Morgan Hill City Council
June 7, 2023

Special/Regular Meeting Agenda
City Council
Mark Turner - Mayor
Rene Spring - Mayor Pro Tem
Gino Borgioli - Council Member
Marilyn Librers - Council Member
Yvonne Martínez Beltrán - Council Member
Wednesday, June 7, 2023 5:00 PM
Council Chamber Building
17555 Peak Avenue, Morgan Hill, CA 95037
Morgan Hill City Council meetings are held in person with the option for the public to attend in-person or by teleconference/video conference. Information on how the public may observe and participate in the meeting is located below.

MEETING PARTICIPATION AND PUBLIC COMMENT
City Council meetings will be live-streamed on Channel 17, the City’s website, and the City’s Facebook page.

Those members of the community that would like to participate in the meetings remotely may do so by joining virtually at: https://bit.ly/MHCityCouncilMeetingor by calling (669) 900-9128, then enter the webinar id: 873 3200 8380#. Public comment may be provided in the following ways:
• Provide public comment in-person
• Join the City Council meeting virtually via the link above. When public comment is opened, raise your virtual hand and be called upon to speak for up to 3 minutes (YOU MUST BE RUNNING THE MOST CURRENT VERSION OF

ZOOM TO BE UNMUTED)
• Join virtually by calling the number above, dial *9 to raise your hand, and be called upon to speak for up to 3 minutes
• Public comment in writing may be submitted via email to [email protected] or by mail to the City Clerk at 17575 Peak Avenue, Morgan Hill, CA 95037. Please email your comments to the City Clerk no later than 3:00 p.m. on Tuesday (the day before the City Council meeting) for your comments to be submitted to the members of the City Council with sufficient

June 7, 2023
2 time to review the comments. You may continue to provide written comments up to noon on Wednesday (the day of the meeting) although Council Members may not have sufficient time to review them before the meeting. Public comments submitted to the City Clerk after 12:00 p.m. the day of the meeting will be provided to the City Council as time allows.

Written comments WILL NOT be read aloud during the City Council Meeting. Please note that written comments are posted on the City’s website, so do not include any personal information you do not want to be posted on the web.

SPECIAL/REGULAR MEETING
A special meeting of the City Council is called at 5:00 pm for the purpose of conducting a closed session.

SPECIAL MEETING
5:00 p.m. closed session

CALL TO ORDER

ROLL CALL ATTENDANCE

DECLARATION OF POSTING AGENDA

CLOSED SESSION
Conference with Labor Negotiators
Authority: Pursuant Government Code Section 54957.6
City Negotiators: Christina Turner, City Manager; Donald Larkin, City Attorney; Michael Horta, Human Resources Director; Dat Nguyen, Finance Director; Edith Ramirez, Assistant City Manager, Development Services
Employee Organization: Morgan Hill Police Officers Association; AFSCME Local 101 Morgan Hill; Community Service Officers Association; Employees Covered under Management Resolution #21-050

OPPORTUNITY FOR PUBLIC COMMENT

SILENT INVOCATION

June 7, 2023
3 ADJOURN TO CLOSED SESSION

REGULAR MEETING
6:00 p.m.

PLEDGE OF ALLEGIANCE

PROCLAMATIONS
Proclaiming the month of June as LGBTQ+ Pride Month

RECOGNITIONS
Certificate of Recognition from Senator John Laird's office to the City of Morgan Hill for the City's efforts to support our LGBTQ+ community.

Certificate of Recognition awarded to Les Taylor for her volunteer efforts supporting the City’s Youth Action Council.

Certificate of Recognition awarded to the Parent Family for their volunteer efforts maintaining the Magical Bridge of Morgan Hill Playground for all visitors.

PRESENTATIONS
Morgan Hill Library Presentation

CITY COUNCIL REPORTS
Council Member Spring

CITY MANAGER'S REPORT

CITY ATTORNEY'S REPORT

OTHER REPORTS

PUBLIC COMMENT
This opportunity for public comment is for items that are not on the agenda. If you would like to make comments on an item that is on the agenda, please wait until we get to that item to offer your comments. Members of the public are entitled to address the City Council concerning any item within the Morgan Hill City Council’s subject

June 7, 2023
4 matter jurisdiction. Public comments are limited to no more than three minutes. Except for certain specific exceptions, the City Council is prohibited from discussing or taking action on any item not appearing on the posted agenda. Public comment is intended for comments. Questions posed during public comment are not generally answered. If you have questions, please send them to the City Clerk at [email protected] to receive a response. (See additional noticing at the end of this agenda)

ADOPTION OF AGENDA

CONSENT CALENDAR
Items appearing on the Consent Calendar are considered routine and may be approved by one motion. Pursuant to City Council Policies and Procedures (CP 97-01), any member of the Council or public may request to have an item removed from the Consent Calendar for comment and action.

1. ACCEPT GALVAN PARK RESTROOM REPLACEMENT PROJECT IN THE AMOUNT OF $143,604
Recommendation:

1. Accept as complete the Galvan Park Restroom Replacement Project;

2. Authorize the City Engineer to sign the Notice of Completion; and

3. Direct the City Clerk to file said Notice of Completion with the County Recorder's Office.

2. ADOPT ORDINANCE NO. 2346, NEW SERIES ENACTING SECTION 9.04.055 (CARRYING OF FIREARMS IN SENSITIVE PLACES) OF CHAPTER 9.04 (WEAPONS) OF TITLE 9 (PUBLIC PEACE, MORALS AND WELFARE) OF

THE MUNICIPAL CODE OF THE CITY OF MORGAN HILL REGARDING THE

PROHIBITION OF CARRYING FIREARMS IN SENSITIVE PLACES
Recommendation:

Waive the reading, adopt Ordinance No. 2346, New Series, and declare that said title, which appears on the agenda, shall be determined to have been read by title and further reading waived.

3. ADOPT RESOLUTION ESTABLISHING THE GANN (PROPOSITION 4) APPROPRIATIONS LIMIT FOR FISCAL YEAR 2023-24
Recommendation:

Adopt Resolution establishing the Gann (Proposition 4) appropriations limit for Fiscal Year 2023-24.

4. APPROVE MICROSOFT ENTERPRISE AGREEMENT
Recommendation:

June 7, 2023
5 1. Approve the purchase of three-year Microsoft Office 365, Windows Server, and SQL Database Licensing from Dell Marketing, LLP in the amount of $411,126, plus a 10% contingency for any additional growth; and

2. Authorize the City Manager to execute and administer a Microsoft Enterprise Agreement for the licensing of Microsoft products and services with Dell through 2026 with subsequent renewal subject to budget appropriation.

5. APPROVE PROFESSIONAL SERVICES AGREEMENT WITH

KENNEDY/JENKS CONSULTANTS FOR THE EAST DUNNE AVENUE

HILLSIDE WATER RESERVOIR PROJECT
Recommendation:

1. Approve a professional services agreement with Kennedy/Jenks Consultants to complete the design for the East Dunne Avenue Hillside Water Reservoir project not to exceed $240,187.

2. Authorize the City Manager to execute all documents and make minor modifications as necessary in order to consummate the transaction.

6. APPROVE REVISIONS TO CITY COUNCIL POLICY CP-94-04, THE CITY'S

INVESTMENT POLICY
Recommendation:

Approve revisions to City Council Policy CP-94-04, the City's Investment Policy.

7. APPROVE THE MAY 3, 2023 CITY COUNCIL MEETING MINUTES Recommendation:

Approve the May 3, 2023 City Council Meeting Minutes.

8. AWARD 2023 PAVEMENT REHABILITATION PROJECT TO MCKIM
CORPORATION IN THE AMOUNT OF $3,948,023
Recommendation:

1. Approve 2023 Pavement Rehabilitation Project plans and specifications;

2. Award contract to McKim Corporation for the 2023 Pavement Rehabilitation Project in the amount of $3,948,023;

3. Authorize expenditure of construction contingency not to exceed $394,802; and

4. Authorize the City Manager to execute and administer the construction contract with McKim Corporation.

June 7, 2023
6 9. AWARD BUTTERFIELD FIRE STATION PROJECT TO LARRY S. KENT, INC.

DBA KENT CONSTRUCTION IN THE AMOUNT OF $7,956,553
Recommendation:

1. Adopt resolution amending the Fiscal Year 2022-23 Budget and appropriating an additional $2,250,000 to fund the Butterfield Fire Station Project;

2. Authorizing an interfund loan to Public Safety Facilities Impact Fund (315) of $7,750,000 from Local Drainage Impact Fund (303) ($5,750,000), Park Maintenance Fund (302) ($1,000,000), and Public Facilities Fund (347) ($1,000,000);

3. Approve the Butterfield Fire Station Plans and Specifications;

4. Award contract to Larry S. Kent, Inc. DBA Kent Construction in the amount of $7,956,553;

5. Authorize expenditures of construction contingency funds not to exceed $795,655; and

6. Authorize the City Manager to execute and administer the construction contract with Larry S. Kent, Inc. DBA Kent Construction.

10. AWARD FISHER BASIN EXPANSION PROJECT TO GALEB PAVING, INC.

IN THE AMOUNT OF $2,568,800
Recommendation:

1. Approve Fisher Basin Expansion Project plans and specifications;

2. Award contract to Galeb Paving Inc. for the Fisher Basin Expansion Project in the amount of $2,568,800;

3. Authorize expenditure of construction contingency funds not to exceed $385,320; and

4. Authorize the City Manager to execute and administer the construction contract with Galeb Paving Inc.

11. AWARD JACKSON OAKS WATER MAIN PROJECT TO SUBTERRA
CONSTRUCTION, INC. IN THE AMOUNT OF $642,100
Recommendation:

1. Approve the Jackson Oaks Water Main Project Plans and Specifications;

2. Award contract to SubTerra Construction, Inc. for the Jackson Oaks Water Main Project in the amount of $642,100;

3. Authorize the expenditure of construction contingency funds not to exceed $96,315; and

4. Authorize the City Manager to execute and administer the construction contract with SubTerra Construction, Inc.

June 7, 2023
7 12. RATIFY CITY POSITIONS ON PENDING LEGISLATION
Recommendation:

1. Ratify the City’s position on pending legislation, Assembly Bill 33 (Bains) Fentanyl Addiction and Overdose Prevention Task Force;

2. Ratify the City’s position on pending legislation, Assembly Bill 367 (Maienschein) Controlled substances: enhancements;

3. Ratify the City's position on pending legislation, Assembly Bill 474 (Rodriguez) State Threat Assessment Center: transnational criminal organizations;

4. Ratify the City's position on pending legislation, Assembly Bill 955 (PetrieNorris) Controlled substances; and

5. Ratify the City's position on pending legislation, Assembly Bill 742 (Jackson) Law enforcement: police canines.

13. RECEIVE MONTHLY BUDGET UPDATE AND APRIL 2023 FINANCIAL AND

INVESTMENT REPORTS
Recommendation:

Accept and file report.

PUBLIC HEARINGS

14. ADOPT RESOLUTION ORDERING ANNUAL ASSESSMENTS AND

RELATED ACTIONS FOR CITY OF MORGAN HILL LANDSCAPE
ASSESSMENT DISTRICT NUMBER 1
Recommendation:

1. Open and close the Public Hearing; and

2. Adopt resolution confirming Fiscal Year (FY) 2023-24 annual assessments and ordering the levy of assessments for the District.

OTHER BUSINESS

15. APPROVE VILLA MIRA MONTE CONCEPTUAL SITE MASTER PLAN Recommendation:

Approve the Villa Mira Monte Conceptual Site Master Plan Design.

16. APPROVE AGREEMENT WITH HEXAGON TRANSPORTATION
CONSULTANTS, INC. FOR DEVELOPMENT OF A TRANSPORTATION

MASTER PLAN
Recommendation:

June 7, 2023
8 1. Authorize the City Manager to execute and administer an agreement with Hexagon Transportation Consultants, Inc. for the development of a Transportation Master Plan at a total cost of $893,960; and

2. Adopt a resolution to amend the FY 2022-23 Budget to appropriate $393,960 from Traffic Impact Fund (309), with the Long Range Planning Fund (207) contributing $100,000 of that appropriation.

17. APPROVE UPDATE TO THE CITY'S DONATION POLICY
Recommendation:

Accept changes to the City's Donation Policy

18. PROVIDE DIRECTION TO STAFF ON PROPOSED FUTURE COUNCIL

INITIATED AGENDA ITEM
Recommendation:

Determine if the majority of the City Council wants the following item agendized at a future meeting for discussion:

Considering implementing term limits for City Council and/or Commission members.

FUTURE COUNCIL INITIATED AGENDA ITEMS
Note: in accordance with Government Code Section 54954.2(a), there shall be no discussion, debate and/or action taken on any request other than providing direction to staff to place the matter of business on a future agenda.

ADJOURNMENT

June 7, 2023
9 NOTICE
Any documents produced by the City and distributed to the majority of the City Council less than 72 hours prior to an open meeting, will be made available for public inspection at the City Clerk’s Counter at City Hall located at 17575 Peak Avenue, Morgan Hill, CA, 95037 and at the Morgan Hill Public Library located at 660 West Main Avenue, Morgan Hill, California, 95037 during normal business hours. (Pursuant to Government Code 54957.5)

PUBLIC COMMENT
Members of the Public are entitled to directly address the City Council concerning any item that is described in the notice of this meeting, before or during consideration of that item. If you wish to address the Council on any issue that is on this agenda, please complete a speaker request card located in the foyer of the Council Chambers and deliver it to the Minutes Clerk prior to discussion of the item. You are not required to give your name on the speaker card in order to speak to the Council, but it is very helpful. When you are called, proceed to the podium and the Mayor will recognize you. If you wish to address the City Council on any other item of interest to the public, you may do so during the public comment portion of the meeting following the same procedure described above. Please limit your comments to three (3) minutes or less.

Please submit written correspondence to the Minutes Clerk, who will distribute correspondence to the City Council.

Persons interested in proposing an item for the City Council agenda should contact a member of the City Council who may plan an item on the agenda for a future City Council meeting. Should your comments require Council action, your request may be placed on the next appropriate agenda. Council discussion or action may not be taken until your item appears on an agenda. This procedure is in compliance with the California Public Meeting Law (Brown Act) Government Code §54950.

City Council Policies and Procedures (CP 03-01) outlines the procedure for the conduct of public hearings.

Notice is given, pursuant to Government Code Section 65009, that any challenge of Public Hearing Agenda items in court, may be limited to raising only those issues raised by you or on your behalf at the Public Hearing described in this notice, or in written correspondence delivered to the City Council at, or prior to the Public Hearing on these matters.

The time within which judicial review must be sought of the action by the City Council, which acted upon any matter appearing on this agenda is governed by the provisions of Section 1094.6 of the California Code of Civil Procedure.

For a copy of City Council Policies and Procedures CP 97-01, please contact the City Clerk’s office (408) 779-7259, (408) 779-3117 (fax) or by email [email protected].

AMERICANS WITH DISABILITIES ACT (ADA)
In compliance with the Americans with Disabilities Act, if you are a disabled person and you need a disability-related modification or accommodation to participate in this meeting, please contact the City Clerk's Office at (408)779-7259, (408)779-3117 (fax) or by email [email protected]. Requests must be made as early as possible and at least two-full business days before the start of the meeting.

June 7, 2023
10

1 CITY COUNCIL STAFF REPORT
MEETING DATE: June 7, 2023
PREPARED BY:

Yat Cho, Senior Project Manager
APPROVED BY: City Manager

ACCEPT GALVAN PARK RESTROOM REPLACEMENT PROJECT IN
THE AMOUNT OF $143,604

RECOMMENDATION(S)

1. Accept as complete the Galvan Park Restroom Replacement Project;

2. Authorize the City Engineer to sign the Notice of Completion; and

3. Direct the City Clerk to file said Notice of Completion with the County Recorder's Office.

COUNCIL PRIORITIES, GOALS & STRATEGIES
City Council Ongoing Priorities
Maintaining and Enhancing Infrastructure
Supporting our Youth, Seniors, and Entire Community
2022-2023 Strategic Priorities
Fiscal Sustainability
Guiding Documents
Bikeways, Trails, and Recreation Master Plan
REPORT NARRATIVE:

On January 11, 2023, the Galvan Park Restroom Replacement Project was awarded to 101 Builders, Inc. in the amount of $143,350 with an authorized contingency of $21,503.

The project resulted in the demolition of the existing restroom, grading, new foundation, flatwork, utility connection(s), and assembly of the new prefabricated restroom (See Attachment 1 for Vicinity Map).

The project began on February 3, 2023 and was substantially completed in May 2023.

One change order was authorized in the amount of $254 due to minor additional work and contract deducts (Attachment 2). The final construction contract with 101 Builders, Inc. is $143,604. Staff recommends accepting this project as it is complete in accordance with the plans and specifications. By accepting this project, the City Clerk will file a Notice of Completion for this project (Attachment 3).

1 Previously, the City Council approved the purchase of a prefabricated restroom with Exeloo Corporation for Galvan Park. By completing this project prior to June 30, 2023 along with the purchase of the prefabricated restroom, the City will be eligible to receive a grant reimbursement through the County of Santa Clara's Community Development Block Grant (CDBG) of $300,000. Staff will submit all necessary paperwork to the County pending project acceptance by City Council.

COMMUNITY ENGAGEMENT:

Inform
Prior to and during construction, staff provided weekly updates on social media and the City website. Additional outreach by contractor through letters was also provided.

ALTERNATIVE ACTIONS:

Accepting the project in accordance with the contract documents is a required process and enables the City to release any retained funds owed to the contractor per California Public Contract Code Section 7107.

PRIOR CITY COUNCIL AND COMMISSION ACTIONS:

On June 15, 2022 - City Council adopted the FY22-23 to FY27-28 CIP Budget.

On November 2, 2022 - City Council approved a contract with Exeloo Corporation for the Purchase of a Self-Cleaning Restroom at Galvan Park.

On January 11, 2023 - City Council awarded Galvan Park Restroom Replacement Project to 101 Builders, Inc.

FISCAL AND RESOURCE IMPACT:

The final contract amount for the Galvan Park Restroom Replacement Project is $143,604. The project was awarded to 101 Builders, Inc. in the amount of $143,350 with an authorized contingency of $21,503 (Total of $164,853). The project is funded in the FY22-23 Budget.

In addition to the contract amount for installation, the City separately purchased the restroom building for $231,738, bringing the total cost for the restroom purchase and installation to $375,342. Once the project is accepted, staff will be submitting a reimbursement of up to $300,000 through the County of Santa Clara Community Development Block Grant (CDBG). Remaining funding for the project was funded by the Quimby Park Fund (375).

CEQA (California Environmental Quality Act):

Categorical Exemption
The activities described in this Staff Report are categorically exempt under CEQA, specifically pursuant to Section 15302 of CEQA Guidelines (Existing Facilities), as the project consisted of the removal and replacement or reconstruction of existing structures and facilities where the new structure will be located on the same site as the structure replaced and will have substantially the same purpose and capacity as the structure replaced.

1

Engineering and Utilities Department
CIP Engineering Division

GALVAN PARK RESTROOM

REPLACEMENT PROJECT
Document Path: G:\R-14\PROJ\Agustin\GIS\Galvan Park Restroom.mxd O
0 180 360 540 720 90
Feet
County of Santa Clara, Sanborn
Project Location
Crest Ave
Hale Ave
W Main Ave

CIP Contract Acceptance
Funding Closeout Statement
Project: Galvan Park Restroom Replacement Project
Project No: 118020
Date of Project
Award: 11-Jan-23 Project AwardAmount:

Funding Source: F375
Contingency
Authorized:

Date of Project
Acceptance: 7-Jun-23 Total Authorized:

Actual Base
Contract Spent:

Change Orders
Description Date
Council Approval
Reqd? (Y/N)
C.O. #1: Miscellaneous Changes 15-May-23 N
Total C.O.:

Additional Appropriations
Source Amount Date
None
Total Construction
Amount (Base
Contract plus
CO's):

Construction Fund Balance: $21,248.62

$143,350
$21,503
$164,853
$143,350
$254.38
$254.38
$143,604.38

<Project Title> 2020 Form NOTICE OF COMPLETION
<Project Number> Page 1
Recording Requested By:

The City of ___________
When Recorded Mail To:
_____________________ <name, title>
_____________________ <street address>
_____________________ <city, state and zip>

EXEMPT FROM RECORDING FEES PER
GOVERNMENT CODE §§ 6103, 27383
SPACE ABOVE THIS LINE IS FOR RECORDER’S USE

NOTICE OF COMPLETION
Civil Code §§ 8182, 8184, 9204, and 9208
NOTICE IS HEREBY GIVEN THAT:

1. The undersigned is the agent of the owner of the Project described below.

2. Owner’s full name is City of Morgan Hill (“City”)

3. City’s address is 17575 Peak Avenue Morgan Hill, CA 95037

4. The nature of City’s interest in the Project is:

XX Fee Ownership __ Lessee __ Other:__________________

5. Construction work on the Project performed on City’s behalf is generally described as follows:

Removal and Installation of Prefabricated restroom at Galvan Park

6. The name of the original Contractor for the Project is: 101 Builders, Inc.

7. The Project was accepted as complete on: May 23, 2023

8. The Project is located at: 17666 Crest Avenue Morgan Hill, CA 95037.

Verification: In signing this document, I, the undersigned, declare under penalty of perjury under the laws of the State of California that I have read this notice, and I know and understand the contents of this notice, and that the facts stated in this notice are true and correct. __________________________ ________________________________ Date and Place Signature
________________________________
Name and Title

EXEMPT FROM NOTARY ACKNOWLEDGMENT REQUIREMENTS PER
GOVERNMENT CODE § 27287 AND CIVIL CODE § 920

2 CITY COUNCIL STAFF REPORT
MEETING DATE: June 7, 2023
PREPARED BY:

Kim Mancera, Deputy City Clerk
APPROVED BY: City Manager
ADOPT ORDINANCE NO. 2346, NEW SERIES ENACTING SECTION

9.04.055 (CARRYING OF FIREARMS IN SENSITIVE PLACES) OF
CHAPTER 9.04 (WEAPONS) OF TITLE 9 (PUBLIC PEACE, MORALS

AND WELFARE) OF THE MUNICIPAL CODE OF THE CITY OF

MORGAN HILL REGARDING THE PROHIBITION OF CARRYING

FIREARMS IN SENSITIVE PLACES

RECOMMENDATION(S)
Waive the reading, adopt Ordinance No. 2346, New Series, and declare that said title, which appears on the agenda, shall be determined to have been read by title and further reading waived.

COUNCIL PRIORITIES, GOALS & STRATEGIES
City Council Ongoing Priorities
Enhancing Public Safety
Supporting our Youth, Seniors, and Entire Community
Fostering a Positive Organizational Culture
Preserving and Cultivating Public Trust
Enhancing Diversity and Inclusiveness
Advocating for Local, Regional, and State Legislative Initiatives 2022-2023 Strategic Priorities
Fiscal Sustainability
Affordable Housing and Homelessness
Community Outreach, Engagement, and Messaging
Economic Development
Transportation
Guiding Documents
Public Safety Master Plan
REPORT NARRATIVE:

On May 3, 2023, the City Council introduced Ordinance No. 2346 New Series, by the following roll call vote: AYES: Borgioli, Librers, Martinez Beltran, Spring, Turner; NOES:

None; ABSTAIN: None; ABSENT: None.

2 In response to the U.S. Supreme Court’s recent decision in New York State Rifle & Pistol Association v. Bruen, staff recommends that Council adopt an ordinance that would ban the carrying of firearms in an initial round of “sensitive places” where the Supreme Court has deemed such bans presumptively lawful. Sensitive places under the proposed ordinance include government offices, schools, courthouses, and polling places.

COMMUNITY ENGAGEMENT:

This report serves to inform the community of the ordinance Prohibiting Possession of Firearms in Sensitive Places. Additionally, staff has reached out to the Superintendent of Morgan Hill Unified School District regarding the prohibition on firearms in schools.

ALTERNATIVE ACTIONS:

The Council can choose not to adopt the presented ordinance, which would allow those who obtain a permit to carry firearms outside the home to carry a firearm in any public location.

PRIOR CITY COUNCIL AND COMMISSION ACTIONS:

On March 8, 2023, the City Council adopted a CCW application fee.

On May 3, 2023, the City Council introduced Ordinance No. 2346 New Series.

FISCAL AND RESOURCE IMPACT:

There is no current fiscal impact on the City at this time for the approval of the sensitive places ordinances.

CEQA (California Environmental Quality Act):

Not a Project.

This entails organizational or administrative activities of governments and will not result in direct or indirect physical changes in the environment.

ORDINANCE NO. 2346, NEW SERIES

AN ORDINANCE OF THE CITY OF MORGAN HILL
ENACTING SECTION 9.04.055 (CARRYING OF FIREARMS
IN SENSTIVE PLACES) OF CHAPTER 9.04 (WEAPONS) OF
TITLE 9 (PUBLIC PEACE, MORALS AND WELFARE) OF

THE MUNICIPAL CODE OF THE CITY OF MORGAN HILL

REGARDING THE PROHIBITION OF CARRYING

FIREARMS IN SENSITIVE PLACES

THE CITY COUNCIL OF THE CITY OF MORGAN HILL DOES ORDAIN AS FOLLOWS:

SECTION 1. New section 9.04.055 is hereby added to Chapter 9.04 (Weapons) of Title 9 (Public Peace, Morals, and Welfare to read as follows:

9.04.055 Carry of Firearms in Sensitive Places
A. Purpose and intent. The purpose of this section is to protect sensitive places that have traditionally been subject to restrictions on carrying or possessing firearms, consistent with the Supreme Court’s guidance in N.Y. State Rifle & Pistol Ass’n v. Bruen (2022), 142 S.

Ct. 2111; to protect health, life, and property within the city; and to preserve the order and security of the City, its inhabitants, and its visitors.

B. Prohibition. Except as otherwise provided by federal or state law, no person shall carry a firearm in any sensitive place unless they are subject to an exemption under subsection (d) of this section. This prohibition applies to persons licensed to carry a concealed firearm.

C. For the purposes of this section, “sensitive place” means any of the following:
i. Any building owned by or under the control of city, county, state, or federal government for the purpose of government administration. ii. Any polling place while voting is occurring.
iii. Any school. For the purposes of this section, “school” includes all institutions that provide preschool, elementary, secondary, post-secondary, technical, or trade or vocational education, and includes all athletic facilities, offices, cafeterias and eating establishments, health care facilities, research facilities, parking lots, and shared rooms and common areas of dormitories thereof. “School” does not include a private residence at which education is provided for children who are all related to one another by blood, marriage, or adoption.

D. Exemptions. This section shall not apply to:

City of Morgan Hill
Ordinance No. 2346, New Series

i. A federal, state, or local law enforcement officer when such person is authorized to carry a concealed weapon or a loaded firearm under state law or under 18 U.S.C. Section 926B or any successor legislation;
ii. An honorably retired officer or agent of a law enforcement agency, when authorized to carry a concealed or loaded weapon under state law or 18 U.S.C. Section 926C; iii. A security guard or messenger of a financial institution, a guard of a contract carrier operating an armored vehicle, a licensed private investigator, a patrol operator, an alarm company operator, or security guard, when such persons are authorized by applicable state or federal law to carry a firearm and when such persons are engaged in the exercise of their official duties;
iv. A person bringing or transporting an unloaded firearm onto city property to exchange, transfer, or relinquish it to law enforcement, in compliance with any city operated, approved, or sponsored program to purchase, exchange, or otherwise obtain voluntary relinquishment of firearms;
v. A person lawfully possessing an unloaded firearm in the locked trunk of, or inside a locked container in, a motor vehicle.
vi. A hunter with a valid hunting license when going to or returning from a legal hunting expedition; provided, however, that when transiting through any area where firearms are prohibited, any firearm is safely stored in a locked container or otherwise secured using a firearm safety device as defined by California Penal Code Section 16540 or any successor legislation.

SECTION 2. Severability. Should any provision of this ordinance be deemed unconstitutional or unenforceable by a court of competent jurisdiction, such provision shall be severed from the ordinance, and such severance shall not affect the remainder of the ordinance.

SECTION 3. Effective Date; Posting. This Ordinance shall take effect on the 31st day following adoption. The City Clerk is hereby directed to publish this Ordinance or a summary thereof pursuant to Government Code Section 36933.

THE FOREGOING ORDINANCE WAS INTRODUCED AT A MEETING OF THE CITY COUNCIL HELD ON THE 3RD DAY OF MAY 2023, AND WAS FINALLY ADOPTED AT A MEETING OF THE CITY COUNCIL HELD ON THE 7th DAY OF JUNE 2023, AND SAID ORDINANCE WAS DULY PASSED AND ADOPTED IN ACCORDANCE WITH LAW BY THE FOLLOWING VOTE:

City of Morgan Hill
Ordinance No. 2346, New Series

AYES: COUNCIL MEMBERS:

NOES: COUNCIL MEMBERS:

ABSTAIN: COUNCIL MEMBERS:

ABSENT: COUNCIL MEMBERS:

APPROVED: ATTEST:

MARK TURNER, Mayor MICHELLE BIGELOW, City Clerk

CERTIFICATE OF THE CITY CLERK

I, MICHELLE BIGELOW, CITY CLERK OF THE CITY OF MORGAN HILL, CALIFORNIA, do hereby certify that the foregoing is a true and correct copy of Ordinance No. 2346, New Series, adopted by the City Council of the City of Morgan Hill, California at their regular meeting held on the 7th day of June 2023.

WITNESS MY HAND AND THE SEAL OF THE CITY OF MORGAN HILL.

DATE:

MICHELLE BIGELOW, City Clerk

3 CITY COUNCIL STAFF REPORT
MEETING DATE: June 7, 2023
PREPARED BY:

Monica Delgado, Budget Manager
APPROVED BY: City Manager
ADOPT RESOLUTION ESTABLISHING THE GANN (PROPOSITION 4)
APPROPRIATIONS LIMIT FOR FISCAL YEAR 2023-24

RECOMMENDATION(S)
Adopt Resolution establishing the Gann (Proposition 4) appropriations limit for Fiscal Year 2023-24.

COUNCIL PRIORITIES, GOALS & STRATEGIES
City Council Ongoing Priorities
Enhancing Public Safety
Protecting the Environment and Preserving Open Space and Agricultural Land Maintaining and Enhancing Infrastructure
Supporting our Youth, Seniors, and Entire Community
Fostering a Positive Organizational Culture
Preserving and Cultivating Public Trust
Preserving our Community History
Enhancing Diversity and Inclusiveness
Advancing Regional Initiatives
2022-2023 Strategic Priorities
Fiscal Sustainability
Affordable Housing and Homelessness
Community Outreach, Engagement, and Messaging
Economic Development
Transportation
Guiding Documents
Bikeways, Trails, and Recreation Master Plan
Climate Action Plan
Communications, Outreach, and Engagement Plan
Economic Blueprint
Fire Services Standards of Coverage
GIS Strategic Plan
Morgan Hill 2035 General Plan
Public Safety Master Plan
Storm Drain Master Plan

3 Vision Zero
Water System Master Plan
Wastewater System Master Plan
REPORT NARRATIVE:

The Gann appropriations limitation imposed by Propositions 4 (1979) and later amended by Proposition 111 (1990) creates a restriction on the amount of government revenue which may be appropriated in any fiscal year. Not all revenues are restricted by the Gann Limit, only those that are defined as “proceeds of taxes.” Additional appropriations to the budget funded by non-tax sources, such as charges for services, restricted revenues or grants, are not affected by the Appropriations Limit. Each year the City Council must adopt, by resolution, an appropriations limit.

California Revenue and Taxation Code section 2227 requires the Department of Finance to transmit an estimate of the percentage change in population to local governments. Each local jurisdiction must use their population factor for January 1, 2023 based on the greater annual population change for the City or the County, in conjunction with a change in the cost of living, or price factor, to calculate their appropriations limit for fiscal year 2023-24.

The State of California Department of Finance annually provides the California per capita personal income change percentage for purposes of calculating the Gann Limit.

For fiscal year 2023-24, California per capita personal income increased by 4.44%. The County’s population decline is -0.25% versus the City's population decline of -0.67%.

Therefore, the calculation for the fiscal year 2023-24 Gann Limit is based on the percentage change in California per capita personal income and the County's population decline. The attachment details the calculation of the Gann Limit for fiscal year 2023-24.

COMMUNITY ENGAGEMENT:

Inform.

Public notice of the Council meeting to adopt the Gann limit was properly noticed in the Morgan Hill Times on May 19, 2023.

ALTERNATIVE ACTIONS:

Not Applicable
PRIOR CITY COUNCIL AND COMMISSION ACTIONS:

On June 15, 2022, the Council adopted FY 2022-23 and 2023-24 Budgets.

On May 3, 2023, the Council adopted Midcycle Budget Amendments.

FISCAL AND RESOURCE IMPACT:

3 There's no fiscal impact associated with adopting the City's Gann Limit.

CEQA (California Environmental Quality Act):

Not a Project
Organizational or administrative activities of governments that will not result in direct or indirect physical changes in the environment.

RESOLUTION NO.

A RESOLUTION OF THE CITY COUNCIL OF CITY OF MORGAN
HILL ADOPTING THE FISCAL YEAR 2023-24

APPROPRIATIONS LIMIT
WHEREAS, the City of Morgan Hill Fiscal Year 2022-23 and 2023-24 Operating Budget was adopted on June 15, 2022;
WHEREAS, in accordance with the State Revenue and Taxation Code Section 7910, the City of Morgan Hill's 2023-24 fiscal year General Fund appropriations limit is $152,934,412 as shown on Schedule A;
WHEREAS, in accordance with the State Revenue and Taxation Code Section 7910, the appropriations for the 2023-24 fiscal year, as shown on Schedule B, which are subject to the appropriations limit as set forth in Article XIIIB of the California Constitution, do not exceed the limit as stated above;
WHEREAS, the annual adjustment factors that were selected to calculate the 2023-24 fiscal year limit were: 1) California Per Capita Personal Income adjustment factor of 1.0444; and 2) County Population Growth factor of 0.9975;
BE IT FURTHER RESOLVED that the City Council of the City of Morgan Hill does hereby approve and adopt the City of Morgan Hill Appropriations Limit and Appropriations Limit Adjustment Factors for Fiscal Year 2023-24.

PASSED AND ADOPTED by the City Council of Morgan Hill at a Regular Meeting held on the 7th Day of June, 2023 by the following vote.

AYES: COUNCIL MEMBERS:

NOES: COUNCIL MEMBERS:

ABSENT: COUNCIL MEMBERS:

ABSTAIN: COUNCIL MEMBERS:

ATTEST: APPROVED:
_____________________________ ______________________________

MICHELLE BIGELOW, CITY CLERK MARK TURNER, MAYOR

City of Morgan Hill
Resolution No.

• CERTIFICATION •

I, MICHELLE BIGELOW, CITY CLERK OF THE CITY OF MORGAN HILL, CALIFORNIA, do hereby certify that the foregoing is a true and correct copy of Resolution No. ____ adopted by the City Council at a Regular Meeting held on June 7, 2023.

WITNESS MY HAND AND THE SEAL OF THE CITY OF MORGAN HILL DATE:

MICHELLE BIGELOW, City Clerk

City of Morgan Hill
Resolution No.

SCHEDULE A

APPROPRIATIONS SUBJECT TO LIMIT
Fiscal Year 2023-24 General Fund Revenues $53,338,814
Less Non Proceeds of Tax 14,215,012
Total appropriations subject to limits $39,123,802

APPROPRIATIONS LIMIT
Fiscal year 2022-23 appropriations limit $146,799,795
Plus Change Factor:

A. Cost of living adjustment - CPI 1.0444
B. Population Adjustment 0.9975
TotalChange Factor 1.0418
Increase in appropriations limit 6,134,617
FISCAL YEAR 2023-24 APPROPRIATIONS LIMIT 152,934,412
Remaining appropriations capacity 113,810,610
Available capacity as a percent of appropriations limit 74% NOTES
A. Cost of living adjustment is based on percentage change in California per capita income.

B. Population adjustment is based on the greater of annual population change for the City of Morgan Hill or Santa Clara County.

SPENDING LIMIT CALCULATION
FISCAL YEAR 2023-24

CITYOF MORGAN HILL

City of Morgan Hill
Resolution No.

SCHEDULE B

CITYOF MORGAN HILL

SPENDING LIMIT CALCULATION
FISCAL YEAR 2023-24

PROCEEDS NON PROCEEDS

REVENUE SOURCE OF TAX OF TAX TOTALS
Property Tax $ 18,509,500 $ 18,509,500
Sales Tax 12,218,967 12,218,967
Transient Occupancy Tax 2,800,000 2,800,000
Franchise Revenue 3,385,800 3,385,800
Property Transfer Tax 510,000 510,000
Public Safety Sales Tax 455,000 455,000
Business License / Other Permits 253,975 253,975
Motor Vehicle in Lieu 40,800 40,800
Transfer from Fund 202 Street Fund Gax Tax 949,760 949,760 Fines and Penalties 70,894 70,894
Use of Money and Property 1,686,119 1,686,119
Other Revenue / Other Agencies 954,398 954,398
Police and Fire Fees 633,189 633,189
Current Service Charges General Govt. 8,573,312 8,573,312 Transfers 2,297,100 2,297,100
Total $ 39,123,802 $ 14,215,012 $ 53,338,814
Percentage of Total 73% 27% 100.00%

4 CITY COUNCIL STAFF REPORT
MEETING DATE: June 7, 2023
PREPARED BY:
spring andrews, Information Technology Director
APPROVED BY: City Manager

APPROVE MICROSOFT ENTERPRISE AGREEMENT

RECOMMENDATION(S)

1. Approve the purchase of three-year Microsoft Office 365, Windows Server, and SQL Database Licensing from Dell Marketing, LLP in the amount of $411,126, plus a 10% contingency for any additional growth; and

2. Authorize the City Manager to execute and administer a Microsoft Enterprise Agreement for the licensing of Microsoft products and services with Dell through 2026 with subsequent renewal subject to budget appropriation.

COUNCIL PRIORITIES, GOALS & STRATEGIES
City Council Ongoing Priorities
Enhancing Public Safety
Maintaining and Enhancing Infrastructure
Advancing Regional Initiatives
2022-2023 Strategic Priorities
Fiscal Sustainability
Guiding Documents
GIS Strategic Plan
Morgan Hill 2035 General Plan
Public Safety Master Plan
Water System Master Plan
Wastewater System Master Plan
REPORT NARRATIVE:

In 2017, the City modernized its legacy on-premise email system to Microsoft’s cloudbased subscription services, which provides remote access to email, significantly larger email boxes, centralized electronic document discovery and retention capabilities, and additional enhanced functionality. Approving this Microsoft Enterprise Agreement (Agreement), the City would renew its Microsoft services under one contract and leverage cost savings associated with utilizing the State purchasing contract.

4 After reviewing available authorized providers, staff recommends entering into an Enterprise License Agreement with Microsoft for the purchase and subsequent renewal of Microsoft software licensing for a three-year contractual term.

The pricing and vendor were selected through a cooperative purchasing mechanism (Section 3.04.180 of the Morgan Hill Municipal Code). This leverages volume discount pricing through vendors qualified for resale off the California State Microsoft contract, otherwise known as “The Riverside Contract.”
COMMUNITY ENGAGEMENT:

Inform
This report serves to inform the community of the recommended action to approve a Microsoft Enterprise Agreement.

ALTERNATIVE ACTIONS:

Not Applicable
PRIOR CITY COUNCIL AND COMMISSION ACTIONS:

The City Council previously approved the initial three-year Microsoft Enterprise Agreement on May 3, 2017 and then in 2020.

FISCAL AND RESOURCE IMPACT:

The recommended agreement will be an annual cost of $137,042 for fiscal years 2023- 24, 2024-25, 2025-26. These costs are subject to yearly auditing and true-up by Microsoft. The amount for FY 2023-24 has been included in the adopted budget. The amounts for the two subsequent years will be included in future budgets.

CEQA (California Environmental Quality Act):

Not a CEQA Project. This action will not have a direct or indirect impact on the environment.

Sam Andrews
[email protected]
512.720.4469
Customer: City of Morgan Hill
Contract: Riverside County EA PSA-0001524 Date of Issue: 5/17/2023 Microsoft Enterprise Agreement (EA) #: TBD/Renewal of 5539154 - expires 5/31/2023 Quote Expires: 6/15/2023
Product Description Mfg# Quantity Unit Price Ext. Price SQL Server Standard Core ALng SA 2-cores 7NQ-00292 12 $624.22 $7,490.64 Win Server DC Core ALng SA 16-cores 9EA-00273 10 $989.92 $9,899.20 Win Server DC Core ALng SA 2-core 9EA-00278 4 $123.79 $495.16 $0.00
Annual Payment Section 1: $17,885.00
Product Description Mfg# Quantity Months Unit Price Ext. Price Enterprise Online Services Products
M365 G3 Unified FUSL GCC Sub Per User AAD-34704 300 12 $31.50 $113,400.00 $0.00
Additional Online Services Products
Exchange Online P2 GCC Sub Per User 3NS-00003 75 12 $5.95 $5,355.00 Visio P2 GCC Sub Per User P3U-00001 3 12 $11.17 $402.12 $0.00
Annual Payment Section 2: $119,157.12
Notes: Total Annual Payment Yr 1 $137,042.12
Microsoft Enterprise Agreement (EA) Master#: 7799072 Total Annual Payment Yr 2 $137,042.12 Microsoft Enterprise Agreement (EA) Enrollment#: Future/TBD Total Annual Payment Yr 3 $137,042.12 Expiring Enrollment# 7799072 (expires on 6/30/2022) Total of 3 years of Payments $411,126.36 Notes:

Quote prepared by: Chris A Johnson
Section 1- Licenses and Software Assurance
Section 2- Monthly Subscriptions

5 CITY COUNCIL STAFF REPORT
MEETING DATE: June 7, 2023
PREPARED BY:

David Gittleson, Associate Engineer
APPROVED BY: City Manager

APPROVE PROFESSIONAL SERVICES AGREEMENT WITH

KENNEDY/JENKS CONSULTANTS FOR THE EAST DUNNE AVENUE

HILLSIDE WATER RESERVOIR PROJECT

RECOMMENDATION(S)

1. Approve a professional services agreement with Kennedy/Jenks Consultants to complete the design for the East Dunne Avenue Hillside Water Reservoir project not to exceed $240,187.

2. Authorize the City Manager to execute all documents and make minor modifications as necessary in order to consummate the transaction.

COUNCIL PRIORITIES, GOALS & STRATEGIES
City Council Ongoing Priorities
Enhancing Public Safety
Maintaining and Enhancing Infrastructure
2022-2023 Strategic Priorities
Fiscal Sustainability
Guiding Documents
Morgan Hill 2035 General Plan
Water System Master Plan
REPORT NARRATIVE:

The East Dunne Hillside Water Reservoir Project is included in the Water Master Plan and the FY 22/24 Capital Improvement Program. The project will construct an 850,000 gallon steel water tank adjacent to East Dunne Avenue on the hillside (Exhibit A).

In February 2016, Kennedy/Jenks Consultants (KJ) began designing the 850,000 gallon East Dunne Hillside Water Reservoir for a cost of $390,278. Over the course of the design, three amendments were issued to modify the scope of work, increase the contract amount and extend the contract duration. Although the total contract amount with KJ was $526,074, only $444,221 was actually spent. The design was completed in December 2018. However, staffing levels and funding to construct the project were not

5 in place, so the project was put on hold.

KJ's original scope of work included: preparation of CEQA studies, design plans and specifications, and construction estimates for an above ground tank, access roadway, retaining walls, pipe connections and future connections, drainage and landscaping.

With this new contract, (Exhibit B) KJ will update the plans to current building codes and city standards, add a storm water detention basin, and modify the East Dunne Booster station to leave in place the existing pumps/piping to the Jackson reservoirs to preserve the existing system for redundancy purposes. This will provide two options to fill the two Jackson Reservoirs. Should the supply pipe fail or require repairs, there would now be a back-up supply line. There is currently no back-up pipe in place.

This project is phase 4 of a multi-phased program to improve fire protection, water system redundancy and enhance domestic water supply for the eastern side of the City.

Phase 1 replaced the Jackson Oaks Booster Station Project located at Oak Canyon Drive. Phase 2 drilled a new well at the existing Jackson Well site, and Phase 3 installed a 16” water main under East Dunne Avenue that connects the existing E.

Dunne Booster Station with the new East Dunne Avenue Hillside Water Reservoir Project that shall be constructed in the current phase of the project. Future phases include the E. Dunne Hillside Water Reservoir Booster Station (to be located at this new reservoir site), and the Upper E. Dunne Ave. Water Main Project that will connect the new booster station at the then existing E. Dunne Avenue Water Reservoir with the existing Holidays Reservoirs.

Staff recommends that the KJ contract be approved so the design can be completed and the project bid in early 2024 with construction to commence in the summer.

COMMUNITY ENGAGEMENT:

Inform
Staff has provided presentations on the project to the communities of Jackson Oaks and Holiday Lake Estates multiple times since 2015 to provide updates on the status of the project. Staff will continue community engagement for the new water reservoir as the design plans are completed.

ALTERNATIVE ACTIONS:

The Council could elect not to move forward with the design and provide staff with alternate direction. Not moving forward would halt progress on the project.

PRIOR CITY COUNCIL AND COMMISSION ACTIONS:

On January 20, 2016, City Council approved a Professional Service Agreement with Kenndy/Jenks Consultants to design the East Dunne Avenue Reservoir project for $390,278.

On August 24, 2016, City Council approved a Second Amendment with Kennedy/Jenks Consultants for a total contract price of $526,074.

5 FISCAL AND RESOURCE IMPACT:

Funding to complete the design is budgeted in the FY 2023-24 Capital Budget from CIP #610A18 – Holiday Lake Improvements, utilizing Water Capital Project Funds (653).

CEQA (California Environmental Quality Act):

Project
An Initial Study (IS) and draft Mitigated Negative Declaration (MND) was prepared by Geier & Geier Consulting, Inc. in November 2016. The IS and MND will be updated, finalized, and adopted prior to Council’s consideration of the award of the construction contract.

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SITE MAP
East Dunne
Hillside Station Booster/Reservoir
Engineering Division
Community Development Agency
Site of East Dunne
Hillside Station Booster/Reservoir

EAST DUNNE

BOOSTER
Path: G:\R-14\PROJ\GIS\Marks\SITE MAPS\SiteMap_EDunne_HillsideReservoir.mxd

1 Updated May 2023

CONSULTANT AGREEMENT FOR DESIGN PROFESSIONALS
Kennedy/Jenks Consultants
THIS AGREEMENT is entered into and becomes effective on _______________ (Effective Date), by and between the CITY OF MORGAN HILL, a municipal corporation, ("CITY"), and Kennedy/Jenks Consultants a California corporation ("CONSULTANT") hereinafter referred to collectively as “Parties.” In consideration of the promises and the mutual covenants contained in this Agreement, the Parties agree as follows:

1. City Authority. This Agreement is entered into pursuant to the action of the Morgan Hill City Council taken on _____________, ____, 20___.

2. Term of Agreement. This Agreement shall cover services rendered from the Effective Date of this Agreement until June 7, 2024 at which time CONSULTANT’S services shall be completed. The City Manager is authorized to extend the term of this Agreement for a maximum period of one year. Any such extension shall be in writing and signed by both Parties to this Agreement.

3. Scope of Service. The services to be performed by CONSULTANT shall be to complete the PS&E package for the construction of the East Dunne Reservior Project as further described in Exhibit A.

4. Compensation. CONSULTANT shall be compensated as follows:

4.1. Amount. $240,187.00. Total compensation to CONSULTANT under this Agreement during its initial term set forth in Section 2 above shall not exceed Two Hundred Forty Thousand One Hundred Eighty Seven dollars and shall be billed based on the rate and basis set forth in Exhibit B. If the City Manager extends the term of this Agreement pursuant to the provisions of Section 2 above, the City Manager shall have the authority to increase the maximum compensation allowed to be paid to CONSULTANT, so long as City Council has appropriated sufficient funds therefor, the Parties mutually agree to such amount in a writing signed by both Parties to this Agreement, and provided further that in no event shall such maximum compensation allowed for the term exceed the City Manager's authority pursuant to Chapter 3.04 of the Morgan Hill Municipal Code, unless otherwise authorized by City Council.

4.2. Billing. CONSULTANT shall provide CITY with an invoice containing the dated, detailed, and itemized descriptions of all services performed and expenses incurred (if such expenses are reimbursable pursuant to Exhibit B) by CONSULTANT on a monthly basis unless otherwise specified in Exhibit B. All invoices shall be sent to the CITY addressed to the department head or project manager identified below in Section 13 Notices. Any rate charged shall be prorated where services are interrupted or not provided for any rate period (for example, any monthly rate charge should be prorated when services were interrupted or provided for only part of the month). For services billed on an hourly rate, the minimum unit of billed time shall not exceed one tenth of one hour. CITY shall pay for services and expenses (if so provided in Exhibit B) up to the limit of compensation set forth above, that in the CITY’S judgment were necessary and reasonable. Services for work performed and expenses incurred in excess of the total compensation set forth in paragraph 4.1 above shall be at no cost to CITY.

5. Termination. CITY or CONSULTANT shall have the right to terminate this Agreement, without cause, by giving thirty (30) days' written notice or less under urgent circumstances. Upon such

2 Updated May 2023
termination, CONSULTANT shall submit to CITY an itemized statement of services performed for which compensation has not been paid. CITY may require CONSULTANT to complete certain work product or documents and CONSULTANT shall deliver to CITY all documents in its possession without additional compensation to CONSULTANT. The City Manager of CITY is authorized to terminate this Agreement, in whole or in part, on behalf of CITY.

5.1. Non-Appropriations. Notwithstanding anything contained in this Agreement to the contrary, if insufficient funds are appropriated, or funds are otherwise unavailable in the budget for CITY for any reason whatsoever in any fiscal year, for payments due under this Agreement, CITY will immediately notify CONSULTANT of such occurrence, and this Agreement shall terminate after the last day during the fiscal year for which appropriations shall have been budgeted for CITY or are otherwise available for payments.

6. Performance of Work. CONSULTANT represents that it is qualified by virtue of experience, training, education, and expertise to accomplish these services. Services shall be performed by CONSULTANT in accordance with professional practices in a manner consistent with a level of care, competence and skill exercised by qualified members of the CONSULTANT’S profession. By delivery of completed work, CONSULTANT certifies that the work conforms to the requirements of this Agreement and all applicable federal, state, and local laws. CONSULTANT shall perform all work and services under this Agreement in conformance with the time schedule set forth on Exhibit C, "Schedule of Performance," attached hereto and incorporated herein by this reference. CITY'S City Manager is authorized on behalf of CITY to modify the timeframes set forth on the Schedule of Performance within the term of this Agreement. If CONSULTANT desires to leave or store any of CONSULTANT’S equipment at a CITY site while CONSULTANT is performing work or service pursuant to this Agreement, CONSULTANT will first obtain the consent of CITY'S City Manager, or his/her delegate, to do so, and any such storage shall occur only in the manner and location allowed by such CITY official and entirely at CONSULTANT’S sole risk.

7. Insurance Requirements. CONSULTANT shall procure and provide proof of the insurance coverage required by this section in the form of certificates and endorsements. The required insurance must cover the activities of CONSULTANT, including its subcontractors, employees, and agents, relating to, or arising from, the performance of any work or service under this Agreement, and must remain in full force and effect at all times during the period covered by this Agreement. The coverages may be arranged under a single policy for the full limits required or by a combination of underlying policies with the balance provided by excess or “umbrella” policies, provided each such policy complies with the requirements set forth herein. Any deductibles or self-insured retentions must be declared to and approved by City. CONSULTANT further understands that the CITY reserves the right to modify the insurance requirements set forth herein, with thirty (30) days’ notice provided to CONSULTANT, at any time as deemed necessary to protect the interests of the CITY.

7.1. Insurance Types and Amounts.

7.1.1. Commercial General Liability (CGL). CONSULTANT shall maintain CGL against claims and liabilities for personal injury, death, or property damage providing protection in the minimum amount of: (i) one million dollars ($1,000,000.00) combined single limit for any one accident or occurrence, or (ii) the maximum amount of such insurance available to CONSULTANT under CONSULTANT’S combined insurance policies (including any excess or “umbrella” policies), whichever is greater.

3 Updated May 2023

7.1.2. Automobile Liability. CONSULTANT shall maintain Automobile Liability covering all owned, non-owned and hired automobiles (if CONSULTANT does not own automobiles, then CONSULTANT shall maintain Hired/Non-owned Automobile Liability) against claims and liabilities for personal injury, death, or property damage providing protection in the minimum amount of: (i) one million dollars ($1,000,000.00) combined single limit for any one accident or occurrence, or (ii) the maximum amount of such insurance available to CONSULTANT under CONSULTANT’S combined insurance policies (including any excess or “umbrella” policies), whichever is greater.

7.1.3. Workers’ Compensation Insurance and Employer’s Liability. CONSULTANT shall maintain Workers Compensation coverage, as required by law, in the minimum amount of: (i) one million dollars ($1,000,000.00) for any one accident or occurrence, or (ii) the maximum amount of such insurance available to CONSULTANT under CONSULTANT’S combined insurance policies (including any excess or “umbrella” policies), whichever is greater. If CONSULTANT is selfinsured, CONSULTANT shall provide its Certificate of Permission to Self-Insure, duly authorized by the Department of Industrial Relations.

7.1.4. Pollution (Environmental) Liability. If the performance of CONSULTANT’S work or service under this Agreement involves hazardous materials, contaminated soil disposal, and/or a risk of accidental release of fuel oil, chemicals or other toxic gases or hazardous materials, CONSULTANT shall procure and maintain Pollution Liability covering the CONSULTANT’S liability for bodily injury, property damage and environmental damage resulting from pollution and related cleanup costs arising out of the work or services to be performed under this Agreement.

Coverage shall be provided for both work performed on site, as well as during the transport of hazardous materials. Such coverage shall be in the minimum amount of: (i) one million dollars ($1,000,000.00) for any one accident or occurrence, or (ii) the maximum amount of such insurance available to CONSULTANT under CONSULTANT’S combined insurance policies (including any excess or “umbrella” policies), whichever is greater.

7.1.5. Professional Liability.

7.1.5.1. If the performance of CONSULTANT’S work or service under this Agreement involves professional and/or technical services (examples include, but are not limited to, architects, engineers, land surveyors, and appraisers), CONSULTANT shall procure and maintain either a claims made or occurrence Errors and Omission liability insurance in the minimum amount of: (i) one million dollars ($1,000,000.00) each claim, or (ii) the maximum amount of such insurance available to CONSULTANT under CONSULTANT’S combined insurance policies (including any excess or “umbrella” policies), whichever is greater. Further, if CONSULTANT maintains a claims-made policy, CONSULTANT shall provide written evidence of such insurance to the CITY for at least five (5) years after the completion of work performed under this Agreement.

7.1.5.2. If the performance of CONSULTANT’S work or service under this Agreement relates to Information Technology or related services (examples include, but are not limited to computer programmers, software designers,

4 Updated May 2023
hardware engineers, or other systems consultants), CONSULTANT shall procure and maintain a claims made Errors and Omission liability insurance, including Cyber Liability and Data Breach, in the minimum amount of: (i) one million dollars ($1,000,000.00) each claim, or (ii) the maximum amount of such insurance available to CONSULTANT under CONSULTANT’S combined insurance policies (including any excess or “umbrella” policies), whichever is greater.

7.1.6. Sexual Abuse/Molestation Liability (SML): If the performance of CONSULTANT’S work or service under this Agreement involves contact with minors, CONSULTANT shall procure and maintain Sexual Abuse and Molestation insurance in the minimum amount of: (i) two hundred thousand dollars ($200,000.00) each claim, or (ii) the maximum amount of such insurance available to CONSULTANT under CONSULTANT’S combined insurance policies (including any excess or “umbrella” policies), whichever is greater.

7.2. Endorsements. CONSULTANT shall provide proof of the following endorsements, listed for each policy for which endorsements are required, as outlined below:

7.2.1. General Liability and pollution liability (when pollution liability applies).

7.2.1.1. “Additionally Insured” - The City of Morgan Hill, its elected or appointed officials, boards, agencies, officers, agents, employees, and volunteers are named as additional insureds. The General Liability endorsement must be at least as broad as ISO Form CG 20 10 for ongoing operations.

7.2.1.2. “Waiver of Rights of Subrogation” - The insurer waives the right of subrogation against the City of Morgan Hill and CITY’S elected or appointed officials, boards, agencies, officers, agents, employees, and volunteers; and

7.2.1.3. “Primary and Non-Contributing” - Insurance shall be endorsed to be primary and non-contributory and will not seek contribution from the City’s insurance or self-insurance. The General Liability endorsement must be at least as broad as ISO Form CG 20 01.

7.2.2. Workers Compensation.

If the performance of CONSULTANT’S work or service under this Agreement involves access to or activity on any property or premises owned or occupied by the CITY, including, but not limited to, CONSULTANT’S presence during site visits and meetings, then insurer waives the right of subrogation against the City of Morgan Hill and the CITY’S elected or appointed officials, boards, agencies, officers, agents, employees, and volunteers.

7.3. Qualification of Insurers. All insurance required pursuant to this Agreement must be issued by a company licensed and admitted, or otherwise legally authorized to carry out insurance business in the State of California, and each insurer must have a current A.M.

Best's financial strength rating of “A” or better and a financial size rating of “VII” or better.

7.4. Certificates. CONSULTANT shall furnish CITY of Morgan Hill with copies of all certificates as outlined herein, whether new or modified, promptly upon receipt. In the event of a claim or legal action, CONSULTANT shall promptly furnish CITY of Morgan Hill with copies of all policies outlined herein. No policy subject to the CONSULTANT’S

5 Updated May 2023
agreement with the CITY shall be canceled or materially changed except after thirty (30) days' notice by the insurer to CITY. A "material change" is a change that results in noncompliance with any insurance requirements in this section 7. Certificates, including renewal certificates, may be mailed electronically to [email protected] or delivered to the Certificate Holder address provided herein.

Certificate Holder address:

City of Morgan Hill
Attn: Risk Management
17575 Peak Avenue
Morgan Hill, CA 95037

8. Non-Liability of Officials and Employees of the CITY. No official or employee of CITY shall be personally liable for any default or liability under this Agreement.

9. Compliance with Law.

9.1. CONSULTANT and its officers, employees, agents, and subcontractors shall comply with all applicable laws, ordinances, administrative regulations, and permitting requirements in carrying out their obligations under this Agreement. CONSULTANT and its officers, employees, agents, and subcontractors covenant there shall be no discrimination based upon any basis prohibited by State or Federal law, including but not limited to, race, color, creed, religion, gender, marital status, age, sexual orientation, national origin, mental disability, physical disability, medical condition, or ancestry, in any activity pursuant to this Agreement.

9.2. Compliance with Wage and Hour Laws: Consultant, and any subcontractor it employs to complete work under this Agreement, shall comply with all applicable federal, state, and local wage and hour laws. Applicable laws may include, but are not limited to, the Federal Fair Labor Standards Act and the California Labor Code.

Final Judgments, Decisions, and Orders: For purposes of this Section, a “final judgment, decision, or order” refers to one for which all appeals have been exhausted or the time to appeal has expired. Relevant investigatory government agencies include: the federal Department of Labor, the California Division of Labor Standards Enforcement, or any other governmental entity or division tasked with the investigation and enforcement of wage and hour laws.

Prior Judgments against CONSULTANT and/or its Subcontractors: BY SIGNING THIS

AGREEMENT, CONSULTANT AFFIRMS THAT IT HAS DISCLOSED ANY FINAL

JUDGMENTS, DECISIONS OR ORDERS FROM A COURT OR INVESTIGATORY GOVERNMENT AGENCY FINDING – IN THE FIVE (5) YEARS PRIOR TO EXECUTING THIS AGREEMENT – THAT CONSULTANT OR ITS SUBCONTRACTOR(S) HAS VIOLATED ANY APPLICABLE WAGE AND HOUR LAWS. CONSULTANT FURTHER

AFFIRMS THAT IT OR ITS SUBCONTRACTOR(S) HAS SATISFIED AND COMPLIED WITH – OR HAS REACHED AGREEMENT WITH THE CITY REGARDING THE MANNER IN WHICH IT WILL SATISFY – ANY SUCH JUDGMENTS, DECISIONS OR ORDERS.

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Judgments or Decisions During Term of Contract: If at any time during the term of this Agreement, a court or investigatory government agency issues a final judgment, decision or order finding that CONSULTANT or an subcontractor it employs to perform work under this Agreement has violated any applicable wage and hour law, or CONSULTANT learns of such a judgment, decision, or order that was not previously disclosed, CONSULTANT shall inform the City Attorney, no more than fifteen (15) days after the judgment, decision or order becomes final or of learning of the final judgment, decision, or order.

CONSULTANT and its subcontractors shall promptly satisfy and comply with any such judgment, decision, or order, and shall provide the City Attorney with documentary evidence of compliance with the final judgment, decision, or order within five (5) days of satisfying the final judgment, decision, or order. The City reserves the right to require CONSULTANT to enter into an agreement with the City regarding the manner in which any such final judgment, decision, or order will be satisfied.

City’s Right to Withhold Payment: Where CONSULTANT or any subcontractor it employs to perform work under this Agreement has been found in violation of any applicable wage and hour law by a final judgment, decision or order of a court or government agency, the City reserves the right to withhold payment to CONSULTANT until such judgment, decision or order has been satisfied in full.

Material Breach: Failure to comply with any part of this Section constitutes a material breach of this Agreement. Such breach may serve as a basis for immediate termination of this Agreement and/or any other remedies available under this Agreement and/or law.

Notice to City Related to Wage Theft Prevention: Notice provided to the City Attorney as required under this Section shall be addressed to: City Attorney, City of Morgan Hill, 17575 Peak Avenue, Morgan Hill, CA 95037. The Notice provisions of this Section are separate from any other notice provisions in this Agreement and, accordingly, only notice provided to the above address satisfies the notice requirements in this Section.

10. Independent Contractor. CONSULTANT is an independent contractor and not an agent or employee of CITY.

11. Confidentiality. All data, documents, or other information received by CONSULTANT from CITY or prepared in connection with CONSULTANT’S services under this Agreement are deemed confidential and shall not be disclosed to any third party by CONSULTANT without prior written consent by CITY.

12. Conflict of Interest and Reporting. CONSULTANT shall at all times avoid conflict of interest or appearance of conflict of interest in performance of this Agreement.

13. Notices. All notices shall be personally delivered or mailed, via first class mail to the below listed address. These addresses shall be used for delivery of service of process. Notices shall be effective five (5) days after date of mailing, or upon date of personal delivery.

Address of CONSULTANT is as follows:

Don Barraza, P.E.

Kennedy/Jenks Consultants
303 Second Street, Suite 300 South
San Francisco, CA 94107

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Address of CITY is as follows:

Development Service Center
David Gittleson P.E.

City of Morgan Hill
17575 Peak Avenue
Morgan Hill, CA 95037
with a copy to:

City Clerk
City of Morgan Hill
17575 Peak Avenue
Morgan Hill, CA 95037

14. Licenses, Permits and Fees. CONSULTANT shall obtain a City of Morgan Hill Business License, all permits and licenses to the extent required by ordinances, codes, and regulations of the federal, state, and local government.

15. Consultant's Proposal. If applicable, this Agreement shall include CONSULTANT'S proposal or bid which is incorporated herein. In the event of any inconsistency between the terms of the proposal and this Agreement, this Agreement shall govern.

16. Maintenance of Records.

16.1. Maintenance. CONSULTANT shall prepare, maintain, and preserve all reports and records that may be required by federal, state, and CITY rules and ordinances related to services provided under this Agreement. CONSULTANT shall maintain records for a period of at least 3 years after receipt of final payment under this Agreement. If any litigation, claim, negotiation, audit exception, or other action relating to this Agreement is pending at the end of the 3-year period, then CONSULTANT shall retain said records until such action is resolved.

16.2. Access to and Audit of Records. The CITY shall have the right to examine, monitor and audit all records, documents, conditions, and activities of the CONSULTANT and its subcontractors related to services under this Agreement. Pursuant to Government Code Section 8546.7, if this Agreement involves the expenditure of public funds in excess of $10,000, the Parties to this Agreement may be subject, at the request of the CITY or as part of any audit of the CITY, to the examination and audit of the State Auditor pertaining to matters connected with the performance of this Agreement for a period of three years after final payment under the Agreement.

16.3. Ownership of Work Product. All documents or other information developed or received by CONSULTANT for work performed under this Agreement shall be the property of CITY. CONSULTANT shall provide CITY with copies of these items upon demand or upon termination of this Agreement.

17. Familiarity with Work. By executing this Agreement, CONSULTANT represents that: (1) it has investigated the work to be performed; (2) it has investigated the site of the work and is aware of all conditions there; and (3) it understands the difficulties and restrictions of the work under this Agreement.

Should CONSULTANT discover any conditions materially differing from those inherent in the work or as represented by CITY, it shall immediately inform CITY and shall not proceed, except at CONSULTANT'S risk, until written instructions are received from CITY.

18. Time of Essence. Time is of the essence in the performance of this Agreement.

19. No Assignment. Neither this Agreement nor any portion shall be assigned by CONSULTANT, without prior written consent of CITY. Any attempted assignment not first approved by CITY shall be

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void and, at CITY'S option, shall terminate this Agreement effective as of the date of such attempted assignment.

20. Attorney Fees. In any legal action, dispute or arbitration arising out of or relating to this Agreement, the prevailing party shall be entitled to an award of its reasonable attorney fees, costs and expenses incurred.

21. Defense and Indemnification.

21.1. Defense and Indemnification for Design Professional Services. Consistent with California Civil Code Section 2782.8, for design professional services to be performed under this agreement by a design professional, as that term is defined under said Section 2782.8, CONSULTANT shall, to the fullest extent permitted by law, indemnify, defend and hold harmless CITY, its elected or appointed officials, boards, agencies, officers, agents, employees, and volunteers (“INDEMNITEES”) from and against any and all claims, liabilities, expenses, liens, or damages of any nature, including liability for bodily injury, property damage or personal injury, and including reasonable attorneys' fees and expenses, that arise out of, pertain to, or relate to the negligence, recklessness, or willful misconduct of CONSULTANT, and/or its agents, officers, employees, subcontractors, or independent contractors in performance of work hereunder or its failure to comply with any of its obligations contained in this Agreement (“CLAIM”) to the extent of CONSULTANT’S proportionate percentage of fault.

21.2. Defense and Indemnification for Non-Design Professional Services. For all services performed under this agreement not covered by Section 21.1 above, CONSULTANT shall, to the fullest extent permitted by law, indemnify, defend and hold harmless CITY, its elected or appointed officials, boards, agencies, officers, agents, employees, and volunteers (“INDEMNITEES”) from and against any and all claims, liabilities, expenses, liens, or damages of any nature, including liability for bodily injury, property damage or personal injury, and including reasonable attorneys' fees and expenses, that arise out of, pertain to, or relate to the performance of this Agreement or the failure to comply with any obligations contained in this Agreement by CONSULTANT, and/or its agents, officers, employees, subcontractors, or independent contractors (“CLAIM”).

21.3. Exceptions. CONSULTANT is not required to indemnify INDEMNITEES against liability for bodily injury, property damage or personal injury, or any other loss, damage or expense arising from the sole negligence, active negligence, or willful misconduct of the CITY.

21.4. Not limited by insurance. The indemnity, defense and hold harmless provisions of this Agreement apply to all CLAIMS alleged against an INDEMNITEE, regardless of whether any insurance policies are applicable. Policy limits do not act as a limitation upon the amount of indemnification or defense to be provided by CONSULTANT.

21.5. Right to Offset. CITY shall have the right to offset against any compensation due CONSULTANT under this Agreement any amount due CITY from CONSULTANT as a result of CONSULTANT’S failure to pay CITY promptly any indemnification arising under this Section (21) and any amount due CITY from CONSULTANT arising from CONSULTANT’S failure either to (i) pay taxes on amounts received pursuant to this Agreement or (ii) comply with applicable workers' compensation laws.

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21.6. Interpretation. This Section shall constitute an agreement or contract of indemnity, incorporating the interpretations under California Civil Code Section 2778. It is expressly understood and agreed that the obligation of the CONSULTANT to indemnify the INDEMNITEE shall be as broad and inclusive as permitted by the laws of the State of California and shall survive termination of this Agreement.

22. Entire Agreement; Modification; Conflicting Provisions. This Agreement constitutes the entire Agreement between the Parties and supersedes any previous agreements, oral or written. This Agreement may be modified, or provisions waived, only by a subsequent mutual written agreement executed by CITY and CONSULTANT. If the provisions contained in the main body of this Agreement conflict with any provision contained in an exhibit to this Agreement, the provisions of the main body of this Agreement shall govern and control over any provision contained in an exhibit to this Agreement.

23. Governing Law and Venue. This Agreement shall be construed in accordance with the laws of the State of California. This Agreement was entered into and is to be performed in the County of Santa Clara. Any action or dispute arising out of this Agreement shall only be brought in Santa Clara County.

24. Interpretation. This Agreement is a negotiated document and shall be deemed to have been drafted jointly by the Parties, and no rule of construction or interpretation shall apply against any particular Party based on a contention that the Agreement was drafted by one of the Parties including, but not limited to, California Civil Code § 1654, the provisions of which are hereby waived. This Agreement shall be construed and interpreted in a neutral manner.

25. Preservation of Agreement. If any term, provision, covenant, or condition of this Agreement is held by a court of competent jurisdiction to be invalid or unenforceable, the rest of the Agreement shall remain in full force and effect and shall in no way be affected or invalidated.

26. Binding Agreement. Notwithstanding the provisions of Section 19 above, this Agreement shall bind any and all successors in interest, legal representatives and/or other permitted assignees or transferees of CONSULTANT in the same manner as if those successors in interest, legal representatives or other permitted assignees or transferees had entered into this Agreement originally.

27. ☒ Data Sharing. This Agreement requires access by CONSULTANT to CITY’S Geographic Information System (GIS) DATA for CONSULTANT to perform the work. CITY agrees to provide the GIS DATA to CONSULTANT solely for the purpose of performance of contracted work with the CITY upon the terms and conditions specified in Exhibit D, incorporated herein by this reference.

28. Electronic Signatures. Unless otherwise prohibited by law or CITY policy, the Parties agree that an electronic copy of a signed contract, or an electronically signed contract, has the same force and legal effect as a contract executed with an original ink signature. The term “electronic copy of a signed contract” refers to a transmission by facsimile, electronic mail, or other electronic means of a copy of an original signed contract in a portable document format. The term “electronically signed contract” means a contract that is executed by applying an electronic signature using technology approved by the CITY.
[Signatures on Next Page]

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29. Authority to Execute. Those individuals who are signing this Agreement on behalf of entities represent and warrant that they are, respectively, duly authorized to sign on behalf of the entities and to bind the entities fully to each and all of the obligations set forth in this Agreement.

IN WITNESS THEREOF, these Parties have executed this Agreement on the day and year shown below.

AS SET FORTH IN CA. CORP. CODE § 313, TWO SIGNATURES ARE REQUIRED FOR CALIFORNIA CORPORATIONS:
(1) CHAIRPERSON OF THE BOARD, PRESIDENT, OR VICE PRESIDENT; AND (2) SECRETARY, ASSISTANT SECRETARY, CHIEF FINANCIAL OFFICER OR ASSISTANT TREASURER.

ATTEST: CITY OF MORGAN HILL
City Clerk/Deputy City Clerk City Manager
Michelle Bigelow Christina J. Turner
Print Name Print Name
Date: Date:

APPROVED AS TO FORM: Kennedy/Jenks Consultants
City Attorney By:

Donald A. Larkin
Print Name
Date:

Print Name and Title of Signer.

If Corporate: Chairman, President or Vice
President
Date:

By:

Date:

Print Name and Title of Signer.

If Corporate: Secretary, Assistant
Secretary, Chief Financial Officer or
Assistant Treasurer
U:\Legal Forms\Consultant Agreements\City Services Agreement For Design Professionals.Docx Jamie E. Kolkey, PE Vice President and Operations Manager May 22, 2023 Corporate Secretary
May 22, 2023
Gerard P. Cavaluzzi

11 Updated May 2023

EXHIBIT A

SCOPE OF SERVICES

303 Second Street, Suite 300 South
San Francisco, California 94107
415-243-2150
FAX: 415-896-0999
4 May 2023
Mr. David Gittleson, P.E.

Associate Engineer
Utilities & Engineering Department
City of Morgan Hill
17575 Peak Avenue
Morgan Hill, California 95037
Subject: Proposal for Design Engineering Services
East Dunne Hillside Water Reservoir and Booster Pump Station Dear David:

Kennedy Jenks Consultants (Kennedy Jenks) is pleased to submit this proposal to provide professional services for the design of the East Dunne Hillside Water Reservoir and modifications to the E. Dunne Booster Pump Station.

It is understood that the engineering services will be performed as a new professional services agreement between Kennedy Jenks and the City of Morgan Hill (City). An understanding and background of the pump station, pipelines, and reservoir project requirements, scope of work, assumptions, summary of tasks to be performed by the City, basis of compensation, schedule and terms and conditions are included below.

Understanding and Background
This proposal is based on conversations with City staff and Kennedy Jenks’ past work associated with development of the E. Dunne Hillside Water Reservoir site and the E. Dunne Booster Pump Station Modifications. The City will review and provide input on the pump station configuration and confirm the design flowrate.

We understand that the E. Dunne Hillside Water Reservoir project, Kennedy Jenks completed bid documents for in December 2018, requires several design updates to bring the documents up to current codes and coordinate with the additional elements outlined within the scope of work contained in this proposal.

We will also review the previous design modifications of the E. Dunne Booster Pump Station in response to City input regarding control of the pump station pressure zones in the lower E.

Dunne area.

Mr. David Gittleson, P.E.

City of Morgan Hill
4 May 2023

We have based our proposal on review of the preliminary E. Dunne Hillside Reservoir pipeline alignment discussed with the City during the 2022 Interim Pipeline Project, and previous utility research, survey and borehole logs from geotechnical investigations at the East Dunne Hillside Water Reservoir site. This proposal is also based on updates outlined in the Theory of Operations Preliminary Report from Akel Engineering Group, Inc. (Akel) dated March 2023. The proposal does not include an update of the previous geotechnical investigation; however, this may be required by the local building official.

We understand that the City would like one (1) set of construction documents prepared to include both the E. Dunne Hillside Reservoir and associated pipelines and the E. Dunne Pump Station Modifications.

Scope of Work
Kennedy Jenks will provide professional design services required to update the previously completed designs of the E. Dunne Booster Pump Station modifications and the E. Dunne Hillside Water Reservoir, working closely with City staff. Kennedy Jenks will provide electronic files of design plans in AutoCAD format and one full-sized set of drawings on mylar.

Deliverables such as specifications will generally be furnished in electronic format using MS Word or Adobe PDF format. Our work is organized in two (2) phases as described below:

Phase 1 – Project Management, Meetings and Quality Control Task 1.1 – Project Management
Subtask 1.1.1 – Project Administration
Kennedy Jenks will set up the project within Kennedy Jenks’ accounting system, prepare subconsultant agreements, and issue a Project Initiation Plan to Kennedy Jenks’s design team, outlining the scope and budget, and develop a baseline schedule. Kennedy Jenks will provide management and oversight of in-house project personnel and subconsultants throughout the project and will review and monitor project budget and progress on a regular basis.

Kennedy Jenks will also prepare and maintain a Major Decisions Log (MDL) that documents the City’s major decisions related to the Project.

Kennedy Jenks will prepare and implement a Hazard Appraisal & Recognition Plan (HARP) for the work. If a Kennedy Jenks employee needs to visit the site, where field investigation activities are ongoing, they will implement the requirements of the HARP.

Subtask 1.1.2 – Project Status Reporting
Kennedy Jenks will prepare and submit monthly invoices electronically to the City in accordance with the Agreement. Invoices will be prepared and submitted electronically on a monthly basis.

Monthly project progress status updates will be prepared and delivered to the City to support the monthly invoices prepared.

Mr. David Gittleson, P.E.

City of Morgan Hill
4 May 2023

Task 1.1 Deliverables:

1. Major Decisions Log updates (electronic, Adobe Acrobat format)

2. Monthly invoices (electronic, Adobe Acrobat format)

3. Monthly Progress Status Update (electronic, Adobe Acrobat format) Task 1.2 – Meetings
It is anticipated that the kickoff meeting will address still undefined elements of the project associated with the E. Dunne Booster Pump Station modifications and E. Dunne Hillside Water Reservoir. It is anticipated that the design review meetings will address all elements of the project. Kennedy Jenks will prepare for and participate in the following meetings with the City.

The meetings are estimated to have a 2-hour maximum duration (excluding travel and time for preparation of materials) and will be attended by up to three (3) Kennedy Jenks staff.

1. Kick-off meeting – to be held in person at City office

2. 60% Design Review Meeting – to be held virtually

3. 90% Design Review meeting – to be held virtually
Kennedy Jenks will also prepare for, and participate, in up to three (3) progress coordination meetings or conference calls with City staff during the project. Each progress meeting is anticipated to have a 1-hour duration (excluding time for preparation of materials) and will be attended by up to two (2) Kennedy Jenks staff.

The meetings are detailed in the following subtasks:

Subtask 1.2.1 – Kick-off Meeting
Kennedy Jenks will prepare for, attend, and facilitate the kick-off meeting with the City, and Kennedy Jenks team members. Client stakeholders, planned roles and responsibilities, project scope, schedule, budget, project controls processes, deliverables, workshops, key deliverable dates and milestones, and key technical issues will be discussed. Kennedy Jenks will prepare and submit a meeting agenda and notes following the meeting.

Subtask 1.2.2 – Design Review Meetings
Kennedy Jenks will conduct workshop-type meetings with the City during the Project to efficiently communicate design concepts and facilitate decisions to keep the project on schedule. The planned meetings will occur at two (2) milestone points as follows:

1. 60% Design Review Meeting

2. 90% Design Review meeting

Mr. David Gittleson, P.E.

City of Morgan Hill
4 May 2023

Subtask 1.2.3 – Progress Meetings
Kennedy Jenks will prepare for, attend, and conduct up to three (3) virtual progress coordination meetings or conference calls that will include a review of progress, discussion of items requiring feedback, list of outstanding issues requiring resolution, status of scope, schedule and budget, and review of risks. Kennedy Jenks will prepare and submit meeting agendas and meeting notes for the progress meetings.

Task 1.3 - Quality Assurance and Quality Control
Each deliverable will receive a quality control review prior to submission to the City from a senior Kennedy Jenks engineer, not directly associated with the project.

Subtask 1.3.1 – In-house C&CR Meeting
Kennedy Jenks will conduct an in-house Concept and Criteria Review (C&CR) meeting early in the project to obtain focused technical input from senior Kennedy Jenks staff based on their experience from other similar projects. The C&CR meeting will be attended by up to six (6) key project team members.

Subtask 1.3.2 – Project Deliverables Reviews
The Construction Document Submittals (e.g. 60%, 90%, 100%), and other deliverables will be reviewed. Reviews will be performed by senior Kennedy Jenks staff and will include interdiscipline coordination checks.

Phase 2 – E. Dunne Hillside Water Reservoir & One Bid Package The East Dunne Hillside Water Reservoir project Kennedy Jenks completed bid documents for in December 2018 requires several design updates including the following:
• Building code review updates;
• California Department of Public Health (CDPH) Department of Drinking Water (DDW) distribution Reservoir Permit;
• Revise alignment of 16-inch water reservoir inlet and 10-inch water reservoir outlet to be outside of the E. Dunne roadway. City is to provide as-builts of Phase 1 Interim Pipelines Project for point of connection information; • Revise 16-inch storm drain alignment;
• Removal of proposed 6-inch sewer line and fire hydrant; • East Dunne Booster Pump Station Modification; and

Mr. David Gittleson, P.E.

City of Morgan Hill
4 May 2023

• Development of a stormwater design that meets the Stormwater Management Guidance Manual (Manual) requirements, including PR1-4. To meet these requirements and based on discussions with the City, Kennedy Jenks proposes the use of a biofiltration basin with an outfall near the south/southeast corner of the property. A conceptual layout is provided as an enclosure herein. Because of the steepness of the hillside, either one taller retaining wall or two shorter retaining walls may be needed to construct the basin. Vehicle access to the biofiltration basin will not be provided. However, pedestrian access will be provided for routine maintenance.

Additionally, Kennedy Jenks has already provided mechanical and electrical engineering associated with providing new pumps at the E. Dunne Booster Pump Station to deliver water to the E. Dunne Hillside Reservoir. The design proposed in the scope assumes that all three (3) of the pump systems at the E. Dunne Booster Pump Station will be available. The Holiday pumps 1 series will be left in operation for a backup system.. The design proposed in the scope will allow the new reservoir to supply fire flow to all three (3) of the lower Holiday pressure zones.

The engineering effort associated with providing control strategies for the instrumentation and controls for pumps to be replaced within the E. Dunne Booster Pump Station will be performed under this task. The design referenced in the Theory of Operations Preliminary Report from Akel (March 2023) increases the design condition of the Holiday Zone 2 pumps (the ‘3’ series pumps) from 360 gpm @ 140 ft TDH to a design condition of gpm @ 380 ft TDH. Satisfying the Akel’s Master Plan Report criteria would require significant re-design of the E. Dunne Booster Pump Station and is not included in this proposal.

Section 3.0 of Akel’s Theory of Operations Preliminary Report (Phase 1 Improvements) includes additional projects covering the construction and modification of pressure reducing valve stations to modify water distribution to the pressure zones in the lower E. Dunne area (Projects 1-B and 1-D) and underground water main installation from the E. Dunne Booster Pump Station to Thomas Grade Drive (part 2 of Project 1-A). However, this proposal does not include any engineering effort for those projects. If lower E. Dunne pressure zone facilities must be modified or the proposed revisions to the E. Dunne Booster Pump Station design require a new generator installation, additional effort and budget will be required to produce the additional drawings and specifications required. The existing day tank, the fuel piping between the engine generator and the day tank, and the exhaust system will have to be evaluated for re-use or replacement.

Based on past experience, permits from the Bay Area Air Quality Management District (BAAQMD) for generator modifications and new generators require engineering support. As stated in the assumption above, Kennedy Jenks has not provided effort for coordinating with Bay Area AQMD for revising the permit for the E. Dunne Booster Pump Station. 450 Page 52 of 405
Mr. David Gittleson, P.E.

City of Morgan Hill
4 May 2023

Task 2.1 – E. Dunne Reservoir 60% Drawings, Specifications and OPCC Based on the design criteria established in the previous 2018 drawings (excluding the design of a new sewer line and fire hydrant), Kennedy Jenks will prepare a 60% design submittal package for the booster pump station modifications, reservoir and associated pipelines (shown on sheet C-07) for City review. Kennedy Jenks will prepare general drawings, site grading, structural drawings, plan and profile drawings for the pipelines (at a scale of 1"=30' horizontal and 1"=5' vertical), various details, landscape plans, cathodic protection drawings, electrical single line diagrams; and partial conduit and wire schedules, and erosion and sedimentation control. The design is based on Kennedy Jenks preparing up to 76 drawings (listed at the end of the scope of work) to be included in the Contract Documents. Drawings will be prepared using AutoCAD 2018 format. Drawings will be set up with 24” x 36” format for reduction to half scale 12"x18" size for submittal and bidding purposes.

Kennedy Jenks will prepare an updated list of technical specifications (based on those prepared in 2018) required for the work for the 60% design.

Kennedy Jenks will perform quantity take-offs from the 60% design drawings and prepare an OPCC update (AACE Class 3).

A workshop with City staff will be held to discuss the 60% design and any critical issues as provided in Task 1.2.

Task 2.1 Deliverables:

1. 60% Design Drawings (Electronic, Adobe pdf format)

2. 60% Design Specifications (Electronic, Adobe pdf format)

3. Class 3 OPCC (Electronic, Adobe pdf format)
Task 2.2 – E. Dunne Reservoir 90% Drawings, Specifications, OPCC and Schedule
Kennedy Jenks will incorporate responses to the City’s review comments on the 60% Design package and advance the 60% design drawings to the 90% design level for City review. The 90% phase will consist of further detailed design and refinement of the project elements to produce a complete set of drawings. Inter-disciplinary and intra-disciplinary coordination will be completed. Kennedy Jenks will coordinate with PG&E for the service application for the new East Dunne Hillside Water Reservoir and Booster Pump Station Modifications as soon as authorization from the City is provided.

Kennedy Jenks will incorporate the responses to comments on both submitted and the proposed list of specifications from the 60% design review and prepare 90% design level specifications. The technical specifications will be prepared using Kennedy Jenks’ standard Construction Specifications Institute (CSI) 2004 format, modified for the project.

Mr. David Gittleson, P.E.

City of Morgan Hill
4 May 2023

Kennedy Jenks will update the quantity take-offs from the 90% design drawings and prepare an OPCC (AACE Class 2) for the 90% design.

Kennedy Jenks will prepare a conceptual construction schedule broken down to define the major components of work. The conceptual schedule will likely contain the following elements:
• Shop drawing submittals for reservoir, pumps, electrical gear, valves, piping, and shoring
• Fabrication of pumps, pipes, fittings and electrical gear • Structural/reservoir construction, startup and testing • Restoration
• Pipeline construction
• Pipe connections
• Pipe testing
Task 2.2 Deliverables:

1. 90% Design Drawings (Electronic, Adobe pdf format)

2. 90% Design Specifications (Electronic, Adobe pdf format)

3. Class 2 OPCC (Electronic, Adobe pdf format)

4. Conceptual Construction Schedule (Electronic, Adobe pdf format)

5. PG&E Service Application

6. AQMD Permit Application for Generator
Task 2.3 – E. Dunne Reservoir 100% Drawings, Specifications, OPCC and Schedule
Kennedy Jenks will incorporate the responses to the comments from the 90% design review and prepare final 100% design drawings that will be stamped and signed for bid. Following review of the 90% design specifications by the City, Kennedy Jenks will address final comments and prepare final 100% technical specifications that will be stamped and signed for bid. The Bidding and Contract Documents will be prepared using the City’s standard General Requirements and bidding forms and supplemental requirements. It is assumed that the City will prepare the front-end documents (Division 0) for KJ to include in the Bid Package.

Task 2.3 Deliverables:

1. 100% Bid Ready Design Drawings (Electronic, Adobe pdf format and Mylar)

2. 100% Bid Ready Design Specifications (Electronic, Adobe pdf format)

3. Class 2 OPCC (Electronic, Adobe pdf format)

4. Final Construction Schedule (Electronic, Adobe pdf format)

5. PG&E Service Application

6. AQMD Permit Application for Generator

Mr. David Gittleson, P.E.

City of Morgan Hill
4 May 2023

Task 2.4– Reservoir Building Permit
A building permit will be required from the City Building Department. Kennedy Jenks has assumed that the City will prepare the building permit application. However, Kennedy Jenks will assist the City in responding to written permit review comments received from the Building Department.

Task 2.5 – California Division of Drinking Water (DDW) Distribution Reservoir, Pump Stations, and Pipeline Permit
Kennedy Jenks will assist the City in completing and filling a permit application with the California State Water Resources Control Board Division of Drinking Water (DDW) for the installation/operation of the project and in responding to written permit review comments received from the DDW.

Task 2.5 Deliverables:

1. DDW Reservoir Permit Application

2. DDW Pump Station Permit Application
Phase 3 – As-Needed Design Contingency (Optional)
Kennedy Jenks will provide as-needed design contingency during the project as requested and authorized by the City. Services may include assistance with additional design services, additional design based on unforeseen site conditions, and additional site visits or meetings. An allowance of up to $25,000 is reserved for this task,
Phase 4 – Bid Assistance
Kennedy Jenks will provide answers to written questions submitted to the City by bidders and provided in writing to Kennedy Jenks. Contract requirements which are changed as a result of questions and answers will be included in addenda. It is assumed that Kennedy Jenks will prepare up to two (2) addenda. It is assumed that the City will distribute all addenda.

Kennedy Jenks (two staff members) will attend one pre-bid meeting via conference call. The City is assumed to prepare the pre-bid meeting agenda and meeting minutes.

Kennedy Jenks will review the bid results for the two lowest construction bid packages received and provide a recommendation to the City concerning award of the contract.

Mr. David Gittleson, P.E.

City of Morgan Hill
4 May 2023

Assumptions
The following assumptions were developed when preparing the Scope of Work, schedule, and estimated cost for the project.

1. One (1) set of construction documents will be prepared to include the E. Dunne Hillside Reservoir, the E. Dunne Pump Station Modifications, and the new pipeline segments. Construction documents will include the City’s Project Manual including General Conditions.

2. It is assumed that the utility, survey, and geotechnical investigations performed for the previously completed E. Dunne Hillside Reservoir project will be utilized for this final design.

3. This proposal does not include an update of the previous geotechnical investigation; however, this may be required by the local building official.

4. The City’s front end (Division 0) specifications will be prepared by the City. The front ends will be incorporated into Kennedy Jenks’ standard specifications for the Divisions 1 through 17. Drawings will be bound separately. This proposal is based on the Division 0 specifications utilized by the City in 2018. If updates have been made since then, additional budget will be required to update KJ’s specifications.

5. All pipelines will be installed by open cut; trenchless designs or methods are not required.

6. No cathodic protection will be required for buried pipelines.

7. Kennedy Jenks will assist the City with information to complete the building permit forms prepared by the City. Kennedy Jenks assumes all information will be submitted in either 8.5x11 or 12x18 and 24x36 formats.

8. The project design work will require approximately five (5) months to complete, assuming the City takes no more than two (2) weeks to review each design submittal.

It is assumed that the kickoff meeting will be performed within one (1) week of Noticeto-Proceed.

9. The design budget is based on Kennedy Jenks preparing up to 76 drawings for the E.

Dunne Hillside Water Reservoir and Booster Pump Station modifications (preliminary drawing list enclosed at the end of the proposal).

10. The design of piping improvements associated with the modification of the E. Dunne Booster Pump Station discharge piping under this scope shall not extend beyond 10 ft of the building envelope.

11. Kennedy Jenks’s schedule and compensation are based on providing the above services for a period of 5 months. If the schedule is extended beyond this period and project management funds are exhausted, a written request will be provided for additional funds.

12. Assumptions related to the construction, startup and operations assistance for the project will be developed when that phase is authorized.

13. A surge analysis for the lower zones served by E. Dunne Pump Station is not included in the scope of work.

14. With regards to the East Dunne Hillside Water Reservoir, all work (including pipeline connection points) is assumed to be within the roadway.

Mr. David Gittleson, P.E.

City of Morgan Hill
4 May 2023

15. It is assumed that all proposed stormwater facilities in the East Dunne Hillside Water Reservoir site will be located within City property and/or the right-of-way.

16. It is assumed that the sewer pipeline is no longer included within the East Dunne Hillside Water Reservoir site.

17. Per direction of the City, no fire hydrant is required near the East Dunne Hillside Water Reservoir site.

18. Updates to the landscaping plans for the East Dunne Hillside Water Reservoir site are assumed to not be required.

19. Bid assistance will be provided per Phase 4. It is assumed the City will run the pre-bid meeting and prepare the agenda and meeting minutes.

20. Engineering services during construction is not included within this scope of work.

21. Potholing at the pump station site or along the pipeline alignment to locate existing underground structures and utilities is not included.

22. The designing of any relocations for utilities or other facilities are not included.

23. Assistance with CEQA document update and/or other environmental permits are not included. The City is responsible for identifying any required CEQA updates.

Tasks Performed by City
The following tasks will be performed by the City:

1. Provide all readily available background documentation for the pump station and pipeline to Kennedy Jenks for review.

2. Provide input and confirm the flowrate(s) for all pump stations.

3. Provide operational information such as the maximum and minimum water surface elevations in the East Dunne and Holiday Lake reservoirs.

4. Provide as-built documentation of the existing water pipelines for tie-ins including record drawings.

5. Prepare and submit reservoir permit applications and any applicable fees; interface with the building department and drinking water department as required.

6. Review Kennedy Jenks’ submittals within two-weeks of receival and provide a single, consolidated set of comments on each submittal.

7. Participate in decision-making and provide a best-faith effort to make key decisions in a timely manner.

8. Monitor and manage communications with the residents and stakeholders including any public outreach efforts.

Basis of Compensation
We propose that compensation for our services be on a time and expense reimbursement basis in accordance with the January 1, 2023 Schedule of Charges. Payments will be made monthly based on invoices, which describe services and list actual costs and expenses. Based on our estimate of services for our proposed tasks, we propose a fee budget of $248,769 for the design

Mr. David Gittleson, P.E.

City of Morgan Hill
4 May 2023

of the reservoir, pipelines and booster pump station. This amount will not be exceeded without prior written authorization from the City. Construction period services for the reservoir, pipelines and booster pump station will be defined, budgeted, and authorized later.

A summary of the proposed budget by phase is provided below. The budget may be increased, if necessary, to provide additional services requested by the City.

Phase
Estimated Fee
Budget
Phase 1 – Project Management, Meetings and Quality Control $29,200 Phase 2 – E. Dunne Hillside Water Reservoir and Booster Pump Station $189,569 Phase 3 – Design Contingency (Optional) $25,000
Phase 4 – Bid Assistance $5,000
Phases 1- 4 Total (Including Optional) $248,769
Interim Pipelines Project Remaining Contract Amount $8,582 Total Amended Contract Amount (Including Optional) $240,187 Schedule
Kennedy Jenks proposes to complete the overall scope of work described above in accordance with the general schedule described in the assumptions above.

Terms and Conditions
This proposal is based on current projections of staff availability and costs and, therefore, is valid for 90 days following the date of this letter. Unless noted otherwise the terms and conditions of the Service Agreement for Design Professionals for the East Dunne Hillside Water Reservoir Project between Kennedy Jenks and the City dated 11 February 2016 are acceptable for use in a new agreement. If this proposal meets with your approval, please forward a new service agreement for design professionals for this work.

Mr. David Gittleson, P.E.

City of Morgan Hill
4 May 2023

If you have any questions regarding our proposal, please contact Don Barraza at (415) 243-2483 or Rachel Druffel-Rodriguez at (858) 676-7532.

Very truly yours,
KENNEDY/JENKS CONSULTANTS, INC.

Jamie E. Kolkey, P.E.

Operations Manager
Donald L. Barraza, P.E.

Principal Engineer
Rachel Druffel-Rodriguez, P.E.

Project Manager
AUTHORIZATION:

City of MORGAN HILL
By: ___________________________
(Signature)
___________________________
(Print Name)
Title: ___________________________
Date: ___________________________
Enclosure

1. Preliminary List of Drawings

2. East Dunne Hillside Water Reservoir Proposed Stormwater Updates

Mr. David Gittleson, P.E.

City of Morgan Hill
4 May 2023

Preliminary List of Drawings

SHEET DRAWING DRAWING TITLE

GENERAL
1 G-1 TITLE SHEET, SHEET INDEX, VICINITY MAP AND LOCATION MAP 2 G-2 PROJECT GENERAL NOTES AND DESIGN CRITERIA
3 G-3 GENERAL NOTES, SYMBOLS AND LEGEND
4 G-4 ABBREVIATIONS
5 G-5 TITLE 22 DISTRIBUTION RESERVOIR REGULATIONS
CIVIL
6 C-1 EXISTING SITE PLAN AND CONTRACTOR STORAGE AREA
7 C-2 SITE PLAN AND HORIZONTAL CONTROL
8 C-3 RESERVOIR SITE AND ACCESS ROAD GRADING PLAN
9 C-4 RESERVOIR ACCESS ROAD PROFILE
10 C-5 RESERVOIR PAD GRADING PLAN
11 C-6 RESERVOIR SITE DRAINAGE PLAN
12 C-7 RESERVOIR SITE PIPING PLAN
13 C-8 RESERVOIR PAD ENLARGED SITE PIPING PLAN
14 C-9 16" WATER (INLET) PIPING PLAN AND PROFILE
15 C-10 10" WATER (INLET) PIPING PLAN AND PROFILE
16 C-11 12" WATER (OUTLET) PIPING PLAN AND PROFILE
17 C-12 16" STORM DRAIN PIPING PLAN AND PROFILE
18 C-13 WATER TIE-IN DETAILS
19 C-14 STORM DRAIN INLET STRUCTURE PLAN AND SECTIONS
20 C-15 BIOFILTRATION BASIN AND OUTLET STRUCTURE DETAILS 21 C-16 WATER DETAILS
22 C-17 STORM DRAIN AND SANITARY SEWER DETAILS
23 C-18 RESERVOIR ACCESS ROAD DETAIL
24 C-19 RESERVOIR ACCESS ROAD SECTIONS
25 C-20 FENCING AND PAVING DETAILS
26 C-21 DRAINAGE DETAILS
27 C-22 EROSION CONTROL DETAILS

LANDSCAPE
28 L-1 IRRIGATION NOTES
29 L-2 IRRIGATION PLAN - I

Mr. David Gittleson, P.E.

City of Morgan Hill
4 May 2023

30 L-3 IRRIGATION PLAN - II
31 L-4 IRRIGATION DETAILS - I
32 L-5 IRRIGATION DETAILS - II
33 L-6 IRRIGATION DETAILS - III
34 L-7 PLANTING PLAN - I
35 L-8 PLANTING PLAN - II
36 L-9 PLANTING DETAILS - I
37 L-10 PLANTING DETAILS - II

STRUCTURAL
38 S-1 STRUCTURAL GENERAL NOTES
39 S-2 STRUCTURAL SPECIAL INSPECTION AND TESTING SCHEDULE 40 S-3 WELDED STEEL TANK ORIENTATION PLAN
41 S-4 WELDED STEEL TANK TYPICAL CROSS SECTION
42 S-5 WELDED STEEL TANK PIPE CONNECTION DETAILS
43 S-6 WELDED STEEL TANK SHELL MANWAY AND PIPE CONNECTION

DETAILS
44 S-7 WELDED STEEL TANK EXTERIOR AND INTERIOR LADDER

SECTIONS AND DETAILS
45 S-8 WELDED STEEL TANK ROOF ACCESS PLATFORM, HATCH AND

VENT DETAILS
46 S-9 WELDED STEEL TANK RINGWALL FOUNDATION AND

MISCELLANEOUS DETAILS
47 S-10 WELDED STEEL TANK TYPICAL DETAILS
48 S-11 RESERVOIR SITE AND RETAINING WALL SECTION
49 S-12 WALL KEY PLAN
50 S-13 ROADWAY RETAINING WALL FLATTENED WALL ELEVATION - I 51 S-14 ROADWAY RETAINING WALL FLATTENED WALL ELEVATION - II 52 S-15 UPPER SOIL NAIL WALL FLATTENED WALL ELEVATION
53 S-16 LOWER SOIL NAIL WALL FLATTENED WALL ELEVATION
54 S-17 ROADWAY RETAINING WALL TRANSVERSE SECTIONS
55 S-18 SOIL NAIL WALL RETAINING WALL TRANSVERSE SECTIONS 56 S-19 SOIL NAIL WALL RETAINING WALL TRANSVERSE SECTION 57 S-20 CONCRETE GRAVITY RETAINING WALLS STRUCTURAL DETAILS 58 S-21 SOIL NAIL WALLS STRUCTURAL NOTES AND DETAILS
59 S-22 SOIL NAIL AND GRAVITY RETAINING WALLS STRUCTURAL DETAILS 60 S-23 SOIL NAIL WALLS AND RETAINING WALLS STRUCTURAL DETAILS

Mr. David Gittleson, P.E.

City of Morgan Hill
4 May 2023

CATHODIC PROTECTION
61 CP-1 CATHODIC PROTECTION PLAN, SECTION, SCHEMATIC AND

DETAILS
62 CP-2 CATHODIC PROTECTION DETAILS

MECHANICAL
63 M-1 EAST DUNNE BOOSTER PUMP STATION - EXISTING PIPING PLAN 64 M-2 EAST DUNNE BOOSTER PUMP STATION - MODIFIED PIPING PLAN

ELECTRICAL
65 E-1 EAST DUNNE HILLSIDE WATER RESERVOIR - ELECTRICAL

OVERALL SITE PLAN
66 E-2 EAST DUNNE HILLSIDE WATER RESERVOIR - ELECTRICAL SINGLE

LINE DIAGRAM AND PANELBOARD SCHEDULE MODIFICATIONS
67 E-3 EAST DUNNE HILLSIDE WATER RESERVOIR - ELECTRICAL

RESERVOIR PLAN
68 E-4 EAST DUNNE BOOSTER PUMP STATION - ELECTRICAL OVERALL

SITE PLAN
69 E-5 EAST DUNNE BOOSTER PUMP STATION - ELECTRICAL SINGLE LINE

DIAGRAM AND ELEVATION MODIFICATIONS
70 E-6 EAST DUNNE BOOSTER PUMP STATION - ELECTRICAL CONTROL

SCHEMATIC
71 E-7 EAST DUNNE BOOSTER PUMP STATION - ELECTRICAL CONDUIT

BLOCK DIAGRAM
72 E-8 EAST DUNNE BOOSTER PUMP STATION - ELECTRICAL CONDUIT

AND CABLE SCHEDULE
73 E-9 EAST DUNNE BOOSTER PUMP STATION - ELECTRICAL SITE PLAN

EAST DUNNE PUMP STATION

INSTRUMENTATION
74 I-1 PROCESS AND INSTRUMENTATION DIAGRAM – EAST DUNNE

RESERVOIR
75 I-2 EAST DUNNE BOOSTER PUMP STATION - NETWORK BLOCK

DIAGRAM
76 I-3 EAST DUNNE BOOSTER PUMP STATION - PROCESS AND
INSTRUMENTATION DIAGRAM – EAST DUNNE PUMP STATION

Preliminary List of Specifications
DIVISION 1: GENERAL REQUIREMENTS
01010 Summary of the Work and Contract Considerations
01040 Coordination and Project Requirements
01140 Environmental Protection
01190 Seismic Requirements
01300 Submittals
01500 Construction Facilities and Temporary Controls
01650 Facility Startup
01700 Contract Closeout
DIVISIONS 2 THROUGH 17: TECHNICAL SPECIFICATIONS
DIVISION 2: SITEWORK
02085 Precast Concrete Utility Vaults
02100 Site Preparation and Plant Protection
02200 Site Preparation
02301 Earthwork
02485 Soil Nail Wall
02510 Water System Piping and Accessories
02530 Sewers
02630 Drainage
02700 Paving and Surfacing
02810 Irrigation
02820 Fences and Gates
02900 Planting
DIVISION 3: CONCRETE
03100 Concrete Formwork and Formwork Accessories
03150 Concrete Joints and Accessories
03200 Concrete Reinforcement, Reinforcement Supports, and Anchor Bolts 03300 Concrete Mixtures, Handling, Placing and Constructing 03330 Concrete Curing and Protection
03350 Concrete Finishes
DIVISION 9: FINISHES
09960 High Performance Coatings

DIVISION 11: EQUIPMENT

Mr. David Gittleson, P.E.

City of Morgan Hill
4 May 2023

11001 General Equipment and Mechanical Requirements
11002 Electric Motor Drives
11003 Disinfection
11211 Centrifugal Water Pumps DIVISION 13: SPECIAL CONSTRUCTION 13113 Impressed Current Cathodic Protection System for Interior of Water Storage Reservoir
13211 Welded Steel Tank
DIVISION 15: MECHANICAL
15135 Seismic-Controlled Electric Valve Actuator
DIVISION 16: ELECTRICAL
16010 General Electrical Requirements
16110 Conduit, Raceways and Fittings
16120 Low Voltage Wire and Cable
16124 Signal Cable
16130 Boxes
16155 Motor Starters
16180 Overcurrent Protective Devices
16402 Underground Electrical Work and Service
16450 Electrical Grounding
16500 Lighting
16955 Control Devices
DIVISION 17: INSTRUMENTATION AND CONTROLS
17010 Instrumentation and Controls, General Requirements 17140 Level Measurement
17150 Pressure Measurement
17200 Miscellaneous Field Instruments
17330 Programmable Logic Controller
17330A Control Strategies
17510 Panels

12 Updated May 2023

EXHIBIT B

SCHEDULE OF COMPENSATION RATES

Client/Address: City of Morgan Hill
17575 Peak Avenue
Morgan Hill, California 95037
Contract/Proposal Date: May 4, 2023
Schedule of Charges Date: May 4, 2023

PERSONNEL COMPENSATION
Classification Hourly Rate
Engineer-Scientist-Specialist 1...........................................................................$140 Engineer-Scientist-Specialist 2...........................................................................$170 Engineer-Scientist-Specialist 3...........................................................................$190 Engineer-Scientist-Specialist 4...........................................................................$205 Engineer-Scientist-Specialist 5...........................................................................$225 Engineer-Scientist-Specialist 6...........................................................................$250 Engineer-Scientist-Specialist 7...........................................................................$275 Engineer-Scientist-Specialist 8...........................................................................$295 Engineer-Scientist-Specialist 9...........................................................................$310 Senior CAD-Designer ........................................................................................$175 CAD-Designer ...................................................................................................$160 Senior CAD-Technician .....................................................................................$145 CAD-Technician ................................................................................................$130 Project Assistant................................................................................................$135 Administrative Assistant.....................................................................................$115 Aide.....................................................................................................................$90 In addition to the above Hourly Rates, an Associated Project Cost charge of $9.74 per hour will be added to Personnel Compensation for costs supporting projects including telecommunications, software, information technology, internal photocopying, shipping, and other support activity costs related to the support of projects Direct Expenses
Reimbursement for direct expenses, as listed below, incurred in connection with the work, will be at cost plus ten percent for items such as:
a. Maps, photographs, 3rd party reproductions, 3rd party printing, equipment rental, and special supplies related to the work.
b. Consultants, soils engineers, surveyors, contractors, and other outside services. c. Rented vehicles, local public transportation and taxis, travel and subsistence. d. Project specific telecommunications and delivery charges. e. Special fees, insurance, permits, and licenses applicable to the work. f. Outside computer processing, computation, and proprietary programs purchased for the work.

Reimbursement for vehicles used in connection with the work will be at the federally approved mileage rates or at a negotiated monthly rate.

If prevailing wage rates apply, the above billing rates will be adjusted as appropriate.

Overtime for non-exempt employees will be billed at one and a half times the Hourly Rates specified above.

Rates for professional staff for legal proceedings or as expert witnesses will be at rates one and one-half times the Hourly Rates specified above.

Excise and gross receipts taxes, if any, will be added as a direct expense.

The foregoing Schedule of Charges is incorporated into the agreement for the services provided, effective May 4, 2023 through December 31, 2023. After December 31, 2023, invoices will reflect the Schedule of Charges currently in effect.

13 Updated May 2023

EXHIBIT C

SCHEDULE OF PERFORMANCE
Design to be completed by June 7, 2024.

6 CITY COUNCIL STAFF REPORT
MEETING DATE: June 7, 2023
PREPARED BY:

Dat Nguyen, Finance Director
APPROVED BY: City Manager
APPROVE REVISIONS TO CITY COUNCIL POLICY CP-94-04, THE

CITY'S INVESTMENT POLICY

RECOMMENDATION(S)
Approve revisions to City Council Policy CP-94-04, the City's Investment Policy.

COUNCIL PRIORITIES, GOALS & STRATEGIES
City Council Ongoing Priorities
Preserving and Cultivating Public Trust
2022-2023 Strategic Priorities
Fiscal Sustainability
REPORT NARRATIVE:

Best practices in municipal finance recommend investment policies be reviewed annually or at a minimum, the internal treasury staff should conduct a review annually.

An update in the investment policy is warranted if staff’s review results in a material change in policy due to either a change in statute or a change in the City’s investment objectives. Finance continues to monitor changes to the California Government Code regarding investment parameters and allowable investments that may impact the City’s investment policy. The redlined version of the City’s investment policy is attached for review and approval. The proposed changes to the investment policy would increase the allowable investments in California Cooperative Liquid Assets Securities System Class (CLASS) from a maximum of 5% of the portfolio to 10% and add U.S. Bank Investment Services as an authorized firm to conduct investment transactions with the City. In December 2022, U.S. Bank completed its acquisition of MUFG Union Bank, which UnionBanc Investment Services was part of. Adding U.S. Bank Investment Services allows the City to continue investment relationships with the current brokers.

California CLASS is a pooled investment option that was created via a joint exercise of powers agreement by and among California public agencies with total investments having grown to about $0.5 billion with 69 California public agencies participating. The City is a member of the California Class and Christina Turner, the City's City Manager, serves as chairperson on its board of trustees. Increasing the allowable investment amount in the California Class would allow the City to optimize interest earnings while maximizing safety and liquidity. Expanding the list of allowable investments would allow the City more options as we look to increase the City portfolio’s short-term returns, while

6 maintaining the City’s investment objectives of safety, liquidity, and yield. The proposed revisions to the City's investment policy have been reviewed and approved by the City's Treasurer.

COMMUNITY ENGAGEMENT:

Inform
Finance periodically renders to City Council for review and approval any changes to the investment policy at a public meeting. In addition, the City’s investment policy is available on the City’s website.

ALTERNATIVE ACTIONS:

City Council could decide not to update the policy.

PRIOR CITY COUNCIL AND COMMISSION ACTIONS:

The City Council approved the last revision to its investment policy in August 2022.

FISCAL AND RESOURCE IMPACT:

Updating and maintaining the City’s investment policy is a part of the Finance Department’s on-going work-plan. There is no additional cost associated with the approval of the Investment Policy.

CEQA (California Environmental Quality Act):

Not a Project
Organizational or administrative activities of governments that will not result in direct or indirect physical changes in the environment.

1 CITY OF MORGAN HILL

CITY COUNCIL POLICIES AND PROCEDURES
POLICY NUMBER: CP-94-04
TITLE: INVESTMENT POLICY
EFFECTIVE DATE: June 8, 1988
REVISED DATE: June 7, 2023; August 17, 2022; May 6, 2020; July 20, 2016; July 15, 2015; January 26, 2011; September 26, 2007; June 15, 1994

TABLE OF CONTENTS
Page
Scope............... ...............................................................................................................................2 Investment Objectives
A. Safety of Principal ...................................................................................................................2 B. Liquidity.... ...............................................................................................................................3 C. Yield .......... ...............................................................................................................................3 Delegation of Authority................................................................................................................3 Ethics and Conflicts of Interest...................................................................................................4 Evaluation of Investments ...........................................................................................................4 Selection of Broker/Dealers .........................................................................................................4 Authorized Investments ...............................................................................................................5 Investment Pools...........................................................................................................................6 Safekeeping of Securities .............................................................................................................6 Diversification...............................................................................................................................7 Maximum Maturities ...................................................................................................................7 Performance Benchmarks………………………………………………………………………7
Bond Proceeds...............................................................................................................................7 Competitive Transactions……………………………………………………………………….8
Reporting Requirements..............................................................................................................8 Investment Policy Review ............................................................................................................8 Policy Statement on Collateralized Time Deposits ....................................................Schedule I Policy Criteria for Selecting Broker/Dealers............................................................Schedule II Firms Authorized to Conduct Investment Transactions .......................................Schedule III Chart of Authorized Investments .............................................................................Schedule IV Glossary ......... .............................................................................................................................18

2 CITY OF MORGAN HILL
Statement of Investment Policy
SCOPE
The City of Morgan Hill’s (the City’s) Investment Policy (the Policy) applies to all funds under the control of the City and includes the general revenues of the City, Successor Agency to the former Morgan Hill Redevelopment Agency (Agency), enterprise fund revenues, and proceeds of bond sales, debt service revenues, and trust funds in the custody of the City.

For simplicity, this Policy shall refer to “City” even when it applies to the Agency, except that the City and Agency shall be distinguished whenever the role of the City Council or Agency Board is described, whenever the role of the City Manager or Executive Director is described, or whenever the role of the City Treasurer or Director of Finance is described.

INVESTMENT OBJECTIVES
The City’s funds shall be invested in accordance with all applicable City policies and codes, State statutes, Federal regulations, and bond covenants, and in a manner designed to accomplish the following objectives, which are listed in priority order:

A. Safety of Principal
Safety of principal is the City’s foremost objective of the investment program. Investments shall be undertaken in a manner that seeks to minimize capital losses by avoiding credit risk and market risk, as defined below:

1. Credit risk, defined as the risk of loss due to failure of the issuer of a security, shall be mitigated by investing in only the highest quality securities (see authorized investments) and by diversifying the investment portfolio so that the failure of any one issuer would not unduly harm the City’s cash flows.

2. Market risk, defined as the risk of market value fluctuations due to overall changes in the general level of interest rates, shall be mitigated by structuring the portfolio so that securities mature at the same time that major cash outflows occur, thus eliminating the need to sell securities prior to maturity. It is explicitly recognized, however, that in a diversified portfolio, occasional measured losses may occur, and must be considered within the context of the overall investment return.

B. Liquidity
Liquidity is the second most important objective of the investment program. The investment portfolio shall remain sufficiently liquid to enable the City to meet all reasonably anticipated operating requirements.

3 C. Yield
The City portfolio shall be invested to attain a market average rate of return through economic cycles, as long as it does not diminish the superior objectives of safety and liquidity. The market rate of return is defined as the average return on the 1-year U.S.

Treasury Bill. Whenever possible, and after the objectives of safety of principal and liquidity have been met, a yield higher than the market rate of return shall be sought.

DELEGATION OF AUTHORITY FOR CITY FUNDS
The City Council has appointed the City Treasurer responsible for undertaking investment transactions on behalf of the City. Unless specifically designated by the City Council, the only officials authorized to undertake investment transactions on behalf of the City are the City Treasurer, Finance Director, and City Manager. The City Manager or designee, as applicable, shall review all investment purchases before they occur. The City Treasurer and the Finance Director will observe, review, and react to the changing conditions that affect the investment portfolio. They will meet on a regular basis to discuss current market conditions, future trends and how each of these affects the investment portfolio and the City.

The City Treasurer, Finance Director and City Manager shall develop and maintain administrative procedures and internal controls, consistent with this Policy, for the operation of the City's investment program. Such procedures shall be designed to prevent losses of public funds arising from fraud, employee error, misrepresentation by third parties, or imprudent actions by employees of the City.

DELEGATION OF AUTHORITY FOR AGENCY FUNDS
The Agency Board has appointed the Director of Finance responsible for undertaking investment transactions on behalf of the Agency. Unless specifically designated by the Agency Board, the only officials authorized to undertake investment transactions on behalf of the Agency are the Director of Finance and Agency Executive Director. The Executive Director or designee, as applicable, shall review all investment purchases before they occur. The Director of Finance and Executive Director will observe, review, and react to the changing conditions that affect the investment portfolio. They will meet on a regular basis to discuss current market conditions, future trends and how each of these affects the investment portfolio and the Agency.

The Director of Finance and Executive Director shall develop and maintain administrative procedures and internal controls, consistent with this Policy, for the operation of the Agency's investment program. Such procedures shall be designed to prevent losses of public funds arising from fraud, employee error, misrepresentation by third parties, or imprudent actions by employees of the Agency.

4 ETHICS AND CONFLICTS OF INTEREST
Officers and employees involved in the investment process shall refrain from personal business activity that could conflict with proper execution of the investment program, or which could impair their ability to make impartial investment decisions. Employees and investment officers shall disclose any material financial interests in financial institutions that conduct business within this jurisdiction, and they shall further disclose any larger personal financial/investment positions that could be related to the performance of the City's portfolio. Employees and officers shall subordinate their personal investment transactions to those of the City, particularly with regard to the timing of purchases and sales, and shall avoid transactions that might impair public confidence in the City's ability to govern effectively.

EVALUATION OF INVESTMENTS
The standard of prudence to be used for managing the City's investment program is California Government Code Section 53600.3, the prudent investor standard which states, “When investing, reinvesting, purchasing, acquiring, exchanging, selling, or managing public funds, a trustee shall act with care, skill, prudence, and diligence under the circumstances then prevailing, including, but not limited to, the general economic conditions and the anticipated needs of the agency, that a prudent person acting in a like capacity and familiarity with those matters would use in the conduct of funds of a like character and with like aims, to safeguard the principal and maintain the liquidity needs of the agency.”
City investment officers acting in accordance with this Policy and the "prudent person" standard and exercising due diligence shall be relieved of personal responsibility for an individual security's credit risk or market price changes, provided that substantial deviations from expectations are reported by the City Treasurer or by the Director of Finance (for the Agency) to the City Manager or Executive Director, as applicable, within three days of discovery. Mutually agreeable remedial action will be taken by the City Treasurer and City Manager (for the City) or by the Director of Finance and Executive Director (for the Agency) and reported to the City Council or Agency Board, as applicable, at their next regularly scheduled meeting.

SELECTION OF BROKER/DEALERS
The City Treasurer (for the City) and Director of Finance (for the Agency) shall jointly maintain a list of broker/dealers approved for investment purposes, and it shall be the policy jointly of the City and the Agency to purchase securities only from those brokers and the firms they represent.

Each approved broker/dealer must possess an authorizing certificate from the California Commissioner of Corporations as required by Section 25210 of the California Corporations Code.

To be eligible, a firm must meet at least one of the following criteria:

1. be recognized as Primary Dealers by the Federal Reserve Bank of New York or have a primary dealer within their holding company structure, or

2. report voluntarily to the Federal Reserve Bank of New York, or

3. qualify under Securities and Exchange Commission (SEC) Rule 15c3-1 (Uniform Net Capital Rule).

5 The City Treasurer (for the City) and Director of Finance (for the Agency) will select broker/dealers on the basis of their expertise in public cash management and their ability to provide service to the account(s). Each authorized broker/dealer shall submit and annually update an approved Broker/Dealer Information Request form that includes the firm's most recent financial statements.

The City Treasurer (for the City) and Director of Finance (for the Agency) shall determine if the broker/dealers are adequately capitalized, make markets on securities appropriate to the City's needs and are recommended by managers of portfolios similar to the City’s. The City Treasurer (for the City) or Director of Finance (for the Agency) shall submit findings and recommendations to the City Council or Agency Board, as applicable. The City Council and Agency Board will determine which broker/dealers will be authorized to trade with the City as part of their annual review of this Policy,
In the event that an external investment advisor is not used in the process of recommending a particular transaction in the City’s or Agency’s portfolio, authorized broker/dealers shall attest in writing that they have read and understand this Policy.

AUTHORIZED INVESTMENTS
All investments and deposits of the City shall be made in accordance with California Government Code Sections 16429.1, 53600-53609 and 53630-53686. The City has further limited the types of allowable securities to those shown in the following list:

A. United States Treasury Bills and Notes with maturities not exceeding five years from the date of trade settlement. There is no limitation on the percentage of the portfolio which can be invested in this category.

B. Federal Instrumentality (government sponsored enterprise) debentures, discount notes, callable and step-up securities, with a final maturity not exceeding five years from the date of trade settlement issued by the following only: the Federal Farm Credit Bank System (FFCB), the Federal Home Loan Bank (FHLB), the Federal National Mortgage Association (FNMA or Fannie Mae), the Federal Home Loan Mortgage Corporation (FHLMC or Freddie Mac), the Tennessee Valley Authority (TVA), and the Government National Mortgage Association (GNMA, but only if the security is backed by the full faith and credit of the U.S. government). Although there is no percentage limitation of the dollar amount or percentage of the portfolio that can be invested in these issuers, the "prudent person" rule shall apply for any single agency name.

C. The Local Agency Investment Fund (LAIF), established by the State Treasurer for the benefit of local agencies and identified under Government Code Section 16429.1, is authorized up to the maximum amount pursuant to California Government Code Section 16429.1
D. Inactive deposits with Banks and Savings and Loans with a branch within California that has a rating of at least A-1 or the equivalent from a nationally recognized statistical rating organization (NRSRO), and has an equity to total assets ratio of at least 4%. All deposits

6 shall be secured in accordance with Sections 53651 and 53652 of the California Government Code and comply with Schedule I (Policy Statement of Collateralized Time Deposits) attached. If deposits are not collateralized, the maximum placed at any one institution will be $250,000. The maximum amount of collateralized inactive deposits placed at any one institution shall not constitute more than 10% of the total assets of the institution or $2,000,000, whichever is less, and shall not exceed the total shareholders' equity of the issuing institution.

E. Money market funds registered with the Securities and Exchange Commission under the Investment Company Act of 1940 that (1) are “no-load” (meaning no commission or fee shall be charged on purchases or sales of shares); (2) have a constant net asset value per share of $1.00; (3) invest only in the securities and obligations authorized in the applicable California statutes and (4) have a rating of at least AAAm or the equivalent by at least two NRSROs. The aggregate investment in money market funds shall not exceed 20% of the City’s total portfolio. The City shall use only those money market funds consisting of investments considered prudent in nature for any fiduciary.

F. Certificates of Deposit (CD) is authorized up to the maximum Federal Deposit Insurance Corporation (FDIC) legal limit amount per FDIC-insured institution.

INVESTMENT POOLS
The Local Agency Investment Fund (LAIF) is authorized under provisions in Section 16429.1 of the California Government Code. The City's participation in the pool was previously approved by the City Council and Agency Board.

The California Cooperative Liquid Assets Securities System Class (CLASS) is authorized under provisions in Section 53601(p) of the California Government Code, California public agencies may invest in shares of beneficial interest issued by a joint powers authority.

City Council review and approval is required prior to investment in any other local government investment pool or joint powers authority.

SAFEKEEPING OF SECURITIES
The City Treasurer (for the City) and the Director of Finance (for the Agency) shall select one or more banks to provide safekeeping and custodial services for the City. A Safekeeping Agreement approved by the City shall be executed with each custodian bank prior to utilizing that bank's safekeeping services.

Custodian banks will be selected on the basis of their ability to provide services for the City's account and the competitive pricing of their safekeeping related services.

The purchase and sale of securities and repurchase agreement transactions shall be settled on a delivery versus payment basis. All securities shall be perfected in the name of the City. Sufficient evidence to title shall be consistent with modern investment, banking and commercial practices.

7 All investment securities, except non-negotiable Certificates of Deposit, Money Market Funds and LAIF, purchased by the City will be delivered by either book entry or physical delivery and will be held in third-party safekeeping by a City approved custodian bank, its correspondent bank or its Depository Trust Company (DTC) participant account.

All Fed wireable book entry securities owned by the City shall be held in the Federal Reserve System in a customer account for the custodian bank which will name the City as “customer.” All DTC eligible securities shall be held in the custodian bank’s DTC participant account and the custodian bank shall provide evidence that the securities are held for the City as “customer.”

DIVERSIFICATION
The City will diversify its investments by security type and investment to avoid incurring unreasonable risks inherent in over-investing in specific instruments, individual financial institutions or maturities. With the exception of bond reserve funds, bond escrow funds, and any other funds approved by the City Council, at all times at least 50% of the total portfolio shall mature in three years or less; at least 30% of the total portfolio shall mature in two years or less; and at least 20% of the portfolio shall mature in one year or less.

MAXIMUM MATURITIES
The City will attempt to match its investments with anticipated cash flow requirements. Unless matched to a specific cash flow, as approved by the City Council or Agency Board, as applicable, and otherwise allowed by law, the City will not directly invest in securities maturing more than five years from the date of trade settlement. Bond reserve funds, bond escrow funds, and any other funds approved by the City Council or Agency Board, as applicable, may be invested in securities exceeding five years if the maturities of such investments are made to coincide as nearly as possible with the expected use of the funds. The weighted average final maturity of the investment portfolio shall not exceed two and one-half years.

PERFORMANCE BENCHMARKS
The investment portfolio shall be designed to attain a market rate of return throughout budgetary and economic cycles, taking into account prevailing market conditions, risk constraints for eligible securities, and cash flow requirements. The performance of the investment portfolio shall be compared to the average yield on the U.S. Treasury security that most closely corresponds to the investment portfolio’s weighted average effective maturity. When comparing the performance of the investment portfolio, all fees involved with managing it shall be included in the computation of its rate of return net of fees.

8 BOND PROCEEDS
Proceeds of bond sales and debt service reserve funds and other bond-related monies (or funds) may be invested in any investments authorized under both California Government Code Section 53600, et. seq. and the applicable bond covenants related to a bond sale. Securities authorized by a bond covenant that are not authorized by this Policy will only be used if they are specifically approved by the City Council or Agency Board, as applicable. Unless otherwise approved by the City Council or Agency Board, as applicable, all securities will be held in third-party safekeeping with the bond trustee, and all delivery-versus-payment rules will apply. Fees will be collected annually to compensate for administration costs.

COMPETITIVE TRANSACTIONS
All investment transactions shall be conducted competitively with authorized broker/dealers. At least three broker/dealers shall be contacted for each transaction, except when purchasing new issue securities, and their bid or offering prices shall be recorded.

If the City is offered a security for which there is no other readily available competitive offering, then the City Treasurer (for the City) or the Director of Finance (for the Agency) will document quotations for comparable or alternative securities.

REPORTING REQUIREMENTS
The City Treasurer (for the City) and Director of Finance (for the Agency) shall render, at least quarterly, reports of investment activity to the City Council and Agency Board within 30 days following the end of the quarter. Each report will include the following information:

1. Investment type, issuer, date of maturity, par value and dollar amount invested in all securities, and investments and monies held by the City;

2. A description of the funds, investments and programs managed by contracted parties;

3. A market value as of the date of the report (or the most recent valuation as to assets not valued monthly) and the source of the valuation;

4. A statement of compliance with the investment policy or an explanation for non-compliance; and

5. A statement of the City’s ability to meet expenditure requirements for six months, and an explanation of why money will not be available if that is the case.

INVESTMENT POLICY REVIEW
The City Treasurer (for the City), working with the Director of Finance (for the Agency),shall periodically review and make recommendations regarding the City’s Investment Policy to ensure its consistency with the overall objectives of preservation of principal, liquidity, yield and diversification and its relevance to current law and economic trends. Amendments to this Investment Policy shall be approved by the City Council.

9 CITY OF MORGAN HILL

POLICY STATEMENT ON COLLATERALIZED TIME DEPOSITS

SCHEDULE I
Before the City Treasurer can place a time deposit with a local bank or savings and loan, the following criteria must be met:

1. The bank must provide the City with an executed copy of the "Contract for Deposit for Moneys" as specified in Section 53649 of the California Government Code.

2. The interest rate on the Time Certificate of Deposit must be competitive with rates offered by other banks and savings and loans and must exceed the interest rate for treasury bills for a similar maturity period.

3. For investments less than $250,000, FDIC insurance will be sufficient without requiring any collateral to be pledged with the Federal Reserve to secure the public fund deposit.

4. For investments exceeding $250,000, there may be a waiver of collateral for the first $250,000 deposited, and all of the funds placed on deposit must be collateralized by 110% of U.S. Treasury or Federal Agency securities, or by 150% of mortgages having maturities less than five years in accordance with Section 53652 of the California Government Code.

The City must receive confirmation that these securities have been pledged in repayment of the time deposit. The securities pledged must be maintained at a current market value 10% greater than the dollar amount of the deposit.

5. The City must be given a current audited financial statement for the financial year just ended as well as the most recent quarterly statement of financial condition. The financial reports must both include a "statement of financial condition" as well as an "income statement" depicting current and prior year operations.

6. The City will not place a fund deposit for more than $2,000,000, or 10% of the assets of the institution, whichever is less.

7. The City must receive a certificate of deposit which specifically expresses the terms governing the transaction, (i.e., the period of time, name of depositor, interest rate, etc.).

8. All time certificates must have a maturity period not exceeding two years from the date of deposit with quarterly payments of interest based upon the stated interest rate.

9. The City must also receive a letter from the comptroller and/or treasurer of the bank at the time the deposit is made, that there is no known pending financial disclosure or public announcement of an adverse financial event involving the bank or savings and loan, nor is there any knowledge that a conflict of interest situation exists with any City official, officer or employee at the time the bank is receiving this deposit. The City has a fiduciary responsibility to make prudent investment of public funds, and to assure its investment practices are absent of any financial inducement or conflict in interest whatsoever.

10. Time deposits will only be made with qualified banks and savings and loans having branch office locations within Santa Clara County. However, time deposits with a bank or savings

10 and loan must be centralized at one designated office location rather than making separate deposits with each branch office.

11 CITY OF MORGAN HILL

POLICY CRITERIA FOR SELECTING BROKER/DEALERS

SCHEDULE II

1. Each approved broker/dealer must possess an authorizing certificate from the California Commissioner of Corporations as required by Section 25210 of the California Corporations Code.

To be eligible, a firm must meet at least one of the following criteria:

1. be recognized as Primary Dealers by the Federal Reserve Bank of New York or have a primary dealer within their holding company structure, or

2. report voluntarily to the Federal Reserve Bank of New York, or

3. qualify under Securities and Exchange Commission (SEC) Rule 15c3-1 (Uniform Net Capital Rule).

The City Treasurer (for the City) and Director of Finance (for the Agency) will select broker/dealers on the basis of their expertise in public cash management and their ability to provide service to the account(s). Each authorized broker/dealer shall submit and annually update an approved Broker/Dealer Information Request form that includes the firm's most recent financial statements.

The City Treasurer (for the City) and Director of Finance (for the Agency) shall determine if the broker/dealers are adequately capitalized, make markets on securities appropriate to the City's needs and are recommended by managers of portfolios similar to the City’s. The City Treasurer (for the City) or Director of Finance (for the Agency) shall submit his findings and recommendations to the City Council or Agency Board, as applicable. As part of their periodic review of the Investment Policy, the City Council and Agency Board will determine which broker/dealers will be authorized to trade with the City.

In the event that an external investment advisor is not used in the process of recommending a particular transaction in the City’s or Agency’s portfolio, authorized broker/dealers shall attest in writing that they have read and understand a copy of this Policy.

2. The net capital position of the firm shall be in excess of $100 million.

3. The intent of the City Treasurer (for City) and Director of Finance (for Agency) is to enter into a long-term relationship. Therefore, the integrity of the firm and the personnel assigned to our account is of primary importance.

5. The firm must provide an active secondary market for the securities it sells.

6. The firm must specify the types of securities it specializes in and will be made available for the City’s account.

7. It is important that the firm provide related services that will enhance the account relationship which could include:

12 a) An active secondary market for its securities.
b) Internal credit research analysis on commercial paper, banker's acceptances and other securities it offers for sale.
c) Be willing to trade securities on the City’s portfolio. d) Be capable of providing market analysis, economic projections, newsletters. e) Provide market education on new investment products, security spread relationships, graphs, etc.

8. The firm must be willing to provide annual financial statements.

9. If requested, the firm must be willing to provide a list of local government clients or other references, particularly those client relationships established within the State of California.

10. The City is prohibited from the establishment of a broker/dealer account for the purpose of holding the City's securities. All securities must be subject to delivery at the City's custodial bank.

11. Without exception, all transactions are to be conducted on a "'delivery vs. payment" basis.

12. The broker/dealer shall be headquartered or have a branch office in California. The City will not conduct security transactions with any firm located out of state.

13. The broker/dealer must have been in operation for more than 5 years.

14. No business relationship shall be established with firms primarily engaged in the sale of "exotic" products. Exotic means "unusually high yields," no ready secondary market, "high price volatility" on the security.

15. The firm must be registered with the State of California's regulatory agency.

16. No broker/dealer or security firm shall be selected who has made a political contribution to the City Treasurer or any member of the City Council or Agency Board or to any candidate for these offices.

13 Broker/Dealer Questionnaire
Name of Firm:

Address:

Telephone No.:

Primary representative Manager
Name:

Title:

Telephone No:

1. Are you a recognized primary dealer in Government securities? ( ) Yes ( ) No

2. If so, how long has your firm been a primary dealer? _________ years.

3. Are you a retail or institutional broker?

4. What was your firm's total volume in U. S. Government and agency securities trading last year?
Firm-wide $____________
Your office $____________

5. Which instruments are offered regularly by your trading desk? ( ) T-bills ( ) BA's (domestic)
( ) T-notes and bonds ( ) BA’s (foreign)
( ) Agencies (specify) ( ) Commercial Paper
FFCB, FHLB, FNMA ( ) Bank C. D.'s

14 FHLMC, SLMA, TVA, GNMA ( ) S & L C. D.'s

WORLD BANK
( ) Repurchase Agreements ( ) Medium Term Corporate Notes ( ) Reverse Repurchase ( ) Mutual Funds (eligible for public Agreements investment)

6. Identify all personnel who will be trading with or quoting securities to the City.

Name Title Phone

7. Please identify your most directly comparable City/Local Agency clients in our geographical area.

Entity Contact Person Phone Client Since

8. Is there anything in your background in the government securities business that makes you stand-out above the rest? Why should the City of Morgan Hill deal with you?
9 Have any of your public sector clients ever sustained a loss on a securities transaction arising from a misunderstanding or misrepresentation of the risk characteristics of a particular instrument? If so, please explain.

10. Has any public sector client ever claimed in writing that your firm was responsible for investment losses? Explain.

11. Has your firm consistently complied with the Federal Reserve’s capital adequacy guidelines? Include certified documentation of your capital adequacy as measured by Federal Reserve standards.

12. Please provide certified financial statements and other statements regarding your firm's capitalization.

13. Please include samples of research reports that your firm regularly supplies to public sector clients.

15 14. Are you a Broker instead of a Dealer (i.e., you DO NOT own positions of securities)?

15. What reports, transactions, confirmations and paper trail would the City receive?

16. What training information would you provide to our employees and investment officers?

17. How many and what percentage of your transactions failed last month? Last year?

18. What portfolio information do you require from clients? --CERTIFICATION--
I hereby certify that I have personally read the City of Morgan Hill's Investment Policy and the California Government Codes pertaining to the investments of the City of Morgan Hill, and have implemented reasonable procedures and a system of controls designed to preclude imprudent investment activities arising out of transactions conducted by our firm on behalf of the City of Morgan Hill, considering the City’s investment objectives, strategies and risk constraints. We pledge to exercise due diligence in informing the City Treasurer and staff of all foreseeable risks associated with financial transactions conducted with our firm. I attest to the accuracy of our responses to the above questionnaire.

NOTE: Completion of this questionnaire is only part of the City of Morgan Hill's Certification process and DOES NOT guarantee that the applicant will be approved to do business with the City.

SIGNED
(Account Representative)
SIGNED
(Countersigned by Company President or person in charge of government securities operations.) DATED

16 CITY OF MORGAN HILL

FIRMS AUTHORIZED TO CONDUCT INVESTMENT TRANSACTIONS

SCHEDULE III
The City is authorized to conduct investment security transactions with the following investment firms and broker/dealers, many of which are designated by the Federal Reserve as primary government dealers. Security transactions with firms other than those appearing on this list are prohibited.

A. Firms designated by the Federal Reserve as Primary Government Dealers:

Bank of Nova Scotia, New York Agency
BMO Capital Markets Corp.

BNP Paribas Securities Corp.

Barclays Capital Inc.

Cantor Fitzgerald & Co.

Citigroup Global Markets Inc.

Credit Suisse Securities (USA) LLC
Daiwa Capital Markets America Inc.

Deutsche Bank Securities Inc.

Goldman, Sachs & Co.

HSBC Securities (USA) Inc.

Jefferies & Company, Inc.

J.P. Morgan Securities, LLC
Merrill Lynch, Pierce, Fenner & Smith, Inc.

Mizuho Securities USA, Inc.

Morgan Stanley Smith Barney
Nomura Securities International, Inc.

RBC Capital Markets, LLC
RBS Securities Inc.

Societe Generale, New York Branch
TD Securities (USA) LLC
UBS Securities, LLC
Wells Fargo Securities, LLC
B. Other authorized firms:

D. A. Davidson and Company
Fundamental Capital Markets
Morgan Keegan & Company, Inc.

UnionBanc Investment Services
U.S. Bank Investment Services

17

18 CITY OF MORGAN HILL SCHEDULE IV
Authorized Investments Ranked by Authority and Degree of Risk August 17, 2022June 7, 2023

AUTHORIZED INVESTMENTS DIVERSIFICATION PURCHASE RESTRICTIONS U.S. TREASURY BILLS & NOTES
______________________________________

DREYFUSS TREASURY CASH

MANAGEMENT FUND
No Limit
______________________________________
___
No Limit
No Limit
______________________________________
___
No Limit
U.S. GOVERNMENT AGENCIES AND

GOVERNMENT SPONSORED

ENTERPRISES
No Limit No Limit
LOCAL AGENCY INVESTMENT FUND No Limit Maximum Set by Gov’t Code CALIFORNIA CLASS Max 105% of portfolio No Limit
TIME DEPOSITS Max 5% of portfolio Max $2 million per institution Collateral = 110% to 150%
MONEY MARKET MUTUAL FUNDS Max 20% of portfolio No Limit REPURCHASE AGREEMENTS Not Authorized Not Authorized
BANKERS’ ACCEPTANCES Not Authorized Not Authorized
COMMERCIAL PAPER Not Authorized Not Authorized
MEDIUM-TERM CORPORATE NOTES Not Authorized Not Authorized NEGOTIABLE CD’S Max 5% of portfolio Up to FDIC insured legal limit per FDIC insured institution

REVERSE REPURCHASE

AGREEMENTS
Not Authorized Not Authorized
ASSET BACKED SECURITIES Not Authorized Not Authorized
STATE & LOCAL INDEBTEDNESS Not Authorized Not Authorized

19 GLOSSARY
AGENCY: Debt issued by an agency of the
federal government that is explicitly
guaranteed by the full faith and credit of the
United States government. The Government
National Mortgage Association (GNMA or
Ginnie Mae), is an example of an agency
issuer.

ASKED: The price at which securities are
offered. (The price at which a firm will sell a
security to an investor.)
BANKERS’ ACCEPTANCE (BA): A draft
or bill or exchange accepted by a bank or trust
company. The accepting institution
guarantees payment of the bill, as well as the
issuer.

BASIS POINT: One one-hundredth of a
percent (i.e., 0.01%).

BID: The price offered by a buyer of
securities. (When you are selling securities,
you ask for a bid.)
BROKER: A broker brings buyers and
sellers together for a commission. A broker
does not take a position.

CERTIFICATE OF DEPOSIT (CD): A
time deposit with a specific maturity
evidenced by a certificate. Large
denomination CD’s are typically negotiable.

COLLATERAL: Securities, evidence of
deposit or other property which a borrower
pledges to secure repayment of a loan. Also
refers to securities pledged by a bank to
secure deposits of public monies.

COUPON: a) The annual rate of interest that
a bond’s issuer promises to pay the
bondholder on the bond’s face value. b) A
certificate attached to a bond evidencing
interest due on a payment date.

DEALER: A dealer, as opposed to a broker,
acts as a principal in all transactions, buying
and selling for its own account.

DEBENTURE: A bond secured only by the
general credit of the issuer.

DELIVERY VERSUS PAYMENT: There
are two methods of delivery of securities:
delivery versus payment and delivery versus
receipt. Delivery versus payment is delivery
of securities with an exchange of money for
the securities. Delivery versus receipt is
delivery of securities with an exchange of a
signed receipt for the securities.

DISCOUNT: The difference between the
cost price of a security and its maturity when
quoted at lower than face value. A security
selling below original offering price shortly
after sale also is considered to be at a
discount.

DISCOUNT SECURITIES: Non-interest
bearing money market instruments that are
issued at a discount and redeemed at maturity
for full face value (e.g., U.S. Treasury Bills).

DIVERSIFICATION: Dividing investment
funds among a variety of securities offering
independent returns.

FANNIE MAE (FNMA): FNMA was
chartered under the Federal National
Mortgage Association Act in 1938. The
corporation's purpose is to purchase and
securitize mortgages in order to ensure that
funds are consistently available to the
institutions that lend money to home buyers.

It is the largest single provider of residential
mortgage funds in the United States. On
September 7, 2008, Fannie Mae was placed
into conservatorship of the FHFA. The
corporation’s purchases include a variety of
adjustable mortgages and second loans, in
addition to fixed-rate mortgages. FNMA’s
securities are also highly liquid and are
widely accepted. FNMA assumes and
guarantees that all security holders will
receive timely payment of principal and
interest.

FEDERAL CREDIT AGENCIES:

Agencies of the Federal government set up to
supply credit to various classes of institutions
(e.g. S&L’s, Small business firms, students,
farmers, farm cooperatives, and exporters).

20 FEDERAL DEPOSIT INSURANCE
CORPORATION (FDIC): A Federal
agency that insures bank deposits, currently
up to $250,000 per deposit.

FEDERAL FUNDS RATE: The rate of
interest at which Fed funds are traded. This
rate is currently pegged by the Federal
Reserve through open-market operations.

FEDERAL HOME LOAN BANKS
(FHLB): The institutions that regulate and
lend to savings and loan associations. The
Federal Home Loan Banks play a role
analogous to that played by the Federal
Reserve Banks vis-a-vis member commercial
banks.

FEDERAL INSTRUMENTALITY
SECURITY: Debt issued by a government
sponsored enterprise that carries an implicit
guarantee of the United States
government. Examples of instrumentality
issuers include the Federal National
Mortgage Association (FNMA or Fannie
Mae), the Federal Home Loan Mortgage
Corporation (FHLMC or Freddie Mac), the
Federal Home Loan Banks (FHLB), and the
Federal Farm Credit Bank (FFCB).

FEDERAL OPEN MARKET
COMMITTEE (FOMC): Consists of seven
members of the Federal Reserve Board and
five of the twelve Federal Reserve Bank
Presidents. The President of the New York
Federal Reserve Bank is a permanent
member, while the other presidents serve on
a rotating basis. The Committee periodically
meets to set Federal Reserve guidelines
regarding purchases and sales of Government
Securities in the open market as a means of
influencing the volume of bank credit and
money.

FEDERAL RESERVE SYSTEM: The
central bank of the United States created by
Congress and consisting of a seven-member
Board of Governors in Washington, D.C.; 12
regional banks and about 5,700 commercial
banks are member of the system.

GINNIE MAE (GNMA): GNMA was
created by the United States Federal
Government through a 1968 partition of the
Federal National Mortgage Association to
provide guarantees on mortgage-backed
securities (MBS) backed by federally insured
or guaranteed loans. Ginnie Mae securities
are the only MBS that are backed by the full
faith and credit of by the United States
government.

LIQUIDITY: A liquid asset is one that can
be converted easily and rapidly into cash
without a substantial loss of value. In the
money market, a security is said to be liquid
if the spread between bid and asked prices is
narrow and reasonable size can be done at
those quotes.

LOCAL GOVERNMENT
INVESTMENT POOL: A local
government investment pool is an investment
option offered to public entities for the
aggregate investment of public funds from
political subdivisions. The funds are placed
in the custody of the manager, frequently a
State Treasurer, for investment and
reinvestment. These pools are investments
tools that offer safety with a competitive
yield and their managers are vested with a
public trust that the pool will maintain
liquidity, diversity, and follow the investment
pool’s guidelines.

MARKET VALUE: The price at which a
security is trading and could presumably be
purchased or sold.

MARKET REPURCHASE
AGREEMENT: A written contract covering
all future transactions between the parties to
repurchase reverse repurchase agreements
that establish each party’s rights in the
transactions. A master agreement will often
specify, among other things, the right of the
buyer-lender to liquidate the underlying
securities in the event of default by the sellerborrower.

MATURITY: The date upon which the
principal or stated value of an investment
becomes due and payable.

OFFER: The price asked by a seller of
securities. (When you are buying securities,

21 you ask for an offer.) See “Asked” and
“Bid”.

OPEN MARKET OPERATIONS:

Purchases and sales of government and
certain other securities in the open market by
the New York Federal Reserve Bank as
directed by the FOMC in order to influence
the volume of money and credit in the
economy. Purchases inject reserves into the
bank system and stimulate growth of money
and credit: Sales have the opposite effect.

Open market operations are the Federal
Reserve’s most important and most flexible
monetary policy tool.

PORTFOLIO: Collection of securities held
by an investor.

PRIMARY DEALER: A group of
government securities dealers who submit
daily reports of market activity and positions
and monthly financial statements to the
Federal Reserve Bank of New York and are
subject to its informal oversight. Primary
dealers include Securities and Exchange
Commission (SEC)-registered securities
broker/dealers, banks and a few unregulated
firms.

PRUDENT PERSON RULE: An
investment standard. In some states, the law
requires that a fiduciary, such as a trustee,
may invest money only in a list of securities
selected by the custody state--the so-called
“legal list”. In other states, the trustee may
invest in a security if it is one which would
be bought by a prudent person of discretion
and intelligence who is seeking a reasonable
income and preservation of capital.

RATE OF RETURN: The yield obtainable
on a security based on its purchase price or its
current market price. This may be the
amortized yield to maturity; on a bond, the
current income return.

REPURCHASE AGREEMENT (RP or
REPO): a holder of securities sells these
securities to an investor with an agreement to
purchase them at a fixed date. The security
“buyer” in effect lends the “seller” money for
the period of the agreement, and the terms of
the agreement are structured to compensate
him for this. Dealers use RP extensively to
finance their positions. Exception: When the
Fed is said to be doing RP, it is lending
money, that is, increasing bank reserves.

SAFEKEEPING: A service to customers
rendered by banks for a fee whereby
securities and valuables of all types and
descriptions are held in the bank’s vaults for
protection.

SECONDARY MARKET: A market made
for the purchase and sale of outstanding
issues following the initial distribution.

SECURITIES & EXCHANGE
COMMISSION: Agency created by
Congress to protect investors in securities
transactions by administering securities
legislation.

TREASURY BILLS: A non-interest
bearing discount security issued by the U.S.

Treasury to finance the national debt. Most
bills are issued to mature in three month, six
months or one year.

TREASURY BOND: Long-term U.S.

Treasury securities having initial maturities
of more than 10 years.

TREASURY NOTES: Intermediate-term
coupon bearing U.S. Treasury securities
having initial maturities of from one year to
ten years.

YIELD: The rate of annual income return on
an investment, expressed as a percentage. (a)
INCOME YIELD is obtained by dividing
the current dollar income by the current
market price for the security. (b) NET
YIELD or YIELD TO MATURITY is the
current income yield minus any premium
above par or plus any discount from par in
purchase price, with the adjustment spread
over the period from the date of purchase to
the date of maturity of the bond.

City Council
Meeting Minutes
Mark Turner - Mayor
Rene Spring - Mayor Pro Tem
Gino Borgioli - Council Member
Marilyn Librers - Council Member
Yvonne Martinez Beltran - Council Member
Wednesday, May 3, 2023 6:00 PM
Council Chamber Building
17555 Peak Avenue, Morgan Hill, CA 95037

CALL TO ORDER
Mayor Turner called the City Council meeting to order at 6:00 pm.

ROLL CALL ATTENDANCE
Deputy City Clerk Kim Mancera called the roll.

PRESENT Rene Spring, Gino Borgioli, Yvonne Martinez Beltran, Mark Turner, Marilyn Librers
ABSENT None

DECLARATION OF POSTING AGENDA
Deputy City Clerk Kim Mancera declared the posting of the agenda.

SILENT INVOCATION

PLEDGE OF ALLEGIANCE

RECOGNITION
Certificate of Recognition awarded to Michael Greymont for his outstanding volunteer

May 3, 2023
2 services and his success in bringing prestigious swim meets for both youth and adults to the Morgan Hill Dennis Kennedy Aquatics Center which has enhanced our Community’s aquatics legacy

PROCLAMATIONS
The month of May as Affordable Housing Month
The month of May as Water Safety Month
The month of May as National Older Americans Month
The month of May as Wildfire Awareness Month
The week of May 21 - 27, 2023 as Public Works Week
May 15, 2023 as Peace Officers Memorial Day and the week of May 14 - 20, 2023 as National Police Week

PRESENTATIONS
YAC Presentation - Asset #18
YAC Graduation Recognitions
PG&E Presentation
Public comment opened at 7:22 pm.

John McKay was called to speak.

There being no further requests to speak, public comment closed.

CITY COUNCIL REPORTS
Council Member Borgioli shared that he attended the Water Commission quarterly meeting where they provided an update on the drought and discussed water conservation. He also attended the Joint Water Resources Committee meeting in Gilroy where they discussed recycled water. He stated that Morgan Hill is working on accessing the pipeline from Gilroy in order to create a program for recycling water.

May 3, 2023
3 CITY MANAGER'S REPORT
City Manager Christina Turner recommended that item 4 be continued to the next regular City Council meeting. She invited the community to attend the Health and Wellness Resource Fair on Saturday, May 6, 2023, from 10:00 am to 1:00 pm, held at the Community and Cultural Center Outdoor Amphitheater. She invited the community to the Morgan Hill Open Streets event on May 13, 2023, on Monterey Road between Main Avenue and 4th Street. She also announced that the annual pride flag-raising ceremony will take place on Thursday, June 1, 2023, at 6:00 pm at the Civic Center Plaza.

CITY ATTORNEY'S REPORT
None.

OTHER REPORTS
None.

PUBLIC COMMENT
Public comment opened at 7:31 pm. There being no requests to speak, public comment closed.

ADOPTION OF AGENDA
MOTION:

Adopting the agenda as posted.

RESULT: Passed
MOVER: Council Member Borgioli
SECONDER: Council Member Martinez Beltran
AYES: Mayor Pro Tem Spring, Council Member Borgioli, Council Member Martinez Beltran, Mayor Turner, Council Member Librers
NAYS: None
ABSTAIN: None
ABSENT: None

CONSENT CALENDAR
Items appearing on the Consent Calendar are considered routine and may be approved

May 3, 2023
4 by one motion. Pursuant to City Council Policies and Procedures (CP 97-01), any member of the Council or public may request to have an item removed from the Consent Calendar for comment and action.

Time estimate for Consent Calendar: 1 - 10 minutes
MOTION:

Approving consent items 2, 3, and 5 through 7.

RESULT: Passed
MOVER: Council Member Martinez Beltran
SECONDER: Council Member Borgioli
AYES: Mayor Pro Tem Spring, Council Member Borgioli, Council Member Martinez Beltran, Mayor Turner, Council Member Librers
NAYS: None
ABSTAIN: None
ABSENT: None

2. APPROVE CONSULTANT AGREEMENT WITH GRIFFIN STRUCTURES, INC.

IN THE AMOUNT OF $115,000 FOR MASTER PLANNING AND PHASING

OF IMPROVEMENTS AT THE CORPORATION YARD
Recommendation:

Authorize the City Manager to execute and administer a consultant agreement with Griffin Structures, Inc. for Master Planning and Phasing of improvements at the Corporation Yard.

3. APPROVE SECOND AMENDMENT TO THE AGREEMENT FOR

COUNTYWIDE HOUSEHOLD HAZARDOUS WASTE COLLECTION

PROGRAM
Recommendation:

Authorize the City Manager to execute the Second Amendment to the Agreement for the Countywide Household Hazardous Waste Collection Program.

5. APPROVE THE APRIL 19, 2023 CITY COUNCIL MEETING MINUTES Recommendation:

Approve the April 19, 2023 City Council Meeting Minutes

6. INITIATE ANNUAL ASSESSMENT PROCESS FOR LANDSCAPE
ASSESSMENT DISTRICT NUMBER 1
Recommendation:

Adopt resolutions approving the following actions:

May 3, 2023
5 1. Initiate the proceedings for the levy of assessments for Fiscal Year 2023- 24;

2. Approve the Engineer's Annual Report and the proposed assessment levy; and

3. Declare the City Council's intention to levy the assessments in the District and to set the Public Hearing date for June 7, 2023.

7. REAPPOINT FOUR (4) COMMISSIONERS TO THE PLANNING COMMISSION Recommendation:

Reappoint Commissioners Joseph Mueller, Liam Downey, Wanye Tanda, and Paul Lake to the Planning Commission with terms ending June 1, 2027.

ITEM PULLED FOR DISCUSSION

1. ADOPT A RESOLUTION DECLARING THE END OF LEVEL 4 WATER

SUPPLY SHORTAGE
Recommendation:

Adopt a resolution declaring the end of the Level 4 Water Supply Shortage.

Public Services Director Chris Ghione and Environmental Program Administrator Tanya Carothers answered questions.

Public comment opened at 7:43 pm. There being no requests to speak, public comment closed.

MOTION:

Approving the recommended action.

RESULT: Passed
MOVER: Council Member Borgioli
SECONDER: Council Member Martinez Beltran
AYES: Mayor Pro Tem Spring, Council Member Borgioli, Council Member Martinez Beltran, Mayor Turner, Council Member Librers
NAYS: None
ABSTAIN: None
ABSENT: None
The meeting recessed at 7:44 pm and reconvened at 7:52 pm.

May 3, 2023
6 ITEM PULLED FROM THE AGENDA

4. APPROVE UPDATE TO THE CITY'S DONATION POLICY
Recommendation:

Accept changes to the City's Donation Policy
Item continued to the next regular City Council Meeting.

PUBLIC HEARINGS

8. APPROVE SOLID WASTE MANAGEMENT RATE ADJUSTMENT FOR 2023 Recommendation:

Adopt resolution approving an adjustment in the maximum allowable solid waste charges effective July 1, 2023.

Environmental Program Administrator Tanya Carothers provided a report and presentation.

The public hearing opened at 8:10 pm. There being no requests to speak, the public hearing closed.

MOTION:

Approving the recommended action.

RESULT: Passed
MOVER: Council Member Librers
SECONDER: Mayor Pro Tem Spring
AYES: Mayor Pro Tem Spring, Council Member Borgioli, Council Member Martinez Beltran, Mayor Turner, Council Member Librers
NAYS: None
ABSTAIN: None
ABSENT: None

OTHER BUSINESS

9. ACCEPT THE MORGAN HILL POLICE DEPARTMENT'S ANNUAL MILITARY

EQUIPMENT USE REPORT
Recommendation:

Accept the Morgan Hill Police Department's Annual Military Equipment Use Report.

Captain Mario Ramirez and Police Chief Shane Palsgrove provided a report and presentation.

May 3, 2023
7 Public comment opened at 8:29 pm. There being no requests to speak, public comment closed.

Report Received.

10. ADOPT ORDINANCE PROHIBITING POSSESSION OF FIREARMS IN

SENSITIVE PLACES
Recommendation:

1. Open/Close the Public Hearing; and

2. Waive the First and Second Reading; and

3. Introduce ordinance prohibiting the carrying of firearms in sensitive places Captain Mario Ramirez and Chief Shane Palsgrove provided a report and presentation.

Public comment opened at 8:42 pm. There being no requests to speak, public comment closed.

MOTION:

Waiving the first and second readings of the ordinance.

RESULT: Passed
MOVER: Mayor Pro Tem Spring
SECONDER: Council Member Borgioli
AYES: Mayor Pro Tem Spring, Council Member Borgioli, Council Member Martinez Beltran, Mayor Turner, Council Member Librers
NAYS: None
ABSTAIN: None
ABSENT: None
MOTION:

Introducing the ordinance.

RESULT: Passed
MOVER: Mayor Pro Tem Spring
SECONDER: Council Member Martinez Beltran
AYES: Mayor Pro Tem Spring, Council Member Borgioli, Council Member Martinez Beltran, Mayor Turner, Council Member Librers
NAYS: None
ABSTAIN: None

May 3, 2023
8 ABSENT: None

11. RECEIVE MONTHLY BUDGET UPDATE AND CITY MANAGER AUTHORITY REPORT; ADOPT FISCAL YEAR 2022-23 AND 2023-2024 MID-CYCLE

BUDGET AMENDMENTS, INCLUDING COMMUNITY FUNDING
RECOMMENDATIONS; APPROVE A FIVE-YEAR AGREEMENT WITH CAL FIRE; DELEGATE THE AUTHORITY TO THE CITY MANAGER TO MAKE ALL

FUTURE EQUIPMENT REPLACEMENT PURCHASES AS APPROVED IN THE BUDGET; AND APPROVE AN UPDATE TO ELECTRIC VEHICLE CHARGING

STATION USER FEES
Recommendation:

1. Accept and file the monthly financial and investment report;

2. Adopt resolution authorizing changes to the adopted Fiscal Year (FY) 2022-23 and 2023-24 budgets;

3. Approve the FY 2023-24 Community Funding recommendations;

4. Authorize the City Manager to enter into a five-year agreement with the California Department of Forestry and Fire Protection (CAL FIRE) to provide fire and emergency medical response services effective July 1, 2023 through June 30, 2028;

5. Delegate the authority to the City Manager to make all future vehicle and equipment purchases as approved in the adopted budget; and

6. Approve an update to the City's electric vehicle (EV) charging station user fees and delegate the authority to the City Manager to update all future EV user fee schedules.

Budget Manager Monica Delgado provided a report and presentation.

Public comment opened at 9:14 pm. The following people were called to speak:

Nick Gaich
Brian Sullivan
Mathew Stein
Delia Gomez (Zoom)
Tracy Wingrove (Zoom)
There being no further requests to speak, public comment closed.

MOTION:

Approving the recommended actions.

RESULT: Passed
MOVER: Council Member Borgioli
SECONDER: Mayor Pro Tem Spring
AYES: Mayor Pro Tem Spring, Council Member Borgioli, Council Member Martinez Beltran, Mayor Turner, Council Member Librers

May 3, 2023
9 NAYS: None
ABSTAIN: None
ABSENT: None

12. PROVIDE DIRECTION TO STAFF ON PROPOSED FUTURE COUNCIL

INITIATED AGENDA ITEMS
Recommendation:

Determine if the majority of the City Council wants the following items agendized at a future meeting for discussion:

1. Managing and counting 'abstain' votes by City Council Members;

2. Considering a noise ordinance to address rooster noises in urban neighborhoods;

3. Charging credit card fees on all City services; and

4. Considering an ordinance prohibiting smoking in multi-unit properties.

City Manager Christina Turner provided a report.

Public comment opened at 9:50 pm. The following people were called to speak:

Doug Muirhead
Judy Scovel
Bryan Lack
Jodi Johnson
There being no further requests to speak, public comment closed.

The City Council voted 5-0 to direct staff to bring back an item regarding managing and counting 'abstain' votes by City Council Members. Ayes: 5 (Turner, Spring, Librers, Borgioli, Martinez Beltran), Noes: 0.

The City Council voted 3-2 to direct staff to bring back an item considering a noise ordinance to address rooster noises in urban neighborhoods. Ayes: 3 (Turner, Spring, Borgioli), Noes: 2 (Librers, Martinez Beltran) The City Council voted 4-1 to direct staff to bring back an item regarding charging credit card fees on all City services. Ayes: 4 (Turner, Spring, Librers, Borgioli), Noes: 1 (Martinez Beltran)
The City Council voted 5-0 to direct staff to bring back an ordinance considering prohibiting smoking in multi-unit properties. Ayes: 5 (Turner, Spring, Librers, Borgioli, Martinez Beltran), Noes: 0

FUTURE COUNCIL INITIATED AGENDA ITEMS
Council Member Librers requested a discussion on our policy regarding cut-off time for public comment supplements.

May 3, 2023
10 Council Member Martinez Beltran requested a discussion on festival safety and fencing, a discussion on capital improvements and maintenance, and a discussion on community promotion funds.

Council Member Spring requested a discussion on fee structures for room rentals at the Community and Cultural Center and a discussion on term limits for Council Members and Commissioners.

ADJOURNMENT
There being no further business, Mayor Turner adjourned the meeting at 10:09 pm.

Minutes Prepared by:

Kim Mancera, Deputy City Clerk

8 CITY COUNCIL STAFF REPORT
MEETING DATE: June 7, 2023
PREPARED BY:

Yat Cho, Senior Project Manager
APPROVED BY: City Manager
AWARD 2023 PAVEMENT REHABILITATION PROJECT TO MCKIM
CORPORATION IN THE AMOUNT OF $3,948,023

RECOMMENDATION(S)

1. Approve 2023 Pavement Rehabilitation Project plans and specifications;

2. Award contract to McKim Corporation for the 2023 Pavement Rehabilitation Project in the amount of $3,948,023;

3. Authorize expenditure of construction contingency not to exceed $394,802; and

4. Authorize the City Manager to execute and administer the construction contract with McKim Corporation.

COUNCIL PRIORITIES, GOALS & STRATEGIES
City Council Ongoing Priorities
Enhancing Public Safety
Maintaining and Enhancing Infrastructure
2022-2023 Strategic Priorities
Fiscal Sustainability
Transportation
Guiding Documents
Bikeways, Trails, and Recreation Master Plan
REPORT NARRATIVE:

The City conducts a significant pavement rehabilitation project to improve the pavement conditions within the City and 2023 is not an exception. The 2023 Pavement Rehabilitation Project includes the resurfacing of the following streets:

La Crosse Drive
La Rena Court
La Roda Court
La Mirada Court
La Porte Court
La Prenda Court

8 La Escuela Court
Descansa Court
El Pajaro Court
La Mesa Court
La Sierra Court
La Honda Court
La Jolla Court
La Mar Court
La Bella Court
East Middle Avenue between Monterey Road to Railroad Tracks Main Avenue between Monterey Road to Butterfield Boulevard Oak View Circle
Oak View Court
The project's scope of work is described as follows but not limited to: Pavement Milling and Filling, Hot Mix Asphalt Concrete Overlay, Full Depth Asphalt Concrete Pavement Repairs, Crack Sealing, Replacement of all Existing Traffic Delineation and Markings, Utility Adjustments, Traffic Signal Loop Removal and Restoration, and all related work within the City Limits.

The plans and specifications were completed in April, 2023 and the bid opening was held on May 3, 2023. Three (3) bids were received and are as listed below:

McKim Corporation $3,948,022.99
Graniterock Company $3,961,184.00
O'Grady Paving, Inc. $5,027,336.15
McKim Corporation's bid amount of $3,948,022.99 is approximately 31% higher than the engineer's estimate of $3,025,000. The low bidder, McKim Corporation, is an experienced public contractor with many years of paving construction experience. Staff recommends the award of the contract to McKim Corporation in the amount of $3,948,023. Due to unforeseen conditions for paving work, staff is requesting a ten (10) percent construction contingency for this project ($394,802). This project is scheduled to start in July 2023 and be completed by October 2023.

The plans and specifications are available for review on the City's webpage under the Government tab and Community Projects site: https://www.morganhill.ca.gov/1436/Project-Plans-Specifications-and-Bid-Res.

COMMUNITY ENGAGEMENT:

Due to the nature of paving projects, there will be possible roadway closures or reroutes for nearby residences and business owners. The Project Engineer, contractor and other staff members will maximize our communication efforts prior to and during the construction of the project through citywide emails, social media posts, and routine updates on the website. Updates will be made frequently to inform the community of impacts, roadway closures and possible interruptions that may arise due to construction.

8 ALTERNATIVE ACTIONS:

City Council may elect to reject all bids for this pavement rehabilitation project and direct staff to rebid the project. Rebidding the project would require City Council award and approval in July for the work to occur and be completed in 2023. Alternatively, the City Council may reject all bids and delay project construction to the summer of 2024. Staff does not recommend either of these alternatives as this project was competively bid with three bids received by the City. Furthermore, it will be unlikely to result in any significant savings and will delay the project for a minimum of three months.

PRIOR CITY COUNCIL AND COMMISSION ACTIONS:
• On June 15, 2022, the City Council adopted the FY2022-23 through 2027-28 Capital Improvement Program Project Budget.
• On April 19, 2023, the City Council received an Update Regarding Pavement Rehabilitation Planning.

FISCAL AND RESOURCE IMPACT:

If approved, the total authorization for this project shall be $4,342,825, which includes a 10% contingency of $394,802. There are sufficient funds within the adopted FY2022-23 and FY2023-24 budgets for this project.

CEQA (California Environmental Quality Act):

Categorical Exemption
The activities described in this Staff Report are categorically exempt under CEQA, specifically pursuant to Section 15301 of the CEQA Guidelines (Existing Facilities), as the subject work involves the repair, maintenance, or minor alteration of existing City facilities involving negligible or no expansion of use of those facilities.

G:\R-14\Proj\GIS\Agustin\2022 pvmnt.mxd
Engineering and Utilities Department
CIP Engineering Division
2023 PAVEMENT

REHABILITATION PROJECT O
820 0 820 1,640 2,460 410
Feet
Sources: Esri, HERE, Garmin, USGS, Intermap, INCREMENT P, NRCan, Esri Japan, METI, Esri China (Hong Kong), Esri Korea, Esri (Thailand), NGCC, (c) OpenStreetMap contributors, and the GIS User Community
La Crosse Drive
La Roda Ct
La Rena Ct
La Mesa Ct
La Sierra Ct
La Bella Ct
La Mar Ct
La Honda Ct
Descansa Ct
El Pajaro Ct
La Escuela Ct
La Porte Ct
La Jolla Ct
La Prenda Ct
La Miranda Ct
1 of 3

G:\R-14\Proj\GIS\Agustin\2022 pvmnt.mxd
Engineering and Utilities Department
CIP Engineering Division
2023 PAVEMENT

REHABILITATION PROJECT O
820 0 820 1,640 2,460 410
Feet
Sources: Esri, HERE, Garmin, USGS, Intermap, INCREMENT P, NRCan, Esri Japan, METI, Esri China (Hong Kong), Esri Korea, Esri (Thailand), NGCC, (c) OpenStreetMap contributors, and the GIS User Community
East Main Avenue
Sources: Esri, HERE, Garmin, USGS, Intermap, INCREMENT P, NRCan, Esri Japan, METI, Esri China (Hong Kong), Esri Korea, Esri (Thailand), NGCC, (c) OpenStreetMap contributors, and the GIS User Community
East Middle Avenue
2 of 3

3 of 3

9 CITY COUNCIL STAFF REPORT
MEETING DATE: June 7, 2023
PREPARED BY:

Yat Cho, Senior Project Manager
APPROVED BY: City Manager
AWARD BUTTERFIELD FIRE STATION PROJECT TO LARRY S. KENT, INC. DBA KENT CONSTRUCTION IN THE AMOUNT OF $7,956,553

RECOMMENDATION(S)

1. Adopt resolution amending the Fiscal Year 2022-23 Budget and appropriating an additional $2,250,000 to fund the Butterfield Fire Station Project;

2. Authorizing an interfund loan to Public Safety Facilities Impact Fund (315) of $7,750,000 from Local Drainage Impact Fund (303) ($5,750,000), Park Maintenance Fund (302) ($1,000,000), and Public Facilities Fund (347) ($1,000,000);

3. Approve the Butterfield Fire Station Plans and Specifications;

4. Award contract to Larry S. Kent, Inc. DBA Kent Construction in the amount of $7,956,553;

5. Authorize expenditures of construction contingency funds not to exceed $795,655; and

6. Authorize the City Manager to execute and administer the construction contract with Larry S. Kent, Inc. DBA Kent Construction.

COUNCIL PRIORITIES, GOALS & STRATEGIES
City Council Ongoing Priorities
Enhancing Public Safety
Maintaining and Enhancing Infrastructure
2022-2023 Strategic Priorities
Fiscal Sustainability
Guiding Documents
Fire Services Standards of Coverage
Morgan Hill 2035 General Plan
Public Safety Master Plan
REPORT NARRATIVE:

Background
In the Public Safety Master Plan and Fire Standards of Coverage documents, it was

9 recommended that a third fire station be designed and constructed. In the dissolution of the former Redevelopment Agency (RDA), a settlement agreement allowed the City to retain the property on Butterfield Boulevard (former location of the skatepark and community garden) for the construction of the recommended third fire station (Attachment 1 - Vicinity Map). Furthermore, the agreement requires that construction of fire station related facilities on the property be completed by August 2024 in order for the City to retain the property.

On December 1, 2021, City Council approved an agreement with Jeff Katz Architects (now known as COAR Design Group) to begin the design of the Butterfield Fire Station Project. Upon the execution of the agreement, COAR Design Group held a kick-off meeting to further understand the needs from both Cal Fire and the City's perspective.

During the preliminary design process, the project budget and the August 2024 completion date were identified as the two main project challenges. While the initial conceptual design yielded a fire station with most of the requested amenities, the construction cost estimate of $11 million exceeded the funds available to build the fire station. COAR Design Group and staff held subsequent meetings to discuss cost savings for building type, size, needs, amenities, and scheduling for the project. The result was a final conceptual design that was presented to the City Council at a construction cost of $7.5 million, excluding solar and microgrid systems.

On November 2, 2022, City Council approved the conceptual design for the Butterfield Fire Station Project and COAR Design Group proceeded with the design development and construction document preparation for the project.

Bids Received
The plans and specifications were completed in March 2023 and the project was advertised for bidding starting April 7, 2023. The scope of work for this project includes but is not limited to: Site demolition of existing flatwork and existing landscaping, installation and construction of a new 6,065 square feet single story stucco finished wood framed fire station, surrounding site work and ADA parking upgrades. Due to budget constraints, the best course of bidding on this project is through a base bid and multiple additive alternatives. The base bid is to construct the Butterfield Fire Station with five additives to further enhance the project. The description of the five additive alternatives is as follows:

Additive Alternate #1 - Covered Parking Lot
Additive Alternative #2 - Solar on Building
Additive Alternative #3 - Solar on Parking Lot
Additive Alternative #4 - Concrete Hose Drying Rack
Additive Alternate #5 - Microgrid System
The bid opening was held on May 11, 2023 and one bid was received:

9 Larry S. Kent,
Inc. DBA
Kent
Construction
Base Bid $
6,854,875
Alternate #1: Covered Parking
Lot
$
156,046
Alternate #2: Solar On
Building
$
214,276
Alternate #3: Solar on Parking
Lot
$
229,028
Alternate #4: Concrete Hose
Drying Rack
$
28,092
Alternate #5: Micro Grid
System
$
474,236
Subtotal $
7,956,553
The bid proposal received was structured such that the lowest responsible base bid was the lowest responsible bidder. During the bidding process, there were three to four general contractors with a strong interest in this project. It is possible that project schedule concerns and workforce constraints led to one bid proposal at the bid opening.

The apparent lowest responsible bidder and only bidder was Larry S. Kent, Inc. DBA Kent Construction.

Kent Construction's base bid of $6,854,875 is approximately 9 percent lower than the engineer's estimate of $7.5 million. Kent Construction is an experienced contractor with many years of experience in construction. Staff recommends the award of this project with Additive Alternates #1,#2, #3, #4, and #5 for a total of $7,956,553. It is important to note that the alternatives supporting the development of solar and a microgrid system will reduce energy needs, resulting in reduced energy costs of over $10,000 annually.

The project is scheduled to begin in July 2023 and is expected to be complete by July 2024, assuming no significant delays.

The plans and specifications are available for review on the City's webpage under the Government tab and Community Projects site: https://www.morganhill.ca.gov/1436/Project-Plans-Specifications-and-Bid-Res.

COMMUNITY ENGAGEMENT:

Inform
There have been previous discussions and engagement regarding the Public Safety Master Plan and Standards of Coverage. The City Council has discussed this project at Council workshops, budget workshops, and other meetings. During construction, staff will be providing regular updates through media, social media, and the City's website.

9 ALTERNATIVE ACTIONS:

City Council may elect not to award the project to Larry S. Kent, Inc. DBA Kent Construction and direct staff to re-bid the project in hopes of obtaining lower bid proposals. However, this does not ensure that lower bid proposals will be received at the time of the re-bid. Additionally, re-bidding the project will cause a minimum delay of four months.

PRIOR CITY COUNCIL AND COMMISSION ACTIONS:
• February 22, 2017 - City Council received and reviewed Public Safety Master Plan.
• December 4, 2019 - City Council received and reviewed the Hazard Risk Assessment and Standards of Coverage Study.
• December 1, 2021 - City Council authorized the City Manager to execute and administer an agreement with Jeff Katz Architecture for the design of the Butterfield Fire Station Project.
• November 2, 2022 - City Council approved conceptual design for the Butterfield Fire Station Project
• March 15, 2023 - City Council approved acceptance of a grant from Silicon Valley Clean Energy for $500,000 to be used towards the project, specifically as an all electric fire station demonstration site.

FISCAL AND RESOURCE IMPACT:

If approved as recommended, the contract amount for the construction portion of this project with Larry S. Kent, Inc. DBA Kent Construction is $7,956,553. Additionally, staff is requesting a 10% construction contingency for this project in the amount of $795,655 for a construction contract total cost of $8,752,208. Including other project expenses such as project administration, inspections, permit fees, furnishings, fixtures, equipment, the grant funded demonstration area, and other construction related expenses, the overall total project cost for construction is $10.25 million.

There is currently $8.0 million appropriated and available for construction of the facility within the current budget within the Public Facilities Safety Fund (315). An additional appropriation of $2.25 million is necessary to fund the project.

The City has always projected the need to borrow money to construct the Fire Station.

There is currently approximately $2.5 million in available funds within the Public Safety Facilities Impact Fund (315) for the third fire station construction. Therefore, staff is proposing an interfund loan of $7.75 million from the following areas: Local Drainage Impact Fund (303) - $5.75 million, Park Maintenance Fund (302) - $1.0 million, and Public Facilities Fund (347) - $1.0 million. Use of these funds for loans will be reduced should the contingency not be expended or should additional revenue come into the Public Safety Impact Fund during construction.

9 City staff recently received the Silicon Valley Clean Energy Decarbonization Grant Program in the amount of $500,000 for this project to employ decarbonization efforts through electrification of a public facility and educating the community about the benefits and ultimate goals of this effort. These funds shall be available via reimbursement and associated expenses are included in the $10.25 million project cost.

CEQA (California Environmental Quality Act):

Categorical Exemption
The City engaged Raney Planning & Management to evaluate the proposed Butterfield Boulevard Fire Station Project to determine whether the proposed project is exempt from review under CEQA. This review (Attachment 2) concluded the project does qualify for a Class 32 exemption for infill development.

County of Santa Clara, Sanborn
Engineering and Utilities Department
CIP Engineering Division

BUTTERFIELD FIRE STATION

PROJECT
Document Path: G:\R-14\PROJ\Agustin\GIS\Butterfield Fire Station.mxd O
0 160 320 480 640 80
Feet
Depot St
Butterfield Blvd
Diana Ave
Project Location

City of Morgan Hill
Development Services Department
Butterfield Boulevard Fire Station Project
Categorical Exemption Memorandum
May 2023
Prepared by
1501 Sports Drive, Suite A, Sacramento, CA 95834

Butterfield Boulevard Fire Station Project
Categorical Exemption Memorandum
Page i
May 2023

TABLE OF CONTENTS
A. Introduction and Summary .............................................................................................1 B. Project Description..........................................................................................................1 C. Discussion........................................................................................................................7 D. Conclusion .....................................................................................................................22

FIGURES
Figure 1 Regional Project Location ...............................................................................................3 Figure 2 Project Vicinity Map.........................................................................................................4 Figure 3 Conceptual Site Plan.......................................................................................................5 Figure 4 Building Elevations Plan..................................................................................................6 TABLES
Table 1 BAAQMD Thresholds of Significance.............................................................................11 Table 2 Maximum Construction Emissions (lbs/day) ..................................................................12 Table 3 Unmitigated Maximum Operational Emissions...............................................................13

APPENDICES
Appendix A: Air Quality and Greenhouse Gas Modeling Results Appendix B: Phase I Environmental Site Assessment

Butterfield Boulevard Fire Station Project
Categorical Exemption Memorandum

May 2023
A. INTRODUCTION AND SUMMARY
In July 2016, the City of Morgan Hill adopted the 2035 General Plan,1 as well as an associated Environmental Impact Report (EIR) for the updated General Plan.2 The General Plan EIR is a program EIR, prepared pursuant to Section 15168 of the California Environmental Quality Act (CEQA) Guidelines (Title 14, California Code of Regulations [CCR], Sections 15000 et seq.). The General Plan EIR analyzed full implementation of the General Plan and identified measures to mitigate the significant adverse impacts associated with the General Plan.

Section 21084 of the Public Resources Code (PRC) requires the CEQA Guidelines to include a list of classes of projects which have been determined not to have a significant effect on the environment and which shall, therefore, be exempt from the provisions of CEQA. In response to that mandate, the Secretary of the Natural Resources Agency has found that several classes of projects listed in Article 19 do not have a significant effect on the environment and, thus, are declared to be categorically exempt from the requirement for the preparation of environmental documents.

The purpose of this Memorandum is to evaluate the Butterfield Boulevard Fire Station Project (proposed project) to determine whether the proposed project is exempt from review under CEQA.

As will be demonstrated below, the proposed project can be considered exempt from CEQA, consistent with CEQA Guidelines Section 15332, In-Fill Development Projects. In addition, none of the exceptions to categorical exemptions specified by CEQA Guidelines Section 15300.2 are applicable to the proposed project.

B. PROJECT DESCRIPTION
The following provides background information on the proposed project, as well as a description of the project site’s current location and setting, the proposed project components, and discretionary actions required for the project.

Project Background
In November 2018, a Standards of Coverage Study (SOC) was commissioned by the cities of Morgan Hill, Gilroy, and the South County Fire Protection District.3 The SOC included a threeyear historical assessment of emergency types, as well as an analysis of the risk of incident types occurring on the community, current resource deployment in the South County, and the ability to deliver adequate staffing to meet rapidly escalating incidents throughout the South County. The SOC also included evaluation of potential future changes to the allocation of facilities, personnel, and delivery models. As discussed within the SOC, only 75 percent of the City’s public road network is currently reachable within 4:00 minutes of travel time without traffic congestion, and only 30 percent is reachable within the 8:00-minute Effective Response Force (ERF) travel time without congestion. One of the City’s primary takeaways of the analysis included in SOC was the need for a third fire station within the City of Morgan Hill, and confirmation that the proposed location of the facility on Butterfield Boulevard and Diana Avenue to be an appropriate location.

As shown in Table 23 of the SOC, constructing the proposed fire station was assumed to improve 4:00-minute first-due travel time coverage by seven percent, and 8:00-minute ERF travel time coverage by almost 63 percent. As a result, the proposed project has been included within the City’s most recent Capital Improvement Program (CIP).
1 City of Morgan Hill. 2035 General Plan, City of Morgan Hill. Adopted July 2016. 2 City of Morgan Hill. Morgan Hill 2035 Final Environmental Impact Report. Adopted July 2016. 3 City of Gilroy, City of Morgan Hill, and South Santa Clara County Fire District. Standards of Coverage Assessment.

November 14, 2019

Butterfield Boulevard Fire Station Project
Categorical Exemption Memorandum

May 2023
Project Location and Setting
The approximately 0.91-acre project site, identified by Assessor’s Parcel Number (APN) 726-15- 072, is located at 17285 Butterfield Boulevard in the City of Morgan Hill, California (see Figure 1 and Figure 2). The project site is currently undeveloped, consisting primarily of ruderal grasses as well as an existing concrete slab, which was previously used as a community garden.

Surrounding existing land uses include single-family residences to the north, across Butterfield Boulevard; the Santa Clara County Superior Courthouse and associated parking lot to the east; the Courthouse Plaza Garden, Caltrain railroad tracks, Railroad Park, and multi-family residences to the south; and the Morgan Hill Caltrain Station and associated park-and-ride lot to the northwest.

The City of Morgan Hill designates the project site as Public Facilities and the site is zoned Public Facilities (PF).

Project Components
The proposed project would include construction of a 5,800-square foot (sf) fire station (see Figure 3). The fire station would include office space and a fire engine garage with four high-speed overhead coiling doors. The maximum height of the proposed fire station building would be 21.5 feet (see Figure 4). The fire station would be staffed by three full-time employees per day, with the possibility for four employees to be present on-site three days a week if the City Deputy Fire Marshal needs a facility outside City Hall.

Fire engines would exit the station garage by way of a new driveway off of Butterfield Boulevard and would return to the garage by way of an existing driveway off of Butterfield Boulevard, located east of the proposed fire station. Butterfield Boulevard north of the fire engine exit would be painted to include “Keep Clear” roadway markings, which would allow for the safe exit of fire engines from the project site. Site access for personal vehicles would be provided by the existing Butterfield Boulevard driveway and an on-site staff parking lot with a total of six parking stalls would be provided south of the fire station. In addition, the proposed project would include new striping within the existing park-and-ride parking lot to the northwest of the site to provide five public parking spaces, including one van-accessible, Americans with Disabilities Act (ADA)- compliant space. An ADA-compliant ramp would be constructed from the park-and-ride parking lot to the existing sidewalk along Butterfield Boulevard in order to provide pedestrian access to the fire station.

Landscaping improvements, including new trees, shrubs, grasses, vines, and ground cover would be provided throughout the project site. Plant selection would be in accordance with Section

18.64.060 (General landscape requirement) of the Morgan Hill Municipal Code, which requires that a minimum of 90 percent of plants and trees be drought-tolerant, with the City preferring native plants adapted to the local climate. It should be noted that the project site does not currently contain any existing trees.

Water and sewer service for the proposed project would be provided by the City through connections to existing pipelines within Butterfield Boulevard. Stormwater runoff within the project site would be directed into three proposed bioretention areas located throughout the site.

Electricity service for the proposed project would be provided by Pacific Gas & Electric Company (PG&E) by way of existing electrical infrastructure in the project vicinity. The project would not use natural gas, as natural gas is prohibited in all new construction, pursuant to Morgan Hill Municipal Code Chapter 15.63.

Butterfield Boulevard Fire Station Project
Categorical Exemption Memorandum

May 2023
Figure 1
Regional Project Location
Approximate
Project Location

Butterfield Boulevard Fire Station Project
Categorical Exemption Memorandum

May 2023
Figure 2
Project Vicinity Map

Butterfield Boulevard Fire Station Project
Categorical Exemption Memorandum

May 2023
Figure 3
Conceptual Site Plan

Butterfield Boulevard Fire Station Project
Categorical Exemption Memorandum

May 2023
Figure 4
Building Elevations Plan

Requested/Required Entitlements
The proposed project would require the City’s approval of the following discretionary entitlement:
• Design Permit.

The purpose of the Design Permit is to allow the City to review all development, signs, buildings, structures, and other facilities in order to further enhance the City’s appearance, as well as the usefulness of the proposed project.

C. DISCUSSION
The following section contains substantial evidence showing that the proposed project can be considered exempt from CEQA and is not subject to any of the exceptions set forth in Section 15300.2 of the CEQA Guidelines. As demonstrated in the analysis below, the proposed project qualifies for exemption under CEQA Guidelines Section 15332, Class 32.

In-Fill Development Project Exemption
Article 19 of the CEQA Guidelines, Sections 15300 through 15333, includes a list of classes of projects that have been determined to not have a significant effect on the environment, and are therefore exempt from CEQA. Section 15332 of the CEQA Guidelines provides a categorical exemption for infill development projects that meet the following criteria:
(a) The project is consistent with the applicable general plan designation and all applicable general plan policies as well as with applicable zoning designation and regulations. (b) The proposed development occurs within the city limits on a project site of no more than five acres substantially surrounded by urban uses. (c) The project site has no value as habitat for endangered, rare or threatened species. (d) Approval of the project would not result in any significant effects relating to traffic, noise, air quality, or water quality.
(e) The site can be adequately served by all required utilities and public services.

The applicability of the above criteria to the proposed project is described in the following sections.

Criterion 15332(a): General Plan and Zoning Consistency The City of Morgan Hill General Plan designates the project site as Public Facilities and the site is zoned PF. The Public Facilities designation is applied to land used by public or quasi-public agencies and organizations including the City, hospitals, utility companies, and the Morgan Hill Unified School District. This designation allows a maximum Floor Area Ratio (FAR) of 0.5. The proposed project would include development of a 5,800-sf fire station on the approximately 0.91- acre project site, for a FAR of 0.15. As such, the project would be consistent with the land use designation and the maximum allowable FAR.

With regard to zoning, according to Section 18.28.010 of the City’s Municipal Code, the purpose of the PF zoning district is to provide a location for schools, governmental offices, parks and recreational facilities, fire and police stations, utilities, and other public and quasi-public facilities to serve the community. The proposed project would be consistent with the PF zoning designation and would comply with the development standards established for the PF district pursuant to Section 18.28.030 of the Municipal Code.

The proposed project would also comply with applicable General Plan policies and zoning regulations adopted for the purpose of avoiding and/or mitigating adverse environmental effects, as demonstrated in this Memorandum.

Based on the above, the proposed project meets Criterion 15332(a).

Criterion 15332(b): Project Location, Size, and Context The project site is comprised of approximately 0.91 acre within the City limits and is bound by Butterfield Boulevard to the northeast. As discussed, the site is surrounded by existing development on all sides. Therefore, the proposed project meets the provisions of Criterion 15332(b).

Criterion 15332(c): Endangered, Rare, or Threatened Species The project site is located within the boundaries of the Santa Clara Valley Habitat Plan (SCVHP) permit area. The SCVHP was developed through a partnership between Santa Clara County, the cities of San José, Morgan Hill, and Gilroy, the Santa Clara Valley Water District (SCVWD), the Santa Clara Valley Transportation Authority (VTA), the U.S. Fish and Wildlife Service (USFWS), and the California Department of Fish and Wildlife (CDFW). The SCVHP provides a framework for promoting the protection and recovery of natural resources, including endangered species, while streamlining the permitting process for planned development, infrastructure, and maintenance activities, and allows participating member agencies, including the City of Morgan Hill, to receive endangered species permits for activities and projects they conduct and those under their jurisdiction. Take authorization is provided through the SCVHP for 18 Covered Species and includes conservation measures to protect Covered Species, as well as a conservation strategy designed to mitigate impacts on covered species and contribute to the recovery of the species in the study area.

Pursuant to the Santa Clara Valley Habitat Agency Geobrowser, the entirely of the project site consists of Urban - Suburban land cover.4 As set forth by Morgan Hill Municipal Code Section

18.132.050, compliance with the SCVHP requires payment of fees according to the Fee Zone designation of the property, payment of nitrogen deposition fees related to the number of anticipated car trips resulting from the development, and any surcharge fees that are required based on site-specific impacts to sensitive habitats or sensitive species. The Urban - Suburban land cover is not subject to SCVHP land cover fees. In addition, pursuant to the Geobrowser Property Report for the project site, fee zones and/or survey areas are not identified for the project site related to sensitive habitats or species. However, the project would be subject to payment of nitrogen deposition fees.

The project site currently consists of ruderal grasses and an existing concrete slab, which was previously used as a community garden. Given the disturbed nature of the project site and surrounding area, the site does not provide habitat value for endangered, rare, or threatened plant or wildlife species. In addition, surface waters and wetlands do not occur on-site, which further prevents the site’s ability to provide necessary habitat for endangered, rare, or threatened species. Furthermore, the project site does not currently contain any existing trees, and, therefore, the project site does not provide nesting habitat for protected birds and raptors.

Overall, through the required payment of all applicable fees, the proposed project would be consistent with the SCVHCP, and based on its existing setting and surrounding existing uses, the project site does not provide habitat value for endangered, rare, or threatened plant or wildlife species. Therefore, the proposed project meets the provisions of Criterion 15332(c). 4 Santa Clara Valley Habitat Agency. Habitat Agency Geobrowser. Available at: http://www.hcpmaps.com/habitat/.

Accessed October 2022.

Criterion 15332(d): Traffic, Noise, Air Quality, and Water Quality The following sections present analysis regarding potential effects related to traffic, noise, air quality, and water quality resulting from implementation of the proposed project.

Traffic
Pursuant to the Governor’s Office of Planning and Research (OPR), certain projects would be presumed to have a less-than-significant effect on Vehicle Miles Travelled (VMT) due to project size, project location, or project type.5 Specifically, OPR recommends that projects that generate less than 110 trips per day may be considered to have less-than-significant VMT impacts. It should be noted that this analysis focuses on employee trips, rather than VMT generated by fire truck trips. Pursuant to Senate Bill (SB) 743 and the CEQA Guidelines, VMT from heavy truck trips is not required; rather, the focus should be on automobile and light truck use. Given that the proposed project would house between three and four full-time employees daily, the proposed project would be expected to generate approximately six to eight average daily trips by employees. Thus, because the proposed project would not generate more than 110 daily trips, the project meets the OPR screening criteria for small projects, and a VMT analysis for the proposed project is not required.

Based on the above, the proposed project would result in a less-than-significant effect related to VMT.

Noise
Sensitive receptors in the project vicinity would be limited to the single-family residences located approximately 155 feet to the north of the project site, across Butterfield Boulevard, and the multifamily residences located approximately 500 feet to the south, past the Courthouse Plaza Garden and across the Caltrain railroad tracks, Railroad Park, and Depot Street. During operation, the primary sources of noise associated with the proposed project would be sirens, routine firehouse activities, and vehicle traffic noise generated on local roadways.

Pursuant to General Plan Policy SSI-8.5 of the City’s General Plan, noise level increases resulting from traffic associated with new projects is considered significant if: a) the noise level increase is 5 dBA DNL or greater, with a future noise level of less than 60 dBA DNL, or b) the noise level increase is 3 dBA DNL or greater, with a future noise level of 60 dBA DNL or greater. In addition, Section 18.76.090 of the Morgan Hill Municipal Code establishes maximum noise level standards for stationary noise sources. Such standards do not apply to noise generated by vehicle traffic in the public right-of-way or noise from temporary construction, demolition, and vehicles that enter and leave the site of the noise-generating use (e.g., construction equipment, trains, trucks).

As shown in Table 4.11-7 of the General Plan EIR, existing (2016) traffic conditions along the segment of Butterfield Boulevard between Main Avenue and Dunne Avenue produced noise levels of 72.3 community noise equivalent level decibels (CNEL dBA) at a distance of 50 feet from the roadway centerline. The General Plan EIR determined that, upon buildout of the General Plan, Butterfield Boulevard between Main Avenue and Dunne Avenue would generate traffic noise levels of 73.2 CNEL dBA at a distance of 50 feet from the roadway centerline, or a 0.9 dBA increase attributable to buildout of the General Plan. Therefore, based on the thresholds included in General Plan Policy SSI-8.5, traffic noise level increases along Butterfield Boulevard between Main Avenue and Dunne Avenue were determined to be less than significant. Given that the project is consistent with the site’s existing land use and zoning designations, traffic noise level 5 Governor’s Office of Planning and Research. Technical Advisory on Evaluation Transportation Impacts in CEQA.

December 2018.

increases associated with public facilities, such as the proposed fire station, on the project site have been previously anticipated by the City and were considered in the analysis included in the General Plan EIR. As such, the project would not result in traffic noise level increases beyond what has been analyzed in the General Plan EIR, and traffic noise attributable to the proposed project would be considered less than significant.

Routine firehouse activities that have the potential to generate stationary noise on the project site include gear checks and daily fire truck maintenance, which may include washing and cleaning the truck as well as changing/updating mechanical equipment. However, such tasks are usually performed during daytime hours inside the fire station bay and do not include the use of emergency sirens. In addition, pursuant to Section 8.28.030 of the City’s Municipal Code, fire sirens and stationary fire alarms are exempt from City noise regulations. Noise at the project site would also be generated by on-site vehicle operations, including driving along the internal driveways and parking lot noise at the southern end of the site. However, on-site vehicle circulation noise would be shielded from residential receptors to the north by the proposed fire station itself. Therefore, operational noise attributable to the proposed project would be minimal.

During construction, the project would result in short-term noise level increases in the project vicinity. However, the Morgan Hill Municipal Code does not specify any short-term construction noise level limits. In addition, Chapter 8.28 of the Morgan Hill Municipal Code prohibits construction activities between 8:00 PM and 7:00 AM, Monday through Friday, and between 6:00 PM and 9:00 AM on Saturdays. Construction activities may not occur on Sundays or federal holidays. Construction activities related to the proposed project would include the use of sounddampening equipment such as mufflers, air-inlet silencers, shrouds, shields, or other noisereducing features where appropriate.

Air Quality
The City of Morgan Hill is located in the San Francisco Bay Area Air Basin (SFBAAB), which is under the jurisdiction of the Bay Area Air Quality Management District (BAAQMD). The SFBAAB area is currently designated as a nonattainment area for State and federal ozone, State and federal fine particulate matter 2.5 microns in diameter (PM2.5), and State respirable particulate matter 10 microns in diameter (PM10) ambient air quality standards (AAQS). The SFBAAB is designated attainment or unclassified for all other AAQS.

In compliance with regulations, due to the nonattainment designations of the area, the BAAQMD periodically prepares and updates air quality plans that provide emission reduction strategies to achieve attainment of the AAQS, including control strategies to reduce air pollutant emissions through regulations, incentive programs, public education, and partnerships with other agencies.

The current air quality plans are prepared in cooperation with the Metropolitan Transportation Commission (MTC) and the Association of Bay Area Governments (ABAG).

The most recent federal ozone plan is the 2001 Ozone Attainment Plan, which was adopted on October 24, 2001 and approved by the California Air Resources Board (CARB) on November 1, 2001. The plan was submitted to the U.S. Environmental Protection Agency (USEPA) on November 30, 2001 for review and approval. The most recent State ozone plan is the 2017 Clean Air Plan, adopted on April 19, 2017. The 2017 Clean Air Plan was developed as a multi-pollutant plan that provides an integrated control strategy to reduce ozone, PM, toxic air contaminants (TACs), and greenhouse gases (GHGs). Although a plan for achieving the State PM10 standard is not required, the BAAQMD has prioritized measures to reduce PM in developing the control strategy for the 2017 Clean Air Plan. The control strategy serves as the backbone of the BAAQMD’s current PM control program.

The aforementioned air quality plans contain mobile source controls, stationary source controls, and transportation control measures to be implemented in the region to attain the State and federal AAQS within the SFBAAB. Adopted BAAQMD rules and regulations, as well as thresholds of significance, have been developed with the intent to ensure continued attainment of AAQS, or to work towards attainment of AAQS for which the area is currently designated nonattainment, consistent with applicable air quality plans. For development projects, BAAQMD establishes significance thresholds for emissions of the ozone precursors reactive organic gases (ROG) and oxides of nitrogen (NOX), as well as for PM10, and PM2.5, expressed in pounds per day (lbs/day) and tons per year (tons/yr). The thresholds are listed in Table 1. Thus, by exceeding the BAAQMD’s mass emission thresholds for operational emissions of ROG, NOX, or PM10, a project would be considered to conflict with or obstruct implementation of the BAAQMD’s air quality planning efforts.

Table 1
BAAQMD Thresholds of Significance
Construction Operational
Pollutant
Average Daily
Emissions (lbs/day)
Average Daily
Emissions (lbs/day)
Maximum Annual
Emissions (tons/year)
ROG 54 54 10
NOX 54 54 10
PM10 (exhaust) 82 82 15
PM2.5 (exhaust) 54 54 10
Source: BAAQMD, CEQA Guidelines, May 2017.

Emissions of particulate matter can be split into two categories: fugitive emissions and exhaust emissions. The BAAQMD thresholds of significance for exhaust PM emissions are presented in Table 1. The BAAQMD does not maintain quantitative thresholds for fugitive emissions of PM10 or PM2.5; rather, BAAQMD requires all projects within the district’s jurisdiction to implement Basic Construction Mitigation Measures (BCMMs) related to dust suppression. The BCMMs include the following:

1. All exposed surfaces (e.g., parking areas, staging areas, soil piles, graded areas, and unpaved access roads) shall be watered two times per day.

2. All haul trucks transporting soil, sand, or other loose material off-site shall be covered.

3. All visible mud or dirt track-out onto adjacent public roads shall be removed using wet power vacuum street sweepers at least once per day. The use of dry power sweeping is prohibited.

4. All vehicle speeds on unpaved roads shall be limited to 15 mph.

5. All roadways, driveways, and sidewalks to be paved shall be completed as soon as possible. Building pads shall be laid as soon as possible after grading unless seeding or soil binders are used.

6. Idling times shall be minimized either by shutting equipment off when not in use or reducing the maximum idling time to five minutes (as required by the California airborne toxics control measure Title 13, Section 2485 of CCR). Clear signage shall be provided for construction workers at all access points.

7. All construction equipment shall be maintained and properly tuned in accordance with manufacturer’s specifications. All equipment shall be checked by a certified visible emissions evaluator.

8. Post a publicly visible sign with the telephone number and person to contact at the lead agency regarding dust complaints. This person shall respond and take corrective action

within 48 hours. The Air District’s phone number shall also be visible to ensure compliance with applicable regulations.

The proposed project’s construction and operational emissions were quantified using the webbased California Emissions Estimator Model (CalEEMod) version 2022.1 – a statewide model designed to provide a uniform platform for government agencies, land use planners, and environmental professionals to quantify air quality emissions, including GHG emissions, from land use projects. The model applies inherent default values for various land uses, including construction data, trip generation rates, vehicle mix, trip length, average speed, etc. However, where project-specific data is available, such data should be input into the model. Accordingly, the proposed project’s modeling was updated to assume that construction would commence in June 2023 and take place over approximately one year. In addition, the model accounted for the approximately 8,700-sf concrete slab that would be demolished as part of project construction.

The proposed project’s estimated emissions associated with construction and operations are provided below. All CalEEMod results are included as Appendix A to this Memorandum.

Construction Criteria Pollutant Emissions
According to the CalEEMod results, the proposed project would result in maximum construction criteria air pollutant emissions as shown in Table 2. The proposed project’s construction emissions would be below the applicable thresholds of significance.

Although thresholds of significance for mass emissions of fugitive dust PM10 and PM2.5 have not been identified by the City of Morgan Hill or BAAQMD, the proposed project’s estimated fugitive dust emissions have been included for informational purposes. All projects within the jurisdiction of the BAAQMD are required to implement all of the BAAQMD’s BCMMs. The proposed project’s required implementation of the BAAQMD’s BCMMs listed above for the project’s construction activities, would help to further minimize construction-related emissions.

Table 2
Maximum Construction Emissions (lbs/day)
Pollutant
Proposed Project
Emissions
Threshold of
Significance
Exceeds
Threshold?
ROG 1.82 54 NO
NOX 17.6 54 NO
PM10* 0.83 82 NO
PM2.5* 0.77 54 NO
Note:
* Denotes emissions from exhaust only. BAAQMD does not have adopted thresholds for fugitive PM emissions.

Source: CalEEMod, October 2022 (see Appendix A).

Because the proposed project would be below the applicable thresholds of significance for construction emissions, project construction would not result in a significant air quality impact.

Operational Criteria Pollutant Emissions
According to the CalEEMod results, the proposed project would result in maximum operational criteria air pollutant emissions as shown in Table 3. The proposed project’s operational emissions would be below the applicable thresholds of significance. As such, the proposed project would not result in a significant air quality impact during operations.

Table 3
Unmitigated Maximum Operational Emissions
Pollutant
Proposed Project
Emissions
Threshold of
Significance
lbs/day tons/yr lbs/day tons/yr
Exceeds
Threshold?
ROG 0.64 0.09 54 10 NO
NOX 0.37 0.05 54 10 NO
PM10* 0.01 <0.005 82 15 NO
PM2.5* 0.01 <0.005 54 10 NO
Note:
* Denotes emissions from exhaust only. BAAQMD does not have adopted thresholds for fugitive PM emissions.

Source: CalEEMod, October 2022 (see Appendix A).

Greenhouse Gas Emissions
On April 20, 2022, the BAAQMD Board of Directors adopted new thresholds of significance for GHG emissions. The GHG thresholds are qualitative and address recent climate change legislation, including SB 32. According to the new thresholds of significance, a project must either include specific project design elements (e.g., exclude use of natural gas, achieve a specific reduction in project-generated VMT below the regional average) or be consistent with a local GHG reduction strategy that meets the criteria pursuant to State CEQA Guidelines Section 15183.5(b).6 In December of 2021, the City of Morgan Hill adopted a Climate Action Plan (CAP); however, the City’s CAP does not qualify as a local GHG reduction strategy under CEQA Guidelines Section 15183.5(b). Therefore, the City has determined that the BAAQMD thresholds of significance are appropriate for the proposed project, and the following analysis focuses on the new BAAQMD GHG thresholds related to specific project design elements.

According to the BAAQMD’s thresholds of significance, in order to find a less-than-significant GHG impact, projects must include, at a minimum, the following project design elements:
• The project will not include natural gas appliances or natural gas plumbing (in both residential and nonresidential development);
• The project will not result in any wasteful, inefficient, or unnecessary energy usage as determined by the analysis required under CEQA Section 21100(b)(3) and Section 15126.2(b) of the State CEQA Guidelines;
• The project will achieve a reduction in project-generated vehicle miles traveled (VMT) below the regional average consistent with the current version of the California Climate Change Scoping Plan (currently 15 percent) or meet a locally adopted SB 743 VMT target, reflecting the recommendations provided in the OPR's Technical Advisory on Evaluating Transportation Impacts in CEQA; and
• The project will achieve compliance with off-street electric vehicle requirements in the most recently adopted version of CALGreen Tier 2.

In order to be consistent with the first criterion, the proposed project is required to include all electric appliances and plumbing. Natural gas is prohibited in all new construction within the City, effective March 1, 2020, pursuant to City Ordinance No. 2306. Therefore, the proposed project would not include the use of natural gas appliances or natural gas plumbing and, thus, would comply with the first criterion.
6 Bay Area Air Quality Management District. CEQA Thresholds for Evaluating the Significance of Climate Impacts From Land Use Projects and Plans. April 2022.

Regarding the second criterion, the proposed project would comply with all applicable federal, State, and local regulations regarding energy use during both project construction and project operations, such as the California Green Building Standards Code and the Building Energy Efficiency Standards. Requirements of the CALGreen Code that would be applicable to the proposed project include, but are not limited to, the following measures:
• Compliance with relevant regulations related to future installation of Electric Vehicle charging infrastructure;
• Indoor water use consumption is reduced through the establishment of maximum fixture water use rates;
• Outdoor landscaping must comply with the California Department of Water Resources’ Model Water Efficient Landscape Ordinance (MWELO), or a local ordinance, whichever is more stringent, to reduce outdoor water use;
• Diversion of 65 percent of construction and demolition waste from landfills; and • Mandatory use of low-pollutant emitting interior finish materials such as paints, carpet, vinyl flooring, and particle board.

Adherence to the most recent CALGreen Code and the Building Energy Efficiency Standards would ensure that the proposed structure would consume energy efficiently through the incorporation of such features as door and window interlocks, direct digital controls for HVAC systems, and high efficiency outdoor lighting. In addition, all construction equipment and operation thereof would be regulated by the CARB In-Use Off-Road Diesel Vehicle Regulation. The In-Use Off-Road Diesel Vehicle Regulation is intended to reduce emissions from in-use, off-road, heavyduty diesel vehicles in California by imposing limits on idling, requiring all vehicles to be reported to CARB, restricting the addition of older vehicles into fleets, and requiring fleets to reduce emissions by retiring, replacing, or repowering older engines, or installing exhaust retrofits.

Required compliance with applicable standards and regulations would ensure that energy use associated with the proposed project would not be wasteful, inefficient, or unnecessary.

With respect to the third criterion, as discussed above, pursuant to the OPR, certain projects are presumed to have a less-than-significant effect on VMT due to project size, project location, or project type. Specifically, OPR recommends that projects that generate less than 110 trips per day may be considered to have less-than-significant VMT impacts. Given that the proposed project would house between three and four full-time employees daily, the proposed project would be expected to generate approximately six to eight average daily trips by employees, and would meet the OPR screening criteria for small projects. Therefore, based on the recommendations provided in the OPR’s Technical Advisory on Evaluating Transportation Impacts in CEQA, VMT associated with the proposed project would be less than significant.

With respect to the fourth criterion, the proposed project would be subject to the nonresidential requirements set forth in the CALGreen standards. The proposed project would include six new onsite parking spaces. Based on the Tier 2 CALGreen standards, nonresidential uses with between zero and nine total parking spaces are required to provide one EV capable on-site space. The proposed project would include one on-site EV capable space.7 Therefore, the proposed project would comply with the nonresidential Tier 2 CALGreen standards.

Based on the above, the proposed project would not conflict with the BAAQMD’s GHG thresholds of significance and, thus, would not conflict with the State’s latest climate legislation. 7 Yat Cho, Senior Project Manager, Morgan Hill Engineering and Utilities Department. Personal communication [email] with Nick Pappani, Vice President, Raney Planning and Management, Inc. October 19, 2022.

Air Quality Conclusion
As discussed above, the proposed project is not anticipated to result in short-term constructionrelated or long-term operational emissions of air quality pollutants that would be considered to have the potential to result in significant effects on the environment.

Water Quality
Project construction activities such as grading, excavation, and trenching for site improvements would result in the disturbance of on-site soils. The exposed soils have the potential to affect water quality in two ways: 1) suspended soil particles and sediments transported through runoff; or 2) sediments transported as dust that eventually reach local water bodies. Spills or leaks from heavy equipment and machinery, staging areas, or building sites also have the potential to enter runoff. Typical pollutants include, but are not limited to, petroleum and heavy metals from equipment and products such as paints, solvents, and cleaning agents, which could contain hazardous constituents. Sediment from erosion of graded or excavated surface materials, leaks or spills from equipment, or inadvertent releases of building products could result in water quality degradation if runoff containing the sediment or contaminants should enter receiving waters in sufficient quantities. Impacts from construction-related activities would generally be short-term and of limited duration.

Pursuant to Morgan Hill Municipal Code Chapter 13.30 (Urban Storm Water Quality Management and Discharge Control), the project applicant would be required to submit a sediment and erosion control plan to the City of Morgan Hill Land Development Engineering Division prior to the approval of improvement plans and issuance of building permits. The plan(s) must conform to City standards to prevent significant sediment and soil erosion during construction and include the standards and guidelines found in the California Stormwater Quality Association (CASQA) Stormwater Best Management Practice Handbook. Compliance with Chapter 13.30 of the Municipal Code would ensure that construction of the proposed project would not violate any water quality standards or waste discharge requirements or otherwise substantially degrade surface or ground water quality during project construction.

Currently, the project site contains approximately 8,700 sf of impervious surfaces in the form of a concrete slab located in the northeast corner of the project site. Following completion of construction activities, the proposed areas of disturbance would include approximately 38,000 sf of impervious surfaces, which could contribute incrementally to the degradation of downstream water quality during storm events. During the dry season, vehicles and other urban activities may release contaminants onto the impervious surfaces, where they would accumulate until the first storm event. During the initial storm event, or first flush, the concentrated pollutants would be transported through stormwater runoff from the site to the stormwater drainage system and eventually a downstream waterway. Typical urban pollutants that would likely be associated with the proposed project include sediment, pesticides, oil and grease, nutrients, metals, bacteria, and trash. In addition, stormwater runoff could cause soil erosion if not properly addressed and provide a more lucrative means of transport for pollutants to enter the waterways.

The proposed project would be subject to all regional and local water quality regulations. In order to meet water quality objectives for the region, the City of Morgan Hill, City of Gilroy, and County of Santa Clara have prepared and are implementing a Revised Regional Storm Water Management Plan (SWMP). The SWMP incorporates the efforts of the City of Morgan Hill, the City of Gilroy, and the unincorporated portion of Santa Clara County, within the watershed of the Pajaro River and Monterey Bay, to meet the Phase II Storm Water Permit requirements for small municipal separate storm sewer systems (MS4s). The Upper Pajaro River Watershed is located

within the jurisdiction of the Central Coast Regional Water Quality Control Board (CCRWQCB).

The City of Morgan Hill implements the SWMP through an extensive program that entails: 1) the establishment of SWMP goals for the City; 2) public education and outreach; 3) public involvement and participation; 4) illicit discharge control; 5) construction site storm water runoff control; 6) postconstruction stormwater management in development; and 7) pollution prevention. For construction activities, the SWMP presents BMPs that are required for the control of storm water runoff quality during construction.

With regard to potential adverse effects to water quality during operations, the proposed project would be managed in accordance with Resolution R3-2013-0032 issued by the CCRWQCB. This resolution formally adopts post-construction stormwater management requirements for development projects in the Central Coast Region. The requirements identify 10 Watershed Management Zones (WMZs) in the covered area, and specify stormwater management requirements for each zone, depending on the size of the development project. Because the project site is located in an area classified as WMZ-1, the proposed project would be required to include site design and runoff features to limit the amount of runoff from the project site, as well as on-site water quality treatment to reduce pollutant loads in the stormwater runoff using a Low Impact Development (LID) treatment system such as biofiltration. As part of the proposed project, three bioretention basins would be constructed throughout the project site. All on-site stormwater would be directed to the bioretention basins.

According to Federal Emergency Management Agency (FEMA) Flood Insurance Rate Map (FIRM) 06085C0444H, the project site is within Zone X, which is defined as a 0.2 percent annual chance flood hazard area.8 As part of ensuring post-construction flows do not result in flooding and/or water quality impacts, the proposed project would be required to comply with applicable requirements set forth by the CCRWQCB, which regulates the City of Morgan Hill’s stormwater discharges through an National Pollutant Discharge Elimination System (NPDES) Phase II MS4 General Permit (State Water Resources Control Board Water Quality Order No. 2013-0001-DWQ; NPDES General Permit No. CAS000004).

In addition, the proposed project would be required to comply with the permanent stormwater pollution prevention measures set forth in Chapter 18.140 (Post Construction Stormwater Pollution Prevention) of the City’s Municipal Code. In accordance with Chapter 18.140, the proposed project would be required to prepare a stormwater runoff management plan that shows compliance with the design standards set forth in Section 18.140.040 (Design standards and selection of best management practices), and implement Best Management Practices (BMPs) to the satisfaction of the City.

The final design of the proposed drainage system would be reviewed and approved by the City of Morgan Hill Land Development Engineering Division, which would ensure that the proposed drainage system complies with all applicable regional and local standards, including those set forth in Chapter 18.140 of the Morgan Hill Municipal Code, as well as requirements pertaining to the incorporation of sufficient permanent stormwater treatment control BMPs. Therefore, water quality standards or waste discharge requirements would not be violated, and water quality would not be degraded as a result of operations of the proposed project. 8 Federal Emergency Management Agency. Flood Map Service Center. Available at:
https://msc.fema.gov/portal/home. Accessed October 2022.

Conclusion
Based on the above, the proposed project would not result in any significant effects related to traffic, noise, air quality, or water quality. Thus, the project meets Criterion 15332(d).

Criterion 15332(a): Utilities and Public Services
Water and sewer service for the proposed development would be provided by the City through new connections to existing infrastructure within Butterfield Boulevard. Given the presence of existing utilities in the immediate project vicinity, the proposed project would not require substantial off-site utility improvements. In addition, given that the proposed project is consistent with the site’s current General Plan land use and zoning designations, increases in demand on existing utilities and public services associated with the project have been previously anticipated in the General Plan and accounted for in local planning efforts. Thus, the site would be adequately served by all required utilities and public services.

Exceptions to Categorical Exemptions analysis
Even if a project is ordinarily exempt under any of the potential categorical exemptions, CEQA Guidelines Section 15300.2 provides specific instances where exceptions to otherwise applicable exemptions apply. Exceptions to a categorical exemption apply in the following circumstances:
(a) Location. Classes 3, 4, 5, 6, and 11 are qualified by consideration of where the project is to be located – a project that is ordinarily insignificant in its impact on the environment may in a particularly sensitive environment be significant. Therefore, these classes are considered to apply all instances, except where the project may impact on an environmental resource of hazardous or critical concern where designated, precisely mapped, and officially adopted pursuant to law by federal, state, or local agencies. (b) Cumulative Impact. All exemptions for these classes are inapplicable when the cumulative impact of successive projects of the same type in the same place, over time is significant.
(c) Significant Effect. A categorical exemption shall not be used for an activity where there is a reasonable possibility that the activity will have a significant effect on the environment due to unusual circumstances.
(d) Scenic Highways. A categorical exemption shall not be used for a project which may result in damage to scenic resources, including but not limited to, trees, historic buildings, rock outcroppings, or similar resources, within a highway officially designated as a state scenic highway. This does not apply to improvements which are required as mitigation by an adopted negative declaration or certified EIR. (e) Hazardous Waste Sites. A categorical exemption shall not be used for a project located on a site which is included on any list compiled pursuant to Section 65962.5 of the Government Code.
(f) Historical Resources. A categorical exemption shall not be used for a project which may cause a substantial adverse change in the significance of a historical resource.

The following analysis addresses whether any of the exceptions to the CEQA exemption apply to the proposed project.

Criterion 15300.2(a): Location
CEQA exemptions 3, 4, 5, 6, or 11, are qualified by consideration of where the project is to be located. Given that the proposed project qualifies for exemption under CEQA Guidelines Section 15332, Class 32, an exception to the exemption under CEQA Guidelines Section 15300.2(a) does not apply to the proposed project.

Criterion 15300.2(b): Cumulative Impact
Pursuant to CEQA Section 15300.2(b), in applying this exception, the cumulative impact must result from “successive projects of the same type in the same place.” Both the “same type” and “same place” limitations restrict the scope of this exception.9 The project site is located within a residential and commercial area, which is mostly developed.

Because the proposed project is consistent with the project site’s General Plan land use and zoning designations, cumulative impacts associated with buildout of the project site have been previously anticipated by the City and analyzed in the General Plan EIR. As discussed above, the project would not require substantial off-site utility upsizing or other related improvements with the potential to result in cumulatively considerable impacts. Thus, the project does not include any unique features that would result in new or more severe cumulative impacts beyond what has been analyzed in the General Plan EIR, and an exception to the exemption pursuant to CEQA Guidelines Section 15300.2(b) does not apply to the proposed project.

Criterion 15300.2(c): Significant Effect
In listing a class of projects as exempt, the Secretary has determined that the environmental changes typically associated with projects in that class are not significant effects within the meaning of CEQA, even though an argument might be made that they are potentially significant.

The plain language of Guidelines Section 15300.2, subdivision (c), requires that a potentially significant effect must be “due to unusual circumstances” for the exception to apply.

The determination as to whether there are “unusual circumstances” (Guidelines Section 15300.2, subd. [c]) is reviewed under PRC Section 21168.5’s substantial evidence prong. Whether a particular project presents circumstances that are unusual for projects in an exempt class is an essentially factual inquiry. As to this question, the lead agency serves as “the finder of fact”.

As the courts have noted, local conditions are relevant in determining whether the environmental effects of a proposed project are unusual or typical. In general, the project site does not contain any unique or unusual features with the potential to result in a potentially significant effect. For example, the project site does not include any aquatic features and, as discussed further below, is not included on any lists of hazardous waste sites. Thus, an exception to the exemption under CEQA Guidelines Section 15300.2(c) does not apply to the proposed project.

Criterion 15300.2(d): Scenic Highway
According to the California Department of Transportation (Caltrans) Scenic Highway Mapping System, officially designated State or County scenic highways do not occur in the project vicinity.10 Thus, an exception to the exemption under CEQA Guidelines Section 15300.2(d) does not apply to the proposed project.

Criterion 15300.2(e): Hazardous Waste Sites
The California Environmental Protection Agency provides a list of data resources that provide information regarding the facilities or sites identified as meeting the “Cortese List” requirements, pursuant to Government Code 65962.5. A Phase I Environmental Site Assessment (ESA) was prepared for the proposed project by Weber, Hayes, & Associates (see Appendix B) and 9 Stephen L. Kostka and Michael H. Zischke. Practice Under the California Environmental Quality Act, Second Edition [pg. 5-68]. March 2019 Update.
10 California Department of Transportation. California State Scenic Highway System Map. Available at:
https://caltrans.maps.arcgis.com/apps/webappviewer/index.html?id=465dfd3d807c46cc8e8057116f1aacaa.

Accessed October 2022.

determined that the project site is not located on any list compiled pursuant to Section 65962.5 of the Government Code.11 Thus, an exception to the exemption under CEQA Guidelines Section 15300.2(e) does not apply to the proposed project.

Criterion 15300.2(f): Historical Resources
The project site is currently undeveloped, consisting primarily of ruderal grasses as well as an existing concrete slab, which was previously used as a community garden. The site is surrounded by existing residential and commercial development. A records search of the California Historic Resources Information System (CHRIS) was performed by the Northwest Information Center (NWIC) for historical resource site records and survey reports within the project area.12 Based on the results of the records search of the CHRIS, the NWIC concluded that recorded historic buildings or structures are not located within or adjacent to the project site. While the NWIC indicated that a moderate potential exists for both Native American archaeological resources and historic-period archaeological resources to be located within the project area, the City standard conditions of approval related to the protection of historical and archaeological resources, consistent with Section 18.60.090 of the City’s Municipal Code, would ensure that in the event that such resources are unearthed during ground disturbing activities (i.e., any activity that exposes, works or redistributes soil, including but not limited to excavating, filling, stockpiling, grading, grubbing, or clearing), the proposed project would not result in a substantial adverse change in the significance of a historical resource, and an exception to the exemption under CEQA Guidelines Section 15300.2(f) does not apply to the proposed project. The City standard conditions of approval related to the protection of historical and archaeological resources are as follows:

A. The developer shall enter into written contracts with an archaeologist and the Tamien Nation Tribe, and pay all fees associated with the activities required by this condition. The following policies and procedures for treatment and disposition of inadvertently discovered human remains or archaeological materials shall apply:

1. Prior to start of grading or earthmoving activity (includes demolition and moving of heavy equipment on site) on the “first day of construction”, the archaeologist and Tamien Nation Tribal Monitor shall hold a preconstruction meeting for the purposes of "cultural sensitivity training" with the general contractor and subcontractors.

2. An archaeologist and a Tamien Nation Tribal Monitor shall be present on-site to monitor all ground disturbing activities and an archaeologist shall be on-call. Where historical or archaeological artifacts are found, work in areas where remains or artifacts are found will be restricted or stopped until proper protocols are met, as described below:
a) Work at the location of the find will halt immediately within fifty feet of the find. If an archaeologist is not present at the time of the discovery, the applicant shall contact an archaeologist for evaluation of the find to determine whether it qualifies as a unique archaeological resource as defined by this chapter. 11 Weber, Hayes, & Associates. Phase I Environmental Site Assessment, Partially Developed Public Lands, 17295 Butterfield Boulevard, Morgan Hill, California. February 11, 2022. 12 Northwest Information Center. Record search results for the proposed Butterfield Boulevard Fire Station Project.

October 18, 2022.

b) If the find is determined not to be a Unique Archaeological Resource, construction can continue. The archaeologist will prepare a brief informal memo/letter in collaboration with a tribal representative that describes and assesses the significance of the resource, including a discussion of the methods used to determine significance for the find;
c) If the find appears significant and to qualify as a unique archaeological resource, the archaeologist will determine if the resource can be avoided and will detail avoidance procedures in a formal memo/letter; and
d) If the resource cannot be avoided, the archaeologist in collaboration with a tribal representative shall develop within forty-eight hours an action plan to avoid or minimize impacts.

The field crew shall not proceed until the action plan is approved by the Development Services Director. The action plan shall be in conformance with California Public Resources Code 21083.2.

3. The following policies and procedures for treatment and disposition of inadvertently discovered human remains or archaeological materials shall apply. If human remains are discovered, it is probable they are the remains of Native Americans,
a) If human remains are encountered, they shall be treated with dignity and respect as due to them. Discovery of Native American remains is a very sensitive issue and serious concern.

Information about such a discovery shall be held in confidence by all project personnel on a need-to-know basis. The rights of Native Americans to practice ceremonial observances on sites, in labs and around artifacts shall be upheld.
b) Remains should not be held by human hands. Surgical gloves should be worn if remains need to be handled.
c) Surgical mask should also be worn to prevent exposure to pathogens that may be associated with the remains.

4. In the event that known or suspected Native American remains are encountered, or significant historic or archaeological materials are discovered, ground-disturbing activities shall be immediately stopped.

Examples of significant historic or archaeological materials include, but are not limited to, concentrations of historic artifacts (e.g., bottles, ceramics) or prehistoric artifacts (chipped chert or obsidian, arrow points, ground stone mortars and pestles), culturally altered ash stained midden soils associated with pre-contact Native American habitation sites, concentrations of fire-altered rock and/or burned or charred organic materials and historic structure remains such as stone lined building foundations, wells or privy pits. Ground-disturbing project activities may continue in other areas that are outside the exclusion zone as defined below.

5. An "exclusion zone" where unauthorized equipment and personnel are not permitted shall be established (e.g., taped off) around the discovery area plus a reasonable buffer zone by the contractor foreman or authorized representative, or party who made the discovery and initiated these protocols, or if on-site at the time or discovery, by the monitoring archaeologist and tribal representative (typically twenty-five to fifty feet for single burial or archaeological find).

6. The discovery locale shall be secured (e.g., 24-hour surveillance) as directed by the City or County if considered prudent to avoid further disturbances.

7. The Contractor Foreman or authorized representative, or party who made the discovery and initiated these protocols shall be responsible for immediately contacting by telephone the parties listed below to report the find and initiate the consultation process for treatment and disposition:
• The City of Morgan Hill Development Services Director (408) 779-7247
• The Contractor’s Point(s) of Contact
• The Coroner of the County of Santa Clara (if human remains found) (408) 793-1900
• The Native American Heritage Commission (NAHC) in
Sacramento (916) 653-4082
• The Amah Mutsun Tribal Band (916) 481-5785 (H) or (916) 743- 5833 (C)
• The Tamien Nation (707) 295-4011 (office) and (925) 336-5359 (THPO)

8. The Coroner has two working days to examine the remains after being notified of the discovery. If the remains are Native American the Coroner has 24 hours to notify the NAHC.

9. The NAHC is responsible for identifying and immediately notifying the Most Likely Descendant (MLD). (Note: NAHC policy holds that the Native American Monitor will not be designated the MLD.)

10. Within 24 hours of their notification by the NAHC, the MLD will be granted permission to inspect the discovery site if they so choose.

11. Within 24 hours of their notification by the NAHC, the MLD may recommend to the City’s Development Services Director the recommended means for treating or disposing, with appropriate dignity, the human remains and any associated grave goods. The
recommendation may include the scientific removal and nondestructive or destructive analysis of human remains and items associated with Native American burials. Only those osteological analyses or DNA analyses recommended by the appropriate tribe may be considered and carried out.

12. If the MLD recommendation is rejected by the City of Morgan Hill the parties will attempt to mediate the disagreement with the NAHC. If mediation fails then the remains and all associated grave offerings shall be reburied with appropriate dignity on the property in a location not subject to further subsurface disturbance.

D. CONCLUSION
This Memorandum demonstrates that the proposed project can be considered exempt from CEQA under Section 15332, and does not meet any of the exceptions to categorical exemptions set forth in Section 15300.2 of the CEQA Guidelines

RESOLUTION NO. 23-_____

A RESOLUTION OF THE CITY COUNCIL OF THE CITY

OF MORGAN HILL APPROVING AN AMENDMENT TO
THE CITY’S FISCAL YEAR 2022-2023 BUDGET IN THE
PUBLIC SAFETY FACILITIES IMPACT FUND (FUND NO.
315), PARK MAINTENANCE FUND (FUND NO. 302),
PUBLIC FACILITIES IMPACT FUND (FUND NO. 347) TO
APPROPRIATE $2,250,000; $1,000,000; AND $1,000,000,

RESPECTIVELY, IN EACH FUND, AND THREE

INTERFUND LOANS TO THE PUBLIC SAFETY

FACILITIES IMPACT FUND FROM THE LOCAL

DRAINAGE IMPACT FUND, PARK MAINTENANCE FUND,

AND PUBLIC FACILITIES IMPACT FUND IN THE
AMOUNT OF $5,750,000; $1,000,000; AND $1,000,000,

RESPECTIVELY, THEREFORE
WHEREAS, the City of Morgan Hill, a municipal corporation and general law city duly organized and existing under and pursuant to the Constitution and laws of the State of California (“City”), is authorized to enter into contracts and agreements for the benefit of the City; and WHEREAS, the reasons supporting this Resolution are set forth in detail in that certain City Council Staff Report entitled “Award Butterfield Fire Station Project to Larry S. Kent. DBA Kent Construction in the Amount of $7,956,553” submitted for City Council consideration at its meeting of June 7, 2023, submitted to the City Council by the City Manager (the “Staff Report”), the contents of which Staff Report are incorporated herein by this reference; and WHEREAS, recommended amendments are needed and proposed to the City’s previously adopted Annual Budget for Fiscal Year 2022-2023 as set forth on Exhibit A to this Resolution, to appropriate the requisite funds to implement the actions authorized by this Resolution; and WHEREAS, the consideration by City Council of the adoption of this Resolution has been duly noticed pursuant to applicable laws and has been placed upon the City Council Meeting Agenda on the date set forth in the Staff Report, or to such date that the City Council may have continued or deferred consideration of this Resolution, and on such date the City Council conducted a duly noticed public meeting at which the City Council provided members of the public an opportunity to comment and be heard and considered any and all testimony and other evidence provided in connection with the adoption of this Resolution; and WHEREAS, the City Council determines that adoption of this Resolution is in the public interest.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF MORGAN HILL DOES HEREBY FIND, DETERMINE, RESOLVE AND ORDER AS FOLLOWS:

City of Morgan Hill
Resolution No. 23-_____

Section 1. Recitals. The City Council does hereby find, determine and resolve that all of the foregoing recitals are true and correct.

Section 2. Approval and Authorization. The City Council does further resolve, order and/or direct as follows:
a. That the City’s previously adopted Fiscal Year 2022-2023 Budget, as the same has been amended to date, is hereby further amended in accordance with and as reflected on Exhibit A attached hereto and incorporated herein by this reference; and
b. That the City Clerk is hereby authorized and directed to forward a copy of this Resolution to the City’s Finance Director, who is hereby authorized and directed to take all actions necessary to implement the terms of this Resolution pertaining to the Fiscal Year 2022-2023 Budget of City.

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

PASSED, APPROVED, AND ADOPTED by the City Council of the City of Morgan Hill at its meeting held on this 7th day of June 2023 by the following vote:

AYES: COUNCIL MEMBERS: None
NOES: COUNCIL MEMBERS: None
ABSTAIN: COUNCIL MEMBERS: None
ABSENT: COUNCIL MEMBERS: None
APPROVED: ATTEST:
___________________________________ _______________________________ MARK TURNER, Mayor MICHELLE BIGELOW, City Clerk

City of Morgan Hill
Resolution No. 23-_____

 CERTIFICATION 
I, Michelle Bigelow, City Clerk of the City of Morgan Hill, California, do hereby certify that the foregoing is a true and correct copy of Resolution No. 23-_____ adopted by the City Council at the meeting held on the 7th day of June 2023.

WITNESS MY HAND AND THE SEAL OF THE CITY OF MORGAN HILL.

DATE: _____________________ ___________________________________ MICHELLE BIGELOW, City Clerk

City of Morgan Hill
Resolution No. 23-_____

EXHIBIT A

AGENDA BUDGET SCORECARD
FISCAL YEAR 2022-2023
ADJUSTMENT # 009
FUND: 302 Park Maintenance Fund
DEPARTMENT: 8030 Park Maintenance
OBJECT: 49230 TRANSFER OUT-PUBLIC SAFETY FACILITIES
AGENDA DATE: 06/07/23
AGENDA ITEM TITLE:
07/01/22 06/30/23

AUDITED PROJECTED

BEGINNING AMENDED ENDING

FUND ESTIMATED APPROPRI- FUND

BALANCE REVENUES ATIONS BALANCE
ORIGINAL BUDGET 2,567,344 - 664,980 1,902,365

CUMULATIVE REVISIONS PRIOR - - - -

TO RECOMMENDED ACTION
RECOMMENDED ACTION - 1,000,000 (1,000,000)
RESULTOF RECOMMENDED ACTION 2,567,344 - 1,664,980 902,365 Fire Station Project Interfund Loan

City of Morgan Hill
Resolution No. 23-_____

AGENDA BUDGET SCORECARD
FISCAL YEAR 2022-2023
ADJUSTMENT # 010
FUND: 347 Public Facilities Impact Fund
DEPARTMENT: 8056 Public Facilities
OBJECT: 49230 TRANSFER OUT-PUBLIC SAFETY FACILITIES
AGENDA DATE: 06/07/23
AGENDA ITEM TITLE:
07/01/22 06/30/23

AUDITED PROJECTED

BEGINNING AMENDED ENDING

FUND ESTIMATED APPROPRI- FUND

BALANCE REVENUES ATIONS BALANCE
ORIGINAL BUDGET 1,017,051 - - 1,017,051

CUMULATIVE REVISIONS PRIOR - - - -

TO RECOMMENDED ACTION
RECOMMENDED ACTION - 1,000,000 (1,000,000)
RESULTOF RECOMMENDED ACTION 1,017,051 - 1,000,000 17,051 Fire Station Project Interfund Loan

City of Morgan Hill
Resolution No. 23-_____

AGENDA BUDGET SCORECARD
FISCAL YEAR 2022-2023
ADJUSTMENT # 011
FUND: 315 Public Safety Facilities Impact Fund
DEPARTMENT: 8080
OBJECT: 86360 CONSTRUCTION
AGENDA DATE: 06/07/23
AGENDA ITEM TITLE:
07/01/22 06/30/23

AUDITED PROJECTED

BEGINNING AMENDED ENDING

FUND ESTIMATED APPROPRI- FUND

BALANCE REVENUES ATIONS BALANCE
ORIGINAL BUDGET 3,221,824 6,221,575 10,050,626 (607,227)

CUMULATIVE REVISIONS PRIOR - - - -

TO RECOMMENDED ACTION
RECOMMENDED ACTION 2,000,000 2,250,000 (250,000)
RESULTOF RECOMMENDED ACTION 3,221,824 8,221,575 12,300,626 (857,227) Fire Station Project

10 CITY COUNCIL STAFF REPORT
MEETING DATE: June 7, 2023
PREPARED BY:

Yat Cho, Senior Project Manager
APPROVED BY: City Manager

AWARD FISHER BASIN EXPANSION PROJECT TO GALEB PAVING,
INC. IN THE AMOUNT OF $2,568,800

RECOMMENDATION(S)

1. Approve Fisher Basin Expansion Project plans and specifications;

2. Award contract to Galeb Paving Inc. for the Fisher Basin Expansion Project in the amount of $2,568,800;

3. Authorize expenditure of construction contingency funds not to exceed $385,320; and

4. Authorize the City Manager to execute and administer the construction contract with Galeb Paving Inc.

COUNCIL PRIORITIES, GOALS & STRATEGIES
City Council Ongoing Priorities
Maintaining and Enhancing Infrastructure
2022-2023 Strategic Priorities
Fiscal Sustainability
Guiding Documents
Storm Drain Master Plan
REPORT NARRATIVE:

The City’s current Storm Drain System Master Plan identifies storm capacity as one of the largest infrastructure issues the City is facing. The City’s Capital Improvement Program has allocated funding for significant improvements to the system over the next five years. Per the City's current Storm Drain Master Plan along with work performed by Akel Engineering Group Inc., the Fisher Basin was been identified as a location where additional stormwater storage capacity would be beneficial in order to reduce the possibility of flooding in the area. This improvement, along with other future planned work, will support reductions in flooding along Fisher Creek. City staff worked with consultant Hanna & Brunetti to prepare plans and specifications for this project, which will increase the holding capacity of storm water in the Fisher Basin (See attached vicinity map).

10 The project scope of work includes the excavation and grading of the Fisher Basin (approximately 44,000 Cubic Yards of Cut) along with the construction of a 12-foot wide access road and concrete outfalls at multiple locations on-site.

The bid opening for this project was held on April 25, 2023 and twelve (12) bids were received:

Galeb Paving, Inc. $2,568,800.00
Manzo Construction, Inc. $2,792,878.00
Jerremy Harris Construction, Inc. $2,850,272.00
Gordon N. Ball, Inc. $3,154,000.00
DeSilva Gates Construction LLC $3,222,222.00
Beals Martin and Associates, Inc. $3,246,001.00
RX Lodge, Inc. $3,275,817.63
Joseph J. Albanese, Inc $3,636,150.00
Granite Rock Company $3,884,550.00
McGuire and Hester $3,892,000.00
Brannon Corporation $3,930,070.00
Specialty Construction, Inc. $4,701,880.00
Galeb Paving Inc.’s bid of $2,568,800 is approximately 22% above the engineer’s estimate of $2,100,000. Galeb Paving, Inc. is an experienced contractor for this type of work. Staff recommends awarding of the contract to Galeb Paving, Inc. in the amount of $2,568,800. Due to possible unforeseen conditions for the grading work, staff is requesting a fifteen (15) percent construction contingency for this project ($385,320).

The project is scheduled to start in July 2023 and be completed by October 2023.

The plans and specifications are available for review on the City's webpage under the Government tab and Community Projects site: https://www.morganhill.ca.gov/1436/Project-Plans-Specifications-and-Bid-Res.

COMMUNITY ENGAGEMENT:

The Fisher Basin Expansion Project is located within residential and commercial neighborhoods. While there may be slight inconveniences for residents and business owners, staff will work with the contractor to minimize these inconveniences and provide email and door notifications prior to any construction activities. Staff will also provide regular updated construction information weekly through Nextdoor and on the City’s website.

ALTERNATIVE ACTIONS:

City Council may elect not to award this construction contract and request the project be rebid. Staff does not recommend this alternative as competitive bids were received.

Rebidding the project is not likely to result in significant savings and it will delay the project approximately three to four months.

10 PRIOR CITY COUNCIL AND COMMISSION ACTIONS:
• On September 6, 2018, the City Council adopted the 2018 Storm Drain Master Plan.
• On June 15, 2022, the City Council adopted the FY2022-23 through 2027-28 Capital Improvement Program Project Budget.

FISCAL AND RESOURCE IMPACT:

The total authorization for the project would be $2,954,120, which includes a 15 percent contingency of $385,320. The project is sufficiently funded in the Fiscal Year 2022-23 Capital Improvement Program (CIP) budget under CIP Project 415020, Fisher Basin Expansion Project, under Fund 303.

CEQA (California Environmental Quality Act):

Mitigated Negative Declaration
A Mitigated Negative Declaration for this project was approved in November 2021 in accordance with CEQA. Mitigation measures are imposed upon the project to reduce potential impacts to a less than significant level.

County of Santa Clara, Sanborn
Engineering and Utilities Department
CIP Engineering Division

FISHER BASIN

EXPANSION PROJECT
Document Path: G:\R-14\PROJ\Agustin\GIS\Fisher Basin Expansion Project.mxd O
0 380 760 1,140 1,520 190
Feet

MONTEREY RD
BUTTERFIELD BLVD.

COCHRANE RD
Fisher Basin
Expansion Project

OLD MONTEREY RD

MONTEREY RD

JARVIS DR

SUTTER BLVD
BUTTERFIELD BLVD.

11 CITY COUNCIL STAFF REPORT
MEETING DATE: June 7, 2023
PREPARED BY:

Yat Cho, Senior Project Manager
APPROVED BY: City Manager

AWARD JACKSON OAKS WATER MAIN PROJECT TO SUBTERRA
CONSTRUCTION, INC. IN THE AMOUNT OF $642,100

RECOMMENDATION(S)

1. Approve the Jackson Oaks Water Main Project Plans and Specifications;

2. Award contract to SubTerra Construction, Inc. for the Jackson Oaks Water Main Project in the amount of $642,100;

3. Authorize the expenditure of construction contingency funds not to exceed $96,315; and

4. Authorize the City Manager to execute and administer the construction contract with SubTerra Construction, Inc.

COUNCIL PRIORITIES, GOALS & STRATEGIES
City Council Ongoing Priorities
Enhancing Public Safety
Maintaining and Enhancing Infrastructure
2022-2023 Strategic Priorities
Fiscal Sustainability
Guiding Documents
Water System Master Plan
REPORT NARRATIVE:

The 2021 Water System Master Plan recommends an ongoing program to replace aging and failing pipelines throughout the City's water system. This includes improvements to mitigate existing water system deficiencies, increasing hydraulic reliability and/or replacing existing pipelines due to poor condition. Over the past few years, the water mains in Hilltop Court and Oak View Circle have had multiple breaks, disrupting water service to the residents in the area.

To address the issues with these water mains, staff worked with Mott MacDonald, a civil engineering design firm, to produce a set of project plans and specifications to replace the aging water mains in Hilltop Court and Oak View Circle. The project's scope of work

11 involves the replacement of the existing 8-inch transite water main in Oak View Circle (approximately 1000 linear feet from Jackson Oaks Drive) and Hilltop Court (approximately 500 linear feet) with a new 8” Ductile Iron Pipe (DIP) water main.

Additional work includes water main connections to the existing main, transferring the existing residential water services to the new main, new fire hydrants, abandoning the existing main, testing and chlorination and trench restoration. Once the work is complete, a slurry seal will be applied to the Hilltop Court pavement while Oak View Circle will receive a 2-inch mill and fill as part of the 2023 Pavement Rehabilitation Project.

The plans and specifications were completed in March, 2023 and the project was advertised for bidding in April, 2023. The bid opening was held on May 9, 2023. Four (4) bids were received and are as listed below:

SubTerra Construction, Inc. $642,100
Anderson Pacific Engineering Construction, Inc. $764,764 Pacific Underground Construction, Inc. $847,925
Koios Construction, Inc. $889,425
The low bidder, SubTerra Construction, Inc.'s bid amount of $642,100 is approximately 14% below the engineer's estimate of $750,000. SubTerra Construction, Inc., is an experienced public contractor with experience in underground utility projects. Staff recommends the award of the contract to SubTerra Construction, Inc. in the amount of $642,100. Due to unforeseen conditions for undergrounding work, staff is requesting a fifteen (15) percent construction contingency for this project ($96,315). This project is scheduled to start in July 2023 and be completed by September 2023.

The plans and specifications are available for review on the City's webpage under the Government tab and Community Projects site: https://www.morganhill.ca.gov/1436/Project-Plans-Specifications-and-Bid-Res.

COMMUNITY ENGAGEMENT:

Inform
The Jackson Oaks Water Main Project is located within residential neighborhoods. Staff will work with the contractor to minimize inconveniences to residents and provide email and door notifications prior to any construction activities. Staff will also provide regular updated construction information weekly through Nextdoor and on the City’s website.

ALTERNATIVE ACTIONS:

City Council may elect not to award this construction contract and request the project be re-bid. Staff does not recommend this alternative as competitive bids were received.

Rebidding the project is not likely to result in significant savings and it will delay the project approximately three to four months.

PRIOR CITY COUNCIL AND COMMISSION ACTIONS:

11 • On August 5, 2020, the City Council approved the agreement with Mott Macdonald for on-call design support for CIP Projects.
• On December 15, 2021, the City Council adopted the Water Systems Master Plan.
• On June 15, 2022, the City Council adopted the FY2022-23 through 2027-28 Capital Improvement Program Budget.

FISCAL AND RESOURCE IMPACT:

The total authorization for the project would be $738,415, which includes a 15% contingency of $96,315. The project is sufficiently funded in the Fiscal Year 2022-23 Capital Improvement Program (CIP) budget under CIP Project 610000, Water Pipeline Repair and Replacement, utilizing Water Capital Project Funds (653).

CEQA (California Environmental Quality Act):

Categorical Exemption
The activities described in this staff report are categorically exempt under CEQA, specifically pursuant to Section 15301 of the CEQA Guidelines (Exisitng Facilities), as the work for this project involves the repair, maintenance, or minor alteration of existing City facilities involving negligible or no expansion of use of those facilities.

Sanborn Map Company, Santa Clara County, Santa Cruz County, Maxar, Microsoft
±
Engineering and Utilities Department
CIP Engineering Division
Document path: G:\R-14\PROJ\Maribel\GIS
Vicinity Map for Jackson Oaks
Water Main Replacement
0 0.01 0.03 0.06 0.09 0.12
Miles
E. Dunne Ave.

Project Location
Jackson Oaks Dr.

Project Location
Hill Top Ct.

Oak View Cir.

12 CITY COUNCIL STAFF REPORT
MEETING DATE: June 7, 2023
PREPARED BY:

Hilary Holeman, Administrative Analyst
APPROVED BY: City Manager

RATIFY CITY POSITIONS ON PENDING LEGISLATION

RECOMMENDATION(S)

1. Ratify the City’s position on pending legislation, Assembly Bill 33 (Bains) Fentanyl Addiction and Overdose Prevention Task Force;

2. Ratify the City’s position on pending legislation, Assembly Bill 367 (Maienschein) Controlled substances: enhancements;

3. Ratify the City's position on pending legislation, Assembly Bill 474 (Rodriguez) State Threat Assessment Center: transnational criminal organizations;

4. Ratify the City's position on pending legislation, Assembly Bill 955 (Petrie-Norris) Controlled substances; and

5. Ratify the City's position on pending legislation, Assembly Bill 742 (Jackson) Law enforcement: police canines.

COUNCIL PRIORITIES, GOALS & STRATEGIES
City Council Ongoing Priorities
Enhancing Public Safety and Quality of Life
Preserving and Cultivating Public Trust
Supporting our Youth, Seniors, and Entire Community
REPORT NARRATIVE:

Per Resolution No. 20-010 (Attachment 1), the City Council recognizes occasional situations arise where communication indicating support or opposition on pending State, County, or other regional boards’ legislation or action that could be important and may occur prior to the next scheduled City Council meeting. Under these circumstances, the Mayor or City Manager is delegated the authority to prepare, execute and transmit written or verbal communications indicating a City’s position when any of the following criteria are met: a) the League of California Cities, or a similar organization, has requested the City to comment or take a position, b) the timing to express a position occurs prior to the next scheduled Council meeting, and c) the pending State, County, or other regional boards’ legislation or action clearly supports or clearly hinders the implementation or fulfillment of an adopted City Council Priority, Goal, or Strategy in a substantial manner such that it is in the best interest of the City to indicate its comment or position. When this occurs, a written report to the City Council for acceptance is required at the next possible meeting.

12 BACKGROUND
On April 25, 2023, the League of California Cities sent an Action Alert (Attachment 2) for cities to send letters of support to the Assembly Committee on Public Safety urging them to support fentanyl-related legislation before the April 27, 2023 hearing. On April 27, 2023, the Mayor communicated a letter of support of all four bills (Attachment 3) electronically via the California Legislature Position Letter Portal and the League of California Cities, and sent the letter to the Assembly Public Safety Committee Chair.

BILL SUMMARIES
AB 33 - Fentanyl Addiction and Overdose Prevention Task Force Existing law, the California Uniform Controlled Substances Act, classifies controlled substances into 5 schedules and places the greatest restrictions and penalties on the use of those substances placed in Schedule I. The act classifies the drug fentanyl in Schedule II. Existing law prohibits a person from possessing for sale or purchasing for purposes of sale, specified controlled substances, including fentanyl, and provides for imprisonment in a county jail for 2, 3, or 4 years for a violation of this provision.

This bill would establish the Fentanyl Addiction and Overdose Prevention Task Force to undertake various duties relating to fentanyl abuse, including, among others, collecting and organizing data on the nature and extent of fentanyl abuse in California and evaluating approaches to increase public awareness of fentanyl abuse. The bill would require the task force to be cochaired by the Attorney General and the Surgeon General, or their designees, and would specify the membership of the task force. The bill would require the first meeting of the task force to take place no later than March 1, 2024, and would require the task force to meet at least once every 2 months. The bill would require the task force to submit an interim report to the Governor and the Legislature by January 1, 2025, and would require the task force to report its findings and recommendations to the Governor and the Legislature by July 1, 2025. The bill would repeal these provisions on January 1, 2026.

AB 367 - Controlled substances: enhancements
Existing law imposes an additional and consecutive 3- or 5-year term in the state prison on a person who personally inflicts great bodily injury on a person in the commission of a felony, as specified. This bill, until January 1, 2029, would state that, for purposes of this enhancement, a person inflicts great bodily injury when they sell, furnish, administer, or give away fentanyl or an analog of fentanyl and the person to whom the substance was sold, furnished, administered, or given suffers a significant or substantial physical injury from using the substance. The bill would specify that this provision does not apply to juvenile offenders. By expanding the scope of an existing crime, this bill would impose a state-mandated local program. 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 no reimbursement is required by this act for a specified reason.

AB 474 - State Threat Assessment Center: Transnational Criminal Organizations Existing law, the California Emergency Services Act, creates, within the Office of the