Title Telephone
Signature Date
REFERENCES
A minimum of five (5) references. Local and similar size contract references are preferred.
REFERENCE NO. 1
NAME OF FIRM
ADDRESS
CITY, STATE, ZIP
TELEPHONE NO.
CONTACT
PROJECT NAME
COMPLETION DATE
APPROX. COST
REFERENCE NO. 2
NAME OF FIRM
ADDRESS
CITY, STATE, ZIP
TELEPHONE NO.
CONTACT
PROJECT NAME
COMPLETION DATE
APPROX. COST
REFERENCE NO. 3
NAME OF FIRM
ADDRESS
CITY, STATE, ZIP
TELEPHONE NO.
CONTACT
PROJECT NAME
COMPLETION DATE
APPROX. COST
REFERENCE NO. 4
NAME OF FIRM
ADDRESS
CITY, STATE, ZIP
TELEPHONE NO.
CONTACT
PROJECT NAME
COMPLETION DATE
APPROX. COST
REFERENCES continued
REFERENCE NO. 5
NAME OF FIRM
ADDRESS
CITY, STATE, ZIP
TELEPHONE NO.
CONTACT
PROJECT NAME
COMPLETION DATE
APPROX. COST
EXHIBIT "D”
COMPENSATION
MapIDNo Site name Address Monthly Amount
S-01 LAH Town Hall 26379 Fremont Road $__________
S-02
Arastradero path Arastradero Rd. and Stirrup Way $__________ S-03
Fremont Road Path
Fremont Road
Concepcion Rd. to Edith Ave. $__________
S-04 Edith Park Edith Ave. & Fremont Rd. $__________
S-05
Foothill College & El Monte
Pedestrian and Bike path
El Monte Road
Moody Rd. to Stonebrook Dr.
$__________
S-06 Westwind Community Barn 27210 Altamont Road $__________ Monthly Total $__________
Optional
S-07 Purissima Park 27500 Purissima Road $__________
PROPOSERS: Please show date, and time on RFP opening on the envelope containing your proposal.
The undersigned as Proposer, declares that the only persons or parties interested in this proposal is made without collusion with any person, firm or corporation. Your signature on this document, should you be awarded the contract as defined in this RFP, signifies that you have fully read and understood this proposal and will comply with all specifications, conditions, unit prices, terms, and delivery of the proposal unless otherwise noted in the “exceptions” portion of the proposal.
Name of
Offeror (Firm): Title:
Authorized
Signature: Date:
Printed/Typed
Name:
Mailing
Address:
Phone: ( )
City,
State,
Zip:
Fax: ( )
E-Mail
Address:
EXHIBIT “E”
AGREEMENT
Consulting Services Agreement between [EFFECTIVE DATE]
Town of Los Altos Hills and ______________ Page 1 of 13
MAINTENANCE SERVICES AGREEMENT BETWEEN
THE TOWN OF LOS ALTOS HILLS AND
[NAME OF CONTRACTOR]
THIS AGREEMENT for consulting services is made by and between the Town of Los Altos Hills (“Town”) and __________________ (“Contractor”) (together referred to as the “Parties”) as of ____________, 20__ (the “Effective Date”).
Section 1. SERVICES. Subject to the terms and conditions set forth in this Agreement, Contractor shall provide to Town the services described in the Scope of Work attached as Exhibit A , and incorporated herein, at the time and place and in the manner specified therein. In the event of a conflict in or inconsistency between the terms of this Agreement and Exhibit A, the Agreement shall prevail.
1.1 Term of Services. The term of this Agreement shall begin on the Effective Date and shall end on _______________, the date of completion specified in Exhibit A, and Contractor shall complete the work described in Exhibit A on or before that date, unless the term of the Agreement is otherwise terminated or extended, as provided for in Section 8. The time provided to Contractor to complete the services required by this Agreement shall not affect the Town’s right to terminate the Agreement, as referenced in Section 8.
1.2 Standard of Performance. Contractor shall perform all services required pursuant to this Agreement according to the standards observed by a competent practitioner of the profession in which Contractor is engaged.
1.3 Assignment of Personnel. Contractor shall assign only competent personnel to perform services pursuant to this Agreement. In the event that Town, in its sole discretion, at any time during the term of this Agreement, desires the reassignment of any such persons, Contractor shall, immediately upon receiving notice from Town of such desire of Town, reassign such person or persons.
1.4 Time. Contractor shall devote such time to the performance of services pursuant to this Agreement as may be reasonably necessary to meet the standard of performance provided in Section 1.1 above and to satisfy Contractor’s obligations hereunder.
Section 2. COMPENSATION. Town hereby agrees to pay Contractor a sum not to exceed ________________, notwithstanding any contrary indications that may be contained in Contractor’s proposal, for services to be performed and reimbursable costs incurred under this Agreement. In the event of a conflict between this Agreement and Contractor’s proposal, attached as Exhibit A, regarding the amount of compensation, the Agreement shall prevail. Town shall pay Contractor for services rendered pursuant to this Agreement at the time and in the manner set forth herein. The payments specified below shall be the only payments from Town to Contractor for services rendered pursuant to this Agreement.
Contractor shall submit all invoices to Town in the manner specified herein. Except as specifically authorized by Town in writing, Contractor shall not bill Town for duplicate services performed by more than one person.
Consulting Services Agreement between [EFFECTIVE DATE]
Town of Los Altos Hills and ______________ Page 2 of 13 Contractor and Town acknowledge and agree that compensation paid by Town to Contractor under this Agreement is based upon Contractor’s estimated costs of providing the services required hereunder, including salaries and benefits of employees and subcontractors of Contractor. Consequently, the parties further agree that compensation hereunder is intended to include the costs of contributions to any pensions and/or annuities to which Contractor and its employees, agents, and subcontractors may be eligible. Town therefore has no responsibility for such contributions beyond compensation required under this Agreement.
2.1 Invoices. Contractor shall submit invoices, not more often than once a month during the term of this Agreement, based on the cost for services performed and reimbursable costs incurred prior to the invoice date. Invoices shall contain the following information:
Serial identifications of progress bills; i.e., Progress Bill No. 1 for the first invoice, etc.;
The beginning and ending dates of the billing period; A Task Summary containing the original contract amount, the amount of prior billings, the total due this period, the balance available under the Agreement, and the percentage of completion;
At Town’s option, for each work item in each task, a copy of the applicable time entries or time sheets shall be submitted showing the name of the person doing the work, the hours spent by each person, a brief description of the work, and each reimbursable expense;
The total number of hours of work performed under the Agreement by Contractor and each employee, agent, and subcontractor of Contractor performing services hereunder;
The Contractor’s signature;
Contractor shall give separate notice to the Town when the total number of hours worked by Contractor and any individual employee, agent, or subcontractor of Contractor reaches or exceeds 800 hours within a 12-month period under this Agreement and any other agreement between Contractor and Town. Such notice shall include an estimate of the time necessary to complete work described in Exhibit A and the estimate of time necessary to complete work under any other agreement between Contractor and Town, if applicable.
2.2 Monthly Payment. Town shall make monthly payments, based on invoices received, for services satisfactorily performed, and for authorized reimbursable costs incurred. Town shall have 30 days from the receipt of an invoice that complies with all of the requirements above to pay Contractor.
2.3 Final Payment. Town shall pay the last 10% of the total sum due pursuant to this Agreement within 60 days after completion of the services and submittal to Town of a final invoice, if all services required have been satisfactorily performed.
2.4 Total Payment. Town shall pay for the services to be rendered by Contractor pursuant to this Agreement. Town shall not pay any additional sum for any expense or cost whatsoever incurred by Contractor in rendering services pursuant to this Agreement.
Consulting Services Agreement between [EFFECTIVE DATE]
Town of Los Altos Hills and ______________ Page 3 of 13 Town shall make no payment for any extra, further, or additional service pursuant to this Agreement.
In no event shall Contractor submit any invoice for an amount in excess of the maximum amount of compensation provided above either for a task or for the entire Agreement, unless the Agreement is modified prior to the submission of such an invoice by a properly executed change order or amendment.
2.5 Hourly Fees. Fees for work performed by Contractor on an hourly basis shall not exceed the amounts shown on the compensation schedule attached hereto as Exhibit B.
2.6 Reimbursable Expenses. Reimbursable expenses are specified below, and shall not exceed $ . Expenses not listed below are not chargeable to Town. Reimbursable expenses are included in the total amount of compensation provided under this Agreement that shall not be exceeded.
2.7 Payment of Taxes. Contractor is solely responsible for the payment of employment taxes incurred under this Agreement and any similar federal or state taxes.
2.8 Payment upon Termination. In the event that the Town or Contractor terminates this Agreement pursuant to Section 8, the Town shall compensate the Contractor for all outstanding costs and reimbursable expenses incurred for work satisfactorily completed as of the date of written notice of termination. Contractor shall maintain adequate logs and timesheets to verify costs incurred to that date.
2.9 Authorization to Perform Services. The Contractor is not authorized to perform any services or incur any costs whatsoever under the terms of this Agreement until receipt of authorization from the Contract Administrator.
Section 3. FACILITIES AND EQUIPMENT. Except as set forth herein, Contractor shall, at its sole cost and expense, provide all facilities and equipment that may be necessary to perform the services required by this Agreement. Town shall make available to Contractor only the facilities and equipment listed in this section, and only under the terms and conditions set forth herein.
Section 4. INSURANCE REQUIREMENTS. Before beginning any work under this Agreement, Contractor, at its own cost and expense, unless otherwise specified below, shall procure the types and amounts of insurance listed below against claims for injuries to persons or damages to property that may arise from or in connection with the performance of the work hereunder by the Contractor and its agents, representatives, employees, and subcontractors. Consistent with the following provisions, Contractor shall provide proof satisfactory to Town of such insurance that meets the requirements of this section and under forms of insurance satisfactory in all respects, and that such insurance is in effect prior to beginning work to the Town. Contractor shall maintain the insurance policies required by this section throughout the term of this Agreement. The cost of such insurance shall be included in the Contractor's bid. Contractor shall not allow any subcontractor to commence work on any subcontract until Contractor has obtained all insurance required herein for the subcontractor(s) and provided evidence that such insurance is in effect to Town.
Consulting Services Agreement between [EFFECTIVE DATE]
Town of Los Altos Hills and ______________ Page 4 of 13 Verification of the required insurance shall be submitted and made part of this Agreement prior to execution. Contractor shall maintain all required insurance listed herein for the duration of this Agreement.
4.1 Workers’ Compensation. Contractor shall, at its sole cost and expense, maintain Statutory Workers’ Compensation Insurance and Employer’s Liability Insurance for any and all persons employed directly or indirectly by Contractor. The Statutory Workers’ Compensation Insurance and Employer’s Liability Insurance shall be provided with limits of not less than $___________________ [dollar amount to be determined based on nature of the work—if no extenuating circumstances exist, $1,000,000 is typically required] per accident. In the alternative, Contractor may rely on a self-insurance program to meet those requirements, but only if the program of self-insurance complies fully with the provisions of the California Labor Code. Determination of whether a selfinsurance program meets the standards of the Labor Code shall be solely in the discretion of the Contract Administrator. The insurer, if insurance is provided, or the Contractor, if a program of self-insurance is provided, shall waive all rights of subrogation against the Town and its officers, officials, employees, and volunteers for loss arising from work performed under this Agreement.
4.2 Commercial General and Automobile Liability Insurance.
4.2.1 General requirements. Contractor, at its own cost and expense, shall maintain commercial general and automobile liability insurance for the term of this Agreement in an amount not less than $_______________________[dollar amount to be determined based on nature of the work—if no extenuating circumstances exist, $1,000,000 is typically required] per occurrence, combined single limit coverage for risks associated with the work contemplated by this Agreement. If a Commercial General Liability Insurance or an Automobile Liability form or other form with a general aggregate limit is used, either the general aggregate limit shall apply separately to the work to be performed under this Agreement or the general aggregate limit shall be at least twice the required occurrence limit. Such coverage shall include but shall not be limited to, protection against claims arising from bodily and personal injury, including death resulting therefrom, and damage to property resulting from activities contemplated under this Agreement, including the use of owned and non-owned automobiles.
4.2.2 Minimum scope of coverage. Commercial general coverage shall be at least as broad as Insurance Services Office Commercial General Liability occurrence form CG 0001 (most recent edition) covering comprehensive General Liability on an “occurrence” basis. Automobile coverage shall be at least as broad as Insurance Services Office Automobile Liability form CA 0001 (most recent edition), Code 1 (any auto). No endorsement shall be attached limiting the coverage.
4.2.3 Additional requirements. Each of the following shall be included in the insurance coverage or added as a certified endorsement to the policy:
Consulting Services Agreement between [EFFECTIVE DATE]
Town of Los Altos Hills and ______________ Page 5 of 13 a. The Insurance shall cover on an occurrence or an occurrence basis, and not on a claims-made basis.
b. Town, its officers, officials, employees, and volunteers are to be covered as insureds as respects: liability arising out of work or operations performed by or on behalf of the Contractor; or automobiles owned, leased, hired, or borrowed by the Contractor
c. For any claims related to this Agreement or the work hereunder, the Contractor’s insurance covered shall be primary insurance as respects the Town, its officers, officials, employees, and volunteers. Any insurance or self-insurance maintained by the Town, its officers, officials, employees, or volunteers shall be excess of the Contractor’s insurance and shall not contribute with it.
d. Each insurance policy required by this clause shall be endorsed to state that coverage shall not be canceled by either party, except after 30 days’ prior written notice has been provided to the Town.
4.3 Professional Liability Insurance.
4.3.1 General requirements. Contractor, at its own cost and expense, shall maintain for the period covered by this Agreement professional liability insurance for licensed professionals performing work pursuant to this Agreement in an amount not less than $_________________________[dollar amount to be determined based on the nature of the work—if no extenuating circumstances exist, $1,000,000 is typically required] covering the licensed professionals’ errors and omissions. Any deductible or self-insured retention shall not exceed $150,000 per claim.
4.3.2 Claims-made limitations. The following provisions shall apply if the professional liability coverage is written on a claims-made form:
a. The retroactive date of the policy must be shown and must be before the date of the Agreement.
b. Insurance must be maintained and evidence of insurance must be provided for at least five years after completion of the Agreement or the work, so long as commercially available at reasonable rates. c. If coverage is canceled or not renewed and it is not replaced with another claims-made policy form with a retroactive date that precedes the date of this Agreement, Contractor must purchase an extended period coverage for a minimum of five years after completion of work under this Agreement.
Consulting Services Agreement between [EFFECTIVE DATE]
Town of Los Altos Hills and ______________ Page 6 of 13 d. A copy of the claim reporting requirements must be submitted to the Town for review prior to the commencement of any work under this Agreement.
4.4 All Policies Requirements.
4.4.1 Acceptability of insurers. All insurance required by this section is to be placed with insurers with a Bests' rating of no less than A:VII.
4.4.2 Verification of coverage. Prior to beginning any work under this Agreement, Contractor shall furnish Town with complete copies of all policies delivered to Contractor by the insurer, including complete copies of all endorsements attached to those policies. All copies of policies and endorsements shall show the signature of a person authorized by that insurer to bind coverage on its behalf. If the Town does not receive the required insurance documents prior to the Contractor beginning work, it shall not waive the Contractor’s obligation to provide them. The Town reserves the right to require complete copies of all required insurance policies at any time.
4.4.3 Deductibles and Self-Insured Retentions. Contractor shall disclose to and obtain the written approval of Town for the self-insured retentions and deductibles before beginning any of the services or work called for by any term of this Agreement. At the option of the Town, either: the insurer shall reduce or eliminate such deductibles or self-insured retentions as respects the Town, its officers, employees, and volunteers; or the Contractor shall provide a financial guarantee satisfactory to the Town guaranteeing payment of losses and related investigations, claim administration and defense expenses.
4.4.4 Wasting Policies. No policy required by this Section 4 shall include a “wasting” policy limit (i.e. limit that is eroded by the cost of defense).
4.4.5 Waiver of Subrogation. Contractor hereby agrees to waive subrogation which any insurer or contractor may require from vendor by virtue of the payment of any loss. Contractor agrees to obtain any endorsements that may be necessary to affect this waiver of subrogation.
The Workers’ Compensation policy shall be endorsed with a waiver of subrogation in favor of the entity for all work performed by the Contractor, its employees, agents, and subcontractors.
4.4.6 Subcontractors. Contractor shall include all subcontractors as insureds under its policies or shall furnish separate certificates and endorsements for each subcontractor. All coverages for subcontractors shall be subject to all of the requirements stated herein.
4.5 Remedies. In addition to any other remedies Town may have if Contractor fails to provide or maintain any insurance policies or policy endorsements to the extent and within the time
Consulting Services Agreement between [EFFECTIVE DATE]
Town of Los Altos Hills and ______________ Page 7 of 13 herein required, Town may, at its sole option exercise any of the following remedies, which are alternatives to other remedies Town may have and are not the exclusive remedy for Contractor’s breach:
Obtain such insurance and deduct and retain the amount of the premiums for such insurance from any sums due under the Agreement;
Order Contractor to stop work under this Agreement or withhold any payment that becomes due to Contractor hereunder, or both stop work and withhold any payment, until Contractor demonstrates compliance with the requirements hereof; and/or Terminate this Agreement.
Section 5. INDEMNIFICATION AND CONTRACTOR’S RESPONSIBILITIES.
Contractor shall indemnify, defend with counsel acceptable to Town, and hold harmless Town and its officers, officials, employees, agents and volunteers from and against any and all liability, loss, damage, claims, expenses, and costs (including without limitation, attorney’s fees and costs and fees of litigation) (collectively, “Liability”) of every nature arising out of or in connection with Contractor’s performance of the Services or its failure to comply with any of its obligations contained in this Agreement, except such Liability caused by the sole negligence or willful misconduct of Town.
The Contractor’s obligation to defend and indemnify shall not be excused because of the Contractor’s inability to evaluate Liability or because the Contractor evaluates Liability and determines that the Contractor is not liable to the claimant. The Contractor must respond within 30 days, to the tender of any claim for defense and indemnity by the Town, unless this time has been extended by the Town. If the Contractor fails to accept or reject a tender of defense and indemnity within 30 days, in addition to any other remedy authorized by law, so much of the money due the Contractor under and by virtue of this Agreement as shall reasonably be considered necessary by the Town, may be retained by the Town until disposition has been made of the claim or suit for damages, or until the Contractor accepts or rejects the tender of defense, whichever occurs first.
With respect to third party claims against the Contractor, the Contractor waives any and all rights of any type to express or implied indemnity against the Indemnitees.
Notwithstanding the forgoing, to the extent this Agreement is a “construction contract” as defined by California Civil Code Section 2782, as may be amended from time to time, such duties of Contractor to indemnify shall not apply when to do so would be prohibited by California Civil Code Section 2782.
In the event that Contractor or any employee, agent, or subcontractor of Contractor providing services under this Agreement is determined by a court of competent jurisdiction or the California Public Employees Retirement System (PERS) to be eligible for enrollment in PERS as an employee of Town, Contractor shall indemnify, defend, and hold harmless Town for the payment of any employee and/or employer contributions for PERS benefits on behalf of Contractor or its employees, agents, or subcontractors, as well as for the payment of any penalties and interest on such contributions, which would otherwise be the responsibility of Town.
Consulting Services Agreement between [EFFECTIVE DATE]
Town of Los Altos Hills and ______________ Page 8 of 13 Section 6. STATUS OF CONTRACTOR.
6.1 Independent Contractor. At all times during the term of this Agreement, Contractor shall be an independent contractor and shall not be an employee of Town. Town shall have the right to control Contractor only insofar as the results of Contractor's services rendered pursuant to this Agreement and assignment of personnel pursuant to Subparagraph 1.3; however, otherwise Town shall not have the right to control the means by which Contractor accomplishes services rendered pursuant to this Agreement. Notwithstanding any other Town, state, or federal policy, rule, regulation, law, or ordinance to the contrary, Contractor and any of its employees, agents, and subcontractors providing services under this Agreement shall not qualify for or become entitled to, and hereby agree to waive any and all claims to, any compensation, benefit, or any incident of employment by Town, including but not limited to eligibility to enroll in the California Public Employees Retirement System (PERS) as an employee of Town and entitlement to any contribution to be paid by Town for employer contributions and/or employee contributions for PERS benefits.
6.2 Contractor Not an Agent. Except as Town may specify in writing, Contractor shall have no authority, express or implied, to act on behalf of Town in any capacity whatsoever as an agent. Contractor shall have no authority, express or implied, pursuant to this Agreement to bind Town to any obligation whatsoever.
Section 7. LEGAL REQUIREMENTS.
7.1 Governing Law. The laws of the State of California shall govern this Agreement.
7.2 Compliance with Applicable Laws. Contractor and any subcontractors shall comply with all laws applicable to the performance of the work hereunder.
7.3 Other Governmental Regulations. To the extent that this Agreement may be funded by fiscal assistance from another governmental entity, Contractor and any subcontractors shall comply with all applicable rules and regulations to which Town is bound by the terms of such fiscal assistance program.
7.4 Licenses and Permits. Contractor represents and warrants to Town that Contractor and its employees, agents, and any subcontractors have all licenses, permits, qualifications, and approvals of whatsoever nature that are legally required to practice their respective professions. Contractor represents and warrants to Town that Contractor and its employees, agents, any subcontractors shall, at their sole cost and expense, keep in effect at all times during the term of this Agreement any licenses, permits, and approvals that are legally required to practice their respective professions. In addition to the foregoing, Contractor and any subcontractors shall obtain and maintain during the term of this Agreement valid Business Licenses from Town.
7.5 Nondiscrimination and Equal Opportunity. Contractor shall not discriminate, on the basis of a person’s race, religion, color, national origin, age, physical or mental handicap or
Consulting Services Agreement between [EFFECTIVE DATE]
Town of Los Altos Hills and ______________ Page 9 of 13 disability, medical condition, marital status, sex, or sexual orientation, against any employee, applicant for employment, subcontractor, bidder for a subcontract, or participant in, recipient of, or applicant for any services or programs provided by Contractor under this Agreement. Contractor shall comply with all applicable federal, state, and local laws, policies, rules, and requirements related to equal opportunity and nondiscrimination in employment, contracting, and the provision of any services that are the subject of this Agreement, including but not limited to the satisfaction of any positive obligations required of Contractor thereby.
Contractor shall include the provisions of this Subsection in any subcontract approved by the Contract Administrator or this Agreement.
Section 8. TERMINATION AND MODIFICATION.
8.1 Termination. Town may cancel this Agreement at any time and without cause upon written notification to Contractor.
Contractor may cancel this Agreement upon _____________ days’ written notice to Town and shall include in such notice the reasons for cancellation.
In the event of termination, Contractor shall be entitled to compensation for services performed to the effective date of termination; Town, however, may condition payment of such compensation upon Contractor delivering to Town any or all documents, photographs, computer software, video and audio tapes, and other materials provided to Contractor or prepared by or for Contractor or the Town in connection with this Agreement.
8.2 Extension. Town may, in its sole and exclusive discretion, extend the end date of this Agreement beyond that provided for in Subsection 1.1. Any such extension shall require a written amendment to this Agreement, as provided for herein. Contractor understands and agrees that, if Town grants such an extension, Town shall have no obligation to provide Contractor with compensation beyond the maximum amount provided for in this Agreement. Similarly, unless authorized by the Contract Administrator, Town shall have no obligation to reimburse Contractor for any otherwise reimbursable expenses incurred during the extension period.
8.3 Amendments. The parties may amend this Agreement only by a writing signed by all the parties.
8.4 Assignment and Subcontracting. Town and Contractor recognize and agree that this Agreement contemplates personal performance by Contractor and is based upon a determination of Contractor’s unique personal competence, experience, and specialized personal knowledge. Moreover, a substantial inducement to Town for entering into this Agreement was and is the professional reputation and competence of Contractor.
Contractor may not assign this Agreement or any interest therein without the prior written approval of the Contract Administrator. Contractor shall not subcontract any portion of the
Consulting Services Agreement between [EFFECTIVE DATE]
Town of Los Altos Hills and ______________ Page 10 of 13 performance contemplated and provided for herein, other than to the subcontractors noted in the proposal, without prior written approval of the Contract Administrator.
8.5 Survival. All obligations arising prior to the termination of this Agreement and all provisions of this Agreement allocating liability between Town and Contractor shall survive the termination of this Agreement.
8.6 Options upon Breach by Contractor. If Contractor materially breaches any of the terms of this Agreement, Town’s remedies shall included, but not be limited to, the following:
8.6.1 Immediately terminate the Agreement;
8.6.2 Retain the plans, specifications, drawings, reports, design documents, and any other work product prepared by Contractor pursuant to this Agreement;
8.6.3 Retain a different Contractor to complete the work described in Exhibit A not finished by Contractor; or
8.6.4 Charge Contractor the difference between the cost to complete the work described in Exhibit A that is unfinished at the time of breach and the amount that Town would have paid Contractor pursuant to Section 2 if Contractor had completed the work.
Section 9. KEEPING AND STATUS OF RECORDS.
9.1 Records Created as Part of Contractor’s Performance. All reports, data, maps, models, charts, studies, surveys, photographs, memoranda, plans, studies, specifications, records, files, or any other documents or materials, in electronic or any other form, that Contractor prepares or obtains pursuant to this Agreement and that relate to the matters covered hereunder shall be the property of the Town. Contractor hereby agrees to deliver those documents to the Town upon termination of the Agreement. It is understood and agreed that the documents and other materials, including but not limited to those described above, prepared pursuant to this Agreement are prepared specifically for the Town and are not necessarily suitable for any future or other use. Town and Contractor agree that, until final approval by Town, all data, plans, specifications, reports and other documents are confidential and will not be released to third parties without prior written consent of both parties.
9.2 Contractor’s Books and Records. Contractor shall maintain any and all ledgers, books of account, invoices, vouchers, canceled checks, and other records or documents evidencing or relating to charges for services or expenditures and disbursements charged to the Town under this Agreement for a minimum of 3 years, or for any longer period required by law, from the date of final payment to the Contractor to this Agreement.
9.3 Inspection and Audit of Records. Any records or documents that Section 9.2 of this Agreement requires Contractor to maintain shall be made available for inspection, audit,
Consulting Services Agreement between [EFFECTIVE DATE]
Town of Los Altos Hills and ______________ Page 11 of 13 and/or copying at any time during regular business hours, upon oral or written request of the Town. Under California Government Code Section 8546.7, if the amount of public funds expended under this Agreement exceeds $10,000.00, the Agreement shall be subject to the examination and audit of the State Auditor, at the request of Town or as part of any audit of the Town, for a period of 3 years after final payment under the Agreement.
Section 10 MISCELLANEOUS PROVISIONS.
10.1 Attorneys’ Fees. If a party to this Agreement brings any action, including an action for declaratory relief, to enforce or interpret the provision of this Agreement, the prevailing party shall be entitled to reasonable attorneys’ fees in addition to any other relief to which that party may be entitled. The court may set such fees in the same action or in a separate action brought for that purpose.
10.2 Venue. In the event that either party brings any action against the other under this Agreement, the parties agree that trial of such action shall be vested exclusively in the state courts of California in the County of Santa Clara or in the United States District Court for the Northern District of California.
10.3 Severability. If a court of competent jurisdiction finds or rules that any provision of this Agreement is invalid, void, or unenforceable, the provisions of this Agreement not so adjudged shall remain in full force and effect. The invalidity in whole or in part of any provision of this Agreement shall not void or affect the validity of any other provision of this Agreement.
10.4 No Implied Waiver of Breach. The waiver of any breach of a specific provision of this Agreement does not constitute a waiver of any other breach of that term or any other term of this Agreement.
10.5 Successors and Assigns. The provisions of this Agreement shall inure to the benefit of and shall apply to and bind the successors and assigns of the parties.
10.6 Use of Recycled Products. Contractor shall prepare and submit all reports, written studies and other printed material on recycled paper to the extent it is available at equal or less cost than virgin paper.
10.7 Conflict of Interest. Contractor may serve other clients, but none whose activities within the corporate limits of Town or whose business, regardless of location, would place Contractor in a “conflict of interest,” as that term is defined in the Political Reform Act, codified at California Government Code Section 81000 et seq.
Contractor shall not employ any Town official in the work performed pursuant to this Agreement. No officer or employee of Town shall have any financial interest in this Agreement that would violate California Government Code Sections 1090 et seq.
Consulting Services Agreement between [EFFECTIVE DATE]
Town of Los Altos Hills and ______________ Page 12 of 13 Contractor hereby warrants that it is not now, nor has it been in the previous 12 months, an employee, agent, appointee, or official of the Town. If Contractor was an employee, agent, appointee, or official of the Town in the previous twelve months, Contractor warrants that it did not participate in any manner in the forming of this Agreement. Contractor understands that, if this Agreement is made in violation of Government Code § 1090 et seq., the entire Agreement is void and Contractor will not be entitled to any compensation for services performed pursuant to this Agreement, including reimbursement of expenses, and Contractor will be required to reimburse the Town for any sums paid to the Contractor.
Contractor understands that, in addition to the foregoing, it may be subject to criminal prosecution for a violation of Government Code § 1090 and, if applicable, will be disqualified from holding public office in the State of California.
10.8 Solicitation. Contractor agrees not to solicit business at any meeting, focus group, or interview related to this Agreement, either orally or through any written materials.
10.9 Contract Administration. This Agreement shall be administered by _______________________________ ("Contract Administrator"). All correspondence, communications and meetings shall be directed to or through the Contract Administrator or his or her designee. The Contractor shall only take direction regarding the services provided under this Agreement from the Contract Administrator. Furthermore, Contractor agrees that the Contract Administrator shall be included any meeting, teleconference or written communication between any Town representative including Committee members and the Contractor. The Town may modify the Contract Administrator at any time upon providing written notice to the Contractor.
10.10 Notices. Any written notice to Contractor shall be sent to:
____________________________________________
____________________________________________
____________________________________________
Any written notice to Town shall be sent to:
Town of Los Altos Hills
Public Works Director
26379 Fremont Road
Los Altos Hills, CA 94022
10.11 Professional Seal. Where applicable in the determination of the contract administrator, the first page of a technical report, first page of design specifications, and each page of construction drawings shall be stamped/sealed and signed by the licensed professional responsible for the report/design preparation. The stamp/seal shall be in a block entitled "Seal and Signature of Registered Professional with report/design responsibility," as in the following example.
Consulting Services Agreement between [EFFECTIVE DATE]
Town of Los Altos Hills and ______________ Page 13 of 13 _________________________________________
Seal and Signature of Registered Professional with
report/design responsibility.
10.12 Integration. This Agreement, including the scope of work attached hereto and incorporated herein as Exhibits A and B represents the entire and integrated agreement between Town and Contractor and supersedes all prior negotiations, representations, or agreements, either written or oral.
Exhibit A Scope of Services
Exhibit B Payment Schedule
10.13 Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be an original and all of which together shall constitute one agreement.
The Parties have executed this Agreement as of the Effective Date.
TOWN OF LOS ALTOS HILLS CONTRACTOR
____________________________ ______________________________ Peter Pirnejad, City Manager [NAME, TITLE]
Attest:
____________________________
Arika Birdsong-Miller, City Clerk
Approved as to Form:
____________________________
Steven T. Mattas, City Attorney
1070873.1
Consulting Services Agreement between [EFFECTIVE DATE]
Town of Los Altos Hills and _____________
EXHIBIT A
SCOPE OF SERVICES
.
Consulting Services Agreement between [EFFECTIVE DATE]
Town of Los Altos Hills and _____________
EXHIBIT B
COMPENSATION SCHEDULE
EXHIBIT “F”
ORDINANCE 606
ITEM 5I
1 TOWN OF LOS ALTOS HILLS March 20, 2025
Staff Report to the City Council
SUBJECT: RESOLUTION UPDATING THE COST SHARING POLICY FOR THE
CONSTRUCTION OF BROADBAND INFRASTRUCTURE WITHIN
PUBLIC WAYS TO EXPAND ELIGIBILITY TO ANY INTERNET
SERVICE PROVIDER ALLOWED WITHIN THE TOWN’S RIGHT-OFWAY FROM: Joram Parcutilo, Management Analyst
REVIEWED: Cody Einfalt, Deputy City Manager
APPROVED: Peter Pirnejad, City Manager
RECOMMENDATION: That the City Council should:
Adopt the attached resolution (Attachment 1) updating the Cost Sharing Policy for the construction of broadband infrastructure within public ways to expand eligibility to any internet service provider allowed within the Town’s rights-of-way.
BACKGROUND:
Under Section 4 of the Cable System Franchise Agreement ("Franchise Agreement") between the Town and Comcast, dated November 18, 2004, Comcast was granted a non-exclusive franchise to build, maintain, and operate a cable system in the Town. As part of this agreement, Comcast must offer cable service to all residential homes in areas that meet the minimum density requirements.
Most Town residents currently have access to Comcast cable service. However, some homes within the Franchise Area do not meet the density requirements outlined in Section 4.1 of the agreement and therefore do not have Comcast service or reliable alternatives. According to the agreement, residents in these areas must help cover the cost of building the necessary infrastructure for service on their street. As a result, some homeowners have asked the Town for assistance, including financial support, to bring Comcast cable services to their homes.
In 2006, the California Legislature passed, and Governor Schwarzenegger signed, Assembly Bill 2987 (Nunez), which established a new state video franchise process. The Digital Infrastructure and Video Competition Act of 2006 (DIVCA) created a new state franchise process that replaced the current local franchise process to speed new infrastructure investment and to promote competition for broadband and video services in California (Attachment 2).
This state video program facilitates market entry of those companies that are most eager to compete against existing cable and satellite video companies. This law means that new video competitors may greatly speed up their deployment of state-of-the-art infrastructure that will deliver video and JP
CE
PP
Staff Report to City Council Page 2
Internet Cost Sharing Policy
March 20, 2025
Commission (CPUC) is the only body that determines which companies can become franchise holders for video services. This meant that the non-exclusive franchise agreement between the Town and Comcast was no longer valid.
Most recently, in 2024, City Council directed staff to expand the scope of this Cable System Infrastructure as part of the FY 24/25-FY25/26 budget to include not only Comcast Cable, but a fiber optic broadband cable expansion that includes other cable companies as well.
DISCUSSION:
The City Council believes that it is in the public’s interest to have adequate cable services available to all residents for better access to public safety information, more opportunity for civic engagement, and enhancing education and digital literacy. For this reason, the Town Council established a cost-sharing program to help residents with the cost of installing new internet connections to their homes. The purpose of this program is to establish a means by which the Town can provide limited financial support for the construction of optic broadband cable expansion within public ways to provide internet to Town residents.
Some homeowners / residents have requested Town assistance including supporting construction funds for cable/broadband services for their residences. As a result, the Cost Sharing Cable Cost Sharing program (see Attachment 3) is designed to assist residences in that process by providing financial support.
If an application for supporting funds is approved by the Town, the Town will contribute a maximum of one dollar (25%) for every three dollars (75%) contributed by residents toward the customer contribution cost of constructing new cable system infrastructure. The Town’s maximum contribution for any single project shall be $25,000, except as otherwise approved by the City Council.
Eligibility- This program applies only to the installation cable/broadband equipment within public ways. This program applies only to areas where residential dwelling units do not meet minimum density requirements established. Construction must be completed by approved contractors.
Ineligibility- For this program, eligible contribution costs for supporting funds shall be amounts paid directly to the cable/broadband provider for system construction and shall NOT include:
• cable service installation costs from the public right-of-way to any residence; • costs or expenses incurred directly by property owner residents beyond the customer contribution cost;
• reimbursements of similar costs previously incurred by other property owner residents; • costs for extended warranty, future maintenance, or future enhancements to the cable service or system infrastructure;
• other costs deemed ineligible by the Town’s City Manager.
Staff’s recommendation is to amend the Cost Sharing Program for the Construction of the Cable System Infrastructure by expanding the eligibility to any internet service provider aside from just Comcast. This would expand the Cable Cost Sharing Program to provide financial assistance to residents partnering with any internet service provider in the Town. broadband services to Californians. As a result, under DIVCA, the California Public Utilities
Staff Report to City Council Page 3
Internet Cost Sharing Policy
March 20, 2025
ENVIRONMENTAL REVIEW:
The proposed policy update is exempt from California Environmental Quality Act (CEQA) due to the policy not being defined as a “project” under CEAQ. 2024-2025 CITY COUNCIL WORK PLAN:
Approving this update to expand the eligibility of the cost sharing policy aligns with the Council’s Work Plan to increase the ease of access to broadband internet service to all Town residents. This is a continuation of the Council’s goals in the 2023 Work Plan.
FISCAL IMPACT:
The purpose of this resolution is to change the language of the program to include other internet providers that operate in our Town and provide ease of access to Town residents. Therefore, there is no immediate fiscal impact. In the event that an application does come forward to utilize this benefit, the Town will contribute 25% of the cable expansion cost, with a cap of $25,000.
Currently, there are no applications for the cost sharing program.
The Town usually only budgets $50,000 each fiscal year for this program. Meaning that roughly two residents can take advantage of this program if the cost of installation exceeds $25,000 each.
Since 2017, there have only been two residents that have taken advantage of this program, both applications were submitted and processed in 2021.
Given the fact that the recommendation is to expand the access of the program to other cable/broadband companies, there may be more interest in the funds in the upcoming years. If all budgeted supporting funds are committed prior to the end of a given fiscal year, the City Council may approve an additional contribution of supporting funds at its discretion.
ATTACHMENTS:
1. Resolution
2. CA Assembly Bill 2987
3. Cost Sharing Program
ITEM 5I, Attachment 1
RESOLUTION xx-25
RESOLUTION UPDATING THE COST SHARING POLICY FOR THE
CONSTRUCTION OF BROADBAND INFRASTRUCTURE WITHIN PUBLIC WAYS
TO EXPAND ELIGIBILITY TO ANY INTERNET SERVICE PROVIDER ALLOWED WITHIN THE TOWN’S RIGHT-OF-WAY
WHEREAS, the current cost sharing policy program is exclusive only to Comcast Cable; and WHEREAS, residents in these areas must help cover the cost of building the necessary infrastructure for service on their street. As a result, some homeowners have asked the Town for assistance, including financial support, to bring Comcast cable services to their homes. The Town will contribute 25% of the cable expansion cost with a cap of $25,000; and WHEREAS, as part of the FY24/25-FY25/26 Budget, City Council has directed staff to expand the cost sharing program to include not only Comcast, but other internet service provider as well; and
WHEREAS, Town staff is recommending to City Council to amend the amend the Cost Sharing Policy for the Construction of the Cable System Infrastructure by expanding the eligibility to any internet service provider. This would expand the Cable Cost Sharing Program to provide financial assistance to residents partnering with any internet service provider in the Town.
NOW THEREFORE, the City Council of the Town of Los Altos Hills does hereby authorize Town staff to amend the Cost Sharing Policy for the Construction of the Cable System Infrastructure by expanding the eligibility to any internet service provider.
The above and foregoing Resolution was passed and adopted by the City Council of the Town of Los Altos Hills at a regular meeting held on the 20th day of March 2025 by the following vote:
AYES:
NOES:
ABSTAIN:
ABSENT:
BY: _______________________________
Kavita Tankha, Mayor
ATTEST:
______________________________
Arika Miller, City Clerk
ATTACHMENT A
ASSEMBLY BILL NO. 2987
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ITEM 5I, Attachment 2
Assembly Bill No. 2987
Passed the Assembly August 31, 2006
Chief Clerk of the Assembly
Passed the Senate August 30, 2006
Secretary of the Senate
This bill was received by the Governor this day
of , 2006, at o’clock m.
Private Secretary of the Governor
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CHAPTER
An act to amend Section 401 of, to add Article 4 (commencing with Section 440) to Chapter 2.5 of Part 1 of Division 1 of, and to add Division 2.5 (commencing with Section 5800) to, the Public Utilities Code, and to amend Section 107.7 of the Revenue and Taxation Code, relating to cable and video service. legislative counsel’s digest
AB 2987, Nunez. Cable and video service.
(1) Existing law provides that any city, county, or city and county may authorize by franchise or license the construction and operation of a community antenna television system and
prescribe rules and regulations to protect the subscribers.
Existing law requires that cable and video service providers comply with specified customer service standards and
performance standards.
This bill would enact the Digital Infrastructure and Video Competition Act of 2006 and would establish a procedure for the issuance of state franchises for the provision of video service, which would be defined to include cable service and open-video systems, that would be administered by the Public Utilities Commission. The commission would be the sole franchising authority for state franchises to provide video services. The bill would require any person or corporation that seeks to provide video service in this state to file an application with the commission for a state franchise with specified information, signed under penalty of perjury. By creating a new crime, the bill would impose a state-mandated local program.
The bill would provide that cities, counties, cities and counties, or joint powers authorities would receive state franchise fees in exchange for the use of public rights-of-way for the delivery of video services provided within their jurisdictions, based on gross revenues, pursuant to a specified formula. The bill would prescribe the extent of the obligation of state franchise holders to provide public, educational, and governmental access (PEG) channels. The bill would also authorize local entities to establish 90 AB 2987 — 2 —
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a fee to support the costs of PEG channel facilities, in the amount of 1% of gross revenues, or more in specified circumstances.
The bill would also require these local entities to permit the installation of networks by holders of state franchises. The bill would also prohibit a holder of a state franchise from
discriminating against or denying access to service to any group of potential residential subscribers because of their income and would provide that this provision is satisfied if certain conditions are met by holders or their affiliates with 1,000,000 or more telephone customers or if alternative conditions are met by a holder or its affiliates with 1,000,000 or fewer telephone customers in California.
The bill would require the holder of a state franchise to notify a local entity that it will provide video service in the entity’s jurisdiction at least 10 days before offering service. The bill would also require the local franchising entity to enforce customer service and protection standards and to enact an ordinance or resolution providing a schedule of penalties for any material breach of those standards by a holder of a state franchise, thereby imposing a state-mandated local program.
The bill would also require that any state franchise holder employing more than 750 employees in California make an annual report of specified information to the commission. The bill would also require that all state franchise holders make an annual report to the commission regarding availability of and subscription to broadband and video service.
The bill would provide that a state franchise is valid for 10 years and would require a provider to apply to the commission for renewal of the franchise for any additional 10-year period.
The bill would authorize the commission’s Division of
Ratepayer Advocates to advocate on behalf of video service customers in connection with state franchise renewal and enforcement of service standards.
The bill would prohibit the commission from permitting a telephone corporation that is providing video service pursuant to a state franchise to authorize an increase in rates for residential basic service until January 1, 2009, unless that corporation is regulated under rate of return regulation, subject to specified exceptions.
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(2) Existing property tax law specifies the manner in which local tax assessors determine the value of cable television possessory interests that are created in a cable television franchise or license that is granted by a local government.
This bill would specify that this valuation method also applies to possessory interests created in a cable franchise or license or a franchise to provide video services that is granted by the state under the bill.
(3) Existing law provides for the Public Utilities Commission Utilities Reimbursement Account. Existing law authorizes the commission to annually determine a fee to be paid by every public utility providing service directly to customers or subscribers and subject to the jurisdiction of the commission, except for a railroad corporation. Existing law requires the commission to establish the fee, with the approval of the Department of Finance, to produce a total amount equal to that amount established in the authorized commission budget for the same year, and an appropriate reserve to regulate public utilities, less specified sources of funding.
This bill would establish a Video Franchising Account in the commission’s Utilities Reimbursement Account, require the commission to annually determine a fee to be paid by an applicant or holder of a state franchise, and authorize the commission to take various actions to collect the fees. (4) The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
This bill would provide that with regard to certain mandates no reimbursement is required by this act for a specified reason.
With regard to any other mandates, this bill would provide that, if the Commission on State Mandates determines that the bill contains costs so mandated by the state, reimbursement for those costs shall be made pursuant to the statutory provisions noted above.
The people of the State of California do enact as follows:
SECTION 1. Section 401 of the Public Utilities Code is
amended to read:
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401. (a) The Legislature finds and declares that the public interest is best served by a commission that is appropriately funded and staffed, that can thoroughly examine the issues before it, and that can take timely and well-considered action on matters before it. The Legislature further finds and declares that funding the commission by means of a reasonable fee imposed upon each common carrier and business related thereto, each public utility that the commission regulates, and each applicant for, or holder of, a state franchise pursuant to Division 2.5 (commencing with Section 5800), helps to achieve those goals and is, therefore, in the public interest.
(b) The Legislature intends, in enacting this chapter, that the fees levied and collected pursuant thereto produce enough, and only enough, revenues to fund the commission with (1) its authorized expenditures for each fiscal year to regulate common carriers and businesses related thereto, public utilities, and applicants and holders of a state franchise to be a video service provider, less the amount to be paid from special accounts except those established by this article, reimbursements, federal funds, and the unencumbered balance from the preceding year; (2) an appropriate reserve; and (3) any adjustment appropriated by the Legislature.
(c) For purposes of this chapter, an “appropriate reserve” means a reserve in addition to the commission’s total authorized annual budget to regulate common carriers and related
businesses, public utilities, and applicants and holders of a state franchise to be a video service provider, to be determined by the commission based on its past and projected operating experience.
SEC. 2. Article 4 (commencing with Section 440) is added to Chapter 2.5 of Part 1 of Division 1 of the Public Utilities Code, to read:
Article 4. Video Service Franchises
440. (a) For purposes of this article, “state franchise,” “video service,” and “video service provider” shall have the same meaning as those terms are defined in Section 5830.
(b) The Public Utilities Commission Video Franchising
Account is hereby created in the Public Utilities Commission Utilities Reimbursement Account.
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441. The commission shall annually determine a fee to be paid by an applicant or holder of a state franchise pursuant to Division 2.5 (commencing with Section 5800). The annual fee shall be established to produce a total amount equal to that amount established in the authorized commission budget for the same year, including adjustments for increases in employee compensation, other increases appropriated by the Legislature, and an appropriate reserve to carry out the provisions of Division
2.5 (commencing with Section 5800), less the amount to be paid from reimbursements, federal funds, and any other revenues, and the amount of unencumbered funds from the preceding year. 442. (a) The commission shall establish the fee pursuant to Section 441 with the approval of the Department of Finance. The commission shall specify the amount of its budget to be financed by the fee in its annual budget request.
(b) The fee shall be determined and imposed by the
commission consistent with the requirements of Section 542 of Title 47 of the United States Code.
(c) All fees collected by the commission pursuant to this section shall be transmitted to the Treasurer at least quarterly for deposit in the Public Utilities Commission Video Franchising Account.
(d) The commission shall maintain those records as are necessary to account separately for all fees and charges, including the fees authorized by Section 441.
(e) The commission shall authorize refunds of the fees provided for in this article when the fees were collected in error. 443. (a) The commission may require a video service
provider subject to this article to furnish information and reports to the commission, at the time or times it specifies, to enable it to determine the fee pursuant to Section 441.
(b) Any video service provider required to submit information and reports under this article may, in lieu thereof, submit information or reports made to any other governmental agency if all of the following are met:
(1) The alternate information or reports contain all of the information required by the commission.
(2) The requirements to which the alternate reports or information are responsive are clearly identified.
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(3) The information or reports are certified by the video service provider to be true and correct.
444. (a) If a video service provider subject to this article is in default of the payment of any fee required by this article for a period of 30 days or more, the commission may suspend or revoke the state franchise of the video service provider or order the video service provider to cease and desist from conducting all operations subject to the franchising authority of the commission.
The commission may estimate from all available information the appropriate fee and may add to the amount of that estimated fee, a penalty not to exceed 25 percent of the amount, on account of the failure, refusal, or neglect to prepare and submit the report or to pay the fee, and the video service provider shall be estopped to complain of the amount of the commission’s estimate.
(b) Upon payment of the fee so estimated and penalty, if applicable, the state franchise of the video service provider suspended in accordance with this section shall be reinstated or the order to cease and desist revoked. The commission may grant a reasonable extension of the 30-day period to any video service provider upon written application and a showing of the necessity of the extension.
(c) Upon revocation of any state franchise or issuance of an order to cease and desist pursuant to this section, all fees in default shall become due and payable immediately.
(d) The commission may bring an action, in its own name or in the name of the people of the state, in any court of competent jurisdiction, for the collection of delinquent fees estimated under this article, or for an amount due, owing, and unpaid to it, as shown by report filed by the commission, together with a penalty of 25 percent for the delinquency.
SEC. 3. Division 2.5 (commencing with Section 5800) is
added to the Public Utilities Code, to read:
DIVISION 2.5. THE DIGITAL INFRASTRUCTURE AND
VIDEO COMPETITION ACT OF 2006
5800. This act shall be known and may be cited as the Digital Infrastructure and Video Competition Act of 2006.
5810. (a) The Legislature finds and declares all of the following:
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(1) Increasing competition for video and broadband services is a matter of statewide concern for all of the following reasons:
(A) Video and cable services provide numerous benefits to all Californians including access to a variety of news, public information, education, and entertainment programming.
(B) Increased competition in the cable and video service sector provides consumers with more choice, lowers prices, speeds the deployment of new communication and broadband technologies, creates jobs, and benefits the California economy.
(C) To promote competition, the state should establish a state-issued franchise authorization process that allows market participants to use their networks and systems to provide video, voice, and broadband services to all residents of the state. (D) Competition for video service should increase
opportunities for programming that appeals to California’s diverse population and many cultural communities.
(2) Legislation to develop this new process should adhere to the following principles:
(A) Create a fair and level playing field for all market competitors that does not disadvantage or advantage one service provider or technology over another.
(B) Promote the widespread access to the most technologically advanced cable and video services to all California communities in a nondiscriminatory manner regardless of socioeconomic status.
(C) Protect local government revenues and control of public rights-of-way.
(D) Require market participants to comply with all applicable consumer protection laws.
(E) Complement efforts to increase investment in broadband infrastructure and close the digital divide.
(F) Continue access to and maintenance of the public,
education, and government (PEG) channels.
(G) Maintain all existing authority of the California Public Utilities Commission as established in state and federal statutes. (3) The public interest is best served when sufficient funds are appropriated to the commission to provide adequate staff and resources to appropriately and timely process applications of video service providers and to ensure full compliance with the requirements of this division. It is the intent of the Legislature 90 AB 2987 — 8 —
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that, although video service providers are not public utilities or common carriers, the commission shall collect any fees
authorized by this division in the same manner and under the same terms as it collects fees from common carriers, electrical corporations, gas corporations, telephone corporations, telegraph corporations, water corporations, and every other public utility providing service directly to customers or subscribers subject to its jurisdiction such that it does not discriminate against video service providers or their subscribers.
(4) Providing an incumbent cable operator the option to secure a state-issued franchise through the preemption of an existing cable franchise between a cable operator and any political subdivision of the state, including, but not limited to, a charter city, county, or city and county, is an essential element of the new regulatory framework established by this act as a matter of statewide concern to best ensure equal protection and parity among providers and technologies, as well as to achieve the goals stated by the Legislature in enacting this act.
(b) It is the intent of the Legislature that a video service provider shall pay as rent a franchise fee to the local entity in whose jurisdiction service is being provided for the continued use of streets, public facilities, and other rights-of-way of the local entity in order to provide service. The Legislature recognizes that local entities should be compensated for the use of the public rights-of-way and that the franchise fee is intended to compensate them in the form of rent or a toll, similar to that which the court found to be appropriate in Santa Barbara County Taxpayers Association v. Board of Supervisors for the County of Santa Barbara (1989) 257 Cal. App. 615.
(c) It is the intent of the Legislature that collective bargaining agreements be respected.
(d) It is the intent of the Legislature that the definition of gross revenues in this division shall result in local entities maintaining their existing level of revenue from franchise fees.
5820. (a) Nothing in this division shall be deemed as creating a vested right in a state-issued franchise by the franchise holder or its affiliates that would preclude the state from amending the provisions that establish the terms and conditions of a franchise. (b) Nothing in this division shall be construed to eliminate or reduce a telephone corporation’s or video service provider’s 90 — 9 — AB 2987
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obligations under any applicable state or federal environmental protection laws. The local entity shall serve as the lead agency for any environmental review under this division and may impose conditions to mitigate environmental impacts of the applicant’s use of the public rights-of-way that may be required pursuant to the California Environmental Quality Act (Division 13 (commencing with Section 21000) of the Public Resources Code).
(c) The holder of a state franchise shall not be deemed a public utility as a result of providing video service under this division.
This division shall not be construed as granting authority to the commission to regulate the rates, terms, and conditions of video services, except as explicitly set forth in this division. 5830. For purposes of this division, the following words have the following meanings:
(a) “Broadband” means any service defined as broadband in the most recent Federal Communications Commission inquiry pursuant to Section 706 of the Telecommunications Act of 1996 (P.L. 104-104).
(b) “Cable operator” means any person or group of persons that either provides cable service over a cable system and directly, or through one or more affiliates, owns a significant interest in a cable system; or that otherwise controls or is responsible for, through any arrangement, the management and operation of a cable system, as set forth in Section 522(5) of Title 47 of the United States Code.
(c) “Cable service” is defined as the one-way transmission to subscribers of either video programming, or other programming service, and subscriber interaction, if any, that is required for the selection or use of video programming or other programming service, as set forth in Section 522(6) of Title 47 of the United States Code.
(d) “Cable system” is defined as set forth in Section 522(7) of Title 47 of the United States Code.
(e) “Commission” means the Public Utilities Commission. (f) “Franchise” means an initial authorization, or renewal of an authorization, issued by a franchising entity, regardless of whether the authorization is designated as a franchise, permit, license, resolution, contract, certificate, agreement, or otherwise, that authorizes the construction and operation of any network in 90 AB 2987 — 10 —
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the right-of-way capable of providing video service to
subscribers.
(g) “Franchise fee” means the fee adopted pursuant to Section 5840.
(h) “Local franchising entity” means the city, county, city and county, or joint powers authority entitled to require franchises and impose fees on cable operators, as set forth in Section 53066 of the Government Code.
(i) “Holder” means a person or group of persons that has been issued a state franchise from the commission pursuant to this division.
(j) “Incumbent cable operator” means a cable operator or OVS serving subscribers under a franchise in a particular city, county, or city and county franchise area on January 1, 2007.
(k) “Local entity” means any city, county, city and county, or joint powers authority within the state within whose jurisdiction a holder of a state franchise under this division may provide cable service or video service.
(l) “Network” means a component of a facility that is wholly or partly physically located within a public right-of-way and that is used to provide video service, cable service, voice, or data services.
(m) “Open-video system” or “OVS” means those services set forth in Section 573 of Title 47 of the United States Code. (n) “OVS operator” means any person or group of persons that either provides cable service over an open-video system directly, or through one or more affiliates, owns a significant interest in an open-video system, or that otherwise controls or is responsible for, through any arrangement, the management of an open-video system.
(o) “Public right-of-way” means the area along and upon any public road or highway, or along or across any of the waters or lands within the state.
(p) “State franchise” means a franchise that is issued pursuant to this division.
(q) “Subscriber” means a person who lawfully receives video service from the holder of a state franchise for a fee. (r) “Video programming” means programming provided by, or generally considered comparable to programming provided by, a 90 — 11 — AB 2987
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television broadcast station, as set forth in Section 522(20) of Title 47 of the United States Code.
(s) “Video service” means video programming services, cable service, or OVS service provided through facilities located at least in part in public rights-of-way without regard to delivery technology, including Internet protocol or other technology. This definition does not include (1) any video programming provided by a commercial mobile service provider defined in Section 322(d) of Title 47 of the United States Code, or (2) video programming provided as part of, and via, a service that enables users to access content, information, electronic mail, or other services offered over the public Internet.
(t) “Video service provider” means an entity providing video service.
5840. (a) The commission is the sole franchising authority for a state franchise to provide video service under this division.
Neither the commission nor any local franchising entity or other local entity of the state may require the holder of a state franchise to obtain a separate franchise or otherwise impose any
requirement on any holder of a state franchise except as expressly provided in this division. Sections 53066, 53066.01, 53066.2, and 53066.3 of the Government Code shall not apply to holders of a state franchise.
(b) The application process described in this section and the authority granted to the commission under this section shall not exceed the provisions set forth in this section.
(c) Any person or corporation who seeks to provide video service in this state for which a franchise has not already been issued, after January 1, 2008, shall file an application for a state franchise with the commission. The commission may impose a fee on the applicant that shall not exceed the actual and reasonable costs of processing the application and shall not be levied for general revenue purposes.
(d) No person or corporation shall be eligible for a state-issued franchise, including a franchise obtained from renewal or transfer of an existing franchise, if that person or corporation is in violation of any final nonappealable order relating to either the Cable Television and Video Provider Customer Service and Information Act (Article 3.5 (commencing with Section 53054) of Chapter 1 of Part 1 of Division 2 of Title 5 of the Government 90 AB 2987 — 12 —
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Code) or the Video Customer Service Act (Article 4.5
(commencing with Section 53088) of Chapter 1 of Part 1 of Division 2 of Title 5 of the Government Code).
(e) The application for a state franchise shall be made on a form prescribed by the commission and shall include all of the following:
(1) A sworn affidavit, signed under penalty of perjury by an officer or another person authorized to bind the applicant, that affirms all of the following:
(A) That the applicant has filed or will timely file with the Federal Communications Commission all forms required by the Federal Communications Commission before offering cable service or video service in this state.
(B) That the applicant or its affiliates agrees to comply with all federal and state statutes, rules, and regulations, including, but not limited to, the following:
(i) A statement that the applicant will not discriminate in the provision of video or cable services as provided in Section 5890. (ii) A statement that the applicant will abide by all applicable consumer protection laws and rules as provided in Section 5900. (iii) A statement that the applicant will remit the fee required by subdivision (a) of Section 5860 to the local entity. (iv) A statement that the applicant will provide PEG channels and the required funding as required by Section 5870.
(C) That the applicant agrees to comply with all lawful city, county, or city and county regulations regarding the time, place, and manner of using the public rights-of-way, including, but not limited to, payment of applicable encroachment, permit, and inspection fees.
(D) That the applicant will concurrently deliver a copy of the application to any local entity where the applicant will provide service.
(2) The applicant’s legal name and any name under which the applicant does or will do business in this state.
(3) The address and telephone number of the applicant’s principal place of business, along with contact information for the person responsible for ongoing communications with the department.
(4) The names and titles of the applicant’s principal officers. 90 — 13 — AB 2987
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(5) The legal name, address, and telephone number of the applicant’s parent company, if any.
(6) A description of the video service area footprint that is proposed to be served, as identified by a collection of United States Census Bureau Block numbers (13 digit) or a geographic information system digital boundary meeting or exceeding national map accuracy standards. This description shall include the socioeconomic status information of all residents within the service area footprint.
(7) If the applicant is a telephone corporation or an affiliate of a telephone corporation, as defined in Section 234, a description of the territory in which the company provides telephone service.
The description shall include socioeconomic status information of all residents within the telephone corporation’s service territory.
(8) The expected date for the deployment of video service in each of the areas identified in paragraph (6).
(9) Adequate assurance that the applicant possesses the financial, legal, and technical qualifications necessary to construct and operate the proposed system and promptly repair any damage to the public right-of-way caused by the applicant.
To accomplish these requirements, the commission may require a bond.
(f) The commission may require that a corporation with wholly owned subsidiaries or affiliates is eligible only for a single state-issued franchise and prohibit the holding of multiple franchises through separate subsidiaries or affiliates. The commission may establish procedures for a holder of a
state-issued franchise to amend its franchise to reflect changes in its service area.
(g) The commission shall commence accepting applications for a state franchise no later than April 1, 2007.
(h) (1) The commission shall notify an applicant for a state franchise and any affected local entities whether the applicant’s application is complete or incomplete before the 30th calendar day after the applicant submits the application.
(2) If the commission finds the application is complete, it shall issue a state franchise before the 14th calendar day after that finding.
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(3) If the commission finds that the application is incomplete, it shall specify with particularity the items in the application that are incomplete and permit the applicant to amend the application to cure any deficiency. The commission shall have 30 calendar days from the date the application is amended to determine its completeness.
(4) The failure of the commission to notify the applicant of the completeness or incompleteness of the application before the 44th calendar day after receipt of an application shall be deemed to constitute issuance of the certificate applied for without further action on behalf of the applicant.
(i) The state franchise issued by the commission shall contain all of the following:
(1) A grant of authority to provide video service in the service area footprint as requested in the application.
(2) A grant of authority to use the public rights-of-way, in exchange for the franchise fee adopted under subdivision (q), in the delivery of video service, subject to the laws of this state. (3) A statement that the grant of authority is subject to lawful operation of the cable service or video service by the applicant or its successor in interest.
(j) The state franchise issued by the commission may be terminated by the video service provider by submitting at least 90 days prior written notice to customers, local entities, and the commission.
(k) It is unlawful to provide video service without a state or locally issued franchise.
(l) Subject to the notice requirements of this division, a state franchise may be transferred to any successor in interest of the holder to which the certificate is originally granted, provided that the transferee first submits all of the information required of the applicant by this section to the commission.
(m) In connection with, or as a condition of, receiving a state franchise, the commission shall require a holder to notify the commission and any applicable local entity within 14 business days of any of the following changes involving the holder or the state franchise:
(1) Any transaction involving a change in the ownership, operation, control, or corporate organization of the holder, including a merger, an acquisition, or a reorganization. 90 — 15 — AB 2987
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(2) A change in the holder’s legal name or the adoption of, or change to, an assumed business name. The holder shall submit to the commission a certified copy of either of the following:
(A) The proposed amendment to the state franchise.
(B) The certificate of assumed business name.
(3) A change in the holder’s principal business address or in the name of the person authorized to receive notice on behalf of the holder.
(4) Any transfer of the state franchise to a successor in interest of the holder. The holder shall identify the successor in interest to which the transfer is made.
(5) The termination of any state franchise issued under this division. The holder shall identify both of the following:
(A) The number of customers in the service area covered by the state franchise being terminated.
(B) The method by which the holder’s customers were notified of the termination.
(6) A change in one or more of the service areas of this division that would increase or decrease the territory within the service area. The holder shall describe the new boundaries of the affected service areas after the proposed change is made. (n) Prior to offering video service in a local entity’s jurisdiction, the holder of a state franchise shall notify the local entity that the video service provider will provide video service in the local entity’s jurisdiction. The notice shall be given at least 10 days, but no more than 60 days, before the video service provider begins to offer service.
(o) Any video service provider that currently holds a franchise with a local franchising entity is entitled to seek a state franchise in the area designated in that franchise upon meeting any of the following conditions:
(1) The expiration, prior to any renewal or extension, of its local franchise.
(2) A mutually agreed upon date set by both the local
franchising entity and video service provider to terminate the franchise provided in writing by both parties to the commission. (3) When a video service provider that holds a state franchise provides the notice required pursuant to subdivision (m) to a local jurisdiction that it intends to initiate providing video service in all or part of that jurisdiction, a video service provider 90 AB 2987 — 16 —
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operating under a franchise issued by a local franchising authority may elect to obtain a state franchise to replace its locally issued franchise. The franchise issued by the local franchising entity shall terminate and be replaced by a state franchise when the state franchising authority issues a state franchise for the video service provider that includes the entire service area served by the video service provider and the video service provider notifies the local entity that it will begin providing video service in that area under a state franchise. (p) Notwithstanding any rights to the contrary, an incumbent cable operator opting into a state franchise under this subdivision shall continue to serve all areas as required by its local franchise agreement existing on January 1, 2007, until that local franchise otherwise would have expired. However, an incumbent cable operator that is also a telephone corporation with less than 1,000,000 telephone customers in California and is providing video service in competition with another incumbent cable operator shall not be required to provide service beyond the area in which it is providing video service as of January 1, 2007. (q) (1) There is hereby adopted a state franchise fee payable as rent or a toll for the use of the public right-of-way by holders of the state franchise issued pursuant to this division. The amount of the state franchise fee shall be 5 percent of gross revenues, as defined in subdivision (d) of Section 5860, or the percentage applied by the local entity to the gross revenue of the incumbent cable operator, whichever is less. If there is no incumbent cable operator or upon the expiration of the incumbent cable operator’s franchise, the amount of the state franchise fee shall be 5 percent of gross revenues, as defined in subdivision (d) of Section 5860, unless the local entity adopts an ordinance setting the amount of the franchise fee at less than 5 percent.
(2) (A) The state franchise fee shall apply equally to all video service providers in the local entity’s jurisdiction. (B) Notwithstanding subparagraph (A), if the video service provider is leasing access to a network owned by a local entity, the local entity may set a franchise fee for access to the network different from the franchise fee charged to a video service provider for access to the rights-of-way to install its own network.
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5850. (a) A state-issued franchise shall only be valid for 10 years after the date of issuance, and the video service provider shall apply for a renewal of the state franchise for an additional 10-year period if it wishes to continue to provide video services in the area covered by the franchise after the expiration of the franchise.
(b) Except as provided in this section, the criteria and process described in Section 5840 shall apply to a renewal registration, and the commission shall not impose any additional or different criteria.
(c) Renewal of a state franchise shall be consistent with federal law and regulations.
(d) The commission shall not renew the franchise if the video service provider is in violation of any final nonappealable court order issued pursuant to this division.
5860. (a) The holder of a state franchise that offers video service within the jurisdiction of the local entity shall calculate and remit to the local entity a state franchise fee, adopted pursuant to subdivision (q) of Section 5840, as provided in this section. The obligation to remit the franchise fee to a local entity begins immediately upon provision of video service within that local entity’s jurisdiction. However, the remittance shall not be due until the time of the first quarterly payment required under subdivision (g) that is at least 180 days after the provision of service began. The fee remitted to a city or city and county shall be based on gross revenues, as defined in subdivision (d), derived from the provision of video service within that jurisdiction. The fee remitted to a county shall be based on gross revenues earned within the unincorporated area of the county. No fee under this section shall become due unless the local entity provides documentation to the holder of the state franchise supporting the percentage paid by the incumbent cable operator serving the area within the local entity’s jurisdiction, as provided below. The fee shall be calculated as a percentage of the holder’s gross revenues, as defined in subdivision (d). The fee remitted to the local entity pursuant to this section may be used by the local entity for any lawful purpose.
(b) The state franchise fee shall be a percentage of the holder’s gross revenues, as defined in subdivision (d).
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(c) No local entity or any other political subdivision of this state may demand any additional fees or charges or other remuneration of any kind from the holder of a state franchise based solely on its status as a provider of video or cable services other than as set forth in this division and may not demand the use of any other calculation method or definition of gross revenues. However, nothing in this section shall be construed to limit a local entity’s ability to impose utility user taxes and other generally applicable taxes, fees, and charges under other applicable provisions of state law that are applied in a nondiscriminatory and competitively neutral manner.
(d) For purposes of this section, the term “gross revenues” means all revenue actually received by the holder of a state franchise, as determined in accordance with generally accepted accounting principles, that is derived from the operation of the holder’s network to provide cable or video service within the jurisdiction of the local entity, including all of the following:
(1) All charges billed to subscribers for any and all cable service or video service provided by the holder of a state franchise, including all revenue related to programming provided to the subscriber, equipment rentals, late fees, and insufficient fund fees.
(2) Franchise fees imposed on the holder of a state franchise by this section that are passed through to, and paid by, the subscribers.
(3) Compensation received by the holder of a state franchise that is derived from the operation of the holder’s network to provide cable service or video service with respect to
commissions that are paid to the holder of a state franchise as compensation for promotion or exhibition of any products or services on the holder’s network, such as a “home shopping” or similar channel, subject to paragraph (4) of subdivision (e). (4) A pro rata portion of all revenue derived by the holder of a state franchise or its affiliates pursuant to compensation arrangements for advertising derived from the operation of the holder’s network to provide video service within the jurisdiction of the local entity, subject to paragraph (1) of subdivision (e).
The allocation shall be based on the number of subscribers in the local entity divided by the total number of subscribers in relation to the relevant regional or national compensation arrangement. 90 — 19 — AB 2987
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(e) For purposes of this section, the term “gross revenue” set forth in subdivision (d) does not include any of the following:
(1) Amounts not actually received, even if billed, such as bad debt; refunds, rebates, or discounts to subscribers or other third parties; or revenue imputed from the provision of cable services or video services for free or at reduced rates to any person as required or allowed by law, including, but not limited to, the provision of these services to public institutions, public schools, governmental agencies, or employees except that forgone revenue chosen not to be received in exchange for trades, barters, services, or other items of value shall be included in gross revenue.
(2) Revenues received by any affiliate or any other person in exchange for supplying goods or services used by the holder of a state franchise to provide cable services or video services.
However, revenue received by an affiliate of the holder from the affiliate’s provision of cable or video service shall be included in gross revenue as follows:
(A) To the extent that treating the revenue as revenue of the affiliate, instead of revenue of the holder, would have the effect of evading the payment of fees that would otherwise be paid to the local entity.
(B) The revenue is not otherwise subject to fees to be paid to the local entity.
(3) Revenue derived from services classified as noncable services or nonvideo services under federal law, including, but not limited to, revenue derived from telecommunications services and information services, other than cable services or video services, and any other revenues attributed by the holder of a state franchise to noncable services or nonvideo services in accordance with Federal Communications Commission rules, regulations, standards, or orders.
(4) Revenue paid by subscribers to “home shopping” or
similar networks directly from the sale of merchandise through any home shopping channel offered as part of the cable services or video services. However, commissions or other compensation paid to the holder of a state franchise by “home shopping” or similar networks for the promotion or exhibition products or services shall be included in gross revenue.
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(5) Revenue from the sale of cable services or video services for resale in which the reseller is required to collect a fee similar to the franchise fee from the reseller’s customers.
(6) Amounts billed to, and collected from, subscribers to recover any tax, fee, or surcharge imposed by any governmental entity on the holder of a state franchise, including, but not limited to, sales and use taxes, gross receipts taxes, excise taxes, utility users taxes, public service taxes, communication taxes, and any other fee not imposed by this section.
(7) Revenue from the sale of capital assets or surplus equipment not used by the purchaser to receive cable services or video services from the seller of those assets or surplus equipment.
(8) Revenue from directory or Internet advertising revenue, including, but not limited to, yellow pages, white pages, banner advertisement, and electronic publishing.
(9) Revenue received as reimbursement by programmers of specific, identifiable marketing costs incurred by the holder of a state franchise for the introduction of new programming. (10) Security deposits received from subscribers, excluding security deposits applied to the outstanding balance of a subscriber’s account and thereby taken into revenue.
(f) For the purposes of this section, in the case of a video service that may be bundled or integrated functionally with other services, capabilities, or applications, the state franchise fee shall be applied only to the gross revenue, as defined in subdivision (d), attributable to video service. Where the holder of a state franchise or any affiliate bundles, integrates, ties, or combines video services with nonvideo services creating a bundled package, so that subscribers pay a single fee for more than one class of service or receive a discount on video services, gross revenues shall be determined based on an equal allocation of the package discount, that is, the total price of the individual classes of service at advertised rates compared to the package price, among all classes of service comprising the package. The fact that the holder of a state franchise offers a bundled package shall not be deemed a promotional activity. If the holder of a state franchise does not offer any component of the bundled package separately, the holder of a state franchise shall declare a stated retail value for each component based on reasonable comparable 90 — 21 — AB 2987
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prices for the product or service for the purpose of determining franchise fees based on the package discount described above. (g) For the purposes of determining gross revenue under this division, a video service provider shall use the same method of determining revenues under generally accepted accounting principals as that which the video service provider uses in determining revenues for the purpose of reporting to national and state regulatory agencies.
(h) The state franchise fee shall be remitted to the applicable local entity quarterly, within 45 days after the end of the quarter for that calendar quarter. Each payment shall be accompanied by a summary explaining the basis for the calculation of the state franchise fee. If the holder does not pay the franchise fee when due, the holder shall pay a late payment charge at a rate per year equal to the highest prime lending rate during the period of delinquency, plus 1 percent. If the holder has overpaid the franchise fee, it may deduct the overpayment from its next quarterly payment.
(i) Not more than once annually, a local entity may examine the business records of a holder of a state franchise to the extent reasonably necessary to ensure compensation in accordance with subdivision (a). The holder shall keep all business records reflecting any gross revenues, even if there is a change in ownership, for at least four years after those revenues are recognized by the holder on its books and records. If the examination discloses that the holder has underpaid franchise fees by more than 5 percent during the examination period, the holder shall pay all of the reasonable and actual costs of the examination. If the examination discloses that the holder has not underpaid franchise fees, the local entity shall pay all of the reasonable and actual costs of the examination. In every other instance, each party shall bear its own costs of the examination.
Any claims by a local entity that compensation is not in accordance with subdivision (a), and any claims for refunds or other corrections to the remittance of the holder of a state franchise, shall be made within three years and 45 days of the end of the quarter for which compensation is remitted, or three years from the date of the remittance, whichever is later. Either a local entity or the holder may, in the event of a dispute 90 AB 2987 — 22 —
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concerning compensation under this section, bring an action in a court of competent jurisdiction.
(j) The holder of a state franchise may identify and collect the amount of the state franchise fee as a separate line item on the regular bill of each subscriber.
5870. (a) The holder of a state franchise shall designate a sufficient amount of capacity on its network to allow the provision of the same number of public, educational, and governmental access (PEG) channels, as are activated and provided by the incumbent cable operator that has
simultaneously activated and provided the greatest number of PEG channels within the local entity under the terms of any franchise in effect in the local entity as of January 1, 2007. For the purposes of this section, a PEG channel is deemed activated if it is being utilized for PEG programming within the
municipality for at least eight hours per day. The holder shall have three months from the date the local entity requests the PEG channels to designate the capacity. However, the three-month period shall be tolled by any period during which the designation or provision of PEG channel capacity is technically infeasible, including any failure or delay of the incumbent cable operator to make adequate interconnection available, as required by this section.
(b) The PEG channels shall be for the exclusive use of the local entity or its designee to provide public, educational, and governmental channels. The PEG channels shall be used only for noncommercial purposes. However, advertising, underwriting, or sponsorship recognition may be carried on the channels for the purpose of funding PEG-related activities. The PEG channels shall all be carried on the basic service tier. To the extent feasible, the PEG channels shall not be separated numerically from other channels carried on the basic service tier and the channel numbers for the PEG channels shall be the same channel numbers used by the incumbent cable operator unless prohibited by federal law. After the initial designation of PEG channel numbers, the channel numbers shall not be changed without the agreement of the local entity unless the change is required by federal law. Each channel shall be capable of carrying a National Television System Committee (NTSC) television signal.
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(c) (1) If less than three PEG channels are activated and provided within the local entity as of January 1, 2007, a local entity whose jurisdiction lies within the authorized service area of the holder of a state franchise may initially request the holder to designate not more than a total of three PEG channels. (2) The holder shall have three months from the date of the request to designate the capacity. However, the three-month period shall be tolled by any period during which the designation or provision of PEG channel capacity is technically infeasible, including any failure or delay of the incumbent cable operator to make adequate interconnection available, as required by this section.
(d) (1) The holder shall provide an additional PEG channel when the nonduplicated locally produced video programming televised on a given channel exceeds 56 hours per week as measured on a quarterly basis. The additional channel shall not be used for any purpose other than to continue programming additional government, education, or public access television. (2) For the purposes of this section, “locally produced video programming” means programming produced or provided by any local resident, the local entity, or any local public or private agency that provides services to residents of the franchise area; or any transmission of a meeting or proceeding of any local, state, or federal governmental entity.
(e) Any PEG channel provided pursuant to this section that is not utilized by the local entity for at least eight hours per day as measured on a quarterly basis may no longer be made available to the local entity, and may be programmed at the holder’s discretion. At the time that the local entity can certify to the holder a schedule for at least eight hours of daily programming, the holder of the state franchise shall restore the channel or channels for the use of the local entity.
(f) The content to be provided over the PEG channel capacity provided pursuant to this section shall be the responsibility of the local entity or its designee receiving the benefit of that capacity, and the holder of a state franchise bears only the responsibility for the transmission of that content, subject to technological restraints.
(g) (1) The local entity shall ensure that all transmissions, content, or programming to be transmitted by a holder of a state 90 AB 2987 — 24 —
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franchise are provided or submitted in a manner or form that is compatible with the holder’s network, if the local entity produces or maintains the PEG programming in that manner or form. If the local entity does not produce or maintain PEG programming in that manner or form, then the local entity may submit or provide PEG programming in a manner or form that is standard in the industry. The holder shall be responsible for any changes in the form of the transmission necessary to make it compatible with the technology or protocol utilized by the holder to deliver services. If the holder is required to change the form of the transmission, the local entity shall permit the holder to do so in a manner that is most economical to the holder.
(2) The provision of those transmissions, content, or
programming to the holder of a state franchise shall constitute authorization for the holder to carry those transmissions, content, or programming. The holder may carry the transmission, content, or programming outside of the local entity’s jurisdiction if the holder agrees to pay the local entity or its designee any incremental licensing costs incurred by the local entity or its designee associated with that transmission. Local entities shall be prohibited from entering into licensing agreements that impose higher proportional costs for transmission to subscribers outside the local entity’s jurisdiction.
(3) The PEG signal shall be receivable by all subscribers, whether they receive digital or analog service, or a combination thereof, without the need for any equipment other than the equipment necessary to receive the lowest cost tier of service.
The PEG access capacity provided shall be of similar quality and functionality to that offered by commercial channels on the lowest cost tier of service unless the signal is provided to the holder at a lower quality or with less functionality.
(h) Where technically feasible, the holder of a state franchise and an incumbent cable operator shall negotiate in good faith to interconnect their networks for the purpose of providing PEG programming. Interconnection may be accomplished by direct cable, microwave link, satellite, or other reasonable method of connection. Holders of a state franchise and incumbent cable operators shall provide interconnection of the PEG channels on reasonable terms and conditions and may not withhold the interconnection. If a holder of a state franchise and an incumbent 90 — 25 — AB 2987
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cable operator cannot reach a mutually acceptable
interconnection agreement, the local entity may require the incumbent cable operator to allow the holder to interconnect its network with the incumbent’s network at a technically feasible point on the holder’s network as identified by the holder. If no technically feasible point for interconnection is available, the holder of a state franchise shall make an interconnection available to the channel originator and shall provide the facilities necessary for the interconnection. The cost of any
interconnection shall be borne by the holder requesting the interconnection unless otherwise agreed to by the parties. (i) A holder of a state franchise shall not be required to interconnect for, or otherwise to transmit, PEG content that is branded with the logo, name, or other identifying marks of another cable operator or video service provider. For purposes of this section, PEG content is not branded if it includes only production credits or other similar information displayed at the conclusion of a program. The local entity may require a cable operator or video service provider to remove its logo, name, or other identifying marks from PEG content that is to be made available through interconnection to another provider of PEG capacity.
(j) In addition to any provision for the PEG channels required under subdivisions (a) to (i), inclusive, the holder shall reserve, designate, and, upon request, activate a channel for carriage of state public affairs programming administered by the state. (k) All obligations to provide and support PEG channel facilities and institutional networks and to provide cable services to community buildings contained in a locally issued franchise existing on December 31, 2006, shall continue until the local franchise expires, until the term of the franchise would have expired if it had not been terminated pursuant to subdivision (o) of Section 5840, or until January 1, 2009, whichever is later. (l) After January 1, 2007, and until the expiration of the incumbent cable operator’s franchise, if the incumbent cable operator has existing unsatisfied obligations under the franchise to remit to the local entity any cash payments for the ongoing costs of public, educational, and government access channel facilities or institutional networks, the local entity shall divide those cash payments among all cable or video providers as 90 AB 2987 — 26 —
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provided in this section. The fee shall be the holder’s pro rata per subscriber share of the cash payment required to be paid by the incumbent cable operator to the local entity for the costs of PEG channel facilities. All video service providers and the incumbent cable operator shall be subject to the same requirements for recurring payments for the support of PEG channel facilities and institutional networks, whether expressed as a percentage of gross revenue or as an amount per subscriber, per month, or otherwise.
(m) In determining the fee on a pro rata per subscriber basis, all cable and video service providers shall report, for the period in question, to the local entity the total number of subscribers served within the local entity’s jurisdiction, which shall be treated as confidential by the local entity and shall be used only to derive the per subscriber fee required by this section. The local entity shall then determine the payment due from each provider based on a per subscriber basis for the period by multiplying the unsatisfied cash payments for the ongoing capital costs of PEG channel facilities by a ratio of the reported subscribers of each provider to the total subscribers within the local entity as of the end of the period. The local entity shall notify the respective providers, in writing, of the resulting pro rata amount. After the notice, any fees required by this section shall be remitted to the applicable local entity quarterly, within 45 days after the end of the quarter for the preceding calendar quarter, and may only be used by the local entity as authorized under federal law. (n) A local entity may, by ordinance, establish a fee to support PEG channel facilities consistent with federal law that would become effective subsequent to the expiration of any fee imposed pursuant to paragraph (2) of subdivision (l). If no such fee exists, the local entity may establish the fee at any time. The fee shall not exceed 1 percent of the holder’s gross revenues, as defined in Section 5860. Notwithstanding this limitation, if, on December 31, 2006, a local entity is imposing a separate fee to support PEG channel facilities that is in excess of 1 percent, that entity may, by ordinance, establish a fee no greater than that separate fee, and in no event greater than 3 percent, to support PEG activities. The ordinance shall expire, and may be reauthorized, upon the expiration of the state franchise.
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(o) The holder of a state franchise may recover the amount of any fee remitted to a local entity under this section by billing a recovery fee as a separate line item on the regular bill of each subscriber.
(p) A court of competent jurisdiction shall have exclusive jurisdiction to enforce any requirement under this section or resolve any dispute regarding the requirements set forth in this section, and no provider may by barred from the provision of service or be required to terminate service as a result of that dispute or enforcement action.
5880. Holders of state franchises shall comply with the Emergency Alert System requirements of the Federal
Communications Commission in order that emergency messages may be distributed over the holder’s network. Any provision in a locally issued franchise authorizing local entities to provide local emergency notifications shall remain in effect, and shall apply to all holders of a state-issued franchise in the same local area, for the duration of the locally issued franchise, until the term of the franchise would have expired were the franchise not terminated pursuant to subdivision (m) of Section 5840, or until January 1, 2009, whichever is later.
5885. (a) The local entity shall allow the holder of a state franchise under this division to install, construct, and maintain a network within public rights-of-way under the same time, place, and manner as the provisions governing telephone corporations under applicable state and federal law, including, but not limited to, the provisions of Section 7901.1.
(b) Nothing in this division shall be construed to change existing law regarding the permitting process or compliance with the California Environmental Quality Act (Division 13
(commencing with Section 21000) of the Public Resources Code) for projects by a holder of a state franchise.
(c) (1) For purposes of this section, an “encroachment permit” means any permit issued by a local entity relating to construction or operation of facilities pursuant to this division.
(2) A local entity shall either approve or deny an application from a holder of a state franchise for an encroachment permit within 60 days of receiving a completed application. An application for an encroachment permit is complete when the applicant has complied with all statutory requirements, including 90 AB 2987 — 28 —
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the California Environmental Quality Act (Division 13
(commencing with Section 21000) of the Public Resources Code).
(3) If the local entity denies an application for an
encroachment permit, it shall, at the time of notifying the applicant of the denial, furnish to the applicant a detailed explanation of the reason for the denial.
(4) The local entity shall adopt regulations prescribing procedures for an applicant to appeal the denial of an
encroachment permit application issued by a department of the local entity to the governing body of the local entity. (5) Nothing in this section precludes an applicant and a local entity from mutually agreeing to an extension of any time limit provided by this section.
(d) A local entity may not enforce against the holder of a state franchise any rule, regulation, or ordinance that purports to allow the local entity to purchase or force the sale of a network. 5890. (a) A cable operator or video service provider that has been granted a state franchise under this division may not discriminate against or deny access to service to any group of potential residential subscribers because of the income of the residents in the local area in which the group resides. (b) Holders or their affiliates with more than 1,000,000 telephone customers in California satisfy subdivision (a) if all of the following conditions are met:
(1) Within three years after it begins providing video service under this division, at least 25 percent of households with access to the holder’s video service are low-income households. (2) Within five years after it begins providing video service under this division and continuing thereafter, at least 30 percent of the households with access to the holder’s video service are low-income households.
(3) Holders provide service to community centers in
underserved areas, as determined by the holder, without charge, at a ratio of one community center for every 10,000 video customers. The holder shall not be required to take its facilities beyond the appropriate demarcation point outside the community center building or perform any inside wiring. The community center may not receive service from more than one state franchise holder at a time under this section. For purposes of this 90 — 29 — AB 2987
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section, “community center” means any facility ran by an organization that has qualified for the California Teleconnect Fund, as established in Section 280 and that will make the holder’s service available to the community.
(c) Holders or their affiliates with fewer than 1,000,000 telephone customers in California satisfy this section if they offer video service to all customers within their telephone service area within a reasonable time, as determined by the commission.
However, the commission shall not require the holder to offer video service when the cost to provide video service is substantially above the average cost of providing video service in that telephone service area.
(d) When a holder provides video service outside of its telephone service area, is not a telephone corporation, or offers video service in an area where no other video service is being offered, other than direct-to-home satellite service, there is a rebuttable presumption that discrimination in providing service has not occurred within those areas. The commission may review the holder’s proposed video service area to ensure that the area is not drawn in a discriminatory manner.
(e) For holders or their affiliates with more than 1,000,000 telephone customers in California, either of the following shall apply:
(1) If the holder is predominantly deploying fiber optic facilities to the customer’s premise, the holder shall provide access to its video service to a number of households at least equal to 25 percent of the customer households in the holder’s telephone service area within two years after it begins providing video service under this division, and to a number at least equal to 40 percent of those households within five years.
(2) If the holder is not predominantly deploying fiber optic facilities to the customer’s premises, the holder shall provide access to its video service to a number of households at least equal to 35 percent of the households in the holder’s telephone service area within three years after it begins providing video service under this division, and to a number at least equal to 50 percent of these households within five years.
(3) A holder shall not be required to meet the 40-percent requirement in paragraph (1) or the 50-percent requirement in paragraph (2) until two years after at least 30 percent of the 90 AB 2987 — 30 —
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households with access to the holder’s video service subscribe to it for six consecutive months.
(4) If 30 percent of the households with access to the holder’s video service have not subscribed to the holder’s video service for six consecutive months within three years after it begins providing video service, the holder may submit validating documentation to the commission. If the commission finds that the documentation validates the holder’s claim, then the commission shall permit a delay in meeting the 40-percent requirement in paragraph (1) or the 50-percent requirement in paragraph (2) until the time that the holder does provide service to 30 percent of the households for six consecutive months. (f) (1) After two years of providing service under this division, the holder may apply to the state franchising authority for an extension to meet the requirements of subdivision (b), (c), or (e). Notice of this application shall also be provided to the telephone customers of the holder, the Secretary of the Senate, and the Chief Clerk of the Assembly.
(2) Upon application, the franchising authority shall hold public hearings in the telephone service area of the applicant. (3) In reviewing the failure to satisfy the obligations contained in subdivision (b), (c), or (e), the franchising authority shall consider factors that are beyond the control of the holder, including, but not limited to, the following:
(i) The ability of the holder to obtain access to rights-of-way under reasonable terms and conditions.
(ii) The degree to which developments or buildings are not subject to competition because of existing exclusive
arrangements.
(iii) The degree to which developments or buildings are inaccessible using reasonable technical solutions under commercially reasonable terms and conditions.
(iv) Natural disasters.
(4) The franchising authority may grant the extension only if the holder has made substantial and continuous effort to meet the requirements of subdivision (b), (c), or (e). If an extension is granted the franchising authority shall establish a new compliance deadline.
(g) Local governments may bring complaints to the state franchising authority that a holder is not offering video service as 90 — 31 — AB 2987
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required by this section, or the state franchising authority may open an investigation on its own motion. The state franchising authority shall hold public hearings before issuing a decision.
The commission may suspend or revoke the franchise if the holder fails to comply with the provisions of this division. (h) If the state franchising authority finds that the holder is in violation of this section, it may, in addition to any other remedies provided by law, impose a fine not to exceed 1 percent of the holder’s total monthly gross revenue received from provision of video service in the state each month from the date of the decision until the date that compliance is achieved.
(i) If a court finds that the holder of the state franchise is in violation of this section, the court may immediately terminate the holder’s state franchise, and the court shall, in addition to any other remedies provided by law, impose a fine not to exceed 1 percent of the holder’s total gross revenue of its entire cable and service footprint in the state in the full calendar month immediately prior to the decision.
(j) As used in this section, the following definitions shall apply:
(1) “Household” means consistent with the United States Census Bureau, as a house, an apartment, a mobile home, a group of rooms, or a single room that is intended for occupancy as separate living quarters. Separate living quarters are those in which the occupants live and eat separately from any other persons in the building and which have direct access from the outside of the building or through a common hall.
(2) “Low income household” means those residential
households located within the holder’s existing telephone service area where the average annual household income is less than $35,000 based on the United States Census Bureau estimates adjusted annually to reflect rates of change and distribution through January 1, 2007.
(3) “Customer’s household” means those residential
households located within the holder’s existing telephone service area that are customers of the service by which that telephone service area is defined.
(4) “Access” means that the holder is capable of providing video service at the household address using any technology, other than direct-to-home satellite service, providing two-way 90 AB 2987 — 32 —
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broadband Internet capability and video programming, content, and functionality, regardless of whether any customer has ordered service or whether the owner or landlord or other responsible person has granted access to the household. If more than one technology is utilized, the technologies shall provide similar two-way broadband Internet accessibility and similar video programming.
(k) Nothing in this section shall be construed to require a holder to provide video service outside its wireline footprint or to match the existing cable franchise territory of any cable provider. 5900. (a) The holder of a state franchise shall comply with the provisions of Sections 53055, 53055.1, 53055.2, and 53088.2 of the Government Code, and any other customer service
standards pertaining to the provision of video service established by federal law or regulation or adopted by subsequent enactment of the Legislature. All customer service and consumer protection standards under this section shall be interpreted and applied to accommodate newer or different technologies while meeting or exceeding the goals of the standards.
(b) The holder of a state franchise shall comply with
provisions of Section 637.5 of the Penal Code and the privacy standards contained in Section 631 of the federal Cable Act (47 U.S.C. Sec. 551 et. seq.).
(c) The local entity shall enforce all of the customer service and protection standards of this section with respect to complaints received from residents within the local entity’s jurisdiction, but it may not adopt or seek to enforce any additional or different customer service or other performance standards under Section 53055.3 or subdivision (q), (r), or (s) of Section 53088.2 of the Government Code, or any other authority or provision of law.
(d) The local entity shall, by ordinance or resolution, provide a schedule of penalties for any material breach by a holder of a state franchise of this section. No monetary penalties shall be assessed for a material breach if it is out of the reasonable control of the holder. Further, no monetary penalties may be imposed prior to January 1, 2007. Any schedule of monetary penalties adopted pursuant to this section shall in no event exceed five hundred dollars ($500) for each day of each material breach, not to exceed one thousand five hundred dollars ($1,500) for each 90 — 33 — AB 2987
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occurrence of a material breach. However, if a material breach of this section has occurred, and the local entity has provided notice and a fine or penalty has been assessed, and if a subsequent material breach of the same nature occurs within 12 months, the penalties may be increased by the local entity to a maximum of one thousand dollars ($1,000) for each day of each material breach, not to exceed three thousand dollars ($3,000) for each occurrence of the material breach. If a third or further material breach of the same nature occurs within those same 12 months, and the local entity has provided notice and a fine or penalty has been assessed, the penalties may be increased to a maximum of two thousand five hundred dollars ($2,500) for each day of each material breach, not to exceed seven thousand five hundred dollars ($7,500) for each occurrence of the material breach. With respect to video providers subject to a franchise or license, any monetary penalties assessed under this section shall be reduced dollar-for-dollar to the extent any liquidated damage or penalty provision of a current cable television ordinance, franchise contract, or license agreement imposes a monetary obligation upon a video provider for the same customer service failures, and no other monetary damages may be assessed.
(e) The local entity shall give the video provider written notice of any alleged material breaches of the consumer service standards of this division and allow the video provider at least 30 days from receipt of the notice to remedy the specified material breach.
(f) A material breach for the purposes of assessing penalties shall be deemed to have occurred for each day within the jurisdiction of each local entity, following the expiration of the period specified in subdivision (e), that any material breach has not been remedied by the video provider, irrespective of the number of customers affected.
(g) Any penalty shall be provided to the local entity who shall submit one-half of the penalty to the Digital Divide Account established in Section 280.5.
(h) Any interested person may seek judicial review of a decision of the local entity in a court of appropriate jurisdiction.
For this purpose, a court of law shall conduct a de novo review of any issues presented.
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(i) This section shall not preclude a party affected by this section from utilizing any judicial remedy available to that party without regard to this section. Actions taken by a local legislative body, including a local franchising authority, pursuant to this section shall not be binding upon a court of law. For this purpose, a court of law shall conduct de novo review of any issues presented.
(j) For purposes of this section, “material breach” means any substantial and repeated failure of a video service provider to comply with service quality and other standards specified in subdivision (a).
(k) The Division of Ratepayer Advocates shall have authority to advocate on behalf of video customers regarding renewal of a state-issued franchise and enforcement of Sections 5890, 5900, and 5950. For this purpose, the division shall have access to any information in the possession of the commission subject to all restrictions on disclosure of that information that are applicable to the commission.
5910. (a) The holder of a state franchise shall perform background checks of applicants for employment, according to current business practices.
(b) A background check equivalent to that performed by the holder shall also be conducted on all of the following:
(1) Persons hired by a holder under a personal service contract.
(2) Independent contractors and their employees.
(3) Vendors and their employees.
(c) Independent contractors and vendors shall certify that they have obtained the background checks required pursuant to subdivision (f), and shall make the background checks available to the holder upon request.
(d) Except as otherwise provided by contract, the holder of a state franchise shall not be responsible for administering the background checks and shall not assume the costs of the background checks of individuals who are not applicants for employment of the holder.
(e) (1) Subdivision (a) only applies to applicants for employment for positions that would allow the applicant to have direct contact with or access to the holder’s network, central office, or customer premises, and perform activities that involve 90 — 35 — AB 2987
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the installation, service, or repair of the holder’s network or equipment.
(2) Subdivision (b) only applies to persons that have direct contact with or access to the holder’s network, central office, or customer premises, and perform activities that involve the installation, service, or repair of the holder’s network or equipment.
(f) This section does not apply to temporary workers
performing emergency functions to restore the network of a holder to its normal state in the event of a natural disaster or an emergency that threatens or results in the loss of service. 5920. (a) A holder of a state franchise employing more than 750 total employees in California shall annually report to the commission all of the following:
(1) The number of California residents employed by the holder, calculated on a full-time or full-time equivalent basis. (2) The percentage of the holder’s total domestic workforce, calculated on a full-time or full-time equivalent basis. (3) The types and numbers of jobs by occupational
classification held by residents of California employed by holders of state franchises and the average pay and benefits of those jobs and, separately, the number of out-of-state residents employed by independent contractors, companies, and
consultants hired by the holder, calculated on a full-time or full-time equivalent basis, when the holder is not contractually prohibited from disclosing the information to the public. This paragraph applies only to those employees of an independent contractor, company, or consultant that are personally providing services to the holder, and does not apply to employees of an independent contractor, company, or consultant not personally performing services for the holder.
(4) The number of net new positions proposed to be created directly by the holder of a state franchise during the upcoming year by occupational classifications and by category of full-time, part-time, temporary, and contract employees.
(b) The commission shall annually report the information required to be reported by holders of state franchises pursuant to subdivision (a), to the Assembly Committee on Utilities and Commerce and the Senate Committee on Energy, Utilities and Communications, or their successor committees, and within a 90 AB 2987 — 36 —
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reasonable time thereafter, shall make the information available to the public on its Internet Web site.
5930. (a) Notwithstanding any other provision of this division, any video service provider that currently holds a franchise with a local franchising entity in a county that is a party, either alone or in conjunction with any other local franchising entity located in that county, to a stipulation and consent judgment executed by the parties thereto and approved by a federal district court shall neither be entitled to seek a state franchise in any area of that county, including any
unincorporated area and any incorporated city of that county, nor abrogate any existing franchise before July 1, 2014. Prior to July 1, 2014, the video service provider shall continue to be exclusively governed by any existing franchise with a local franchising entity for the term of that franchise and any and all issues relating to renewal, transfer, or otherwise in relation to that franchise shall be resolved pursuant to that existing franchise and otherwise applicable federal and local law. This subdivision shall not be deemed to extend any existing franchise beyond its term. (b) When an incumbent cable operator is providing service under an expired franchise or a franchise that expires before January 2, 2008, the local entity may extend that franchise on the same terms and conditions through January 2, 2008. A state franchise issued to any incumbent cable operator shall not become operative prior to January 2, 2008.
(c) When a video service provider that holds a state franchise provides the notice required pursuant to subdivision (m) of Section 5840 to a local entity, the local franchising entity may require all incumbent cable operators to seek a state franchise and shall terminate the franchise issued by the local franchising entity when the commission issues a state franchise for the video service provider that includes the entire service area served by the video service provider and the video service provider notifies the local entity that it will begin providing video service in that area under a state franchise.
5940. The holder of a state franchise under this division who also provides stand-alone, residential, primary line, basic telephone service shall not increase this rate to finance the cost of deploying a network to provide video service.
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5950. The commission shall not permit a telephone
corporation that is providing video service directly or through its affiliates pursuant to a state-issued franchise as an incumbent local exchange carrier to increase rates for residential, primary line, basic telephone service above the rate as of July 1, 2006, until January 1, 2009, unless that telephone corporation is regulated under rate of return regulation. However, the commission may allow rate increases to reflect increases in inflation as shown in the Consumer Price Index published by the Bureau of Labor Statistics. This section does not affect the authority of the commission to authorize an increase in rates for basic telephone service that is bundled with other services and priced as a bundle. Nothing in this section is intended to prohibit implementation of commission decision D. 06-04-071 to the extent it has not been implemented prior to July 1, 2006. 5960. (a) For purposes of this section, “census tract” has the same meaning as used by the United States Census Bureau, and “household” has the same meaning as specified in Section 5890. (b) Every holder, no later than April 1, 2008, and annually no later than April 1 thereafter, shall report to the commission on a census tract basis the following information:
(1) Broadband Information:
(A) The number of households to which the holder makes broadband available in this state. If the holder does not maintain this information on a census tract basis in its normal course of business, the holder may reasonably approximate the number of households based on information it keeps in the normal course of business.
(B) The number of households that subscribe to broadband that the holder makes available in this state.
(C) Whether the broadband provided by the holder utilizes wireline-based facilities or another technology.
(2) Video Information:
(A) If the holder is a telephone corporation:
(i) The number of households in the holder’s telephone service area.
(ii) The number of households in the holder’s telephone service area that are offered video service by the holder. (B) If the holder is not a telephone corporation:
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(i) The number of households in the holder’s video service area.
(ii) The number of households in the holder’s video service area that are offered video service by the holder.
(3) Low-Income Household Information:
(i) The number of low-income households in the holder’s video service area.
(ii) The number of low-income households in the holder’s video service area that are offered video service by the holder. (c) The commission, no later than July 1, 2008, and annually no later than July 1 thereafter, shall submit to the Governor and the Legislature a report that includes based on year-end data, on an aggregated basis, the information submitted by holders pursuant to subdivision (b).
(d) All information submitted to the commission and reported by the commission pursuant to this section shall be disclosed to the public only as provided for pursuant to Section 583. No individually identifiable customer information shall be subject to public disclosure.
5970. Subject to the requirements of this division, a state franchise may be transferred to any successor in interest of the holder to which the certificate originally is granted, whether this transfer is by merger, sale, assignment, bankruptcy, restructuring, or any other type of transaction, provided that the following conditions are met:
(a) The transferee submits to the commission all of the information required by this division of an applicant.
(b) The transferee agrees that any collective bargaining agreement entered into by a video service provider shall continue to be honored, paid, or performed to the same extent as would be required if the video service provider continued to operate under its franchise for the duration of that franchise unless the duration of that agreement is limited by its terms or by federal or state law.
SEC. 4. Section 107.7 of the Revenue and Taxation Code is amended to read:
107.7. (a) When valuing possessory interests in real property created by the right to place wires, conduits, and appurtenances along or across public streets, rights-of-way, or public easements contained in either a cable franchise or license granted pursuant 90 — 39 — AB 2987
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to Section 53066 of the Government Code (a “cable possessory interest”) or a state franchise to provide video service pursuant to Section 5840 of the Public Utilities Code (a “video possessory interest”), the assessor shall value these possessory interests consistent with the requirements of Section 401. The methods of valuation shall include, but not be limited to, the comparable sales method, the income method (including, but not limited to, capitalizing rent), or the cost method.
(b) (1) The preferred method of valuation of a cable television possessory interest or video service possessory interest by the assessor is capitalizing the annual rent, using an appropriate capitalization rate.
(2) For purposes of this section, the annual rent shall be that portion of that franchise fee received that is determined to be payment for the cable television possessory interest or video service possessory interest for the actual remaining term or the reasonably anticipated term of the franchise or license or the appropriate economic rent. If the assessor does not use a portion of the franchise fee as the economic rent, the resulting assessments shall not benefit from any presumption of
correctness.
(c) If the comparable sales method, which is not the preferred method, is used by the assessor to value a cable possessory interest or video service possessory interest when sold in combination with other property including, but not limited to, intangible assets or rights, the resulting assessments shall not benefit from any presumption of correctness.
(d) Intangible assets or rights of a cable system or the provider of video services are not subject to ad valorem property taxation.
These intangible assets or rights, include, but are not limited to:
franchises or licenses to construct, operate, and maintain a cable system or video service system for a specified franchise term (excepting therefrom that portion of the franchise or license which grants the possessory interest), subscribers, marketing, and programming contracts, nonreal property lease agreements, management and operating systems, a work force in place, going concern value, deferred, startup, or prematurity costs, covenants not to compete, and goodwill. However, a cable possessory interest or video service possessory interest may be assessed and valued by assuming the presence of intangible assets or rights 90 AB 2987 — 40 —
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necessary to put the cable possessory interest or video service possessory interest to beneficial or productive use in an operating cable system or video service system.
(e) Whenever any change in ownership of a cable possessory interest or video service possessory interest occurs, the person or legal entity required to file a statement pursuant to Section 480, 480.1, or 480.2, shall, at the request of the assessor, provide as a part of that statement the following, if applicable: confirmation of the sales price; allocation of the sales price among the counties; and gross revenue and franchise fee expenses of the cable system or video service system by county. Failure to provide this information shall result in a penalty as provided in Section 482, except that the maximum penalty shall be five thousand dollars ($5,000).
SEC. 5. (a) It is the intent of the Legislature that video service providers shall pay as rent a franchise fee to the local entity in which service is being provided for the continued use of streets, public facilities, and other rights-of-way of the local entity in order to provide service.
(b) It is the intent of the Legislature that securing a state franchise by a cable television operator or video service provider pursuant to this act shall not affect the existing requirements governing the valuation of possessory interests as set forth in Section 107.7 of the Revenue and Taxation Code. Furthermore, nothing in this act shall be construed to change the existing jurisdiction of the State Board of Equalization and county assessors with respect to the assessment of these properties for property tax purposes.
SEC. 6. No reimbursement is required by this act pursuant to Section 6 of Article XIII B of the California Constitution for certain costs that may be incurred by a local agency or school district because, in that regard, this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIII B of the California Constitution.
However, if the Commission on State Mandates determines that this act contains other costs mandated by the state, reimbursement to local agencies and school districts for those 90 — 41 — AB 2987
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costs shall be made pursuant to Part 7 (commencing with Section 17500) of Division 4 of Title 2 of the Government Code. 90 AB 2987 — 42 —
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Approved , 2006
Governor
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ATTACHMENT B
General Order XXX
Implementing The Digital Infrastructure and
Video Competition Act of 2006 (AB 2987)
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Table of Contents
Title Page
I. Definitions ....................................................................................................................... 1 II. Purpose of the General Order.................................................................................... 5 III. When Various Applicants Can/Must Apply for a
State Video Franchise ................................................................................................... 6 A. The Commission’s Role in Processing Applications...............................6 B. Applications for New Franchises................................................................7 C. Applicants with Existing Franchises ..........................................................7
1. Eligibility Conditions ...........................................................................7
2. Franchise Effectiveness Date...............................................................8
3. Terms of Service Offered .....................................................................8
4. Effect of a New Competitor’s Entry into a Video Market...............8
5. Exception for a Party to a Stipulation and Consent
Judgment Approved by a Federal District Court ...........................9 IV. Application Process for a State Video Franchise................................................ 10 A. Steps for Obtaining a State Video Franchise...........................................10
1. Step 1: Complete the Application for a State Video
Franchise (Appendix A to the General Order)..............................10 a) Adequate Assurance of Financial, Legal, and
Technical Qualifications ...............................................................10 b) Application Fee..............................................................................11
2. Step 2: Application Submission Requirements ..............................12 a) Submit Completed Application to the Commission...............12 b) Concurrently Deliver a Copy of the Application to
the Affected Local Entity..............................................................12
3. Step 3: Commission Review of the Application
for Completeness ................................................................................12
4. Step 4: Notification of Application Completeness
or Incompleteness ...............................................................................13
5. Step 5: State Video Franchise Issued for
Complete Applications ......................................................................14 - i -
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Table of Contents
Title Page
B. Failure of Commission to Act on Application ........................................14 C. Protests to State Video Franchise Applications Disallowed................14 V. The State Video Franchise Holder.......................................................................... 15 VI. The State Video Franchise – Authorization to Offer Service, Obligations, Amendment, Renewal, Transfer, Voluntary
Termination, and Miscellaneous Changes ........................................................... 16 A. Authorization to Offer Service ..................................................................16
1. Grants of Authority ............................................................................16
2. Duration of a State Video Franchise.................................................16 B. State Video Franchise Obligations............................................................17
1. Obligations Imposed by Statute .......................................................17 C. Amending a State Video Franchise ..........................................................17
1. Fee for Amending a State Video Franchise....................................17
2. Procedures for Filing a Supplemental Application ......................18
3. Commission Review and Issuance of a
Supplemental Application.................................................................18 D. Renewal of a State Video Franchise..........................................................19
1. Eligibility to Seek Ren ........................................................................19 E. Transfer of a State Video Franchise ..........................................................20 F. Voluntary Termination of a State Video Franchise.............................21 G. Miscellaneous Changes ..............................................................................22 VII. Reporting Requirements ........................................................................................... 22 A. Reports for Collection of the User Fee .....................................................22 B. Annual Employment Reports....................................................................23
1. Reporting Obligations Imposed on State Video Franchise Holders with More than 750 California Employees .....................23
2. Commission Reports to Legislative Committees ..........................24 - ii -
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Table of Contents
Title Page
C. Annual Reports on Broadband and Video Services............................25 D. Information on Service to Community Centers......................................28 E. Additional Information ..............................................................................29 F. Enforcement of Reporting Requirements ................................................29 Appendix A Application
Appendix B Video Franchise Certificate
- iii -
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ATTACHMENT B
General Order XXX
Implementing The Digital Infrastructure and
Video Competition Act of 2006 (AB 2987)
I. Definitions
A. “AB 2987” means Assembly Bill 2987, the Digital
Infrastructure and Video Competition Act of 2006 (Ch. 700, Stats. 2006).1
B. “Applicant” means any person or entity that seeks to provide Video Service in the state pursuant to a State
Video Franchise.
C. “Application” means the form prescribed by the
Commission for seeking a grant, change, or renewal of a State Video Franchise.
D. “Application Fee” means any fee that the Commission
imposes to recover its actual and reasonable costs of
processing an Application.2
E. “Broadband” or “Broadband Service” means any service defined as broadband, or having advanced
telecommunications capability, in the most recent Federal Communications Commission inquiry pursuant to Section
706 of the Telecommunications Act of 1996 (P.L. 104-104).3 1 In this General Order, all further references to Public Utilities Code sections adopted or amended in AB 2987 track the statutory language effected by AB 2987. 2 CAL. PUB. UTIL. CODE § 5840(c). This fee is not levied for general revenue purposes, consistent with Public Utilities Code § 5840(c).
3 Id. at § 5830(a). The Federal Communications Commission currently uses the term “broadband” and “advanced telecommunications capability” to describe services and facilities with an upstream (customer-to-provider) and downstream (provider-tocustomer) transmission speed of more than 200 kilobits per second. FEDERAL
COMMUNICATIONS COMMISSION, AVAILABILITY OF ADVANCED TELECOMMUNICATIONS CAPABILITY IN THE UNITED STATES, FOURTH REPORT TO CONGRESS, FCC 04-208, 10 (Sept. 9, - 1 -
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ATTACHMENT B
General Order XXX
Implementing The Digital Infrastructure and
Video Competition Act of 2006 (AB 2987)
F. “Census Tract” has the same meaning as used by the U.S.
Census Bureau.4
G. “Commission” means the Public Utilities Commission.
H. “Community Center” means any facility run by an
organization that has qualified for the California
Teleconnect Fund, as established in Public Utilities Code § 280, and that will make the State Video Franchise
Holder’s service available to the community.5
I. “Effective Date of this General Order” means January 2, 2007 or the date when this Order is adopted, whichever is later.
J. “Household” means, consistent with the U.S. Census
Bureau, a house, apartment, a mobile home, a group of
rooms, or a single room that is intended for occupancy as separate living quarters.6
K. “Incumbent Cable Operator” means a cable operator or open-video system serving subscribers under a franchise in 2004). This definition, however, is under review by the Commission, and it may evolve in response to rapid technological changes in the marketplace. Id. 4 CAL. PUB. UTIL. CODE at § 5960(a).
5 Id. at § 5890(b)(3).
6 Id. at § 5890(j)(1). Separate living quarters are those in which the occupants live and eat separately from any other persons in building and which have direct access from the outside of the building or through a common hall. Id.
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ATTACHMENT B
General Order XXX
Implementing The Digital Infrastructure and
Video Competition Act of 2006 (AB 2987)
a particular city, county, or city and county franchise area on January 1, 2007.7
L. “Local Entity” means any city, county, city and county, or joint powers authority within the state within whose
jurisdiction a State Video Franchise Holder may provide Video Service.8
M. “Low-Income Household” means a residential Household where the average annual Household income is less than
$35,000, as based on U.S. Census Bureau estimates adjusted annually to reflect rates of change and distribution through January 1, 2007.9
N. “State Video Franchise” means a franchise issued pursuant to AB 2987.10
O. “State Video Franchise Holder” means a successful
Applicant’s parent company, or if none, the successful
Applicant itself.11 Accordingly, for the purposes of
imposing statutory obligations, a “holder” is deemed to be a successful Applicant, its parent company (if any), and any and all subsidiaries or affiliates of the Applicant or its 7 Id. at § 5830(j).
8 Id. at § 5830(k).
9 Id. at § 5890(j)(2) (defining “low-income households” for the purposes of imposing build-out requirements).
10 Id. at § 5830(p).
11 Pursuant to Public Utilities Code § 5840(e)(D)(5), an Applicant must submit information on the applicant’s parent company, if any exists.
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ATTACHMENT B
General Order XXX
Implementing The Digital Infrastructure and
Video Competition Act of 2006 (AB 2987)
parent company that are offering services in California that are implicated by AB 2987 requirements.12
P. “Telephone Service Area” means the area where the
Commission has granted an entity a Certificate of Public Convenience and Necessity to provide telephone service.
Q. “Telephone Corporation” means a telephone corporation as defined in Public Utilities Code § 234.
R. “User Fee” means the fee paid to the Commission
quarterly by each Holder pursuant to Public Utilities Code § 442(a).
S. “Video Service” means video programming services, cable service, or open-video system service provided through
facilities located at least in part in public rights-of-way without regard to delivery technology, including Internet protocol or other technology. This definition does not
include (1) any video programming provided by a
commercial mobile service provider defined in Section
322(d) of Title 47 of the United States Code, or (2) video programming provided as part of, and via, a service that enables users to access content, information, electronic mail, or other services offered over the public Internet.13 12 This tentative conclusion follows from how we propose to issue state video franchises. See CAL. PUB. UTIL. CODE § 5830(i) (“‘Holder’ means a person or group of persons that has been issued a state franchise from the commission pursuant to this division.”).
13 Id. at § 5830(s).
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ATTACHMENT B
General Order XXX
Implementing The Digital Infrastructure and
Video Competition Act of 2006 (AB 2987)
T. “Video Service Area” means the area proposed to be
served under a State Video Franchise.
U. “Video Service Provider” means any entity providing
Video Service.14
II. Purpose of the General Order
The purpose of this General Order is to promulgate the rules necessary to implement Assembly Bill (AB) 2987, the Digital Infrastructure and Video Competition Act of 2006 (DIVCA), which was signed into law by Governor Arnold Schwarzenegger on September 29, 2006. In enacting this Order, we remain mindful of the fact that the Legislature intends for the state video franchising process to achieve the following objectives:
A. Create a fair and level playing field for all market participants that does not disadvantage or advantage one service provider or technology over another;
B. Promote the widespread access to the most technologically advanced cable and video services to all California
communities in a nondiscriminatory manner, regardless of their socioeconomic status;
C. Protect local government revenues and control of public rights-of-way;
D. Require video service providers to comply with all
applicable consumer protection laws;
E. Complement efforts to increase investment in Broadband infrastructure investment and close the digital divide; 14 Id. at § 5830(t).
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ATTACHMENT B
General Order XXX
Implementing The Digital Infrastructure and
Video Competition Act of 2006 (AB 2987)
F. Continue access to and maintenance of public, education, and government (PEG) channels; and
G. Maintain all existing authority of the California Public Utilities Commission as established by state and federal statutes.15
This Commission will act to bring these intended economic and social benefits of Video Service competition to California.
We also recognize that the Legislature found that the public interest is best served by a Commission that is appropriately funded and staffed, and therefore able to give timely and well-considered action on matters before it. 16 Accordingly, the General Order assesses fees that will ensure that our video franchising operations are adequately funded and staffed.
III. When Various Applicants Can/Must Apply
for a State Video Franchise
A. The Commission’s Role in
Processing Applications
The Commission shall begin accepting Applications for State Video Franchises on the Effective Date of this General Order.17 Between the Effective Date of this General Order and January 1, 2008, persons wishing to offer Video Service in an area where a franchise has not already been granted may seek a franchise from the Commission or from the local franchising authority. 15 CAL. PUB. UTIL. CODE §§ 5810(2)(A)-(G).
16 Id. at § 401(a).
17 See id. at § 5840(g) (ordering the Commission to commence accepting Applications for a State Video Franchise no later than April 1, 2007).
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ATTACHMENT B
General Order XXX
Implementing The Digital Infrastructure and
Video Competition Act of 2006 (AB 2987)
After January 1, 2008, the Commission shall be the sole franchising authority for new Video Service franchises in the state of California.18 “Any person or corporation who seeks to provide Video Service in the state” and does not already have a video franchise shall apply for a State Video Franchise with the Commission.19
B. Applications for New Franchises
Applications for State Video Franchise in areas where a franchise has not already been granted may be submitted on or after the Effective Date of this General Order.20
C. Applicants with Existing Franchises
1. Eligibility Conditions
Applicants providing Video Service under an existing local franchise are not eligible to apply for a State Video Franchise for the same service area covered by the local franchise unless at least one of the following three conditions applies:
(i) the local franchise expires prior to renewal or extension; (ii) the Applicant and the local franchising authority mutually agree to terminate the local franchise, and submit their agreement in writing to the Commission; or (iii) a Video Service or cable provider with a State Video Franchise notifies a Local Entity of its intent to begin offering Video Service in all or part of the service area included in an Incumbent Cable Operator’s local franchise.21
18 Id. at §§ 5840(c),(g).
19 Id. at § 5840(c).
20 Id. at § 5840(g).
21 Id. at § 5840(o).
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ATTACHMENT B
General Order XXX
Implementing The Digital Infrastructure and
Video Competition Act of 2006 (AB 2987)
2. Franchise Effectiveness Date
In no case shall a State Video Franchise issued to an Incumbent Cable Operator become effective prior to January 2, 2008.22 Prior to January 2, 2008, an Incumbent Cable Operator with an expired or expiring franchise may choose to renew the local franchise or seek a State Video Franchise. If a State Video Franchise is sought, the local franchise shall be extended under its existing terms until the state franchise is effective.23
3. Terms of Service Offered
If one or more of the above conditions applies and an Incumbent Cable Operator chooses to replace its local franchise with a State Video Franchise, the Incumbent Cable Operator must continue providing Video Service to the entire service area covered by the local franchise being replaced as it existed on January 1, 2007 until the local franchise would, under its terms, have expired.24 An Incumbent Cable Operator that is also a telephone service provider with fewer than 1,000,000 telephone customers in California shall be required to continue providing Video Service only in the areas in which it provided Video Service as of January 1, 2007.25
4. Effect of a New Competitor’s Entry
into a Video Market
Local franchising entities have the authority to require Incumbent Cable Operators to seek State Video Franchises if and when a State Video Franchise 22 Id. at § 5930(b).
23 Id. at § 5930(b).
24 Id. at § 5840(p).
25 Id. at § 5840(p).
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ATTACHMENT B
General Order XXX
Implementing The Digital Infrastructure and
Video Competition Act of 2006 (AB 2987)
Holder provides notice of its intent to offer service within the Local Entity’s jurisdiction.26 In that circumstance, once the Commission issues a State Video Franchise to the Video Service Provider that includes the entire service area served by the Video Service Provider and the Video Service Provider gives notice to the local franchise authority that it will begin providing service under that State Video Franchise, the local franchise authority shall terminate the franchise issued by the local franchise authority.
5. Exception for a Party to a Stipulation and
Consent Judgment Approved by a
Federal District Court
Any Video Service Provider that currently holds a franchise with a local franchising entity in a county that is a party, either alone or in conjunction with any other local franchising entity located in that county, to a stipulation and consent judgment executed by the parties thereto and approved by a federal district court shall neither be entitled to seek a state franchise in any area of that county, including any unincorporated area and any incorporated city of that county, nor abrogate any existing franchise before July 1, 2014. Prior to July 1, 2014, the Video Service Provider shall continue to be exclusively governed by any existing franchise with a local franchising entity for the term of that franchise and any and all issues relating to renewal, transfer, or otherwise in relation to that franchise shall be resolved pursuant to that existing franchise and otherwise applicable federal and local law. This subdivision shall not be deemed to extend any existing franchise beyond its term.27
26 Id. at § 5930(c).
27 Id. at § 5930(a).
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ATTACHMENT B
General Order XXX
Implementing The Digital Infrastructure and
Video Competition Act of 2006 (AB 2987)
IV. Application Process for a State Video Franchise
A. Steps for Obtaining a State Video Franchise
1. Step 1: Complete the Application for a State Video
Franchise28 (Appendix A to the General Order)
The Application shall include all information required by Public Utilities Code § 5840(e), as well as information required to ascertain an Applicant’s eligibility requirements, as described in Public Utilities Code §§ 5840(c), 5840(d), 5840(f), 5840(o), 5840(p), 5890(b), 5890(c), 5890(d), 5930(a), 5930(b), and 5930(c). a) Adequate Assurance of Financial, Legal,
and Technical Qualifications
An Applicant is required to provide “adequate assurance” that it “possesses the financial, legal, and technical qualifications necessary to construct and operate the proposed system and promptly repair any damage to the public right-of-way caused by the Applicant.”29 To meet this requirement, the Applicant must submit a description of its qualifications pursuant to § 5840(e)(9) and a copy of Applicant’s most current audited financial statement, with an unqualified opinion, for a twelve-month reporting period ending no earlier than the prior calendar year. The financial statement must demonstrate that Applicant possesses a minimum of $100,000 of unencumbered cash that is reasonably liquid and readily available to meet expenses. Alternatively, the Commission will accept a bond in the amount of $100,000. 28 Id. at § 5840(e).
29 Id. at § 5840(e)(9).
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ATTACHMENT B
General Order XXX
Implementing The Digital Infrastructure and
Video Competition Act of 2006 (AB 2987)
b) Application Fee
Upon filing its initial Application, an Applicant is required to pay an Application Fee in the amount of $2,000 to the Commission. This fee does not exceed the actual and reasonable costs of processing an Application.30 30 Id. at § 5840(c).
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ATTACHMENT B
General Order XXX
Implementing The Digital Infrastructure and
Video Competition Act of 2006 (AB 2987)
2. Step 2: Application Submission Requirements
a) Submit Completed Application to the
Commission31
The Commission requires all Applicants to submit Applications in the format – paper or electronic – that the Commission directs. In all cases, the Applicant must complete the attached affidavit, submitting one original and one copy to the Commission.
b) Concurrently Deliver a Copy of the
Application to the Affected Local Entity
An Applicant also shall submit a copy of its Application to the appropriate contact person for each Local Entity where the Applicant will provide service.32
3. Step 3: Commission Review of the Application
for Completeness
The Commission shall review the Application and determine whether the Application is complete or incomplete before the thirtieth calendar day after the Commission receives the Application.33
31 Id. at § 5840(a).
32 Id. at § 5840(e)(1)(D).
33 Id. at § 5840(h)(1).
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ATTACHMENT B
General Order XXX
Implementing The Digital Infrastructure and
Video Competition Act of 2006 (AB 2987)
4. Step 4: Notification of Application
Completeness or Incompleteness
The Commission, acting through the Executive Director, shall notify the Applicant and affected Local Entities34 as to whether the Application is complete or incomplete before the thirtieth calendar day after the Commission receives the Application.35
The Commission’s notice of a complete Application will include notification that the Commission shall issue a State Video Franchise before the fourteenth calendar day after the determination of completeness was made.36 The Commission’s notice of an incomplete Application will include a statement specifying which items are incomplete and a statement permitting the Applicant to amend the Application.37
The Commission shall have 30 calendar days from the date an incomplete Application is amended and received by the Commission to determine its completeness.38
Notice of complete and incomplete amended Applications and review of subsequent incomplete amended Applications shall follow the procedures outlined in Steps 3 and 4 above.
34 The Commission will use the local authority contact information provided by the Applicant in the Application.
35 CAL. PUB. UTIL. CODE § 5840(h)(1).
36 Id. at § 5840(h)(2) (“If the commission finds the Application is complete, it shall issue a state franchise before the 14th calendar day after that finding.”). 37 Id. at § 5840(h)(3).
38 Id.
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ATTACHMENT B
General Order XXX
Implementing The Digital Infrastructure and
Video Competition Act of 2006 (AB 2987)
5. Step 5: State Video Franchise Issued
for Complete Applications
The Commission, acting through the Executive Director, shall issue a State Video Franchise to the Applicant before the fourteenth calendar day after its determination of Application completeness.39 The form used to issue a State Video Franchise is found in Appendix B of the General Order.
B. Failure of Commission to Act on Application
If the Commission fails to notify the Applicant of the completeness or incompleteness of the Applicant’s Application before the forty-fourth calendar day after receipt of an Application, the Commission’s inaction will be interpreted to constitute issuance of the State Video Franchise, with no further action required on behalf of the Applicant.40
A California State Video Franchise, however, is not deemed granted due to Commission failure to act when Applicant is statutorily ineligible for the State Video Franchise, pursuant to the requirements of §§ 5840 (d), 5840(c), 5840(d), 5840(o), 5930(a), 5930(b), and 5930(p).
C. Protests to State Video Franchise
Applications Disallowed
No person or entity may file a protest to an Application. 39 Id. at § 5840(h)(2).
40 Id. at § 5840(h)(4).
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ATTACHMENT B
General Order XXX
Implementing The Digital Infrastructure and
Video Competition Act of 2006 (AB 2987)
V. The State Video Franchise Holder
A. Prohibition on Awarding Multiple Franchises
to Subsidiaries or Affiliates of a Single
Enterprise
The Commission prohibits the holding of multiple State Video Franchises through separate subsidiaries or affiliates of a single enterprise.41 Any company with subsidiaries or affiliates may only receive a single State Video Franchise.42 B. Ineligibility of Entities in Violation of the Cable
Television and Video Providers Service and
Information Act or the Video Customer Service Act
No person or corporation shall be eligible for a State Video Franchise if that person or corporation is in violation of any final nonappealable order relating to either the Cable Television and Video Providers Customer Service and Information Act43 or the Video Customer Service Act44.45 This provision applies to State Video Franchises sought through renewal or transfer of an existing State Video Franchise.46
41 See id. at § 5840(f) (explicitly granting the Commission the authority to effect this provision).
42 See id. at § 5840(f) (specifically providing that the Commission may adopt this provision).
43 CAL. GOVT. CODE §§ 53054 et seq.
44 CAL. GOVT. CODE §§ 53088 et seq.
45 CAL. PUB. UTIL. CODE § 5840(d).
46 Id.
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ATTACHMENT B
General Order XXX
Implementing The Digital Infrastructure and
Video Competition Act of 2006 (AB 2987)
VI. The State Video Franchise – Authorization to Offer Service, Obligations, Amendment, Renewal, Transfer, Voluntary
Termination, and Miscellaneous Changes
A. Authorization to Offer Service
1. Grants of Authority
It is unlawful to provide Video Service without a state or locally issued franchise.47 The issuance of a State Video Franchise represents the Commission’s determination that an Applicant has satisfied the statutory requirements pursuant to AB 2987 to offer Video Service. The document in which the Commission memorializes the issuance of a State Video Franchise serves as proof of the Commission’s grant of authority to provide Video Service, but does not itself constitute authority to offer Video Service.
Each State Video Franchise issued by the Commission includes (1) a grant of authority to provide Video Service in the Video Service Area as requested in the Application; (2) a grant of authority, in exchange for the franchise fee set forth in Public Utilities Code Section 5840(q), to use the public rights-of-way for the delivery of Video Service in the Video Service Area specified in the Application and any subsequent amendments to such Video Service Area approved by the Commission; and (3) a statement that the grant of the authority is subject to the lawful operation of the Video Service by the Applicant or its successor-in-interest.48
2. Duration of a State Video Franchise
A State Video Franchise is effective for ten years after the date of its issuance.49
47 Id. at § 5840(k).
48 Id. at § 5840(i).
49 Id. at § 5850(a).
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ATTACHMENT B
General Order XXX
Implementing The Digital Infrastructure and
Video Competition Act of 2006 (AB 2987)
B. State Video Franchise Obligations
1. Obligations Imposed by Statute
State Video Franchise Holders are required to comply with all applicable requirements of the Public Utilities Code.
2. Enforcement of Obligations
A State Video Franchise is subject to suspension or revocation if a Video Service Provider fails to comply with the applicable requirements of Division 2.5 the Public Utilities Code.50 In addition, the Commission shall not renew a State Video Franchise if the State Video Franchise Holder is in violation of any final nonappealable court order issued pursuant to Division 2.5 of the Public Utilities Code.51
C. Amending a State Video Franchise
A State Video Franchise Holder may amend a State Video Franchise in order to reflect changes to its service territory.52
1. Fee for Amending a State Video
Franchise
There is no fee associated with such amendments to reflect changes in service territory, but in general, the Commission’s supplemental Application process tracks the State Video Franchise Application process as set forth below.53 50 Id. at § 5890(g).
51 Id. at § 5850 (d).
52 Id. at § 5840(f).
53 See id. at § 5840.
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ATTACHMENT B
General Order XXX
Implementing The Digital Infrastructure and
Video Competition Act of 2006 (AB 2987)
2. Procedures for Filing a Supplemental
Application
A State Video Franchise Holder seeking a Video Service Area amendment (whether an increase or decrease) shall file a supplemental Application to its initial Application that clearly shows the new boundaries of the affected service areas,54 describes any and all Local Entities impacted by the new service area, and further amends all sections of the prior Application affected by the change in service territory or other factors. This supplemental Application shall be numbered sequentially in the document title, starting with the first supplemental Application filed by a State Video Franchise Holder.
One original and one copy of the supplemental Application shall be filed with the Commission and concurrently served on any Local Entities affected by the change in Video Service Area.
3. Commission Review and Issuance of a
Supplemental Application
The Commission, acting through the Executive Director, will notify the State Video Franchise Holder and any affected Local Entities whether the supplemental Application is complete or incomplete on or before the thirtieth calendar day following the filing date of the supplemental Application. The State Video Franchise Holder will have the opportunity to remedy any incomplete supplemental Application. Once an incomplete Application is refiled with the missing information, the Commission will have 30 days to determine the completeness of a supplemented Application.
The Commission’s failure to notify the State Video Franchise Holder of a supplemental Application’s completeness or incompleteness before the fortyfourth calendar day after the receipt of a supplemental Application shall be deemed to constitute issuance of the amended franchise, so long as the State 54 Id. at § 5840(m)(6).