Agenda packet — Morgan Hill City Council, November 19, 2025 (part 1 of 2)

City Council
Special/Regular Meeting Agenda
Mark Turner - Mayor
Marilyn Librers - Mayor Pro Tem
Soraida Iwanaga - Council Member
Yvonne Martínez Beltrán - Council Member
Miriam Vega - Council Member
Wednesday, November 19, 2025
5:00 p.m. Closed Session
6:00 p.m. Regular Session
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 participate by teleconference/video conference. Information on how the public may observe and participate in the meeting is below.

MEETING PARTICIPATION
Morgan Hill City Council meetings are held in person. The community may attend in person or via Zoom (video/teleconference). The meetings are also live-streamed on the City’s website and Facebook page.

As a courtesy, and technology permitting, members of the public may attend online.

However, the City cannot guarantee that the public’s access to online technology will be uninterrupted, and technical difficulties may occur from time to time. Unless required by the Ralph M. Brown Act, the meeting will continue despite technical difficulties for participants using the online option.

Those wishing to participate in the meetings remotely must register in advance at https://bit.ly/CityCouncilZoomRegistration. Additionally, Zoom participants must be running the latest version or will be required to update to the latest version before being able to join the meeting remotely.

Remote participation is also available by calling (669) 900-9128 and entering webinar id: 873 3200 8380#. Dial *9 to raise your hand, and be called upon to speak for up to 3

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November 19, 2025
2 minutes. Dial *6 to unmute.

PUBLIC COMMENT
Public comment may be offered verbally at the meeting or in writing before the meeting.

Public comment is limited to three minutes, but the Mayor may adjust time limits for individual or total comments while ensuring all viewpoints are heard, encouraging speakers to avoid repetition, and allowing a designated spokesperson for organized support or opposition to present longer if needed.

Those attending remotely may only offer public comment for items on the agenda in one of four categories:
• Consent Calendar
• Other Business
• Public Hearings
• Closed Session
Public comment will be heard from those attending in person first, with the submission of a speaker card. Once that is complete, we will move to those on Zoom who have their hand raised. Following public comment from Zoom, we will close the public comment period for that item.

Remote public comment for items not on the agenda will not be accepted.

Written public comment may be submitted to the City Clerk:
• In person at the City Council Meeting;
• Via email to [email protected]; or
• Hand delivered or mailed 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) so that your comments can be submitted to the members of the City Council with sufficient time to review them. 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 noon (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. It is recommended that you do not include any personal information that you do not want to be posted on the web. Please be advised that communications directed to the City Council are public records and are subject to disclosure pursuant to the California Public Records Act and Brown Act unless exempt from disclosure under the applicable law. Communications

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November 19, 2025
3 will NOT be edited for redactions and will be printed/posted as submitted.

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 or by email at [email protected]. Requests must be made as early as possible and at least two full business days before the start of the meeting.

SPECIAL/REGULAR MEETING
A special meeting of the City Council is called at 5:00 p.m. 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
Public Employment (§ 54957)
Title: City Attorney

OPPORTUNITY FOR PUBLIC COMMENT ON CLOSED SESSION

ADJOURN TO CLOSED SESSION

REGULAR MEETING
6:00 p.m.

SILENT INVOCATION

PLEDGE OF ALLEGIANCE

PRESENTATIONS

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November 19, 2025
4 YAC Presentation — November Developmental Asset #41, Positive Cultural Identity

RECOGNITIONS
YAC Recognition of Mike Cox

CITY COUNCIL REPORTS
Council Member Vega

OTHER REPORTS

CITY MANAGER'S REPORT

CITY ATTORNEY'S REPORT

PUBLIC COMMENT FOR ITEMS NOT ON THE AGENDA
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 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. ADOPT WEED ABATEMENT RESOLUTION, DECLARING WEEDS TO BE A

PUBLIC NUISANCE AND SETTING A PUBLIC HEARING DATE OF
FEBRUARY 18, 2026
Recommendation:

Adopt the resolution declaring weeds and brush to be a nuisance and setting the hazardous vegetation public hearing for February 18, 2026.

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November 19, 2025
5 2. ADOPT ORDINANCE NO. 2369, NEW SERIES, AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF MORGAN HILL AMENDING CHAPTER 5.28 (“AMUSEMENT AND ENTERTAINMENT PREMISES”) TO TITLE 5
(“BUSINESS LICENSES GENERALLY”) OF THE MORGAN HILL MUNICIPAL CODE
Recommendation:

Waive the reading, adopt Ordinance No. 2369, 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 ORDINANCE NO. 2370, NEW SERIES, AN ORDINANCE OF THE

CITY COUNCIL OF THE CITY OF MORGAN HILL AMENDING THE

HIGHWAY COMMERCIAL (CH) PLANNED DEVELOPMENT (PD) OVERLAY ZONE ON A 25.3-ACRE SITE ON THE SOUTHWEST CORNER OF CONDIT ROAD AND DIANA AVENUE (ZA2025-0001 CONDIT – AUTO PARK PD) APN’S: 728-17-031, -035, and -036
Recommendation:

Waive the reading, adopt Ordinance No. 2370, 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.

4. ADOPT ORDINANCE NO. 2371, NEW SERIES, AN ORDINANCE OF THE

CITY COUNCIL OF THE CITY OF MORGAN HILL AMENDING THE

DEVELOPMENT PLAN FOR A PLANNED UNIT DEVELOPMENT (PUD) ON A 35 ACRE SITE ON THE WEST SIDE OF CONDIT ROAD BETWEEN DUNNE AND TENNANT AVENUES (ZA2025-0002 CONDIT – CONDIT ROAD PUD) APN’S 817-12-001,-003, -004, -018, -019; 817-13-019-022, -024, -026,027, 029-032, and 034-035
Recommendation:

Waive the reading, adopt Ordinance No. 2371, 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.

5. ADOPT ORDINANCE NO. 2372, NEW SERIES, AN ORDINANCE OF THE

CITY COUNCIL OF THE CITY OF MORGAN HILL AMENDING THE

HIGHWAY COMMERCIAL (CH) PLANNED DEVELOPMENT (PD) OVERLAY ZONE ON A 9.27 ACRE SITE ON THE NORTH SIDE OF THE EASTERN TERMINUS OF LAUREL ROAD (ZA2025-0005 LAUREL – HONDA) APN’S:
726-01-001, 726-01-006, AND 726-01-007
Recommendation:

Waive the reading, adopt Ordinance No. 2372, 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.

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November 19, 2025
6 6. ADOPT ORDINANCE NO. 2373, NEW SERIES, AN ORDINANCE OF THE

CITY COUNCIL OF THE CITY OF MORGAN HILL AMENDING THE TENNANT

STATION SHOPPING CENTER PLANNED UNIT DEVELOPMENT (PUD) ON A 21.88 ACRE SITE ON THE SOUTHEAST CORNER OF MONTEREY ROAD AND TENNANT AVENUE (AAE2025-0003 TENNANT-TENNANT STATION PD) APN’S: 817-06-041, 055, 056, 057, AND 058
Recommendation:

Waive the reading, adopt Ordinance No. 2373, 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.

7. ADOPT MORGAN HILL'S APPROACH TO PUBLIC SERVICE
Recommendation:

Adopt "Morgan Hill's Approach to Public Service."

8. APPROVE THE SECOND AMENDMENT TO SUBDIVISION IMPROVEMENTS AGREEMENT FOR MANZANITA PARK - TRACT NO. 10585 LOCATED EAST OF THE MONTEREY ROAD/TILTON AVENUE INTERSECTION (APN:725-01- 035 and 725-16-001)
Recommendation:

1. Approve the Second Amendment to Subdivision Improvements Agreement for Manzanita Park - Tract No. 10585;

2. Authorize the City Manager to execute the Second Amendment to Subdivision Improvements Agreement with TOLL WEST COAST LLC (Subdivider); and

3. Authorize the recordation of the Second Amendment to Subdivision Improvements Agreement.

9. APPROVE THE NOVEMBER 5 AND NOVEMBER 10, 2025 CITY COUNCIL

MEETING MINUTES
Recommendation:

Approve the November 5 and November 10, 2025 City Council Meeting Minutes.

10. RECEIVE REPORT REGARDING UPCOMING 2026 COMMISSION

VACANCIES PER THE MADDY ACT
Recommendation:

Receive report.

PUBLIC HEARINGS

11. ADOPT ORDINANCE 2368, NEW SERIES, AMENDING CHAPTERS 15.08 (BUILDING CODE), 15.12 (ELECTRICAL CODE), 15.16 (MECHANICAL

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November 19, 2025
7 CODE), 15.20 (PLUMBING CODE), 15.44 (FIRE CODE), AND TO ADOPT BY REFERENCE THE 2025 CALIFORNIA BUILDING STANDARDS CODES

KNOWN AND DESIGNATED AS CALIFORNIA CODE OF REGULATIONS, TITLE 24
Recommendation:

1. Open/close the public hearing;

2. Waive the second reading of the ordinance; and

3. Adopt the ordiance.

12. CONDUCT TAX AND EQUITY FISCAL RESPONSIBILITY ACT (TEFRA)

HEARING APPROVING ISSUANCE OF BONDS FOR VILLAGE AT
MADRONE APARTMENT PROJECT LOCATED AT 18730 MINER LANE

WITHIN THE CITY OF MORGAN HILL
Recommendation:

1. Open and close public hearing consistent with the requirements of the Federal Tax and Equity Fiscal Responsibility Act ("TEFRA") and Section 147 (f) of the Internal Revenue Code of 1986, as amended (the “Code”); and

2. Adopt a resolution approving the issuance of revenue bonds by the California Municipal Finance Authority (CMFA), for the acquisition, construction, improvement and equipping of Village at Madrone, a 249- multifamily rental housing project located at 18730 Miner Lane, Morgan Hill, California (the “Project”).

OTHER BUSINESS

13. APPROVE THE 2026 CITY COUNCIL MEETING SCHEDULE
Recommendation:

Review, discuss, if needed, amend, and approve the 2026 City Council meeting schedule.

14. RECEIVE MONTHLY BUDGET UPDATE; SEPTEMBER 2025 FINANCIAL AND INVESTMENT REPORTS; AND CITY MANAGER AUTHORITY REPORT Recommendation:

Receive and file reports.

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.

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November 19, 2025
8 ADJOURNMENT

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November 19, 2025
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 described in the notice of this meeting during consideration of that item. If you wish to address the Council on any item on this agenda, please complete a speaker request card located in the foyer of the Council Chambers and deliver it to the Minutes Clerk before the City Council discussion on the item. You are not required to give your name on the speaker card 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 request an item on the agenda for a future City Council meeting. 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].

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November 19, 2025
10

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November
Developmental Asset #41
Positive Cultural Identity: Young person feels
comfortable with and is proud of their identity.

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A real-life topic that connects with this
month developmental assets is:

Imposter Syndrome

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Kahmani Joseph
YAC Active Member
● Staying connected with long distance family
● Positive self image
● Culturally connected

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DJ William
YAC President
● Experiencing my Culture through Food
● Coping with Distance
● The Impact of exploring other cultures

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Aakash Shakya
YAC Active Member
● Cultural Connection and Family Values
● Balancing Dual Identities
● Pride and Resilience in Heritage

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“Your culture is your most valuable asset.

Guard it with your life.” — Brian Chesky,
co-founder of Airbnb

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1 CITY COUNCIL STAFF REPORT
MEETING DATE: November 19, 2025
PREPARED BY:

Nichole Martin, Community Services Coordinator
APPROVED BY: City Manager

ADOPT WEED ABATEMENT RESOLUTION, DECLARING WEEDS TO

BE A PUBLIC NUISANCE AND SETTING A PUBLIC HEARING DATE
OF FEBRUARY 18, 2026

RECOMMENDATION(S)
Adopt the resolution declaring weeds and brush to be a nuisance and setting the hazardous vegetation public hearing for February 18, 2026.

COUNCIL PRIORITIES, GOALS & STRATEGIES
City Council Ongoing Priorities
Enhancing Public Safety
REPORT NARRATIVE:

Under Government Code section 39561, cities may adopt a resolution declaring weeds and dry brush to be a public nuisance and order their abatement (Attachment 1). Weed and brush abatement services constitute the City’s weed abatement program and are key to reducing fire risk and protecting public safety.

The City of Morgan Hill has contracted with Santa Clara County for weed and brush abatement services since 1996. In the last several years, City and County staff have successfully worked together to streamline program administration and improve communications with Morgan Hill property owners. The County’s Consumer and Environmental Protection Agency - Weed Abatement Program manages the program.

As in prior years, staff has combined the initial resolution for both the weed and brush abatement programs. Staff proposes that the abatement program commencement hearing take place on February 18, 2026.

Once the resolution is adopted, County staff will notify the affected property owners of the February 18th public hearing and of their obligations to abate hazardous vegetation before the deadline. In response to the City’s past request for more notification to the property owners, the County will also be mailing a courtesy notice out to affected property owners in the early Spring to further remind them of their obligations. The City’s Fire Department and the County’s Weed Abatement Division are continuing to integrate their efforts and communication methods to enhance customer service. The improvements instituted have eliminated customer complaints about receiving conflicting information from the two programs.

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1 COMMUNITY ENGAGEMENT:

Empower
The weed abatement program relies on a full range of community engagement approaches. Much of it begins when the County Program or City Fire Department informs a property owner that a hazardous situation has been observed on their property. The owner is given several months during which they may consult and work together with program staff to understand the situation and the needed remedies.

Ultimately, each property owner is invited and empowered to remedy the situation themselves in order to minimize their program charges while maintaining public safety.

In addition, many of the properties on the original list got onto the list as a result of a complaint from a community member about a hazardous situation.

ALTERNATIVE ACTIONS:

The Council could choose not to act or delay action on this resolution. Not declaring weeds and brush to be a nuisance would potentially compromise community fire safety.

Delaying action would ultimately provide the affected property owners with less notice and time to plan for abating their hazardous vegetation.

PRIOR CITY COUNCIL AND COMMISSION ACTIONS:

While this will be the first Council action addressing hazardous vegetation for the 2026 fire season, the recommended approach is consistent with the actions taken by the Council for over a decade.

FISCAL AND RESOURCE IMPACT:

The Weed Abatement Program is designed to be user-fee supported. The per-lot assessment includes costs for doing the weed and brush control work plus overhead County costs to administer the program. Based on the City’s agreement with the County, the City may need to ultimately contribute to the program’s costs if user fee revenues do not completely cover all of the County’s costs. Administering this program is an activity anticipated in the Public Services and Fire Departments’ work programs and budgets. Fees imposed by the County Program do not cover the cost of the City staff time associated in providing oversight and those resources are budgeted and funded through the General Fund (010).

CEQA (California Environmental Quality Act):

Categorical Exemption These activities are categorically exempt from environmental review under the California Environmental Quality Act pursuant to California Code of Regulations, Title 21, Section 15304(i) (Minor Alterations to Land – Fuel Management Activities).

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RESOLUTION NO. 25-XXX

A RESOLUTION OF THE CITY COUNCIL OF THE CITY

OF MORGAN HILL DECLARING CERTAIN HAZARDOUS

VEGETATION GROWING IN THE CITY OF MORGAN

HILL TO BE A PUBLIC NUISANCE, DESCRIBING
PROPERTIES WHERE SUCH NUISANCE EXISTS;

ORDERING ABATEMENT AND SETTING A PUBLIC

HEARING THEREON
WHEREAS, the City Council finds that certain weeds and brush are growing in the City of Morgan Hill upon the various streets, alleys, sidewalks, and upon private property, which said weeds and brush bear seeds of a wingy or downy nature, or may attain such growth as to become, when dry, a fire menace, or which are otherwise noxious and dangerous; and WHEREAS, the City Council further finds and declares that said weeds and brush constitute a public nuisance.

NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Morgan Hill authorizes as follows:

1. That the weeds, as described in the above recital, constitute and will continue to constitute a public nuisance, and it is ordered that this public nuisance be abated in the manner provided in Title 8, Chapter 8.20 of the Morgan Hill Municipal Code.

2. That the nuisance exists upon all streets, alleys, sidewalks, and private property within said City as shown, described and delineated on the several maps of the property in the City, which are recorded in the Office of the County Recorder of the County of Santa Clara, reference in each instance for the description of any particular street, alley, or private property being hereby made to the several maps mentioned, and in the event of there being several subdivision maps on which lots are shown, reference is hereby made to the latest subdivision map.

3. That it is ordered that Wednesday, the 18th day of February 2026, at 6:00 p.m., in the Council Chambers of the City Council of the City of Morgan Hill is hereby fixed as the time and place when objections to the proposed destruction or removal of weeds shall be heard and be given due consideration.

4. That the City Clerk of the City of Morgan Hill is hereby ordered and directed to cause notice of the adoption of this Resolution and notice of hearing to be given to property owners pursuant to Section 39562.1 of the Government Code.

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City of Morgan Hill
Resolution No. 25-xxx

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PASSED AND ADOPTED by the City Council of Morgan Hill at a Regular Meeting held on the 19th day of November 2025 by the following vote:

AYES: COUNCIL MEMBERS:

NOES: COUNCIL MEMBERS:

ABSTAIN: COUNCIL MEMBERS:

ABSENT: COUNCIL MEMBERS:

APPROVED: ATTEST:

MARK TURNER, Mayor MICHELLE BIGELOW, City Clerk
 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.25-xxx, adopted by the City Council at the meeting held on November 19, 2025.

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

DATE:

MICHELLE BIGELOW, City Clerk

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2 CITY COUNCIL STAFF REPORT
MEETING DATE: November 19, 2025
PREPARED BY:

Michelle Bigelow, City Clerk
APPROVED BY: City Manager
ADOPT ORDINANCE NO. 2369, NEW SERIES, AN ORDINANCE OF

THE CITY COUNCIL OF THE CITY OF MORGAN HILL AMENDING
CHAPTER 5.28 (“AMUSEMENT AND ENTERTAINMENT PREMISES”)
TO TITLE 5 (“BUSINESS LICENSES GENERALLY”) OF THE MORGAN

HILL MUNICIPAL CODE

RECOMMENDATION(S)
Waive the reading, adopt Ordinance No. 2369, 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
2022-2023 Strategic Priorities
Fiscal Sustainability
Economic Development
Guiding Documents
Economic Blueprint
Morgan Hill 2035 General Plan
REPORT NARRATIVE:

On November 5, 2025, the City Council introduced Ordinance No. 2369 New Series, by the following roll call vote: AYES: Vega, Iwanaga, Martinez Beltran, Turner; NOES:

None; ABSTAIN: None; ABSENT: Librers.

The proposed ordinance modernizes Chapter 5.28 of the Morgan Hill Municipal Code to update entertainment permit regulations first adopted in 1998. The amendments clarify definitions, allow live entertainment by right until 10:00 p.m. for compliant establishments, and align the permit process with other City policies to ensure public safety and consistency. The updates aim to support a lively, diverse, and safe entertainment environment consistent with the City’s Economic Blueprint and Tourism goals.

COMMUNITY ENGAGEMENT:

Inform.

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2 The City's Economic Development team had one-on-one conversations with several restaurant operators to share the draft amendment and gather their feedback.

The City's Economic Development team conducted outreach by attending meetings and sharing a draft of the ordinance amendment with the following organizations.

Morgan Hill Chamber of Commerce
Downtown Morgan Hill Improvement District
Morgan Hill Downtown Association
On October 13, 2025, the City's Economic Development team, along with the Chief of Police, conducted a virtual Zoom meeting with business operators and property owners to share the draft amendment and gather their feedback.

Feedback from business owners and operators has been supportive, emphasizing flexibility for daytime entertainment and clarity in permitting requirements.

ALTERNATIVE ACTIONS:

Not Applicable.

PRIOR CITY COUNCIL AND COMMISSION ACTIONS:

On November 5, 2025, the City Council introduced the ordinance.

FISCAL AND RESOURCE IMPACT:

The ordinance modernization is not anticipated to have a significant fiscal impact. Staff time for application review and enforcement will be offset by permit fees.

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.

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ORDINANCE NO. 2369, NEW SERIES

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
MORGAN HILL AMENDING CHAPTER 5.28 (“AMUSEMENT
AND ENTERTAINMENT PREMISES”) TO TITLE 5
(“BUSINESS LICENSES GENERALLY”) OF THE MORGAN

HILL MUNICIPAL CODE

THE CITY COUNCIL OF THE CITY OF MORGAN HILL, CALIFORNIA DOES ORDAIN AND ENACT AS FOLLOWS:

SECTION 1: Chapter 5.28 (“Amusement and Entertainment Premises”) of Title 5 (“Business Licenses Generally”) is hereby amended to read as follows:
“5.28 Amusement and Entertainment Premises

5.28.010 Purpose.

The purpose of this chapter is the protection of the public safety and welfare by allowing establishments to provide entertainment which does not create a public nuisance or require excessive public safety resources to maintain order.

5.28.020 Definitions.

The following definitions shall be for the purpose of this chapter only, unless specifically adopted by another section of the Morgan Hill Municipal Code. "Dancing" means the movement of the human body, accompanied by music or rhythm, except however, dancing as used in this chapter means dancing by patrons only. "Entertainment" means a single event or series of events, or an ongoing activity or business, occurring as a principle use or business or part of another business, to which the public may be invited to watch, listen, or participate, or is conducted for the purposes of holding the attention of, gaining the attention of or diverting or amusing guests or patrons, including but not limited to:

1. Any amusement or event such as live music or other performance which is knowingly permitted by an establishment subject to this chapter, including presentations by performer(s) such as musicians, disc jockeys (DJs), operators of karaoke, hypnotists, pantomimes, poets, comedians, song or dance acts, dancing by the patrons, or other such demonstrations of talent or such activity which may be attended by members of the public whether or not the participants in said activities are compensated by the establishment.

2. Establishments are exempt from this chapter which only provide juke boxes, televisions, video games, video programs, or recorded music and no other entertainment as herein defined.

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City of Morgan Hill
Ordinance No. 2369, New Series

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"Establishment" means any location within the limits of the City of Morgan Hill to which the public may be invited where food and/or alcoholic beverages are served. "Lewd conduct" is the touching of genitals, buttocks or breasts in public view for the purposes of sexual, arousal, gratification or affront, or any violation of Sections 288, 288(a), 311.6, 314, 647(a) or 647(b) of the California Penal Code. "Obscene" is defined by any applicable current standard set by California or federal case law.

5.28.030 Entertainment permit required.

A. Entertainment or dancing conducted between the hours of 8:00 a.m. and 10:00 p.m. shall be allowed by right, provided the establishment complies with all other applicable laws and ordinances.

B. No person shall provide or permit any type of entertainment or dancing in a restaurant, nightclub, bar or establishment where food and/or alcoholic beverages are served and which is open to the public between the hours of 10:00 P.M. and 8:00 A.M unless such person shall first obtain a permit to do so from the Chief of Police or their designee as hereinafter provided.

5.28.040 Exemptions.

Entertainment events which are conducted by or sponsored by nonprofit charitable organizations, community service organizations or are provided for members and their guests at a private club where admission is not open to the public, or at a private residence where the public is not invited, or conducted in connection with regularly established community recreation programs, carnivals, or recreation parks are exempt from the provisions of this chapter.

5.28.050 Entertainment restrictions.

Entertainment provided by or allowed by the permittee shall be restricted to that type of entertainment which is specified in the entertainment permit. In addition, the permittee is responsible to preserve the peace and maintain order within and immediately adjacent to the premises upon which the entertainment permit has been granted and to comply with all conditions specified in the permit.

5.28.060 Entertainment permit—Application.

A. If a conditional use permit, or any other entitlement or license, except a certificate of occupancy, is required for the use of any establishment which proposes to provide, or which does provide, entertainment or dancing, the provisions of those permits shall be satisfied before application is made to the City for a permit under the provisions of this chapter.

B. An application for an entertainment permit or the renewal of such permit shall be filed with the police department at least thirty days in advance of the term, date or dates for

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City of Morgan Hill
Ordinance No. 2369, New Series

Page 3 of 9 ends

which the application is made on forms provided by the City and shall be accompanied by the appropriate fee.

5.28.070 Permit—Application contents.

Each application for an entertainment permit shall contain:

A. A complete identification of the applicant;
B. The name, address, and telephone number of the owner of the real property upon, in, or from which the establishment is to be operated. In the event the applicant is not the legal owner of the property, the application shall be accompanied by a copy of any written lease between the applicant and the property owner authorizing the establishment to offer live entertainment on its premises, or, alternatively, if there is no written lease, then a written, notarized acknowledgment from the property owner that the property owner has been advised that live entertainment will be offered by the applicant upon, in, or from the property owner's property.

C. The names, residential addresses, business addresses and phone numbers of the managers or persons in charge;
D. The names, residential addresses, business addresses and phone numbers and written consent of the owner of the premises who shall give consent to entertainment being conducted upon the premises by signing the application in the space provided; E. A floor plan and site plan showing the building interior rooms and grounds, including parking spaces, the square footage, seating capacity of the area thereof to be used for dancing or entertainment and emergency exits; F. The exact nature of the proposed business which the permit is being requested and the exact nature in detail of the dancing or entertainment which is being proposed; G. Whether or not any person referred to in subsections A through D of this section has had a permit for the same or similar business suspended or revoked anywhere and, if so, the circumstances of such suspension or revocation. The suspension of an Alcoholic Beverage Control license shall be considered as being included within the purposes of the subsection;
H. The hours of operation; and
I. Such other related information as the Chief of Police may require to preserve the public peace, safety, health and welfare of the city or its inhabitants.

5.28.75 Permit—Denial.

A. The Chief of Police or their designee may deny an application for a live entertainment permit on any of the following grounds:

1. The live entertainment, as proposed by the applicant, would not comply with the requirements of this chapter.

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2. The live entertainment, as proposed by the applicant, would not comply with any applicable law, including, but not limited to, the City's building, fire, zoning, and health regulations.

3. The applicant has knowingly made any false, misleading or fraudulent statement of material fact in the application for a live entertainment permit. Any omission or falsified information within the application will result in an automatic denial.

4. Any owner of the establishment offering live entertainment, within five years immediately preceding the date of filing of the application, has been convicted in a court of competent jurisdiction of any offense that relates directly to the offering of live entertainment or has at any time been convicted in a court of competent jurisdiction of any felony the commission of which occurred on the premises of the establishment.

5. Any owner of the establishment offering live entertainment in the City of Morgan Hill that is not in good standing due to the existence of uncorrected violations or unpaid fines or fees.

6. Within the last five years, the applicant has failed to comply with a final court order or administrative action of an investigatory agency finding a violation of applicable federal, state and local wage and hour laws, including, but not limited to, the Federal Fair Labor Standards Act, the California Labor Code, and any local minimum wage ordinance or prevailing wage requirements. For purposes of this subsection, a final court order or administrative action is one as to which there is no pending appeal and the time for filing an appeal has passed.

7. The establishment offered live entertainment within the City without first obtaining a live entertainment permit from the Police Department of the City of Morgan Hill.

B. The City shall not accept an application for the same or substantially similar live entertainment permit for the same site for a period of twelve months following the denial of a permit, or the date the denial was upheld, whichever is later.

C. The notices provided to the establishment offering live entertainment pursuant to this section may also be sent to the owner of the premises where the establishment is located. However, failure to provide notice to the property owner shall not invalidate any actions taken by the City.

D. The applicant or employee has been issued a citation for an ABC violation within 1 year of application.

5.28.080 Permit—Granting.

Upon receipt of an application, and after an investigation, the Chief of Police or their designee shall approve the application for the entertainment permit or the renewal of such permit upon finding that:

A. A completed written application form therefore has been filed and the required fee has been paid to the City; and

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B. As a result of such investigation all applicable provisions of this chapter with regard to permit application have been met and that the operation by the applicant will be carried on in a building, structure, and location which complies with and meets all of the health, zoning, fire, building and safety requirements and standards of the law of the State and the City applicable to business operation; and C. The applicant, employees, agents or any person connected with or associated with the applicant as a partner, director, officer or manager has not been convicted in a court of competent jurisdiction by final judgement within the last ten years of:

1. An offense involving the presentation, exhibition, or performance of an obscene production or play, or

2. An offense involving lewd conduct, or

3. A felony offense involving the use of force and violence upon the person of another; and
D. That the applicant, employees, agents, or any person connected with or associated with the applicant as a partner, director, officer or manager has not knowingly made any false, misleading or fraudulent statement of a material fact in the application for the permit or in any report or record required to be filed with any City agency; and E. That the applicant has not had a similar type of permit previously revoked for good cause within the past year, unless the applicant has shown a material change in the circumstances since the date of revocation.

5.28.090 Permit—Conditions.

A. Upon the approval of the application for an entertainment permit or the renewal of such permit, the Chief of Police or their designee shall issue such permit to the applicant upon such terms and conditions and restrictions not in conflict with any paramount law and as may be necessary to protect the public peace, health, safety and general welfare of the city or its inhabitants.

Such conditions may include, for restaurants, bars, and nightclubs, the implementation and maintenance of a security plan consistent with a nationally recognized standard for nightlife safety, surveillance and monitoring system, entry and identification controls, responsible alcohol service, including trained and licensed security personnel, incident reporting and police cooperation, environmental and preventive crime design, compliance and enforcement, and appropriate crowd management measures.

B. Every person holding a permit issued pursuant to this chapter shall keep the permit posted in a conspicuous place in clear view upon the premises to which it applies.

The permit shall be physically displayed similar to a food safety card and must include details of the permit and contact information for the Code Enforcement Division for the purpose of receiving complaints.

C. The permittee shall provide neighbor notification as part of the permitting process.

Notification procedures shall include timely written notice to property owners and tenants

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within a reasonable radius of the proposed establishment, with instructions on how to submit concerns or objections to the City.

D. The operator shall not shut, turn off, or reduce the intensity of lighting in the area used for dancing to such an extent as to provide less lighting or illumination than is customary for rooms or areas of like dimensions, or to a degree that makes it difficult or impossible to clearly see or identify individuals dancing on the floor provided for dancing.

E. All entertainers and employees shall be clothed in such a way as to not expose specified anatomical areas, as defined in Section 18.92.020, at any time while working or performing at the establishment.

F. The floor space provided for dancing shall be free of any furniture, obstructions, or partitions and maintained in a safe condition at all times.

5.28.100 Permit Issuance.

Notice of the decision of the chief of police or their designee with reference to a permit application pursuant to this chapter shall be given to the applicant or any other such person requesting such notice within thirty days after the receipt of an application for a permit or the renewal of such permit.

5.28.110 Permit—Terms.

The term date or dates for the permitted entertainment shall be for the dates of the specific occasion requested, or if the request is for a continuous permit, the permit shall be issued for a period of not longer than one year from the original date of issue, renewable at the time the establishment's annual business license is renewed.

5.28.120 Revocation of permit—Hearing.

A. The Chief of Police or their designee shall give written notice of the proposed revocation or suspension of any permit granted pursuant to this chapter to the permittee. The notice shall set forth the date that the revocation or suspension is effective, the time and place of the informal meeting with the police chief or their designee, the ground or grounds upon which the revocation or suspension is based, the pertinent code sections, and a brief statement of the factual issues in support thereof. The notice shall be mailed to the permittee at the business address at least ten business days prior to the effective date of the suspension or revocation, unless immediate revocation is necessary to protect the public health and safety, such as criminal activity resulting in the arrest of one or more individuals at the establishment or building code violations that render the establishment unsafe to occupy.

B. No appeal may be taken to any such administrative decision made by the Chief of Police or their designee pursuant to the provisions of this chapter unless such decision to appeal has been first taken up with the Chief of Police. This shall be an informal meeting to allow the permittee to provide evidence that the permit should not be suspended or revoked.

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C. Failure to attend an informal meeting with the Chief of Police or their designee shall be deemed a forfeiture of any right to appeal the decision to suspend or revoke a permit.

D. Within ten business days of the informal meeting, the Chief of Police or their designee shall render his or her decision in writing, stating his or her findings and the action taken, if any. The decision letter shall be mailed to the permittee at the business address. The decision letter shall include the information of the right to appeal.

E. The permittee may appeal the decision to suspend or revoke a live entertainment permit by filing a written notice of appeal with the City Manager, within ten days from the deposit of the decision letter in the mail or its receipt by the permittee, whichever occurs first, specifying in detail the ground or grounds for the appeal.

F. The City Manager or their designee shall set a time and place for the hearing on the appeal not less than fifteen days and not more than sixty days from the date the appeal was received by the City Manager or their designee and shall give at least five days’ written notice by mail to the permittee of the date, time, and place for the hearing. The hearing shall be conducted in accordance with Section 5.28.121.

G. After the hearing on the appeal, the hearing officer may refer the matter back to the Chief of Police for a new investigation and decision, may affirm the decision of the Chief of Police or their designee, may dismiss the disciplinary action, or may revoke or suspend the permit. The permittee will be notified by the City Manager or their designee. The decision of the hearing officer upon such appeal shall be final and shall be subject to judicial review according to the provisions and time limits set forth in Code of Civil Procedure Section 1094.6.

H. The notices provided to the live entertainment permit holder pursuant to this section may also be sent to the owner of the premises where the live entertainment is offered.

However, failure to provide notice to the property owner shall not invalidate any actions taken by the city.

5.28.125 Hearing Rules.

The following rules shall apply to any hearing required by this chapter.

A. The City Manager or their designee may hear the appeal or designate a City employee or third party to act as the hearing officer.

B. All parties involved shall have the right to offer testimonial, documentary, and tangible evidence bearing on the issues, to be represented by counsel, and to confront and crossexamine witnesses.

C. Any relevant evidence may be admitted if it is the sort of evidence upon which reasonable persons are accustomed to rely in the conduct of serious affairs.

D. The hearing officer may conduct the hearing informally, both as to rules of procedure and admission of evidence, in any manner which will provide a fair hearing.

E. A continuance may be granted for good cause if the party seeking the continuance has made a good faith effort to prevent the recurrence of the incident that led to the notice of intent to revoke or suspend.

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F. If the Chief of Police or their designee submits an additional written report concerning the revocation or suspension to the hearing officer for consideration at the hearing, then a copy of this report also shall be mailed to the person requesting the hearing at least five days prior to the date of the hearing. Any administrative citation, revocation or suspension letter, and any additional report submitted by the Chief of Police shall constitute prima facie evidence of the respective facts contained in those documents.

G. The standard of proof shall be by a preponderance of the evidence.

H. Failure to attend an appeal hearing is grounds for dismissal of the appeal and constitutes a failure to exhaust the administrative remedies.

5.28.130 Revocation of permit—Reapplication.

Whenever a permit is revoked under the terms of this chapter, no other application for a permit under this chapter shall be considered from the same applicant for the same type of use for a period of one year from the date of such revocation.

5.28.140 Violations.

Any establishment offering live entertainment operated, conducted, or maintained contrary to the provisions of this chapter is unlawful and a public nuisance.

SECTION 2. Severability. If any part of this Ordinance is held to be invalid or inapplicable to any situation by a court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of this Ordinance or the applicability of this Ordinance to other situations.

SECTION 3. Effective Date; Publication. This ordinance shall take effect thirty (30) days after the date of its passage and adoption. The City Clerk is hereby directed to publish in full or summary this ordinance pursuant to §36933 of the Government Code in a newspaper of general circulation in the City of Morgan Hill.

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THE FOREGOING ORDINANCE WAS INTRODUCED AND THE TITLE THEREOF

READ AT A REGULAR MEETING OF THE CITY COUNCIL OF THE CITY OF MORGAN HILL HELD ON THE 5TH DAY OF NOVEMBER 2025, AND WAS FINALLY ADOPTED AT A REGULAR MEETING OF SAID COUNCIL ON THE 19TH DAY OF NOVEMBER 2025, AND SAID ORDINANCE WAS DULY PASSED AND ADOPTED IN ACCORDANCE WITH LAW 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

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. 2369, New Series, adopted by the City Council of the City of Morgan Hill, California at their regular meeting held on the 19th day of November 2025.

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

DATE: _____________________ _________________________________ MICHELLE BIGELOW, City Clerk

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3 CITY COUNCIL STAFF REPORT
MEETING DATE: November 19, 2025
PREPARED BY:

Michelle Bigelow, City Clerk
APPROVED BY: City Manager
ADOPT ORDINANCE NO. 2370, NEW SERIES, AN ORDINANCE OF

THE CITY COUNCIL OF THE CITY OF MORGAN HILL AMENDING THE

HIGHWAY COMMERCIAL (CH) PLANNED DEVELOPMENT (PD)
OVERLAY ZONE ON A 25.3-ACRE SITE ON THE SOUTHWEST
CORNER OF CONDIT ROAD AND DIANA AVENUE (ZA2025-0001
CONDIT – AUTO PARK PD) APN’S: 728-17-031, -035, AND -036

RECOMMENDATION(S)
Waive the reading, adopt Ordinance No. 2370, 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
2022-2023 Strategic Priorities
Fiscal Sustainability
Economic Development
Guiding Documents
Economic Blueprint
Morgan Hill 2035 General Plan
REPORT NARRATIVE:

On November 5, 2025, the City Council introduced Ordinance No. 2370 New Series, by the following roll call vote: AYES: Vega, Iwanaga, Martinez Beltran, Turner; NOES:

None; ABSTAIN: None; ABSENT: Librers.

This Ordinance amends the allowed uses of the Planned Development zoning to eliminate limitations on the number of vehicle sales establishments.

COMMUNITY ENGAGEMENT:

A 10-day public hearing notice was published in the Friday, October 24, 2025, edition of the Morgan Hill Times pursuant to Government Code Section 65090-65096. A notice was also mailed to property owners within 300 feet of the project sites.

A 20-day public hearing notice was published in the Friday, August 29, 2025, edition of

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3 the Morgan Hill Times pursuant to Government Code Section 65090-65096. A notice was also mailed to property owners within 300 feet of the project sites.

On September 23, 2025, the Planning Commission held a duly noticed public hearing where they considered public testimony along with a Staff Report, exhibits, and other materials. The Planning Commission agenda packet including the Public comments received at the hearing is linked here.

Prior to the June 24, 2025, Planning Commission workshop and the September 23, 2025, Planning Commission meeting, City staff conducted individual outreach to the Auto Dealers within the Auto Park PUD.

On July 10, 2025, City staff provided an update to the Morgan Hill Chamber of Commerce Economic Development Committee on the proposed Zoning Amendments.

On June 24, 2025, staff conducted a Planning Commission workshop for the commission to review and provide feedback on the proposed zoning amendments, except for ZA2025-0005: Laurel - Honda PD Amendment, which was added to the Cityinitiated PUD amendments after the workshop. In advance of the June 24, 2025, Planning Commission Workshop, business and property owners located within the Auto Park and Condit Road PUDs were contacted via email and standard mail. The Planning Commission agenda packet including the Public comments received at the hearing is linked here.

ALTERNATIVE ACTIONS:

Not Applicable.

PRIOR CITY COUNCIL AND COMMISSION ACTIONS:

On September 23, 2025, the Planning Commission recommended approval of the Zoning Amendment of the City Council with no changes.

On November 5, 2025 the City Council introduced the Zoning Amendment ordinance.

FISCAL AND RESOURCE IMPACT:

The proposed City initiated zoning amendments are aimed at stimulating Economic Development, thus increasing the amount of sales tax and transient occupancy tax (TOT) collected by the City.

CEQA (California Environmental Quality Act):

This ordinance is categorically exempt from environmental review under Section 15061(b)(3) of the California Environmental Quality Act (CEQA) Guidelines. The proposed text amendments are covered by the common-sense exemption that CEQA applies only to projects that have the potential for causing a significant effect on the environment. Where it can be seen with certainty that there is no possibility that the activity in question may have a significant effect on the environment, the activity is not subject to CEQA.

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ORDINANCE NO. 2370, NEW SERIES

AN ORDINANCE OF THE CITY COUNCIL OF THE

CITY OF MORGAN HILL AMENDING THE HIGHWAY

COMMERCIAL (CH) PLANNED DEVELOPMENT (PD)
OVERLAY ZONE ON A 25.3-ACRE SITE ON THE

SOUTHWEST CORNER OF CONDIT ROAD AND
DIANA AVENUE (ZA2025-0001 CONDIT-AUTO PARK
PD) APN’S: 728-17-031, -035, and -036
WHEREAS, On March 25, 2009, the City Council adopted ordinance No. 1926 approving a zoning amendment to establish a Development Plan and Guidelines for a Planned Development area including the allowance for four motor vehicle sales dealerships at the southwest corner of Condit Road and Diana Avenue.

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

SECTION 1. The proposed zoning amendment is consistent with the General Plan and any applicable specific plan as provided by Government Code Section 65860.

The proposed zoning amendments are consistent with the City's General Plan, as they support commercial development in alignment with the site's existing Commercial land use designation. The Commercial designation is primarily applied to properties located along arterial roadways west of Highway 101 and along the eastern freeway frontage. This designation is intended to accommodate a broad range of retail and service-oriented uses, including automobile dealerships.

SECTION 2. The proposed amendment will not be detrimental to the public interest, health, safety, convenience, or welfare of the City.

The proposed amendment will not introduce hazardous activities or increase risks to public health or safety. Any new development or business will still be subject to building codes, fire codes, and environmental regulations.

SECTION 3. The affected site is physically suitable in terms of design, location, shape, size, and other characteristics to ensure that the permitted land uses and development will comply with the zoning code and general plan and contribute to the health, safety, and welfare of the property, surrounding properties, and the community at large.

The site is presently developed with vehicle sales use and the allowance for additional dealerships within the same area will not be detrimental to the health, safety, and welfare of the property, surrounding properties, and the community at large.

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SECTION 4. This ordinance is categorically exempt from environmental review under Section 15061(b)(3) of the California Environmental Quality Act (CEQA) Guidelines. The proposed text amendments are covered by the common-sense exemption that CEQA applies only to projects which have the potential for causing a significant effect on the environment. Where it can be seen with certainty that there is no possibility that the activity in question may have a significant effect on the environment, the activity is not subject to CEQA.

SECTION 5. The proposed amendment shall apply to those parcels identified by assessor parcel number attached hereto, as Exhibit “A”
SECTION 6. The City Council hereby amends the Auto Park PD Guidelines as shown in Exhibit B.

SECTION 7. The request was considered by the Planning Commission at its regular meeting of September 23, 2025, at which time the Planning Commission recommended approval of Zoning Amendment application, ZA2025-0001: Condit – Auto Park PD. The City Council accepts the recommendation of the Planning Commission.

SECTION 8. Severability. If any part of this Ordinance is held to be invalid or inapplicable to any situation by a court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of this Ordinance or the applicability of this Ordinance to other situations.

SECTION 9. Effective Date; Publication. 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 AND THE TITLE THEREOF

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City of Morgan Hill
Ordinance No. 2370, New Series

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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. 2370, New Series, adopted by the City Council of the City of Morgan Hill, California at their regular meeting held on the 19th day of November, 2025.

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

DATE: _____________________ _________________________________ MICHELLE BIGELOW, City Clerk

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Ordinance No. 2370, New Series

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EXHIBIT A

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Ordinance No. 2370, New Series

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‘EXHIBIT B’

AUTO PARK P GUIDELINES
REVISED OCTOBER 2025
Allowed Uses
AU-1. Vehicle Sales and Leasing per (MHMC 18.124.40).

AU-2. Any other use proposed in the PD shall require an amendment to the PD Guidelines and zoning.

Design (Site, Building and Landscape)
D-1. Future development within the PD shall comply with the adopted PD Guidelines as contained herein.

D-2. Future development of the PD shall require a Design Permit and shall be subject to compliance with the site development standards of the HC, Highway Commercial Zoning District and the City of Morgan Hill Architectural Review Handbook. The following design measures shall be implemented in the PD:
a. A minimum 30-ft wide landscape buffer (excluding any landscaping in the public right-of-way) shall be provided along the Condit Road frontage. The 30-ft wide Condit Road landscape buffer shall include rolling berms and minimum 24-inch box size trees.
b. A minimum 15-ft wide landscape buffer (excluding any landscaping in the public right-of-way) shall be provided along the Diana Avenue frontage. c. A minimum 30-ft wide landscape buffer shall be provided along the Madrone Channel frontage.
d. Areas of required parking shall be landscaped in strict adherence to the Morgan Hill Architectural Review Handbook, including but not limited to the provision of landscape planters and minimum five feet of landscaping between the interior side property lines and parking stalls and/or drive aisles.
e. A path of travel from the sidewalk to each building shall be provided via a four-ft wide sidewalk set within a minimum 14-ft wide landscape area on at least one side of both internal drive aisles labeled Utility Drive and Sales Avenue on the Auto Park PD Development Plan.
f. The buildings for the three new dealerships shall be compatible in design and scale with the existing Ford Store dealership.

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g. To the greatest extent possible, service bay roll-up doors should not face Condit Road or Diana Avenue. If service bay roll-up doors do face Condit Road and/or Diana Avenue, landscape screening shall be provided to minimize visibility from the public right-of-way.
h. Any flag poles installed on-site shall not exceed 30 feet in height, except as may be permitted by approval of a conditional use permit for a telecommunications facility.

D-3. On-site stormwater detention/retention will be required with development of the site, subject to the review and approval of the Morgan Hill Public Works Department.

Detention/retention pond(s) shall not be located within the required Condit Road or Diana Avenue landscape buffers, and there shall be no new storm drainage outfalls directly into Madrone Channel from the project site.

Circulation
C-1. Cross access circulation shall be maintained between the adjoining dealerships and throughout the PD as shown on the Auto Park PD Development Plan. As part of any future subdivision of the project site, the applicant shall record cross access easements along common drive aisles and reciprocal ingress/egress easements at all driveway entrances.

C-2. To the greatest extent possible, dead end drive aisles should be avoided. Dead end drive aisles shall only be allowed in areas designated for vehicle display, storage, or temporary parking of service vehicles. Dead end drive aisles shall not be allowed in any public or customer parking areas.

C-3. The internal drive aisles labeled Utility Drive and Sales Avenue on the Auto Park PD Development Plan shall be a minimum 30 ft in width.

C-4. Test driving of vehicles shall be limited to Condit Road, Highway 101 and segments of Dunne Avenue, Cochrane Road and/or Tennant Avenue required for access to and from the freeway. Test driving of vehicles is prohibited along Murphy Avenue, on Condit Road north of Main Avenue and south of Dunne Avenue and on East Dunne Avenue, east of Condit Road. A map of the approved, designated test driving route as described above shall be included in all Sales Employee Handbooks for all dealerships located within the Auto Park PD.

Parking
P-1. The parking and/or display of vehicles in any landscape area are expressly prohibited within the PD.

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Ordinance No. 2370, New Series

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P-2. All employee and customer parking shall be clearly marked and shall be provided entirely on-site.

P-3. Parking required for an ancillary motor vehicle service use shall be calculated separately and in addition to parking required for the principally permitted motor vehicle sale use.

Deliveries/Loading & Unloading
D/L&U-1. Motor vehicle deliveries to the dealerships shall be restricted to the hours of 9 a.m. to 4 p.m. Monday through Saturday to minimize traffic/circulation conflicts.

D/L&U-1. All loading and unloading of motor vehicles shall be conducted entirely on-site.

Lighting
L-1. As part of the Design Permit review process for any future dealership, the applicant shall provide for City review and approval a photometric plan identifying lighting levels resulting from all exterior lighting. Lighting levels at the new dealerships shall be equal to or less intensive than the lighting levels at the existing Ford Store dealership. Also, lighting standards for the PD shall include the following:
a. Parking lot lights located between the building and Condit Road and/or Diana Avenue shall not be more than 18 ft in overall height, except that lights located within 85 feet of Condit Road and/or Diana Avenue shall not be more than 15 ft in overall height (e.g., 2'-6" base with 12'-6" pole or 3'-0" base with 12'-0" pole). All other parking lot lights shall not exceed an overall height of 20 ft. b. The existing lights at the Ford Store dealership shall remain at their current height as approved under Building Permit No. BLD2003-01108.
c. Flood lights aimed at the sky or used to spot light display areas are expressly prohibited. Accent uplighting of buildings and/or landscaping may be permitted subject to review and approval of the required Design Permit.

L-2. All lighting shall be shielded and directed in such a manner so as not to produce harmful effects upon neighboring property. Adjustments to the lighting intensity may be required after commencement of the use. I
Signage
S-1. One (1) shared use freeway sign advertising the names of the four dealerships shall be allowed for the Auto Park PD. The freeway sign shall be designed in accordance with the provisions of the City Sign Code, and shall not be installed until after a second dealership is established within the Auto Park PD.

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S-2. All signs shall comply with Chapter 18.76, Sign Code, of the Morgan Hill Municipal Code and require sign permits prior to installation.

S-3. Individually mounted channel letters shall be utilized for building attached signs.

S-4. The use of flags, banners, tassels, balloons or other inflatable objects is prohibited in the PD except as expressly permitted in Chapter 18.88, Sign Code, of the Morgan Hill Municipal Code.

Noise
N-1. The use of any exterior public address system or other noise intrusive communication system is expressly prohibited in the PD.

General Provisions
GP-1. Any modification to these PD Guidelines shall be subject to review and approval of a PD Amendment.

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4 CITY COUNCIL STAFF REPORT
MEETING DATE: November 19, 2025
PREPARED BY:

Michelle Bigelow, City Clerk
APPROVED BY: City Manager
ADOPT ORDINANCE NO. 2371, NEW SERIES, AN ORDINANCE OF

THE CITY COUNCIL OF THE CITY OF MORGAN HILL AMENDING THE

DEVELOPMENT PLAN FOR A PLANNED UNIT DEVELOPMENT (PUD)
ON A 35 ACRE SITE ON THE WEST SIDE OF CONDIT ROAD
BETWEEN DUNNE AND TENNANT AVENUES (ZA2025-0002 CONDIT – CONDIT ROAD PUD) APN’S 817-12-001,-003, -004, -018, -019; 817-13- 019-022, -024, -026,027, 029-032, AND 034-035

RECOMMENDATION(S)
Waive the reading, adopt Ordinance No. 2371, 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
Maintaining and Enhancing Infrastructure
2024-2025 Strategic Priorities
Fiscal Sustainability
Economic Development and Tourism
Healthy Community
Guiding Documents
Economic Blueprint
Morgan Hill 2035 General Plan
REPORT NARRATIVE:

On November 5, 2025, the City Council introduced Ordinance No. 2371 New Series, by the following roll call vote: AYES: Vega, Iwanaga, Martinez Beltran, Turner; NOES:

None; ABSTAIN: None; ABSENT: Librers.

The ordinance is summarized below:

Hotel Development Flexibility

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4 Removes the existing cap of five hotels within the PUD to accommodate additional hotel development in response to market demand and evolving hospitality needs.

Temporary Uses
Adds provisions to allow temporary uses, enabling interim activities such as live entertainment, recreational events, and community gatherings.

Commercial Indoor Recreation
Allows indoor recreation uses up to 30,000 square feet by right, eliminating the requirement for a Conditional Use Permit and supporting expanded recreational opportunities.

Athletic Training Facilities with Onsite Accommodations Allows specialized athletic training facilities that include onsite lodging to meet the operational needs of professional sports teams.

Retail Development
Expands permitted retail uses by allowing grocery stores by right and permitting convenience stores with a Conditional Use Permit, enhancing access to essential goods and services.

Restaurants with Drive-through
Removes the existing limitation of one restaurant with a drive-through, allowing for greater flexibility in food service options within the PD.

Motor Vehicle Sales
Removes the restriction of two motor vehicle sales with outdoor display, thereby allowing additional dealerships with outdoor display areas within the PD.

Tasting Rooms
Revises the permitted uses to identify “Tasting Rooms” as an allowed use, replacing the outdated reference to “Wine Tasting.” The term “Tasting Room,” as defined in the Zoning Code, encompasses the on-site tasting and retail sale of wine, beer, and/or other alcoholic beverages, with both on-site and off-site sales directly to the public.

COMMUNITY ENGAGEMENT:

A 20-day public hearing notice was published in the Friday, August 29, 2025, edition of the Morgan Hill Times pursuant to Government Code Section 65090-65096. A notice was also mailed to property owners within 300 feet of the project sites.

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4 received at the hearing is linked here.

On July 10, 2025, City staff provided an update to the Morgan Hill Chamber of Commerce Economic Development Committee on the proposed Zoning Amendments.

ALTERNATIVE ACTIONS:

Not Applicable.

PRIOR CITY COUNCIL AND COMMISSION ACTIONS:

On September 23, 2025, the Planning Commission recommended approval of the Zoning Amendment of the City Council with no changes.

On November 5, 2025 the City Council Introduced the ordinance.

FISCAL AND RESOURCE IMPACT:

The proposed City initiated zoning amendments are aimed at stimulating Economic Development, thus increasing the amount of sales tax and transient occupancy tax (TOT) collected by the City.

CEQA (California Environmental Quality Act):

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ORDINANCE NO. 2371, NEW SERIES

AN ORDINANCE OF THE CITY COUNCIL OF THE

CITY OF MORGAN HILL AMENDING THE

DEVELOPMENT PLAN FOR A PLANNED UNIT
DEVELOPMENT (PUD) ON A 35 ACRE SITE ON THE

WEST SIDE OF CONDIT ROAD BETWEEN DUNNE
AND TENNANT AVENUES (ZA2025-0002 CONDIT –
CONDIT ROAD PUD) APN’S 817-12-001,-003, -004, -018, -
019; 817-13-019-022, -024, -026,027, 029-032, and 034-
035
WHEREAS, On March 25, 2009, the City Council adopted ordinance No. 1926 approving a zoning amendment to establish a Development Plan and Guidelines for a Planned Development area including the allowance for four motor vehicle sales dealerships at the southwest corner of Condit Road and Diana Avenue.

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

SECTION 1. The proposed zoning amendment is consistent with the General Plan and any applicable specific plan as provided by Government Code Section 65860.

The proposed zoning amendments are consistent with the City’s General Plan, as they support commercial development in alignment with the site’s existing Commercial land use designation. The Commercial designation is primarily applied to properties located along arterial roadways west of Highway 101 and along the eastern freeway frontage. This designation is intended to accommodate a broad range of retail and service-oriented uses, including automobile dealerships.

SECTION 2. The proposed amendment will not be detrimental to the public interest, health, safety, convenience, or welfare of the City.

The property on the west side of Condit Road, between East Dunne Avenue and Tennant Avenue, is predominantly developed with retail and hotel uses. The proposed amendment will facilitate additional development that will contribute to the health, safety, and welfare of the property, surrounding properties, and the community at large.

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City of Morgan Hill
Ordinance No. 2371, New Series

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SECTION 5 The proposed amendment shall apply to those parcels identified by assessor parcel number attached hereto, as Exhibit “A.”
SECTION 6. The City Council hereby amends the permitted and conditional uses as contained in the certain series of documents date stamped December 17, 2001 on file in the Community Development Department, entitled “Condit PUD planned development and phasing plan” prepared by DpC, Development Process Consultants.

Uses allowed within the PUD shall be amended as follows:

Permitted Uses
Restaurants, Sit down.

Tasting Rooms
General Retail uses including grocery and excluding liquor stores. Motels and hotels
Conference centers, banquet, and meeting rooms
Commercial indoor and outdoor recreation 30,000 square feet or less.

Conditional Uses
Commercial indoor recreation greater than 30,000 square feet. 3.000 square feet Motor vehicle sales and service uses.

Service uses shall only be allowed when ancillary to motor vehicle sales.

Restaurants with drivethrough,
Other commercial uses with an outdoor sales display area.

Any other use, which the Planning Commission determines to be similar to permitted or conditional uses
Convenience Markets (per MHMC 18.92.030)
Athletic Training Facility with ancillary accommodations Any other use, which the Planning Commission determines to be similar to permitted and conditional uses.

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City of Morgan Hill
Ordinance No. 2371, New Series

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Temporary Uses
Limited to 1-year with (2) 1-year extensions
In addition to those temporary uses identified in section 18.92.150 c. • Live Entertainment
• Recreation
• Social Gatherings
Any other temporary uses which the Development Services Director deems to be similar to other temporary uses
SECTION 7. The request was considered by the Planning Commission at its regular meeting of September 23, 2025, at which time the Planning Commission recommended approval of Zoning Amendment application, ZA 2025-0002 Condit – Condit Road PD. The City Council accepts the recommendation of the Planning Commission.

SECTION 8. Severability; If any part of this Ordinance is held to be invalid or inapplicable to any situation by a court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of this Ordinance or the applicability of this Ordinance to other situations.

THE FOREGOING ORDINANCE WAS INTRODUCED AND THE TITLE THEREOF

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City of Morgan Hill
Ordinance No. 2371, New Series

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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. 2371, New Series, adopted by the City Council of the City of Morgan Hill, California at their regular meeting held on the 19th day of November 2025.

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

DATE: _____________________ _________________________________ MICHELLE BIGELOW, City Clerk

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City of Morgan Hill
Ordinance No. 2371, New Series

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EXHIBIT A

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5 CITY COUNCIL STAFF REPORT
MEETING DATE: November 19, 2025
PREPARED BY:

Michelle Bigelow, City Clerk
APPROVED BY: City Manager
ADOPT ORDINANCE NO. 2372, NEW SERIES, AN ORDINANCE OF

THE CITY COUNCIL OF THE CITY OF MORGAN HILL AMENDING THE

HIGHWAY COMMERCIAL (CH) PLANNED DEVELOPMENT (PD)
OVERLAY ZONE ON A 9.27 ACRE SITE ON THE NORTH SIDE OF THE EASTERN TERMINUS OF LAUREL ROAD (ZA2025-0005 LAUREL –
HONDA) APN’S: 726-01-001, 726-01-006, AND 726-01-007

RECOMMENDATION(S)
Waive the reading, adopt Ordinance No. 2372, 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.

On November 5, 2025, the City Council introduced Ordinance No. 2372 New Series, by the following roll call vote: AYES: Vega, Iwanaga, Martinez Beltran, Turner; NOES:

None; ABSTAIN: None; ABSENT: Librers.

This Ordinance proposes to eliminate the restriction that limits the Planned Development (PD) area to only one motor vehicle sales dealership, thereby allowing for the development of additional vehicle sales businesses.

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5 COMMUNITY ENGAGEMENT:

On July 10, 2025, City staff provided an update to the Morgan Hill Chamber of Commerce Economic Development Committee on the proposed Zoning Amendments.

ALTERNATIVE ACTIONS:

Not Applicable.

PRIOR CITY COUNCIL AND COMMISSION ACTIONS:

On September 23, 2025, the Planning Commission recommended approval of the Zoning Amendment of the City Council with no changes.

On November 5, 2025, the City Council introduced the Zoning Amendment ordinance.

FISCAL AND RESOURCE IMPACT:

The proposed City initiated zoning amendments are aimed at stimulating Economic Development, thus increasing the amount of sales tax and transient occupancy tax (TOT) collected by the City.

CEQA (California Environmental Quality Act):

This ordinance is exempt from environmental review pursuant to Section 15061(b)(3) of

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5 the California Environmental Quality Act (CEQA) Guidelines, as the proposed text amendments to the Morgan Hill Zoning Code is not a project with potential for causing a significant effect on the environment requiring California Environmental Quality Act (CEQA) analysis. Additionally, on July 27, 2016, the City Council certified an environmental impact report (EIR) for the Morgan Hill 2035 General Plan. This ordinance is consistent with, and implements, the General Plan and therefore was analyzed in the EIR for the 2035 General Plan. Pursuant to Section 15162 and Section 15183 of the State CEQA Guidelines, no additional review under the California Environmental Quality Act is required.

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ORDINANCE NO. 2372, NEW SERIES

AN ORDINANCE OF THE CITY COUNCIL OF THE

CITY OF MORGAN HILL AMENDING THE HIGHWAY

COMMERCIAL (CH) PLANNED DEVELOPMENT (PD)
OVERLAY ZONE ON A 9.27 ACRE SITE ON THE

NORTH SIDE OF THE EASTERN TERMINUS OF
LAUREL ROAD (ZA2025-0005 LAUREL – HONDA)
APN’S: 726-01-001, 726-01-006, AND 726-01-007
WHEREAS, On April 17, 1996, the City Council adopted Ordinance No. 1273, N.S., establishing a Highway Commercial (CH) and Planned Unit Development (PUD) overlay zone to allow one motor vehicle dealership use on parcel 726-01-001 and unspecified highway commercial uses within the remainder of the zoning area on the north side of the eastern terminus of Laurel Road.

WHEREAS, On December 3, 2014, the City Council adopted Ordinance No 2125, to revise the boundaries of the PUD to include parcels 726-01-001, -006, and -007 in their entirety as shown in EXHIBIT A.

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

SECTION 1. The proposed zoning amendment is consistent with the General Plan and any applicable specific plan as provided by Government Code Section 65860.

SECTION 2. The proposed amendment will not be detrimental to the public interest, health, safety, convenience, or welfare of the City.

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City of Morgan Hill
Ordinance No. 2372, New Series

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safety, and welfare of the property, surrounding properties, and the community at large.

The site is presently developed with a vehicle sales use and the allowance for additional dealerships within the same area will not be detrimental to the health, safety, and welfare of the property, surrounding properties, and the community at large.

SECTION 5 The proposed amendment shall apply to those parcels identified by assessor parcel number numbers attached hereto, as EXHIBIT “A”
SECTION 6. The City Council hereby amends the permitted uses of the subject Planned Unit Development (PUD) overlay zone as follows:

Allowable Uses:

Land Uses of the Highway Commercial (CH) Zoning District Vehicle Sales and Leasing per (MHMC 18.124.40).

The City Council accepts the recommendation of the Planning Commission.

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City of Morgan Hill
Ordinance No. 2372, New Series

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THE FOREGOING ORDINANCE WAS INTRODUCED AND THE TITLE THEREOF READ

AT A REGULAR MEETING OF THE CITY COUNCIL OF THE CITY OF MORGAN HILL HELD ON THE 5TH DAY OF NOVEMBER 2025, AND WAS FINALLY ADOPTED AT A REGULAR MEETING OF SAID COUNCIL ON THE 19TH DAY OF NOVEMBER 2025, AND

SAID ORDINANCE WAS DULY PASSED AND ADOPTED IN ACCORDANCE WITH LAW BY THE FOLLOWING VOTE:

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. 2372, New Series, adopted by the City Council of the City of Morgan Hill, California at their regular meeting held on the 19th day of November 2025.

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

DATE: _____________________ _________________________________ MICHELLE BIGELOW, City Clerk

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City of Morgan Hill
Ordinance No. 2372, New Series

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EXHIBIT A

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6 CITY COUNCIL STAFF REPORT
MEETING DATE: November 19, 2025
PREPARED BY:

Michelle Bigelow, City Clerk
APPROVED BY: City Manager
ADOPT ORDINANCE NO. 2373, NEW SERIES, AN ORDINANCE OF

THE CITY COUNCIL OF THE CITY OF MORGAN HILL AMENDING THE

TENNANT STATION SHOPPING CENTER PLANNED UNIT
DEVELOPMENT (PUD) ON A 21.88 ACRE SITE ON THE SOUTHEAST CORNER OF MONTEREY ROAD AND TENNANT AVENUE (AAE2025-
0003 TENNANT-TENNANT STATION PD) APN’S: 817-06-041, 055, 056, 057, AND 058

RECOMMENDATION(S)
Waive the reading, adopt Ordinance No. 2373, 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
Preserving and Cultivating Public Trust
2024-2025 Strategic Priorities
Economic Development and Tourism
Guiding Documents
Morgan Hill 2035 General Plan
REPORT NARRATIVE:

On November 5, 2025, the City Council introduced Ordinance No. 2373 New Series, by the following roll call vote: AYES: Vega, Iwanaga, Martinez Beltran, Turner; NOES:

None; ABSTAIN: None; ABSENT: Librers.

This Ordinance is an amendment to a Planned Development (PD) for the Tennant Station shopping center that modifies restrictions on square footages for the Fitness, Cinema and Bowling Alley uses within the center. Instead of specific square footage limits, any proposed expansion of these uses will require review by the Development Services Director and future permitting if deemed required rather than requiring an amendment to the Planned Development.

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6 COMMUNITY ENGAGEMENT:

A 20-day public hearing notice was published in the Friday, September 19, 2025, edition of the Morgan Hill Times pursuant to Government Code Section 65090-65096. A notice was also mailed to property owners within 300 feet of the project site.

ALTERNATIVE ACTIONS:

Not Applicable.

PRIOR CITY COUNCIL AND COMMISSION ACTIONS:

The City Council adopted Ordinance No. 336 N.S., on January 3, 1973, prezoning 75 acres of property located at the southeast corner of Tennant Avenue and Monterey Road to Planned Unit Development (PUD).

The City Council adopted Ordinance No. 1039 N.S. on August 7, 1991, incorporating a detailed development plan for 21-acres of the site.

The City Council adopted Ordinance No. 1546 N.S. on May 15, 2002, establishing design guidelines for the PUD and amending the precise development plan for the site.

The Planning Commission recommended approval of the proposed ordinance on October 14, 2025.

The City Council introduced the ordinance on November 5, 2025.

FISCAL AND RESOURCE IMPACT:

None.

CEQA (California Environmental Quality Act):

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ORDINANCE NO 2373, NEW SERIES

AN ORDINANCE OF THE CITY COUNCIL OF THE

CITY OF MORGAN HILL AMENDING THE TENNANT

STATION SHOPPING CENTER PLANNED UNIT
DEVELOPMENT (PUD) ON A 21.88 ACRE SITE ON THE

SOUTHEAST CORNER OF MONTEREY ROAD AND
TENNANT AVENUE (AAE2025-0003 TENNANTTENNANT STATION PD) APN’S: 817-06-041, 055, 056, 057, AND 058
WHEREAS. On August 7, 1991, the City Council adopted Ordinance No. 1039, N.S., incorporating a detailed development plan for Tennant Station.

WHEREAS. On May 15, 2002, the City Council adopted Ordinance No 1546 establishing design guidelines for the PUD and amending the precise development plan for the site as shown in EXHIBIT A.

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

SECTION 1. The proposed zoning amendment is consistent with the General Plan and any applicable specific plan as provided by Government Code Section 65860.

The proposed zoning amendment is consistent with the City's General Plan, as it supports commercial development in alignment with the site's existing Commercial land use designation.

SECTION 2. The proposed amendment will not be detrimental to the public interest, health, safety, convenience, or welfare of the City.

The amendment supports the purpose of the Zoning Code—to implement the General Plan and protect public health, safety, and welfare.

The affected site is an existing shopping center and the proposed PUD amendment does not change the use, orientation or size of the center. Future development proposals will be subject to the appropriate level of design review to ensure compliance with the PUD and City guidelines.

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City of Morgan Hill
Ordinance No. 2373, New Series

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SECTION 5. The City Council hereby amends the Section II of the subject Planned Unit Development (PUD) overlay zone as follows:

II. ALLOWED USES/GENERAL PROVISIONS

2. The following existing uses shall be allowed in specific locations and sizes shown on Figure 1. Any enlargement or relocation of the following uses shall be reviewed by the Development Services Director for master plan consistency and potential impacts to the center. If an increase to the size of the uses results in impacts to the center, the appropriate permitting process will be required. will require amendment to the PUD.

Bowling Alley 26,525 sq. ft.

Movie Theater 23,009 sq. ft.

Fitness Center 24,708 sq. ft.

SECTION 6. The request was considered by the Planning Commission at its regular meeting of October 14 , 2025, at which time the Planning Commission recommended approval of Zoning Amendment application, AAE2025-0003: Tennant – Tennant Station PUD. The City Council accepts the recommendation of the Planning Commission.

SECTION 7. Severability. If any part of this Ordinance is held to be invalid or inapplicable to any situation by a court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of this Ordinance or the applicability of this Ordinance to other situations.

SECTION 8. Effective Date; Publication. 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.

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City of Morgan Hill
Ordinance No. 2373, New Series

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THE FOREGOING ORDINANCE WAS INTRODUCED AND THE TITLE THEREOF READ AT

A REGULAR MEETING OF THE CITY COUNCIL OF THE CITY OF MORGAN HILL HELD ON THE 5TH DAY OF NOVEMBER 2025, AND WAS FINALLY ADOPTED AT A REGULAR MEETING OF SAID COUNCIL ON THE 19TH DAY OF NOVEMBER 2025, AND SAID

ORDINANCE WAS DULY PASSED AND ADOPTED IN ACCORDANCE WITH LAW BY THE FOLLOWING VOTE:

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. 2373, New Series, adopted by the City Council of the City of Morgan Hill, California at their regular meeting held on the 19th day of November 2025.

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

DATE: _____________________ _________________________________ MICHELLE BIGELOW, City Clerk

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City of Morgan Hill
Ordinance No. 2373, New Series

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EXHIBIT A

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7 CITY COUNCIL STAFF REPORT
MEETING DATE: November 19, 2025
PREPARED BY:

Michelle Bigelow, City Clerk
APPROVED BY: City Manager

ADOPT MORGAN HILL'S APPROACH TO PUBLIC SERVICE

RECOMMENDATION(S)
Adopt "Morgan Hill's Approach to Public Service."

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
Advocating for Local, Regional, and State Legislative Initiatives 2024-2025 Strategic Priorities
Fiscal Sustainability
Affordable Housing and Homelessness
Community Engagement
Economic Development and Tourism
Healthy Community
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
Vision Zero
Water System Master Plan
Wastewater System Master Plan

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7 REPORT NARRATIVE:

At the November 10, 2025, Special City Council Meeting - Facilitated Session, consultants Jacob Green and Associates presented "Morgan Hill's Approach to Public Service" as a replacement for the City Council's previously adopted "City Council Norms" document after interviews with the Mayor and Council Members. Following a review of "Morgan Hill's Approach to Public Service," the City Council directed staff to bring it for formal approval at the November 19, 2025, City Council meeting.

COMMUNITY ENGAGEMENT:

Inform.

This report serves to inform the community of the upcoming review and adoption of "Morgan Hill's Approach to Public Service."
ALTERNATIVE ACTIONS:

The City Council could choose to modify "Morgan Hill's Approach to Public Service." PRIOR CITY COUNCIL AND COMMISSION ACTIONS:

The City Council Norms were initially adopted in January 2019 and have been reviewed annually since then.

FISCAL AND RESOURCE IMPACT:

None.

CEQA (California Environmental Quality Act):

Not a Project. This is an administrative activity that will not result in direct or indirect physical changes in the environment.

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Consolidated Set of Norms
“Morgan Hill Approach to Public Service”
Morgan Hill Approach to Public Service
I. Stewardship of the Public Trust (your behaviors)
We earn and preserve the community’s trust and investment through ethical conduct, professionalism, and integrity in every action (consistent with adopted City Council Norms).

II. Collaboration for Collective Impact (your contribution) We create greater outcomes together by valuing diverse perspectives, building alignment, and working as one team in service to the community.

III. Managing the Public’s Business (your process and decisions) We conduct the public’s business through orderly, civil, transparent, and wellreasoned processes that ensure fairness and efficiency through City Council Policy 97-01 (Rules for the Conduct of City Council Meetings, Placement of Items on the Agenda, and Matters to be Reconsidered).

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8 CITY COUNCIL STAFF REPORT
MEETING DATE: November 19, 2025
PREPARED BY:

Maria Angeles, Senior Civil Engineer
APPROVED BY: City Manager

APPROVE THE SECOND AMENDMENT TO SUBDIVISION
IMPROVEMENTS AGREEMENT FOR MANZANITA PARK - TRACT NO.
10585 LOCATED EAST OF THE MONTEREY ROAD/TILTON AVENUE
INTERSECTION (APN:725-01-035 AND 725-16-001)

RECOMMENDATION(S)

1. Approve the Second Amendment to Subdivision Improvements Agreement for Manzanita Park - Tract No. 10585;

2. Authorize the City Manager to execute the Second Amendment to Subdivision Improvements Agreement with TOLL WEST COAST LLC (Subdivider); and

3. Authorize the recordation of the Second Amendment to Subdivision Improvements Agreement.

COUNCIL PRIORITIES, GOALS & STRATEGIES
City Council Ongoing Priorities
Protecting the Environment and Preserving Open Space and Agricultural Land Guiding Documents
Morgan Hill 2035 General Plan
REPORT NARRATIVE:

Manzanita Park – Tract 10585 is a 67-unit residential condominium development (“Project”) located at the northernmost part of the City, just east of the Monterey Road/Tilton Avenue intersection as shown on the attached Site Map (Attachment 1).

The Final Map for the Project was approved by the City Council on August 23, 2023, and the Final Map and original Subdivision Improvements Agreement were recorded on September 6, 2023.

The subdivider of the Project, TOLL WEST COAST LLC, executed the Subdivision Improvements Agreement (SIA) (Attachment 2) with the City requiring that the public improvements be completed within eighteen (18) months from the date of the recording of the Final Map (no later than March 6, 2025). Due to delays involved with the removal of a utility pole by PG&E in front of the project and obtaining approval from Union Pacific Railroad (UPRR) to modify the Monterey Road and Tilton Avenue traffic signal, the

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8 Subdivider asked for and was granted a six-month extension to the SIA (“First Amendment to SIA”) (Attachment 3) which extended the completion date for the Project's public improvements to September 6, 2025.

There is still a delay in the UPRR permitting process. Based on recent correspondence with UPRR staff, it is estimated that the issuance of the UPRR permit and the actual signal construction work will not be finalized until the Spring of 2027. Given this continued delay, the Subdivider has requested an additional time extension to complete the required public improvements for the project.

The project's SIA allows for the amendment of the SIA by mutual consent of the original parties or their successors in interest, provided that any such amendment is executed in writing by the parties. This Second Amendment to Subdivision Improvements Agreement is necessary for the Subdivider to proceed with completing the remaining public improvements, including the signal work within the UPRR rights-of-way.

Staff recommends that City Council approve the Second Amendment to the Subdivision Improvements Agreement (Attachment 4) to extend the deadline to complete the public improvements by an additional eighteen (18) months from the expiration date of the First Amendment to SIA (no later than March 6, 2027) and a subsequent extension of not more than six (6) months to be granted by the City Manager as needed by the Project.

Staff also recommends that City Council authorize the City Manager to sign and record the Second Amendment to Subdivision Improvements Agreement on behalf of the City.

COMMUNITY ENGAGEMENT:

Inform
This report serves to inform the community of the recommended Second Amendment to Subdivision Improvements Agreement for Manzanita Park - Tract No. 10585.

ALTERNATIVE ACTIONS:

The City Council could decide not to approve the Second Amendment to Subdivision Improvements Agreement. The Subdivider will then be required to enter into a new Subdivision Improvements Agreement with the City to complete the remaining public improvements required of the Project.

PRIOR CITY COUNCIL AND COMMISSION ACTIONS:

August 23, 2023 - City Council approved the Final Map and authorized execution of the Subdivision Improvements Agreement by the City Manager for Manzanita Park - Tract No. 10585.

FISCAL AND RESOURCE IMPACT:

Development review costs for this project are paid for from development processing fees.

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8 CEQA (California Environmental Quality Act):

Project - A Mitigated Negative Declaration was adopted for the Project on March 22, 2022.

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RECORDING REQUESTED BY

WHEN RECORDED RETURN TO

CITY OF MORGAN HILL
City Clerk’s Office
17575 PEAK AVENUE
MORGAN HILL, CA 95037
(RECORD AT NO FEE PURSUANT TO
GOVERNMENT CODE SECTION 27383) THE AREA ABOVE IS RESERVED FOR RECORDER'S USE

SECOND AMENDMENT TO SUBDIVISION IMPROVEMENTS AGREEMENT

TOLL WEST COAST LLC
MANZANITA PARK - TRACT NO. 10585

THIS SECOND AMENDMENT TO THE SUBDIVISION IMPROVEMENTS AGREEMENT (“AMENDMENT”) is dated as of this _______ day of ________________, 2025, and is entered into by and between the CITY OF MORGAN HILL, a California municipal corporation (“CITY”), and TOLL WEST COAST LLC, a Delaware Limited Liability Company, (“SUBDIVIDER”), duly authorized to do business in California and will remain so during the term of this Agreement.

SUBDIVIDER and CITY are collectively referred to as the “Parties”.

RECITALS
The following recitals are a substantive portion of this SECOND AMENDMENT:

1. The CITY and SUBDIVIDER entered into that Subdivision Improvements Agreement (“ORIGINAL AGREEMENT”) on September 1, 2023, to develop the property known as Manzanita Park in Morgan Hill, California (APN: 725-01-035 and 725-16-001) as a residential development project designated as Tract No. 10585 (“Project”). The ORIGINAL AGREEMENT was recorded on September 6, 2023, with the Santa Clara County Recorder as document number 25527058.

2. On September 6, 2023, the final map for Tract No. 10585 was recorded with the Santa Clara County Recorder in Book 957 of Maps, pages 3 through 6.

3. Pursuant to the ORIGINAL AGREEMENT, the SUBDIVIDER is required to perform and complete all public improvements within eighteen (18) months from the date of the recording of the Final Map (completion deadline of March 6, 2025). Pursuant to Section 6 of the ORIGINAL AGREEMENT, the City Manager may extend the deadline for completion by not more than six (6) months at her reasonable discretion and determination that granting the extension will not be detrimental to the public welfare.

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4. The SUBDIVIDER submitted a written request to extend the deadline by an additional six (6) months, to no later than September 6, 2025, to complete the public improvements due to PG&E’s delays to remove an existing overhead utility pole located on the Project’s Monterey Road frontage, and delay in the permit approval by Union Pacific Railroad (UPRR) for the signalization work on the western portion of Monterey Road and Tilton Avenue intersection.

5. The City Engineer deemed that the extension of the deadline by an additional six (6) months was necessary to allow the SUBDIVIDER to continue the completion of the remaining public improvements which included the traffic signal improvements.

6. On May 8, 2025, CITY and SUBDIVIDER entered into a First Amendment to Subdivision Improvements Agreement (“FIRST AMENDMENT”), recorded with the Santa Clara County Recorder on May 16, 2025 as document number 25807645, extending the time for performance by six (6) months to September 6, 2025.

7. The UPRR permit is still pending. It is estimated that the issuance of the UPRR permit and the actual construction of the signalization work on the western portion of Monterey Road and Tilton Avenue intersection, within both the UPRR and City rights-of-way, may be completed in early 2027.

8. The SUBDIVIDER submitted a second request to the City to extend the time to perform the remaining public improvements due to the continued delay in obtaining the UPRR permit.

AGREEMENT
THE PARTIES MUTUALLY AGREE AS FOLLOWS:

1. All terms and conditions of the ORIGINAL AGREEMENT, as amended, shall remain in full force and effect, except that the following amendments shall be made as set forth below.

The first paragraph of Section 6 of the ORIGINAL AGREEMENT is amended to read as follows:
“Section 6. Timing of Performance
SUBDIVIDER agrees to perform and complete all Improvements within forty-two (42) months from the date of the recording of the Final Map; provided however, the City Manager may extend the deadline for completion by not more than six (6) months at his or her reasonable discretion and determination that granting the extension will not be detrimental to the public welfare. The SUBDIVIDER may request the City Council to further extend the deadline for completion upon written request by the SUBDIVIDER and the submittal of adequate evidence to justify the extension.”

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Page 3 of 3 ends

2. Those individuals who are signing this SECOND AMENDMENT 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 SECOND AMENDMENT.

IN WITNESS THEREOF, the parties have executed this SECOND AMENDMENT on the day and year shown below.

ATTEST: CITY OF MORGAN HILL
By: By:

Michelle Bigelow, City Clerk Christina J. Turner, City Manager Date: Date:

APPROVED AS TO FORM: "Subdivider"
By: TOLL WEST COAST, LLC
Donald A. Larkin, City Attorney
Date: By:

Steve Savage, VP Land
Development
Date:

By:

Ben Helber, VP Community
Planning
Date:

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A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document, to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.

State of California
County of Santa Clara
On 20____, before me, a Notary Public in and for
said County and State, personally appeared
proved to me on the basis of satisfactory evidence to be the person whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

SIGNATURE OF NOTARY PUBLIC
(ABOVE AREA FOR NOTARY SEAL)
A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document, to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

SIGNATURE OF NOTARY PUBLIC
(ABOVE AREA FOR NOTARY SEAL)

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City Council
Meeting Minutes
Mark Turner - Mayor
Marilyn Librers - Mayor Pro Tem
Soraida Iwanaga - Council Member
Yvonne Martínez Beltrán - Council Member
Miriam Vega - Council Member
Wednesday, November 5, 2025
5:00 p.m. Closed Session
6:00 p.m. Regular Session
Council Chamber Building
17555 Peak Avenue, Morgan Hill, CA 95037

SPECIAL/REGULAR MEETING
A special meeting of the City Council was called at 5:18 p.m. for the purpose of conducting a closed session.

SPECIAL MEETING
5:00 p.m. Closed Session

CALL TO ORDER
Mayor Turner called the City Council meeting to order at 5:18 p.m.

ROLL CALL ATTENDANCE
Deputy City Clerk Rossi called the roll.

PRESENT Mark Turner, Soraida Iwanaga, Yvonne Martinez Beltran, Miriam Vega
ABSENT Marilyn Librers

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

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November 5, 2025
2 CLOSED SESSION
City Attorney Larkin announced the closed session item.

CONFERENCE WITH LABOR NEGOTIATORS
Authority: Pursuant to Government Code Section 54957.6
City Negotiators: Christina Turner, City Manager; Donald Larkin, City Attorney; Michael Horta, Human Resources Director; Dat Nguyen, Finance Director; Chris Ghione, Assistant City Manager, Public Services
Employee Organization: Morgan Hill Police Officers Association; Employees Covered under Management Resolution #23-051

OPPORTUNITY FOR PUBLIC COMMENT ON CLOSED SESSION
Public comment opened at 5:18 p.m. With no requests to speak, public comment closed.

ADJOURN TO CLOSED SESSION
The meeting adjourned to closed session at 5:18 p.m.

REGULAR MEETING
The regular meeting convened at 6:00 p.m.

SILENT INVOCATION

PLEDGE OF ALLEGIANCE

CITY COUNCIL REPORTS
Council Member Martínez Beltrán shared a highlight of her weekend, attending the Morgan Hill Ride event. She compared the event to San Jose’s Viva Calle Rides, an initiative she had long hoped to bring to Morgan Hill after first experiencing a similar concept while abroad. She met with Ed Solis from Open Space Alliances, who supported the idea, and with funding assistance from Supervisor Sylvia Arenas, the event took off. There were two hubs, one of which ended at Guglielmo Winery, offering a scenic showcase of Morgan Hill’s landscapes, commercial districts, and local wineries. Martínez Beltrán noted that this event serves as a great economic multiplier for Morgan Hill.

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November 5, 2025
3 CITY MANAGER'S REPORT
City Manager Turner shared that the Winter/Spring Recreation Activity Guide is now available on the City’s website, with registration for 2026 programs beginning Monday, November 10 at 8:00 a.m. for classes and Wednesday, November 12 at 8:00 a.m. for swim lessons. Morgan Hill Parks and Recreation has concluded the annual Haunted Home Decorating Contest, with winners to be recognized at the upcoming Parks and Recreation Commission meeting. Registration is now open for the Holiday Lights Home Decorating Contest, with judging scheduled for December. Additionally, on Monday morning, November 10, the City Council will participate in a Governance Training Workshop led by a professional facilitator to reaffirm their commitment to governance best practices.

CITY ATTORNEY'S REPORT
City Attorney Larkin shared that the Council met in closed session earlier in the evening and there was no reportable action.

OTHER REPORTS
Council Member Iwanaga expressed how much fun the past two weeks of community celebrations have been. She highlighted the “Terror at the Pirate’s Cove” event, which she was fortunate to attend for the second time, noting how enjoyable it was to see everyone dressed up and participating. She also attended the Safe Trick-or-Treat event Downtown for the first time and described it as heartwarming to see families and children showcasing their creativity through costumes while enjoying a true community gathering.

Mayor Turner congratulated David Dindak, President of the Downtown Association, noting the Downtown Trick-or-Treating event was well-run and highly successful. He also attended the Morgan Hill Ride event and thanked Council Member Martínez Beltrán for her support in helping the event develop over the past two years, adding that he looks forward to continued conversations and future growth for the event. In recent weeks, he attended the Open Studios event hosted by the Library, Culture, and Arts Commission, which he has supported and sponsored for several years, visiting vendors and art exhibits throughout the City. He also participated in the Food Truck Fly-In, providing opening remarks and noting that Council Member Vega and her mother were among the attendees. Additionally, Mayor Turner reported having productive meetings with community members, including farmers, ranchers, and winery owners, regarding proposed county zoning amendments that may impact them. He added that he is working on another meeting with Supervisor Betty Duong’s office and shared his gratitude to the Supervisors for their efforts to gain a better understanding of the potential impacts.

Council Member Vega shared that she was pleased to welcome her students from Salinas who attended tonight’s meeting.

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November 5, 2025
4 PUBLIC COMMENT FOR ITEMS NOT ON THE AGENDA
Public comment opened at 6:08 p.m. With no requests to speak, public comment closed.

ADOPTION OF AGENDA
Adopting the agenda as posted.

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

MOTION:

Approving consent calendar items 1 through 5.

1. ACCEPTANCE OF 2023 INFLOW AND INFILTRATION SANITARY SEWER PROJECT IN THE AMOUNT OF $2,634,308
Recommendation:

1. Accept as complete the 2023 Inflow and Infiltration Sanitary Sewer

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November 5, 2025
5 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. APPROVE FINAL MAP FOR DIANA AVENUE SINGLE FAMILY HOMES - TRACT NO. 10669 AND RELATED SUBDIVISION IMPROVEMENTS

AGREEMENT
Recommendation:

1. Approve the Final Map;

2. Authorize the City Manager to execute the Subdivision Improvements Agreement with MH Diana 2025 Inc., a California Corporation; and

3. Authorize the recordation of the Final Map and the Subdivision Improvements Agreement.

3. APPROVE SECOND AMENDMENT TO HOUSING-RELATED CONSULTANT

AGREEMENT FOR LEGAL SERVICES
Recommendation:

Approve and authorize the City Manager to execute and administer a second amendment to the Burke, Williams & Sorensen, LLP housing-related consultant agreement for legal services to increase the amount from $60,000 to $220,000.

4. APPROVE MEMORANDUM OF UNDERSTANDING (MOU) WITH MORGAN

HILL AMERICAN FEDERATION OF STATE, COUNTY, AND MUNICIPAL

EMPLOYEES (AFSCME) AND MOU WITH COMMUNITY SERVICE OFFICERS'

ASSOCIATION (CSOA) AND CORRESPONDING SALARY SCHEDULES
Recommendation:

1. Approve a MOU with AFSCME effective December 21, 2025 - December 31, 2028 and corresponding salary schedules; and

2. Approve a MOU with CSOA effective December 21, 2025 - December 31, 2028 and corresponding salary schedules.

5. APPROVE THE OCTOBER 15, 2025 AND OCTOBER 22, 2025 CITY COUNCIL

MEETING MINUTES
Recommendation:

Approve the October 15 and October 22, 2025 City Council Meeting Minutes.

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November 5, 2025
6 OTHER BUSINESS

6. APPROVE A MEMORANDUM OF UNDERSTANDING WITH THE SANTA

CLARA VALLEY OPEN SPACE AUTHORITY FOR A PUBLIC ACCESS

PARTNERSHIP ON DEVELOPMENT OF THE EL TORO MOUNTAIN AREA Recommendation:

Authorize the City Manager to execute and administer a Memorandum of Understanding with the Santa Clara Valley Open Space Authority for a partnership on public access development of the El Toro Mountain area.

Public Services Director Ghione provided a presentation and report.

Santa Clara Valley Open Space Authority, District 1 Director Alex Kennett and General Manager, Andrea Mackenzie spoke.

Public comment opened at 6:23 p.m. With no requests to speak, public comment closed.

MOTION:

Approving the recommended action.

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

7. APPROVE REQUEST TO RENAME NOB HILL TRAIL PARK AFTER

COMMUNITY MEMBER MARTY CHEEK OR PROVIDE ALTERNATIVE

DIRECTION
Recommendation:

Approve or do not approve the renaming of the Nob Hill Trail Park in recognition of Marty Cheek.

Public Services Director Ghione provided a presentation and report.

Public comment opened at 6:33 p.m. The following people were called to speak:

John McKay
Nick Gaich
With no further requests to speak, public comment closed.

MOTION:

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November 5, 2025
7 Approve an alternate recognition of an amenity within the park area, direct City staff to work with the requestor to finalize the specific recognition, and delegate the item to the Parks and Recreation Commission for approval of the alternate recognition within the park area.

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

8. INTRODUCE ORDINANCE AMENDING CHAPTER 5.28 (AMUSEMENT AND

ENTERTAINMENT PREMISES) OF THE MUNICIPAL CODE
Recommendation:

1. Waive the first and second reading of the Ordinance amendment; and

2. Introduce the Ordinance.

Economic Development Director Mahood provided a presentation and report.

Public comment opened at 7:10 p.m. The following people were called to speak:

Nick Gaich
David Dindak
With no further requests to speak, public comment closed.

MOTION:

Waiving the first and second reading of the ordinance.

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November 5, 2025
8 MOTION:

Introducing the ordinance.

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

PUBLIC HEARINGS

9. INTRODUCE ORDINANCES APPROVING THE FOLLOWING CITY-INITIATED ZONING AMENDMENTS:

CONDIT - AUTO PARK: PLANNED DEVELOPMENT (PD) ZONING

AMENDMENT TO THE DEVELOPMENT PLAN FOR THE AUTO PARK

PLANNED UNIT DEVELOPMENT (PUD) LOCATED ON THE SOUTHWEST CORNER OF CONDIT ROAD AND DIANA AVENUE (ZA2025-0001)
CONDIT - CONDIT ROAD: PLANNED DEVELOPMENT (PD) ZONING

AMENDMENT TO THE DEVELOPMENT PLAN FOR THE CONDIT ROAD

PLANNED UNIT DEVELOPMENT (PUD) LOCATED ON THE WEST SIDE OF CONDIT ROAD BETWEEN E. DUNNE AVENUE AND TENNANT AVENUE
(ZA2025-0002)
LAUREL - HONDA: PLANNED DEVELOPMENT (PD) ZONING AMENDMENT

TO THE ALLOWED USES OF THE HIGHWAY COMMERCIAL - CH (PD)

OVERLAY ZONE ON THE EASTERLY TERMINUS OF LAUREL ROAD
(ZA2025-0005)
Recommendation:

1. Open/close public hearing;

2. Waive first and second reading of the Zoning Amendment ZA2025-0001:

Condit – Auto Park PUD;

3. Introduce Ordinance approving Zoning Amendment ZA2025-0001;

4. Waive first and second reading of the Zoning Amendment ZA2025-0002:

Condit – Condit Road PUD;

5. Introduce Ordinance approving Zoning Amendment ZA2025-0002;

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November 5, 2025
9 6. Waive first and second reading of the Ordinance approving Zoning Amendment ZA2025-0005: Laurel Road – Honda PUD; and

7. Introduce Ordinance approving Zoning Amendment ZA2025-0005.

Economic Development Director Mahood provided a presentation and report.

The public hearing opened at 7:45 p.m.

Nick Gaich was called to speak.

With no further requests to speak, the public hearing was closed.

MOTION:

Waiving the first and second reading of the Zoning Amendment ZA2025-0001:

Condit – Auto Park PUD ordinance.

Introducing the Zoning Amendment ZA2025-0001: Condit – Auto Park PUD ordinance.

Waiving the first and second reading of the Zoning Amendment ZA2025-0002:

Condit – Condit Road PUD ordinance.

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November 5, 2025
10 RESULT: Passed
MOVER: Council Member Martinez Beltran
SECONDER: Council Member Iwanaga
AYES: Mayor Turner, Council Member Iwanaga, Council Member Martinez Beltran, Council Member Vega
NAYS: None
ABSTAIN: None
ABSENT: Mayor Pro Tem Librers
MOTION:

Introducing the Zoning Amendment ZA2025-0002: Condit – Condit Road PUD ordinance.

Waiving the first and second reading of the Zoning Amendment ZA2025-0005:

Laurel Road – Honda PUD ordinance.

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November 5, 2025
11 Introducing the Zoning Amendment ZA2025-0005: Laurel Road – Honda PUD ordinance.

10. INTRODUCE ORDINANCE TO AMEND THE TENNANT STATION PLANNED

UNIT DEVELOPMENT (PUD) TO MODIFY THE MAXIMUM SQUARE

FOOTAGES ALLOWED FOR THREE MAJOR USES AND ADD AN

ADMINISTRATIVE FUNCTION TO MAKE MINOR CHANGES TO SQUARE

FOOTAGES IN THE FUTURE
Recommendation:

1. Open/close public hearing;

2. Waive first and second reading of the Ordinance; and

3. Introduce Ordinance amending the Tennant Station Planned Unit Development.

Development Services Director Carman provided a presentation and report.

The public hearing opened at 7:57 p.m.

Mitchell Gardner was called to speak (Zoom).

With no further requests to speak, the public hearing was closed.

MOTION:

Waiving first and second reading of the ordinance.

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November 5, 2025
12 ABSENT: Mayor Pro Tem Librers
MOTION:

Introducing the ordinance.

FUTURE COUNCIL INITIATED AGENDA ITEMS
None.

ADJOURNMENT
There being no further business, Mayor Turner adjourned the meeting at 8:00 p.m.

Minutes Prepared by:

Vicky Rossi, Deputy City Clerk

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City Council
Meeting Minutes
Mark Turner - Mayor
Marilyn Librers - Mayor Pro Tem
Soraida Iwanaga - Council Member
Yvonne Martínez Beltrán - Council Member
Miriam Vega - Council Member
Monday, November 10, 2025
Facilitated City Council Session
8:30 a.m.

Community and Cultural Center
17000 Monterey Rd, Morgan Hill, CA 95037

CALL TO ORDER
Mayor Turner called the meeting to order at 8:38 a.m.

ROLL CALL ATTENDANCE
City Clerk Bigelow called the roll.

PRESENT Mark Turner, Marilyn Librers, Soraida Iwanaga, Yvonne Martinez Beltran, Miriam Vega
ABSENT None

DECLARATION OF POSTING AGENDA
City Clerk Bigelow declared the posting of the agenda.

OTHER BUSINESS

1. CITY COUNCIL GOVERNANCE TRAINING WORKSHOP
Recommendation:

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November 10, 2025
2 1. Affirm City Council's commitment to supporting and implementing governance best practices as described in the attached CP 97-01 - Rules for the Conduct of City Council Meetings, Placement of Items on the Agenda, and Matters to be Reconsidered; and

2. Consider adoption of a consolidation of the concepts contained within the adopted City Council Norms, which is retitled as the attached "Morgan Hill Approach to Public Service."
City Manager Turner introduced Jacob Green and Greg Devereaux with Jacob Green and Associates.

The consultants presented on organizational alignment and high-functioning teams.

They then presented a consolidated list of norms. The Council directed staff to bring the consolidated norms, "Morgan Hill's Approach to Public Service," to a future meeting for formal adoption.

The meeting recessed at 9:59 a.m. and reconvened at 10:17 a.m.

City Manager Turner led a discussion and review of the following documents:
• CP 97-01 - Rules for the Conduct of City Council Meetings, Placement of Items on the Agenda, and Matters to be Reconsidered
• CP 05-01 - Ethics Policy
• CP 24-01 - Code of Conduct of Public Meetings in the Council Chamber and Conference Rooms
• City Council Norms
The City Council directed staff to bring the Harassment Prevention Policy, Outside Assignments, and City Council Meeting Schedule and policy for review at a future meeting.

Public comment opened at 11:50 a.m. The following people were called to speak:

Doug Muirhead
Nick Gaich
Yvonne Randolph
With no further requests to speak, public comment closed.

CLOSED SESSION
City Attorney Larkin announced the closed session items.

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November 10, 2025
3 Conference with Legal Counsel – Anticipated Litigation Significant exposure to litigation pursuant to § 54956.9(b): Number of Cases Unknown
Conference with Legal Counsel—Existing Litigation (§ 54956.9) Guerrero v. Encarncion, et al., Santa Clara County Superior Court Case No. 21- CV-379735

OPPORTUNITY FOR PUBLIC COMMENT
Public comment opened at 11:59 a.m. With no requests to speak, public comment closed.

ADJOURN TO CLOSED SESSION
The meeting adjourned to closed session at 11:59 a.m.

The meeting reconvened at 12:15 p.m.

City Attorney Larkin announced that the first closed session item was continued, and there was no reportable action from the second closed session item.

ADJOURNMENT
The meeting adjourned at 12:15 p.m.

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10 CITY COUNCIL STAFF REPORT
MEETING DATE: November 19, 2025
PREPARED BY:

Michelle Bigelow, City Clerk
APPROVED BY: City Manager
RECEIVE REPORT REGARDING UPCOMING 2026 COMMISSION

VACANCIES PER THE MADDY ACT

RECOMMENDATION(S)
Receive report.

COUNCIL PRIORITIES, GOALS & STRATEGIES
City Council Ongoing Priorities
Supporting our Youth, Seniors, and Entire Community
Fostering a Positive Organizational Culture
Preserving our Community History
Enhancing Diversity and Inclusiveness
2024-2025 Strategic Priorities
Community Engagement
REPORT NARRATIVE:

Government Code Section 54972 (Maddy Act) requires that before December 31st of each year, the City Council cause to be prepared a list of appointments to all ongoing boards, commissions, and committees that the City Council appoints. The list includes which terms will expire during the next calendar year, including the name of the incumbent appointee, the date of appointment, the date the term expires, and the necessary qualifications for the position. Chapter 2.22.010 - Master Provisions for Boards and Commissions of the Municipal Code established the following commissions:

Planning Commission (PC); Parks and Recreation Commission (PRC); and the Library, Culture, and Arts Commission (LCAC).

Chapter 2.22.010, Section B, states that: “Unless otherwise set forth, all members of boards, commissions, and committees shall be residents of the city and shall continue to be residents of the city during their terms of office. Notwithstanding the foregoing, individuals who reside within the Morgan Hill Unified School District boundary and who do not otherwise reside in any city other than Morgan Hill may be appointed to boards, commissions, and committees provided that no more than thirty percent of the members of any board, commission, or committee shall be non-Morgan Hill residents.” The attached "Local Appointment List" highlights the Parks and Recreation (PRC) and

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10 Library, Culture, and Arts Commissioners (LCAC) whose terms expire in 2026. The PRC has four members, and the LCAC has three members whose terms expire on April 1, 2026. No terms for the Planning Commission expire in the 2026 calendar year.

COMMUNITY ENGAGEMENT:

This report serves to inform the public of the upcoming board, commission, and committee vacancies.

ALTERNATIVE ACTIONS:

Not Applicable
PRIOR CITY COUNCIL AND COMMISSION ACTIONS:

Per Resolution No. 7082, adopted by the City Council on December 17, 2014, this report is being presented as an informational item. The City Clerk’s Office will post the “Local Appointment List” in accordance with Government Code Section 54972.

FISCAL AND RESOURCE IMPACT:

The time necessary to prepare this report is accommodated in the Administrative Services Budget.

CEQA (California Environmental Quality Act):

Not a Project. This is an administrative activity that will not result in direct or indirect physical changes in the environment.

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Chapter 2.22 MASTER PROVISIONS FOR BOARDS AND COMMISSIONS* Sections:

2.22.010 Establishment of boards and commissions.

2.22.030 Clerk and secretary.

2.22.040 Rules of procedure.

2.22.050 Rules of attendance.

2.22.060 Meetings.

2.22.070 Compensation.

2.22.080 Effect.
* Prior ordinance history: Ords. 811 N.S., 890 N.S., 891 N.S., 1607 N.S. and 1719 N.S.

2.22.010 Establishment of boards and commissions.

A. There are established within the city the following boards and commissions:

1. Planning commission;

2. Parks and recreation commission;

3. Library, culture and arts commission; and

4. Disaster council.

B. Unless otherwise set forth, all members of boards, commissions and committees shall be residents of the city and shall continue to be residents of the city during their terms of office.

Notwithstanding the foregoing, individuals who reside within the Morgan Hill Unified School District boundary and who do not otherwise reside in any city other than Morgan Hill may be appointed to boards, commissions and committees provided that no more than thirty percent of the members of any board, commission or committee shall be non-Morgan Hill residents.

C. Members shall be appointed by the mayor subject to approval of a majority vote of the city council and may be removed without cause by vote of any three members of the city council.

D. The appointment terms of members may be extended, at the discretion of the city council, until such time as a successor member may be appointed and take office.

E. Vacancies in the commission occurring other than by expiration of term shall be filled for the unexpired term in the same manner as original appointments.

F. The members of the commission shall organize the commission and shall elect from its members a chair and vice-chair and such other officers as may be necessary in accordance with adopted city council policy.
(Ord. 1778 N.S. § 2 (part), 2006)
(Ord. No 1930 N.S., § 2, 4-22-2009; Ord. No. 1935 N.S., § 1, 6-3-2009)

2.22.030 Clerk and secretary.

The city clerk or designate shall also act as clerk for each of the boards and commissions and shall have authority to sign any official notices and also to certify any resolution of the commissions or boards. The city council may appoint a person not a member of the commission or board to act as secretary of the commission or board. The secretary shall keep a record of all proceedings of said board or commission, its resolutions, its findings and actions, which records shall be a public record and kept with the city clerk in the City Hall building.
(Ord. 1778 N.S. § 2 (part), 2006)

2.22.040 Rules of procedure.

A. The chair shall preside at all meetings of the board or commission. The vice chair shall assume the duties of the chair in the absence of or in case of inability of the chair.

B. A majority of the members of the commission or board shall constitute a quorum for the transaction of business.

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C. Unless otherwise specified herein, each board or commission may adopt its own rules and regulations for the transaction of its business. Such rules shall be subject to approval of the city council before becoming effective.
(Ord. 1778 N.S. § 2 (part), 2006)

2.22.050 Rules of attendance.

If any member is absent from three of any six consecutive regular board or commission meetings, unless such absence is with the permission of the chair, or vice chair in absence of the chair, expressed in the official minutes, the member's seat shall be deemed vacated. The city manager shall so notify the city council and the council shall take action to fill the seat within a reasonable period of time.
(Ord. 1778 N.S. § 2 (part), 2006)

2.22.060 Meetings.

Unless otherwise specified, the commission shall hold regular meetings once every two months at a designated time and place which shall be fixed and determined by the commission and entered upon in its minutes. Special meetings of the commission may be called at any time by the chair or by a majority of the members of the board upon notice being given to all members of the board and to all news media at least twenty-four hours in advance of the meetings, as required by the laws of the state of California. (Ord. 1778 N.S. § 2 (part), 2006)
(Ord. No. 1930 N.S., § 3, 4-22-2009)

2.22.070 Compensation.

Members of the boards and commissions shall serve without compensation but may receive reimbursement for actual and necessary expenditures made or incurred in the performance of their prescribed duties in accordance with state law and the Municipal Code and policies of the city of Morgan Hill.
(Ord. 1778 N.S. § 2 (part), 2006)

2.22.080 Effect.

Nothing in this chapter shall be construed as restricting or curtailing any of the powers of the city council or city officers as defined by the laws of the state of California or by this Municipal Code. Except as otherwise set forth in Chapter 2.36, the city council declares that the public interest and convenience require the appointment of the boards and commissions established pursuant to Section 2.22.010 to act purely in an advisory capacity to the city council. (Ord. 1778 N.S. § 2 (part), 2006)

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17555 PEAK AVENUE MORGAN HILL CALIFORNIA 95037
[email protected]
POSTED ON November 19, 2025, PER MADDY ACT

LOCAL APPOINTMENTS LIST
Unless otherwise set forth, all members of boards, commissions, and committees shall be residents of the city and shall continue to be residents of the city during their terms of office. Notwithstanding the foregoing, individuals who reside within the Morgan Hill Unified School District boundary and who do not otherwise reside in any city other than Morgan Hill may be appointed to boards, commissions, and committees provided that no more than thirty percent of the members of any board, commission, or committee shall be non-Morgan Hill residents.

LIBRARY, CULTURE & ARTS COMMISSION (Four-Year Term)
Meets monthly to serve as a liaison with the County Library, advise the City Council and City staff on culture and art-related projects and programming, and support efforts to initiate art and cultural events in the community.

Date Appointed Name Term Expires
April 24, 2024 Robyn Carillo April 1, 2028
April 24, 2024 Tanaya Rose April 1, 2028
July 22, 2020 Patrice Lyn April 1, 2026
March 20, 2019 Suman Ganapathy April 1, 2028
September 4, 2024 Mark Fiorenza April 1, 2026
May 4, 2022 Cindy Blanton April 1, 2026
April 21, 2021 Amanda Santiago April 1, 2028
PARKS & RECREATION COMMISSION (Four-Year Term)
Meets monthly to make recommendations regarding the planning and development of parks, cultural facilities, and recreation programs.

Date Appointed Name Term Expires
May 4, 2022 Harpreet Vittal April 1, 2026
February 15, 2023 Julie Lucido April 1, 2026
May 4, 202 Shweta Maniar April 1, 2026
April 24, 2024 Poonam Chabra April 1, 2028
April 24, 2024 Saied Zargar April 1, 2028
May 4, 1998 Craig C. van Keulen April 1, 2026
July 22, 2020 John Moniz April 1, 2028
PLANNING COMMISSION (Four-Year Term)
Meets twice monthly to advise on matters related to City growth and development.

Date Appointed Name Term Expires
July 15, 2015 Liam Downey June 1, 2027
May 3, 2017 Mohammad Habib June 1, 2029
August 3, 2022 James Wilson June 1, 2029
May 21, 2025 David Lovato June 1, 2029
January 28, 1989 Joseph Mueller June 1, 2027
March 2, 2022 Paul Lake June 1, 2027
April 25, 2007 Wayne Tanda June 1, 2027
Note: Yellow-highlighted Commissioners have terms expiring in 2026

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11 CITY COUNCIL STAFF REPORT
MEETING DATE: November 19, 2025
PREPARED BY:

Eric Blomquist, Building Official
APPROVED BY: City Manager
ADOPT ORDINANCE 2368, NEW SERIES, AMENDING CHAPTERS

15.08 (BUILDING CODE), 15.12 (ELECTRICAL CODE), 15.16
(MECHANICAL CODE), 15.20 (PLUMBING CODE), 15.44 (FIRE CODE), AND TO ADOPT BY REFERENCE THE 2025 CALIFORNIA BUILDING

STANDARDS CODES KNOWN AND DESIGNATED AS CALIFORNIA
CODE OF REGULATIONS, TITLE 24

RECOMMENDATION(S)

1. Open/close the public hearing;

2. Waive the second reading of the ordinance; and

3. Adopt the ordiance.

COUNCIL PRIORITIES, GOALS & STRATEGIES
City Council Ongoing Priorities
Enhancing Public Safety
Preserving and Cultivating Public Trust
REPORT NARRATIVE:

POLICY CONSIDERATIONS:

This item was introduced at the October 15, 2025, City Council meeting, and is now coming back for public hearing, second reading, and adoption.

Pursuant to the California Health and Safety Code, the California Building Standards Commission is required to adopt certain building standards codes on a triennial basis.

This code, known as the California Building Standards Codes, is Title 24 of the California Code of Regulations. It provides uniform building standards to be used throughout the state of California, and it consists of thirteen different parts. These parts include Administrative, Building, Residential, Electrical, Mechanical, Plumbing, Energy, Wildland-urban Interface, Historical, Fire, Existing Building, Green Building, and Referenced Standards.

Local agencies may amend the California Building Standards upon making findings related to specific local geographic, topographic, and/or climatic conditions. AB130, signed into law on June 30, 2025, restricts local jurisdictions from making new

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11 amendments that would apply to residential construction. However, there is an exception to AB130 that allows amendments that are substantially equivalent to an amendment previously filed by the jurisdiction and in effect as of September 30, 2025, to be applied towards residential construction.

In order to maintain the current Morgan Hill code amendments that were made to the previous editions of the California Building Standards Codes, it is necessary to revise certain Chapters of Title 15 (Building and Construction) of the City's Municipal Code.

Chapters 15.08 (Building Code),15.20 (Plumbing Code), and 15.44 (Fire Code) to adopt the 2025 California Building Standards Codes including the findings to incorporate the previously adopted local code amendments. These revisions are aligned with changes allowed under AB130. All other parts of Title 24 of the California Code of Regulations will be adopted by reference without amendments.

During the ordinance introduction at the City Council meeting on October 15, 2025, staff addressed inquiries regarding code requirements for electric readiness and the installation of heat pump mechanical units. Staff determined that between the adopted provisions of the California Energy Code (Title 24, Part 6) and Morgan Hill Municipal Code (Chapter 15.63), all new residential and non-residential buildings are required to be constructed with electric readiness and utilize heat pump mechanical units. These requirements for electric readiness and heat pumps are generally not required during the permitting of improvements to existing construction, with the key exception that the replacement of certain smaller non-residential rooftop mechanical units must comply with efficiency standards, often requiring replacement with a heat pump unit or equivalent energy efficiency measures.

Although electric readiness is not a code requirement for the permitting of improvements to an existing structure, staff provides information to the applicant during the permitting process for remodels about voluntarily incorporating electric readiness measures. If an applicant chooses to incorporate electric readiness within their permitted scope of work, they may do so without causing a delay or increasing permit fees for their project.

COMMUNITY ENGAGEMENT:

Inform: The Building Division will provide building code update outreach to the local development community, contractors, and homeowners to inform them of the changes from the 2022 to the 2025 California Building Standards.

A notice of ordinance adoption was published in the Morgan Hill Times on Friday, October 31, 2025.

ALTERNATIVE ACTIONS:

Not Applicable
PRIOR CITY COUNCIL AND COMMISSION ACTIONS:

On October 15, 2025, Council introduced Ordinance 2368 proposing amending

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11 Chapters 15.08 (Building Code), 15.12 (Electrical Code), 15.16 (Mechanical Code),

15.20 (Plumbing Code), 15.44 (Fire Code) and to adopt by reference the 2025 California Building Standards Codes known and designated as California Code of Regulations, Title 24. On November 2, 2022, Council adopted Ordinance 2337 adopting the 2022 California State Building Standards Codes.

FISCAL AND RESOURCE IMPACT:

Periodic reviews and updates of the City’s Municipal Code, including Building Standards, are part of the staff’s annual workplan. The primary resources allocated to this update were from the Development Services Department.

CEQA (California Environmental Quality Act):

Not a Project
Adoption of an ordinance and resolution regarding Building and Fire Codes is exempt from the requirements of the California Environmental Quality Act (CEQA) under Title 14 of the California Code of Regulations, Section 15061(b)(3), in that it is not a Project which has the potential for causing a significant effect on the environment. The action being considered by the City Council is an administrative activity of government that will not result in the direct or indirect physical change in the environment. This action entails adoption of State mandated Building Codes that are enforceable by the City. Minor amendments will not have a significant effect on the environment because the strengthened requirements reduce hazards and accommodate features to reduce environmental effects.

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ORDINANCE NO. 2368, NEW SERIES

AN ORDINANCE OF THE CITY OF MORGAN HILL
AMENDING CHAPTERS 15.08 (BUILDING CODE),15.12
(ELECTRICAL CODE), 15.16 (MECHANICAL CODE), 15.20
(PLUMBING CODE), 15.44 (FIRE CODE) AND TO ADOPT BY
REFERENCE THE 2025 CALIFORNIA STATE BUILDING

STANDARDS CODES KNOWN AND DESIGNATED AS
CALIFORNIA CODE OF REGULATIONS, TITLE 24.

WHEREAS, Health and Safety Code Section 17922 requires that the State adopt building standards and rules and regulations (“State Building Standards Code”) and that such State Building Standards Code impose substantially the same requirements as are contained in the most recent editions of specified uniform industry codes; and WHEREAS, Health and Safety Code Section 17958 allows the City Council to adopt ordinances or regulations which impose the same requirements as the State Building Standards Code or make changes or modifications to the State Building Standards Code upon express findings that that such modifications or changes are reasonably necessary because of local climatic, geological, or topographical conditions; and
WHEREAS, the Building Standards, along with any changes or modifications made by the City Council, become effective 180 days after publication by the California Building Standards Commissions; and
WHEREAS, the City Council desires to adopt the 2025 State Building Standards Code, including the California Building Code, the California Electrical Code, the California Mechanical Code, the California Plumbing Code, and the California Fire Code, as published by the California Building Standards Commission, along with changes and modifications reasonably necessary because of local climatic, geological, or topographical conditions, based on findings set forth in this ordinance; and
WHEREAS, the Building Official and the Fire Department have determined that local amendments to the State Building Standards Codes are necessary due to unique conditions that exist in the City of Morgan Hill; and
WHEREAS, amendments related to fire and life-safety contained in the 2025 State Building Standards Code as recommended by the City Building Official and the Fire Department are hereby found to be reasonably necessary due to the following local conditions, along with additional express findings that are already on file with the California Building Standards Commission:

A. Climatic Conditions
Santa Clara County and the City of Morgan Hill are located in a semi-arid Mediterranean type climate which predisposes all fuels to rapid ignition and spread of fire. Hot, dry winds and low humidities are common to all areas within the City of Morgan Hill and

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Santa Clara County in general. Winter rains promote the growth of grass and brush. This vegetation presents heavy dry fuel loads in the summer months. These conditions are conducive to the ready ignition, propagation, and spread of grass, brush, and structure fires. These conditions, which can cause small brush fires that spread quickly, are a contributing factor to the high fire danger in the area and create the need for an increased level of fire protection. This added protection will supplement normal fire department response and provide immediate protection for life and safety of multiple occupancy occupants during fire occurrences.

B. Topographic Conditions
The topography of Morgan Hill has hillside homes on each side of the City with long response times for safety equipment. The City’s foothills cause many problems for firefighters, including long response times, inadequate water supply, and unlimited fuel.

Fog, heavy rains, mudslides, and earthquakes are common occurrences which negatively affect the ability of the City’s public safety resources to respond to emergency situations.

The City is in a Category D seismic activity classification. Many traffic corridors such as Highway 101, Monterey Road, Union Pacific Railroad, related bridges, underpasses, and crossings are subject to obstruction in the event of an earthquake, traffic accident, hazardous material spill, or other disaster.

C. Geographic Conditions

1. Santa Clara County and the City of Morgan Hill are located within the seismically active San Francisco Bay region. The significant earthquakes in the region are generally associated with the crustal movements along well-defined, active fault zones. The nearest known active faults are the San Andreas Fault, approximately 12 miles southwest of Morgan Hill and the Calaveras Fault, approximately one mile northeast. Both faults have produced major earthquakes in the past and have estimated maximum credible Richter magnitudes of 8.3 and 7.3, respectively. The Sargent-Berrocal Fault, a potentially active fault, lies approximately ten miles away and has an estimated maximum credible Richter magnitude of 7.3. The Coyote Creek Fault is located in Morgan Hill and is classified as potentially active as well. In addition, several unnamed faults traverse the western slopes of the upland areas.

2. Regional planning for reoccurrence is recommended by the State Department of Conservation. The October 17, 1989 Santa Cruz earthquake resulted in only one major San Francisco fire in the Marina district but, when combined with the 34 other fires and over 500 responses, the fire department was taxed to its full capabilities.

The Marina fire was difficult to contain because mains supplying water to the district burst during the earthquake. If more fires had been ignited by the earthquake, it would have been difficult for the fire department to contain them. Experts predict a major earthquake in our area. This situation creates the need for both additional fire protection measures and automatic on-site fire protection for building occupants since a multitude of fires may result from breakage of gas lines and electric lines as a result of an earthquake.

3. Traffic and circulation congestion presently existing in the City of Morgan Hill often places fire department response time to fire occurrences at risk. This condition will

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Ordinance No. 2368, New Series

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be exacerbated by any major disaster, including any earthquake where damage to the highway system will occur. This condition makes the need for additional on-site protection for property occupants necessary.

4. The City of Morgan Hill is located in an area subject to climatic conditions of high winds and low humidity. This combination of events creates an environment which is conducive to rapidly spreading fires. Control of such fires requires rapid response.

Obstacles generated by strong winds, such as fallen trees, streetlights, and utility poles, greatly impact the response time to reach an incident scene.

5. The City of Morgan Hill is located in the middle of a seismically active area. The viability of the public water system would be questionable at best after a major seismic event. A severe seismic event has the potential to negatively impact any rescue or fire suppression activities because it is likely to create obstacles similar to those indicated under the high wind section above. With the probability of strong aftershocks, there exists a need to provide increased protection for anyone on upper floors.

6. The City of Morgan Hill is located approximately sixteen (16) miles from the ocean.

The City’s typical ground water level is between ten and twenty feet. This condition makes the City more prone to subsidence issues than most inland communities and cities.

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

SECTION 1. Chapter 15.08 (Building Code) of Title 15 (Buildings and Construction) of the Morgan Hill Municipal Code is hereby amended to read (additions in underline, deletions in strikeout):
"Chapter 15.08 - BUILDING CODE
Sections:

15.08.010 Adoption of the 2025 California Building Code and the 2025 California Residential Code, and other parts of the State Buildings Standards Code.

15.08.020 Short title.

15.08.030 Organization, enforcement, fees, and inspections.

15.08.040 Additions, amendments, and deletions.

15.08.050 Building over utility easements.

15.08.060 Section R309.1 and R309.2 amended – Automatic Fire Sprinklers Systems

15.08.070 Section 2308.10.3 and R602.10.4 , amended – Braced wall panel methods (gypsum board and Portland cement plaster).

15.08.080 R506.1 amended - Minimum slab provisions.

15.08.90 Section J103.2 amended - Exemptions

15.08.100 Violation—Penalty.

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15.08.010 - Adoption of the 2025 California Building Code, the 2025 California Residential Code and other parts of the State Building Standards Code.

Thereby adopted by reference that certain code known and designated as the California Code of Regulations, Title 24, Parts 1, 2, 2.5, 3, 4, 5, 6, 7, 8, 10, 11, and 12 as published by the California Building Standards Commission, as further described and including the following:
• 2025 California Administrative Code (California Code of Regulations Title 24, Part 1). • 2025 California Building Code (California Code of Regulations Title 24, Part 2) based on the 2024 International Building Code; as prepared by the International Code Council, and as amended by the State of California.
• 2025 California Residential Code (California Code of Regulations Title 24, Part 2.5) based on the 2024 International Residential Code; as prepared by the International Code Council, and as amended by the State of California.
• 2025 California Energy Code (California Code of Regulations Title 24, Part 6). • 2025 California Wildland-Urban Interface Code (California Code of Regulations Title 24, Part 7) based on the 2024 International Wildland-Urban Interface Code; as prepared by the International Code Council, and as amended by the State of California. • 2025 California Historical Building Code (California Code of Regulations Title 24, Part 8).
• 2025 California Existing Building Code (California Code of Regulations Title 24, Part 10) based on the 2024 International Existing Building Code; as prepared by the International Code Council, and as amended by the State of California. • 2025 California Green Building Standards Code (California Code of Regulations Title 24, Part 11).
• 2025 California Referenced Standards Code (California Code of Regulations Title 24, Part 12).

Such code shall include those sections requiring enforcement by the Morgan Hill Building Department, and, as further amended by the City of Morgan Hill, provisions intended to address local climatic, geologic, and topographic conditions as permitted by state law. Adoption of said code shall include the adoption of Appendices I, and J, including Division II Scope and Administration, contained in the 2025 California Building Code and Appendices BF, and BH, including Division II Scope and Administration of the 2025 California Residential Code.

Such code shall be and become the City of Morgan Hill Building Code regulating the erection, construction, alteration, repair, relocation, demolition, occupancy, use, height, area, and maintenance of all buildings and structures and certain equipment therein specifically regulated.

The provisions of said code shall provide for the issuance of permits and certificates of occupancy, the collection of fees thereof, and penalties for violation of such code.

At least one copy of the City of Morgan Hill Building Code has been deposited in the office of the city building official and is available for public inspection.

15.08.020 - Short title.

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This chapter shall be known as the "building code" and may be cited as such.

15.08.030 - Organization, enforcement, fees, and inspections.

The organization, enforcement, fees, and inspections shall comply with the 2025 California Building Code. The building official may use the building valuation data from the International Code Council and incorporate a regional cost modifier for determining a "cost per square foot."

15.08.040 - Additions, amendments, and deletions.

The following provisions of the California Building Code and California Residential Code shall be added, amended, or deleted as follows:

A. The following sections in the California Building Code are amended by this chapter:
2308.6.3, 1907.1, and J103.2.

B. The following section in the California Residential Code is amended by this chapter:

R309.1, R309.2, R506.1 and R602.10.4.

15.08.050 - Building over utility easements.

It is unlawful for any person, firm, or corporation to erect, construct, or maintain any structure, building, garage, carport, storage shed, or other similar building over or within the boundary of any utility easement. "Utility easement" as used in this section includes any easement for a gas line, water line, storm drainage line, sewer line or buried or overhead electrical or telephone lines.

15.08.060 – Section R309.1 and R309.2 amended—Automatic Fire Sprinkler Systems.

A. Section R309.1 of the 2025 California Residential Code, is hereby amended to read in its entirety:

R309.1 Townhouse automatic fire sprinkler systems. An automatic residential fire sprinkler system shall be installed in townhouses.

Exception: An automatic residential fire sprinkler system shall not be required where additions or alterations are made to existing townhouses if the addition does not exceed 1200 square feet or result in a total building area of more than 3600 square feet and an existing automatic residential fire sprinkler system is not installed.

B. Section R309.2 of the 2025 California Residential Code is amended to read in its entirety:

R309.2 One- and two-family dwellings automatic fire sprinkler systems. An automatic residential fire sprinkler system shall be installed in one- and two-family dwellings.

Exception:

1. An automatic residential fire sprinkler system shall not be required where additions or alterations are made to existing buildings if the addition does not exceed 1200 square feet or result in a total building area of more than 3600 square feet and an existing automatic residential fire sprinkler system is not installed.

2. Accessory Dwelling Unit, provided that all of the following are met:

2.1. The unit meets the definition of an Accessory Dwelling Unit as defined in the Government Code Section 65852.2.

2.2. The existing primary residence does not have automatic fire sprinklers.

2.3. The accessory detached dwelling unit does not exceed 1,200 square feet in size.

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2.4. The unit is on the same lot as the primary residence.

C. Findings. The City of Morgan Hill is located in an area subject to a climatic condition of high winds and low humidity. This combination of events creates an environment which is conducive to rapidly spreading fires. Control of such fires requires rapid response. Obstacles generated by a strong wind, such as fallen trees, street lights, and utility poles, greatly impact the response time to reach an incident scene. This condition makes the requirement for additional onsite protection for property occupants necessary. These amendments comply with the exception allowed by AB130 as the changes or modifications are substantially equivalent to changes or modifications that were previously filed by the governing body of the city and were in effect as of September 30, 2025.

15.08.070 - Section 2308.10.3 and R602.10.4 amended—Braced wall panel methods (gypsum board and Portland cement plaster).

A. Section 2308.10.3 of the 2025 California Building Code, which allows the use of gypsum board and Portland cement plaster for wall bracing, is hereby amended to read in its entirety:
2308.10.3 Braced wall panel methods
Construction of braced wall panels shall be by one or a combination of the methods in Table 2308.10.3(1). Braced wall panel length shall be in accordance with Section 2308.10.4 or 23010.6.5. The use of Gypsum Board (GB) or Portland Cement Plaster (PCP) type braced wall panels are not allowed.

B. Section R602.10.4 of the 2025 California Residential Code, which allows the use of gypsum board and Portland cement plaster for wall bracing, is hereby amended to read in its entirety:

R602.10.4 Construction methods for braced wall panels.

Intermittent and continuously sheathed braced wall panels shall be constructed in accordance with this section and the methods listed in Table R602.10.4. The use of Gypsum Board (GB) or Portland Cement Plaster (PCP) type braced wall panels are not allowed.

C. Findings. The city is in a Category D seismic activity classification. Gypsum wallboard and exterior Portland cement plaster have performed poorly during California seismic events.

Shear values for gypsum wallboard and Portland cement plaster contained in the code are based on monodirectional testing. It is appropriate to eliminate the use of these materials until cyclic loading tests are performed and evaluated. These amendments comply with the exception allowed by AB130 as the changes or modifications are substantially equivalent to changes or modifications that were previously filed by the governing body of the city and were in effect as of September 30, 2025.

15.08.080 - Section R506.1 amended—Minimum slab provisions.

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A. Section R506.1 of the 2025 California Residential Code is hereby amended to read in its entirety:

R506.1 General. Concrete slab-on-ground floors shall be designed and constructed in accordance with the provisions of this section or ACI 332. Floors shall be a minimum 3- 1/2 inches (89 mm) thick (for expansive soils, see Section R403.1.8). The slab shall be reinforced with not less than six inches by six inches ten-gauge wire mesh or an approved alternate. The specified compressive strength of concrete shall be as set forth in Section R402.2.

B. Findings. To avoid damage due to soil expansion, shrinkage and seismic activity which causes damage to concrete slab flooring throughout the city, imposing the above requirements eliminates the need for a soils report for some small projects. These amendments comply with the exception allowed by AB130 as the changes or modifications are substantially equivalent to changes or modifications that were previously filed by the governing body of the city and were in effect as of September 30, 2025.

15.08.90 – Section J103.2 amended—Exemptions
A. Section J103.2 of the 2025 California Building Code is hereby amended to read in its entirety:

J103.2 Exemptions. A grading permit shall not be required for the following:

1. Grading of less than 50 cubic yards in an isolated, self-contained area, provided that the public is not endangered and that such grading will not adversely affect adjoining properties.

2. Excavation for construction of a structure permitted under this code.

3. Cemetery graves.

4. Refuse disposal sites controlled by other regulations.

5. Excavations for wells, or trenches for utilities.

B. Findings. The City includes hillside properties in geological sensitive areas. The valley surface soil is characterized by peculiarly high expansivity and includes properties subject to flooding. The City also has water tributaries leading to the San Francisco and Monterey Bays and projects must comply with strict Best Management Practices. This amendments complies with the exception allowed by AB130 as the changes or modifications are substantially equivalent to changes or modifications that were previously filed by the governing body of the city and were in effect as of September 30, 2025.

15.08.100 - Violation.

A. A violation of the code adopted by this chapter occurs when a person:

1. Fails to comply with this code;

2. Violates or fails to comply with any order made under this code;

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3. Builds in violation of any detailed statement of specifications or plans submitted and approved thereunder or any certificate or permit issued thereunder and from which no appeal has been taken; or

4. Fails to comply with such an order as affirmed or modified by the city council or by a court of competent jurisdiction, within the time fixed in this chapter.

B. The imposition of one penalty for any violation shall not excuse the violation or permit it to continue and all such persons shall be required to correct or remedy such violations or defects within a reasonable time.

C. The application of the above penalty shall not be held to prevent the enforced removal of prohibited conditions.

SECTION 2. Chapter 15.12 (Electrical Code) of Title 15 (Buildings and Construction) of the Morgan Hill Municipal Code is hereby amended to read (additions in underline, deletions in strikeout):
"Chapter 15.12 - ELECTRICAL CODE
Sections:

15.12.010 Short title.

15.12.020 Adoption of the 2025 California Electrical Code.

15.12.030 Scope, organization, enforcement, fees, and inspections.

15.12.040 Violation.

15.12.010 - Short title.

This chapter shall be known as the "electrical code" and may be cited as such.

15.12.020 - Adoption of the 2025 California Electrical Code.

There is adopted by reference that certain code known and designated as the California Code of Regulations, Title 24, Part 3, further described and referred to as the 2025 California Electrical Code published by the California Building Standards Commission and based on the National Electric Code, 2023 Edition, prepared by the National Fire Protection Association. Adoption of said code shall include those sections and annexes requiring enforcement by the Morgan Hill Building Department and, as further amended by the City of Morgan Hill, provisions intended to address local climatic, geologic, and/or topographic conditions, as permitted by state law. Such code shall be and become the Morgan Hill Electrical Code, regulating and controlling the design, construction, installation, quality of materials, location, operation, and maintenance of electrical systems, equipment, and appliances. The provisions of said Code shall provide for the issuance of permits and collection of fees thereof and penalties for violation of such code.

At least one copy of the City electrical code has been deposited in the office of the City building official and is available for public inspection.

15.12.030 - Scope, Organization, Enforcement, Fees, And Inspections.

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The scope, organization, enforcement, fees, and inspections of the 2025 California Electrical Code must comply with those set forth in the 2025 California Building Code and 2025 California Electrical Code.

15.12.040 - Violation.

A. A violation of the code adopted by this chapter occurs when a person:

1. Fails to comply with this code;

2. Violates or fails to comply with any order made under this code;

3. Builds in violation of any detailed statement of specifications or plan submitted and approved thereunder or any certificate or permit issued thereunder and from which no appeal has been taken; or

4. Fails to comply with such an order as affirmed or modified by the city council or by a court of competent jurisdiction, within the time fixed in this chapter.

B. Such person shall be liable severally and for each and every violation and noncompliance respectively.

C. The imposition of one penalty for any violation shall not excuse the violation or permit it to continue and all such persons shall be required to correct or remedy such violations or defects within a reasonable time.

D. The application of the above penalty shall not be held to prevent the enforced removal of prohibited conditions.

SECTION 3. Chapter 15.14 (Mechanical Code) of Title 15 (Buildings and Construction) of the Morgan Hill Municipal Code is hereby amended to read (additions in underline, deletions in strikeout):
"Chapter 15.16 - MECHANICAL CODE
Sections:

15.16.010 Short title.

15.16.020 Adoption of the 2025 California Mechanical Code.

15.16.030 Scope, organization, enforcement, fees, and inspections.

15.16.040 Violation—Penalty.

15.16.010 - Short title.

This chapter shall be known as the "mechanical code" and may be cited as such.

15.16.020 - Adoption of the 2025 California Mechanical Code.

There is hereby adopted by reference that certain code known and designated as the California Code of Regulations, Title 24, Part 4, further described and referred to as the 2025 California Mechanical Code published by the California Building Standards Commission and based on the Uniform Mechanical Code; 2024 Edition, prepared by the International Association

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of Plumbing and Mechanical Officials. The adoption of said Code shall include those sections requiring enforcement by the Morgan Hill Building Department. Such code shall be and become the Morgan Hill Mechanical Code, regulating heating, ventilating, comfort cooling, refrigeration systems, and other miscellaneous heating appliances, prescribing conditions under which such work may be performed within the city, and providing for the issuance of permits and the collection of fees therefore and penalties for violation of such code.

At least one copy of the city mechanical code has been deposited in office of the city building official and is available for public inspection.

15.16.030 - Scope, organization, enforcement, fees, and inspections.

The scope, organization, enforcement, fees, and inspections of the California Mechanical Code must comply with those set forth in the 2025 California Building Code and the 2025 California Mechanical Code.

15.16.040 - Violation.

A. A violation of the code adopted by this chapter occurs when a person:

1. Fails to comply with this code;

2. Violates or fails to comply with any order made under this code;

4. Fails to comply with such an order as affirmed or modified by the city council or by a court of competent jurisdiction, within the time fixed in this chapter.

B. Such person shall be liable severally, and for each and every such violation and noncompliance respectively.

D. The application of the above penalty shall not be held to prevent the enforced removal of prohibited conditions.

SECTION 4. Chapter 15.20 (Plumbing Code) of Title 15 (Buildings and Construction) of the Morgan Hill Municipal Code is hereby amended to read (additions in underline, deletions in strikeout):
"Chapter 15.20 - PLUMBING CODE
Sections:

15.20.010 Short title.

15.20.020 Adoption of the 2025 California Plumbing Code.

15.20.030 Scope, organization, fees, and inspections.

15.20.040 Amendments and deletions.

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15.20.050 Section 604.3 amended--Copper tube.

15.20.060 Sections 609.3 amended-- Under concrete slab.

15.20.070 Violation-Penalty.

15.20.010 - Short title.

This chapter shall be known as the "plumbing code" and may be cited as such.

15.20.020 - Adoption of the 2025 California Plumbing Code.

There is hereby adopted by reference that certain code known and designated as the California Code of Regulations, Title 24, Part 5, further described and referred to as the 2025 California Plumbing Code published by the California Building Standards Commission and based on the Uniform Plumbing Code, 2024 Edition, prepared by the International Association of Plumbing and Mechanical Officials. The adoption of said code shall include those sections requiring enforcement by the local building department as mandated by the State and as further amended by the City of Morgan Hill with provisions intended to address local climatic, geologic, and topographic conditions, as permitted by state law. Such code shall be and become the Morgan Hill Plumbing Code, regulating plumbing and drainage systems, house sewers, private sewage disposal, drainage systems, and prescribing conditions under which such work may be carried on within the city and providing for the issuance of permits and the collection of fees therefore.

At least one copy of the city plumbing code has been deposited in the office of the city building official and is available for public inspection.

15.20.030 - Scope, organization, fees, and inspections.

The scope, organization, enforcement, fees, and inspections of the California Plumbing Code must comply with those set forth in the 2025 California Building Code and 2025 California Plumbing Code.

15.20.040 - Amendments and deletions.

The following provisions of the 2025 California Plumbing Code shall be amended or deleted:

A. The following sections of the California Plumbing Code are amended by this chapter:
604.3 and 609.3.

15.20.050 - Section 604.3 amended—Copper tube.

A. Section 604.3 of the 2025 California Plumbing Code is hereby amended to read in its entirety:
604.3 Copper or Copper Alloy Tube. Copper or copper alloy tube for potable water piping shall have a weight of not less than type "L."
Exceptions: None
B. Finding. Due to water hardness in the city, type "L" copper shall be required. This amendment complies with the exception allowed by AB130 as the changes or modifications are substantially equivalent to changes or modifications that were previously filed by the governing body of the city and were in effect as of September 30, 2025.

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15.20.060 - Sections 609.3 amended—Under concrete slab.

A. Section 609.3 of the 2025 California Plumbing Code is hereby amended to read in its entirety:
609.3 Under Concrete Slab. Water piping shall not be installed directly in or under a concrete floor slab within a building without prior approval of the Building Official.

B. Findings.

1. Most of the surface soils in Morgan Hill are relatively young and unconsolidated sedimentary materials formed from a wide variety of parent materials. The varying chemical composition, degree of weathering, and the relatively acid environment have created soils of varying types, which are peculiarly corrosive in nature.

2. Much of the surface soil in Morgan Hill is characterized by peculiarly high expansivity (i.e., shrink-swell behavior) and low bearing strength. There are two types of expansive soils in the area:
a. The organic silty clays which are the recent bay muds; and b. The plastic silty clays which weather from the shale found in the hills surrounding Santa Clara Valley.

3. The local climate is characterized by markedly delineated rainy and dry seasons, which tend to maximize the volume changes occurring within the soil.

4. Areas of the city have hard water, which may be corrosive to ferrous pipe.

5. The groundwater table is unusually high in many places.

6. Morgan Hill is a seismically active region.

7. This amendment complies with the exception allowed by AB130 as the changes or modifications are substantially equivalent to changes or modifications that were previously filed by the governing body of the city and were in effect as of September 30, 2025.

15.20.070 - Violation.

A. A violation of the code adopted by this chapter occurs when a person:

1. Fails to comply with this code;

2. Violates or fails to comply with any order made under this code;

4. Fails to comply with such an order as affirmed or modified by the city council or by a court of competent jurisdiction, within the time fixed in this chapter.

B. Such person shall be liable severally and for each and every such violation and noncompliance respectively.

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D. The application of the above penalty shall not be held to prevent the enforced removal of prohibited conditions.

SECTION 5. Chapter 15.44 (Fire Code) of Title 15 (Buildings and Construction) of the Morgan Hill Municipal Code is hereby amended to read (additions in underline, deletions in strikeout):
"Chapter 15.44 FIRE CODE
Sections:

15.44.010 Adoption of the 2025 California Fire Code.

15.44.015 Adoption of appendix chapters

15.44.020 Short title; International Fire Code and California Fire Code Defined.

15.44.030 Establishment and duties of the bureau of fire prevention.

15.44.040 Modification of provisions by chief.

15.44.050 Establishment of limits of districts.

15.44.060 Additions, amendments, and deletions.

15.44.070 Scope and general requirements.

15.44.080 Chapter 2 - Definitions.

15.44.090 Chapter 5 – Fire Service Features.

15.44.100 Chapter 9 – Fire Protection Systems.

15.44.110 Chapter 33 - Fire Safety During Construction and Demolition.

15.44.120 Chapter 50 - Hazardous Materials - General Provisions.

15.44.130 Chapter 56 – Explosives and Fireworks.

15.44.140 Chapter 57 – Flammable and Combustible Liquids.

15.44.150 Chapter 58 – Flammable Gases and Flammable Cryogenic Fluids.

15.44.180 Chapter 64 – Pyrophoric Materials.

15.44.160 Appendix C.

15.44.170 Violation.

15.44.010 - Adoption of the 2025 California Fire Code.

There is hereby adopted by reference that certain code known and designated as the California Code of Regulations, Title 24, Part 9, further described and referred to as the 2025 California Fire Code published by the California Building Standards Commission and based on the International Fire Code;, 2024 Edition, prepared by the International Code Council, including Appendix Chapters B and C, save and except such portions as are hereinafter deleted, modified, or amended by this chapter. Such code shall be and become the Morgan Hill Fire Code, regulating and governing the safeguarding of life and property from fire and explosion hazards arising from the storage, handling, and use of hazardous substances, materials, and devices, and from conditions hazardous to life or property in the occupancy of buildings and premises in the City of Morgan Hill.

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One (1) copy of the code shall be kept on file at all times in the office of the city building official and the administrative offices of the Morgan Hill Fire Department for use and examination by the public.

15.44.015 - Adoption of appendix chapters.

The following Appendix Chapters from the 2025 California Fire Code are hereby adopted:

Appendix B: Fire Flow Requirements for Buildings.

Appendix C: Fire Hydrant Locations and Distribution.

Appendix D: Fire Apparatus Access Roads

15.44.020 - Short Title; International Fire Code and California Fire Code Defined.

This chapter shall be known as the "Fire Code" and may be cited as such. Whenever the phrase "International Fire Code" appears in this code or any ordinance of the city, such phrase shall be deemed and construed to refer to and apply to the International Fire Code, 2024 Edition, as adopted and amended by this chapter. Whenever the phrase "California Fire Code" appears in this code or any ordinance of the city, such phrase shall be deemed and construed to refer to and apply to the 2025 California Fire Code, as adopted and amended by this chapter. Sections amended or modified in this chapter shall refer to the sections of the California Fire Code unless otherwise specified.

15.44.030 - Establishment and duties of bureau of fire prevention.

The California Fire Code and International Fire Code shall be enforced by the bureau of fire prevention in the Morgan Hill Fire Department, which shall be operated under the supervision of the chief of the fire department.

15.44.040 - Modification of provisions by chief.

A. The Chief of the Morgan Hill Fire Department shall have power to modify any of the provisions of the fire code upon application in writing by the owner or lessee, or their duly authorized agent, when there are practical difficulties in the way of carrying out the strict letter of the codes, provided that the spirit of the codes shall be observed, public safety secured, and substantial justice done.

B. The particulars of such modification, when granted or allowed, and the decision of the chief shall be entered in the records of the fire department and a signed copy shall be furnished to the applicant for modification.

15.44.050 - Establishment of limits of districts.

A. Storage of stationary tanks of flammable cryogenic fluids are to be prohibited. The limits referred to in Section 5806.2 of the 2025 California Fire Code, in which the storage of flammable cryogenic fluids in stationary containers is prohibited, are hereby established as to all locations of the City of Morgan Hill which are residential and congested commercial areas as determined by the fire code official.

B. Storage of Class I and II liquids in outside aboveground tanks is prohibited. The limits referred to in Section 5704.2.9.6.1 of the 2025 California Fire Code, in which the storage of flammable or combustible liquids in aboveground tanks is prohibited, are hereby established as to all locations of the City of Morgan Hill that are residential or congested commercial areas as determined by the fire code official.

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C. Storage of Class I and II liquids in aboveground tanks is prohibited. The limits referred to in Section 5706.2.4.4 of the 2025 California Fire Code, in which the storage of flammable or combustible liquids in aboveground tanks is prohibited, are hereby established as to all locations of the City of Morgan Hill that are residential or other locations as determined by the fire code official.

D. Storage of liquefied petroleum gases ("LPG") is prohibited. The limits referred to in Section 6104.2 of the 2025 California Fire Code, in which storage of liquefied petroleum gas is restricted, are hereby established as to all locations of the City of Morgan Hill that are residential or congested commercial areas as determined by the fire code official.

Exceptions: LPG may be used for industrial operations or when natural gas is not available or would not provide a viable substitute for LPG. Portable containers for temporary heating and/or cooking uses may be permitted if stored and handled in accordance with this code.

Facilities in commercial areas for refueling portable or mobile LPG containers may be approved by the fire code official on a case by case basis.

15.44.060 - Additions, amendments, and deletions.

A. In accordance with California Health and Safety Code Section 17958.7, certain modifications to the California Fire Code as set forth in this Chapter are reasonably necessary because of local climatic, geologic, or topographical conditions.

B. Climatic Conditions
Santa Clara County and the City of Morgan Hill are located in a semi-arid Mediterranean type climate which predisposes all fuels to rapid ignition and spread of fire. Hot, dry winds, and low humidities, are common to all areas within the City of Morgan Hill and Santa Clara County in general. Winter rains promote the growth of grass and brush. This vegetation presents heavy dry fuel loads in the summer months. These conditions are conducive to the ready ignition, propagation and spread of grass, brush and structure fires. These conditions, which can cause small brush fires which spread quickly, are a contributing factor to the high fire danger in the area, and create the need for an increased level of fire protection. This added protection will supplement normal fire department response available and provide immediate protection for life and safety of multiple occupancy occupants during fire occurrences.

C. Topographic Conditions
The topography of Morgan Hill has hillside homes on each side of the city with long response times for safety equipment. The City foothills cause many problems for firefighters, including long response times, inadequate water supply and unlimited fuel. Fog, heavy rains, mudslides and earthquakes are other common occurrences which negatively affect the ability of the city’s public safety resources to respond to emergency situations. The City is in a Category D seismic activity classification. Many traffic corridors such as Highway 101 and Monterey Road, Southern Pacific Railroad, related bridges, underpasses and crossings are subject to obstruction in the event of an earthquake, traffic accident, hazardous material spill or other disaster.

D. Geographic Conditions

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1. Santa Clara County and the City of Morgan Hill are located within the seismically active San Francisco Bay region. The significant earthquakes in the region are generally associated with the crustal movements along well-defined, active fault zones. The nearest known active faults are the San Andreas Fault, approximately 12 miles southwest of Morgan Hill, and the Calaveras Fault, approximately 1 mile northeast. Both faults have produced major earthquakes in the past, and have estimated maximum credible Richter magnitudes of 8.3 and 7.3, respectively. The Sargent-Berrocal Fault, a potentially active fault, lies approximately 10 miles away and has an estimated maximum credible Richter magnitude of 7.3. The Coyote Creek Fault is located in Morgan Hill and is classified as potentially active as well. In addition, several unnamed faults traverse the western slopes of the upland areas.

2. Regional planning for reoccurrence is recommended by the State of California, Department of Conservation. The October 17, 1989, Santa Cruz earthquake resulted in only one major San Francisco fire in the Marina district, but when combined with the 34 other fires and over 500 responses, the department was taxed to its full capabilities. The Marina fire was difficult to contain because mains supplying water to the district burst during the earthquake. If more fires had been ignited by the earthquake, it would have been difficult for the fire department to contain them.

Experts predict a major earthquake in our area within the next 50 years. This situation creates the need for both additional fire protection measures and automatic on-site fire protection for building occupants since a multitude of fires may result from breakage of gas lines and electric lines as a result of an earthquake.

3. Traffic and circulation congestion presently existing in the City of Morgan Hill often places fire department response time to fire occurrences at risk. This condition will be exacerbated by any major disaster, including any earthquake where damage to the highway system will occur. This condition makes the need for additional on-site protection for property occupants necessary.

4. The City of Morgan Hill is located in an area subject to a climatic condition of high winds and low humidity. This combination of events creates an environment which is conducive to rapidly spreading fires. Control of such fires requires rapid response.

Obstacles generated by a strong wind, such as fallen trees, street lights and utility poles greatly impact the response time to reach an incident scene.

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6. The City of Morgan Hill is located approximately sixteen (16) miles from the ocean.

The City’s typical ground water level is between ten (10) and twenty (20) feet. This condition makes the City more prone to subsidence issues than most inland communities.

7. These amendments comply with the exception allowed by AB130 as the changes or modifications are substantially equivalent to changes or modifications that were previously filed by the governing body of the city and were in effect as of September 30, 2025.

15.44.070– Scope and general requirements.

A. Section 101.1 of the 2025 California Fire Code is hereby amended to read in its entirety:
[A] 101.1 Title. These regulations shall be known as the Fire Code of Morgan Hill, hereinafter referred to as "this code."

15.44.80- Chapter 2—Definitions.

A. The following definitions in Section 202 of the 2025 California Fire Code is hereby added to read:

CORROSIVE LIQUID.

Corrosive liquid is
1) any liquid which, when in contact with living tissue, will cause destruction or irreversible alteration of such tissue by chemical action; or
2) any liquid having a pH of 2 or less or 12.5 or more; or 3) any liquid classified as corrosive by the U.S. Department of Transportation; or 4) any material exhibiting the characteristics of corrosivity in accordance with Title 22, California Code of Regulations §66261.22.

MODERATELY TOXIC GAS. A chemical or substance that has a median lethal concentration (LC50) in air more than 2000 parts per million but not more than 5000 parts per million by volume of gas or vapor, when administered by continuous inhalation for an hour, or less if death occurs within one hour, to albino rats weighing between 200 and 300 grams each.

HEALTH HAZARD-OTHER. A hazardous material which affects target organs of the body, including but not limited to, those materials which produce liver damage, kidney damage, damage to the nervous system, act on the blood to decrease hemoglobin function, deprive the body tissue of oxygen or affect reproductive capabilities, including mutations (chromosomal damage), sensitizers or teratogens (effect on fetuses).

SECONDARY CONTAINMENT. Secondary containment is that level of containment that is external to and separate from primary containment and is capable of safely and securely containing the material, without discharge, for a period of time reasonably necessary to ensure detection and remedy of the primary containment failure.

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SPILL CONTROL. That level of containment that is external to and separate from the primary containment and is capable of safely and securely containing the contents of the largest container and prevents the materials from spreading to other parts of the room.

WORKSTATION. A defined space or an independent principal piece of equipment using flammable or unstable (Class 3 or 4 as ranked by NFPA 704) hazardous materials where a specific function, laboratory procedure or research activity occurs. Approved or listed hazardous materials storage cabinets, flammable liquid storage cabinets, or gas cabinets serving a workstation are included as part of the workstation. A workstation is allowed to contain ventilation equipment, fire protection devices, detection devices, electrical devices and other processing and scientific equipment.

15.44.90 - Chapter 5—Fire Service Features.

A. Section 503.1 of the 2025 California Fire Code is hereby amended to read in its entirety:
503.1 Where required. Fire apparatus access roads shall be provided and maintained in accordance with Sections 503.1.1 through 503.1.3 and in accordance with Appendix D and comply with the Fire Department Standard Details and Specifications.

B. Section 503.2.1 of the 2025 California Fire Code is hereby amended to read in its entirety:
503.2.1 Dimensions. Fire apparatus access roads shall have an unobstructed width of not less than 20 feet (6096 mm) for engines, and 26 feet (7925 mm) for aerial fire apparatus exclusive of shoulders, except for approved gates or barricades in accordance with Sections 503.5.1 and 503.6. The unobstructed vertical clearance shall be a minimum of 13 feet 6 inches (4115 mm), or as determined by the fire code official.

C. Section 503.2.4 of the 2025 California Fire Code is hereby amended to read in its entirety:
503.2.4 Turning radius. The required turning radius of a fire apparatus access road shall be a minimum of 30 feet (9144 mm) inside, and a minimum of 50 feet (15240 mm) outside.

D. Section 503.2.7 of the 2025 California Fire Code is hereby amended to read in its entirety:
503.2.7 Grade. The maximum grade of a fire apparatus access road shall not exceed 15- percent, unless approved by the fire code official
E. Section 503.5 of the 2025 California Fire Code is hereby amended to read in its entirety:
503.5 Required gates or barricades. The fire code official is authorized to require the installation and maintenance of gates or other approved barricades across fire apparatus access roads, trails, or other accessways, not including the public streets, alleys, or highways. The minimum width shall be 12 feet (4268 mm) for single-family dwellings and 20 feet (6096 mm) for all others. Electric gate operators, where provided shall be listed in

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accordance with UL 325. Gates intended for automatic operation shall be designed, constructed, and installed to comply with the requirements of ASTM F2200 F. Section 503.6 of the 2025 California Fire Code is hereby amended to read in its entirety:
503.6 Security gates. The installation of security gates across a fire apparatus access road shall be approved by the fire code official. Where security gates are installed, they shall have an approved means of emergency operation. The security gates and the emergency operation shall be maintained operational at all times. Electric gate operators, where provided, shall be listed in accordance with UL 325. Gates intended for automatic operation shall be designed, constructed and installed to comply with the requirements of ASTM F2200. The minimum width shall be 12 feet (4268 mm) for single-family dwellings and 20 feet (6096 mm) for all others.

15.44.100 - Chapter 9—Fire Protection Systems.

A. Section 903.2 of the 2025 California Fire Code is hereby amended to read in its entirety:
903.2 Where required. Approved automatic sprinkler systems in new and existing buildings and structures shall be provided in the locations described in this Section or in Sections 903.2.1 through 903.2.12 and Sections 903.2.14 through 903.2.21 , whichever is the more restrictive. For the purposes of this section, firewalls and fire barriers used to separate building areas shall be constructed in accordance with the California Building Code and shall be without openings or penetrations.

1. An automatic sprinkler system shall be provided throughout all new buildings and structures, other than Group R occupancies, greater than 1,200 square feet of building area.

Exceptions:
a. Group S-2 or U occupancies, including photovoltaic support structures, used exclusively for vehicle parking which meet all of the followings:
i. Noncombustible construction;
ii. Maximum building areas not to exceed 5,000 square feet; iii. Structure is open on three (3) or more sides; and
iv. Minimum of 10 feet separation from property line and existing buildings, or similar structures, unless area is separated by fire walls.

2. An automatic sprinkler system shall be installed throughout all new buildings with a Group R fire area.

Exception:

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a. Accessory Dwelling Unit (ADU), provided that all of the following are met:
i. The unit meets the definition of an Accessory Dwelling Unit as defined in the Government Code Section 65852.2.
ii. The existing primary residence does not have automatic fire sprinklers. iii. The accessory detached dwelling unit does not exceed 1,200 square feet in size. iv. The unit is on the same lot as the primary residence. v. The unit meets all apparatus access and water supply requirements of Chapter 5 and Appendix B of the 2025 California Fire Code

3. An automatic sprinkler system shall be provided throughout existing Group A, B, E, F, I L, M, R, S and U buildings and structures, when additions are made that increase the building area by more than 1,200 square feet or where the resulting area exceeds 3,600 square feet.

4. An automatic sprinkler system shall be provided throughout all new basements regardless of size and throughout existing basements that are expanded by more than 50%.

5. Any change in the character of occupancy or in use of any building which, in the opinion of the City fire code official or building official, would place the building into a more hazardous division of the same occupancy group or into a different group of occupancies and constitutes a greater degree of life safety 1 or increased fire risk 2 , shall require the installation of an approved fire automatic fire sprinkler system. 1 Life Safety—Increased occupant load, public assembly areas, public meeting areas, churches, indoor amusement attractions, buildings with complex exiting systems due to increased occupant loads, large schools/daycare facilities, large residential care facilities with non ambulatory.
2 Fire Risks—High-piled combustible storage, woodworking operations, hazardous operations using hazardous materials, increased fuel loads (storage of moderate to highly combustible materials), increased sources of ignition (welding, automotive repair with use of flammable liquids and open flames).

15.44.110 - Chapter 33—Fire Safety During Construction and Demolition.

A. Section 3307.1 is hereby added to read:
3307.1 Required Access: All construction sites shall be accessible by fire department apparatus by means of roadways having an all-weather driving service of not less than 20ft. of unobstructed width. The roads shall have the ability to withstand the live loads of a 75,000 pound fire apparatus, and have a minimum 13ft. 6 in. of vertical clearance. Dead end fire access roads in excess of 150 ft. in length shall be provided with approved turnarounds.

When approved by the Fire Code Official, temporary access roadways may be utilized until such time that the permanent roadways are installed. As a minimum, the roadway shall consist of a compacted sub base and eight (8”) inches of road base material (Class 2

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aggregate base rock) both compacted to a minimum 95%. The perimeter edges of the roadway shall be contained and delineated by curb and gutter or other approved method. The use of geotextile reinforcing fabric underlayment or soils lime-treatment may be required if so determined by the project civil engineer. Provisions for surface drainage shall also be provided where necessary. The integrity of the roadway shall be maintained at all times.

15.44.120 - Chapter 50—Hazardous Materials—General Provisions.

A. Section 5001.2.2.2 of the 2025 California Fire Code is hereby amended to read in its entirety:
5001.2.2.2 Health hazards. The material categories listed in this section are classified as health hazards. A material with a primary classification as a health hazard can also pose a physical hazard.

1. Highly toxic and toxic materials.

2. Corrosive materials.

3. Moderately toxic gas.

4. Health hazards-Other.

B. Section 5003.2.2.1 of the 2025 California Fire Code is hereby amended to read in its entirety:
5003.2.2.1 Design and construction. Piping, tubing, valves, fittings and related components used for hazardous materials shall be in accordance with the following:

1. Piping, tubing, valves, fittings, and related components shall be designed and fabricated from materials compatible with the material to be contained and shall be of adequate strength and durability to withstand the pressure, structural and seismic stress, and exposure to which they are subject.

2. Piping and tubing shall be identified in accordance with ASME A13.1 and Santa Clara County Fire Chiefs Marking Requirements and Guidelines for Hazardous Materials and Hazardous Waste to indicate the material conveyed.

3. Readily accessible manual valves or automatic remotely activated fail-safe emergency shutoff valves shall be installed on supply piping and tubing at the following locations:

3.1 The point of use.

3.2 The tank, cylinder or bulk use.

4. Manual emergency shutoff valves and controls for remotely activated emergency shutoff valves shall be identified and the location shall be clearly visible accessible and indicated by means of a sign.

5. Backflow prevention or check valves shall be provided when the backflow of hazardous materials could create a hazardous condition or cause the unauthorized discharge of hazardous materials.

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6. Where gases or liquids having a hazard ranking of Health hazard Class 3 or 4, Flammability Class 4, or Reactivity Class 4 in accordance with NFPA 704 are carried in pressurized piping above 15 pounds per square inch gauge (psig)(103 Kpa), an approved means of leak detection, emergency shutoff and excess flow control shall be provided.

Where the piping originates from within a hazardous material storage room or area, the excess flow control shall be located within the storage room or area. Where the piping originates from a bulk source, the excess flow control shall be located as close to the bulk source as practical.

Exceptions:

1. Piping for inlet connections designed to prevent backflow.

2. Piping for pressure relief devices.

7. Secondary containment or equivalent protection from spills shall be provided for piping for liquid hazardous materials and for highly toxic and toxic corrosive gases above threshold quantities listed in Tables 6004.2.1.4. Secondary containment includes but is not limited to double walled piping.

Exceptions:

1. Secondary containment is not required for toxic corrosive gases if the piping is constructed of inert materials.

2. Piping under sub-atmospheric conditions if the piping is equipped with an alarm and fail-safe-to-close valve activated by a loss of vacuum.

8. Expansion chambers shall be provided between valves whenever the regulated gas may be subjected to thermal expansion. Chambers shall be sized to provide protection for piping and instrumentation and to accommodate the expansion of regulated materials.

C. Section 5003.2.2.2 of the 2025 California Fire Code is hereby amended to read in its entirety:
5003.2.2.2 Additional regulation for supply piping for health hazard materials. Supply piping and tubing for gases and liquids having a health hazard ranking of 3 or 4 shall be in accordance with ASME B31.3 and the following:

1. Piping and tubing utilized for the transmission of toxic, highly toxic, or highly volatile corrosive liquids and gases shall have welded, or brazed connections throughout except for connections within an exhausted enclosure if the material is a gas, or an approved method of drainage or containment is provided for connections if the material is a liquid.

2. Piping and tubing shall not be located within corridors, within any portion of a means of egress required to be enclosed in fire-resistance-rated construction or in concealed spaces in areas not classified as Group H Occupancies.

3. All primary piping for toxic, highly toxic and moderately toxic gases shall pass a helium leak test of 1x10-9 cubic centimeters/second where practical, or shall pass testing in accordance with an approved, nationally recognized standard. Tests shall be conducted by a qualified "third party" not involved with the construction of the piping and control systems.

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D. Section 5004.2.1 of the 2025 California Fire Code is hereby amended to read in its entirety:
5004.2.1 Spill control for hazardous material liquids. Rooms, buildings or areas used for storage of hazardous material liquids shall be provided with spill control to prevent the flow of liquids to adjoining areas. Floors in indoor locations and similar surfaces in outdoor locations shall be constructed to contain a spill from the largest single vessel by one of the following methods:

1. Liquid-tight sloped or recessed floors in indoor locations or similar areas in outdoor locations.

2. Liquid-tight floors in indoor and outdoor locations or similar areas provided with liquidtight raised or recessed sills or dikes.

3. Sumps and collection systems, including containment pallets in accordance with Section 5004.2.3.

4. Other approved engineered systems.

Except for surfacing, the floors, sills, dikes, sumps and collection systems shall be constructed of noncombustible material, and the liquid-tight seal shall be compatible with the material stored. When liquid-tight sills or dikes are provided, they are not required at perimeter openings having an open-grate trench across the opening that connects to an approved collection system.

E. Section 5004.2.2.2 of the 2025 California Fire Code is hereby amended to read in its entirety:
5004.2.2.2 Incompatible materials. Incompatible materials shall be separated from each other in independent secondary containment systems.

15.44.130 – Chapter 56 — Explosives and Fireworks.

A. Section 5601.1.3 of the 2025 California Fire Code is hereby amended to read in its entirety:
5601.1. 3 Fireworks. The possession, manufacture, storage, sale, handling, and use of fireworks, including those fireworks classified as Safe and Sane by the California State Fire Marshal, are prohibited.Exception: The use of fireworks for fireworks displays as allowed in Section 5608.

15.44.140 - Chapter 57—Flammable and Combustible Liquids.

A. Section 5704.2.7.5.8 of the 2025 California Fire Code is hereby amended to read in its entirety:
5704.2.7.5.8 Overfill prevention. An approved means or method in accordance with Section 5704.2.9.7.5 shall be provided to prevent the overfill of all Class I, II and IIIA liquid storage tanks. Storage tanks in refineries, bulk plants or terminals regulated by Sections 5706.4 or 5706.7 shall have overfill protection in accordance with API 2350.

Exception: Outside aboveground tanks with a capacity of 1320 gallons (5000 L) or less need only comply with Section 5704.2.9.7.5.1 (Item1, Sub-item 1.1)

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An approved means or method in accordance with Section 5704.2.9.7.5 shall be provided to prevent the overfilling of Class IIIB liquid storage tanks connected to fuel-burning equipment inside buildings.

15.44.150 – Chapter 58 — Flammable gases and flammable cryogenic fluids.

A. Section 5809.3.3 of the 2025 California Fire Code is hereby amended to read in its entirety:
5809.3.3 Site plan. For other than emergency roadside service, a site plan shall be developed for each location at which mobile gaseous hydrogen fueling occurs. The site plan shall be of sufficient detail to indicate the following:

1. All buildings and structures.

2. Lot lines or property lines.

3. Solar photovoltaic parking lot canopies.

4. Appurtenances on-site and their use and function.

5. All uses adjacent to the lot lines of the site.

6. Hydrogen fueling locations.

7. Scale of the site plan.

15.44.160 – Appendix C- Fire Hydrant Locations and Distribution A. Section C102.1 of the 2025 California Fire Code is hereby amended to read in its entirety:

C102.1 Minimum number of fire hydrants for a building. The number of fire hydrants available to a building shall be not less than the minimum specified in Table C102.1, utilizing the base fire flow without fire sprinkler reduction.

B. Section C103.1 of the 2025 California Fire Code is hereby amended to read in its entirety:

C103.1 Hydrant spacing. Fire apparatus access roads and public streets providing required access to buildings in accordance with Section 503 of the California Fire Code shall be provided with one or more fire hydrants, as determined by Section C102.1. Where more than one fire hydrant is required, the distance between required fire hydrants shall be in accordance with Sections C103.2 and C103.3, but in no case shall the average spacing be more than 300 feet on center.

15.44.1700 - Violation.

A. A violation of the code adopted by this chapter occurs when a person:

1. Fails to comply with this code;

2. Violates or fails to comply with any order made under this code;

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Ordinance No. 2368, New Series

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4. Fails to comply with such an order as affirmed or modified by the city council or by a court of competent jurisdiction, within the time fixed in this chapter.

B. Such person may be liable severally and for each and every such violation and noncompliance respectively.

D. The application of the above penalty shall not be held to prevent the enforced removal of prohibited conditions.

Section 6. References to Prior Code. Unless superseded and expressly repealed, references in City forms, documents and regulations to the chapters and sections of the former Morgan Hill Building Code 2022, shall be construed to apply to the corresponding provisions contained within the Morgan Hill Building Code 2025. Ordinance No. 2337 of the City of Morgan Hill and all other ordinances or parts of ordinances in conflict herewith are hereby superseded and expressly repealed.

Section 7. CEQA. The City Council finds, pursuant to Title 14 of the California Code of Regulations, Section 15061( b)( 3), that the adoption of this Ordinance is exempt from the requirements of the California Environmental Quality Act (CEQA) because it can be seen with certainty that there is no potential for causing a significant effect on the environment.

Section 8. 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 9. Effective Date; Publication. This Ordinance shall take effect on January 1, 2026.

The City Clerk is hereby directed to publish this Ordinance or a summary thereof pursuant to Government Code Section 36933.

This ordinance was introduced at a meeting of the City Council held on the 15th day of October 2025, and adopted at a meeting held on the 19th day of November 2025, and said ordinance was duly passed and adopted in accordance with law by the following vote:

AYES: COUNCIL MEMBERS:

NOES: COUNCIL MEMBERS:

ABSTAIN: COUNCIL MEMBERS:

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City of Morgan Hill
Ordinance No. 2368, New Series

Page 26 of 26 ends

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. 2368, New Series, adopted by the City Council of the City of Morgan Hill, California at their regular meeting held on the 19th day of November 2025.

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

DATE: _______________________ __________________________ MICHELLE BIGELOW, City Clerk

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City Council Meeting
2025 Building Code
Adoption and
Amendments
November 19, 2025

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Prior City Council Actions
This item was introduced at the October 15, 2025, City Council meeting, and now coming back for the public hearing, second reading, and adoption.

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Morgan Hill’s Building and Construction Code
• Provides regulations for the built environment under
construction within the City limits.
• Based on California Code of Regulations, Title 24
published by California Building Standards Commission
with minor local amendments.
• Updated on a triennial basis.

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California Code of Regulations Title 24
4 Part 1 California Administrative Code
Part 2 California Building Code
Part 2.5 California Residential Code
Part 3 California Electrical Code
Part 4 California Mechanical Code
Part 5 California Plumbing Code
Part 6 California Energy Code
Part 7 California Wildland-Urban Interface Code
Part 8 California Historical Building Code
Part 9 California Fire Code
Part 10 California Existing Building Code
Part 11 California Green Building Standards Code
Part 12 California Referenced Standards Codes

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Amendments
Local Jurisdictions may amend state-mandated standards to be stricter upon express findings that the amendments are
reasonably necessary due to:
• Local Climatic Conditions
• Local Geological Conditions
• Local Topographical Conditions
Note: AB 130 restricts new amendments on residential construction.

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Building Standards Code Adoption
Propose adopting the entire 2025 California Building Standards Codes by reference and amend certain sections of the:
• California Building Code
• California Residential Code
• California Plumbing Code
• California Fire Code
Proposed amendments were part of the 2022 Code cycle adoption.

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California Building Standards Amendments
• Automatic fire sprinklers required in existing structures when an addition increases the square footage by 1,200 SF, or the addition increases the total building area to more than 3,600 SF.
• Requires fire sprinklers for new non-residential buildings larger than 1,200 SF. • Integrates local fire apparatus access standards.
• Prohibits the use of gypsum board and Portland cement plaster as a braced wall panel method.
• Requires reinforcement in buildings’ concrete slabs.
• Removes the exception that would allow Type M copper in the potable water piping system.
• Prohibits water piping to be installed directly in or under a concrete floor of a building without prior approval.
• Includes other Fire Code amendments for consistency with other local agencies.

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Electric Ready
Electric Ready is to install electrical infrastructure in buildings to allows future installation of electric appliances when replacing the existing gas appliances. • All new construction is required to comply with the electric ready requirements. • Staff provides information to applicants during the permitting process of existing structures allowing the applicants to voluntarily incorporate electric ready measures into their project.

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Heat Pump Mechanical Unit
A Heat pump is an electric system that heats and cools a structure utilizing an indoor coil, refrigeration and an outdoor air heat exchanger. The unit changes the refrigerant flow direction to provide heating or cooling within the structure.
• All new construction will utilize heat pump mechanical units. • Existing construction is not required to install heat pumps with the exception that the replacement of small non-residential rooftop mechanical units must comply with efficiency standards, often requiring replacement with a heat pump. • Although not required, 49% of all residential replacements have voluntarily installed heat pump systems (64 out of 130 permits)

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Next Step
Open/close public hearing, waive the second reading, and adopt the ordinance

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Questions?

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12 CITY COUNCIL STAFF REPORT
MEETING DATE: November 19, 2025
PREPARED BY:

Crystal Zamora, Housing Coordinator
APPROVED BY: City Manager

CONDUCT TAX AND EQUITY FISCAL RESPONSIBILITY ACT (TEFRA)

HEARING APPROVING ISSUANCE OF BONDS FOR VILLAGE AT
MADRONE APARTMENT PROJECT LOCATED AT 18730 MINER LANE

WITHIN THE CITY OF MORGAN HILL

RECOMMENDATION(S)

2. Adopt a resolution approving the issuance of revenue bonds by the California Municipal Finance Authority (CMFA), for the acquisition, construction, improvement and equipping of Village at Madrone, a 249-multifamily rental housing project located at 18730 Miner Lane, Morgan Hill, California (the “Project”).

COUNCIL PRIORITIES, GOALS & STRATEGIES
City Council Ongoing Priorities
Supporting our Youth, Seniors, and Entire Community
Enhancing Diversity and Inclusiveness
Advocating for Local, Regional, and State Legislative Initiatives 2024-2025 Strategic Priorities
Affordable Housing and Homelessness
Guiding Documents
Morgan Hill 2035 General Plan
REPORT NARRATIVE:

JEMCOR Development Partners, LLC (“JEMCOR” or the “Borrower”), built a 100 percent affordable housing development project known as the Village at Madrone, comprised of 249-multifamily units, ranging from 30% of the Area Median Income (AMI) to 60% AMI. The apartments serve as workforce housing and is located at 18730 Miner Lane (the “Project”) in the City of Morgan Hill, California (the “City”).

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12 JEMCOR had applied for and received a very competitive award for Federal Low Income Housing Tax Credits (“LIHTC”) from the California Tax Credit Allocation Committee and a tax-exempt bond allocation from the California Debt Limit Allocation Committee (“CDLAC”).

As the nature of the financing vehicle is tax-exempt, the Tax and Equity Fiscal Responsibility Act (“TEFRA”) requires the local jurisdiction to support the transaction.

The City held a TEFRA hearing for this project on April 20, 2022. Morgan Hill City Council approved the TEFRA hearing associated with the bond issuance.

The Borrower requested that the California Municipal Finance Authority (“CMFA”), a joint exercise of powers authority and a public entity of the State of California, serve as the municipal issuer of the tax-exempt revenue bonds in an aggregate principal amount not to exceed $85,000,000 (the “Bonds”). The tax-exempt bond financing is a “conduit” financing in which the City of Morgan Hill has no exposure for the debt. Rather, JEMCOR, the Borrower, asks the CMFA to issue the bonds upon CDLAC’s authorization and then solicits a lender who purchases all the bonds in a private sale.

CMFA is a public entity that is authorized and experienced in the issuance of such bonds. CMFA issued bonds on June 2, 2022.

The Borrower is now seeking a modification to their permanent loan amount but not the aggregate principal bond amount of $85,000,000. This change triggers a technical reissuance of the bonds, which requires an additional TEFRA hearing.

For the Bonds to qualify as tax-exempt bonds, the City of Morgan Hill must conduct an additional public hearing (the “TEFRA Hearing”) providing for the members of the community an opportunity to speak in favor of or against the use of tax-exempt bonds for the financing of the Project.

The City Council’s only role is to listen to public testimony regarding the appropriateness of bond financing. Following the close of the TEFRA hearing, the City must approve the issuance of the bonds for the financing of the Project through a resolution. The City has no financial obligation or legal risk with the bond issuance.

CALIFORNIA MUNICIPAL FINANCE AUTHORITY:

The CMFA was created on January 1, 2004, pursuant to a joint exercise of powers agreement to promote economic, cultural and community development, through the financing of economic development and charitable activities throughout California. To date, over 350 municipalities have become members of CMFA.

The CMFA assists local governments, non-profit organizations and businesses with the issuance of taxable and tax-exempt bonds aimed at improving the standard of living in California. The CMFA’s representatives and its Board of Directors have considerable experience in bond financing.

The bonds to be re-issued by the CMFA for the Project will be the sole responsibility of the Borrower, JEMCOR, and the City will have no financial, legal, moral obligation,

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12 liability, or responsibility for the Project or the repayment of the bonds for the financing of the Project. All financing documents with respect to the issuance of the bonds will contain clear disclaimers that the bonds are not obligations of the City or the State but are to be paid for solely from funds provided by the Borrower. Outside of holding the TEFRA Hearing and adopting the required resolution, no other participation or activity of the City or the City Council with respect to the issuance of the bonds will be required.

COMMUNITY ENGAGEMENT:

The community was informed by a notice published in the Morgan Hill Times on November 7, 2025.

ALTERNATIVE ACTIONS:

There are no alternative actions as the City must approve the resolution after the public hearing.

PRIOR CITY COUNCIL AND COMMISSION ACTIONS:

The City held a TEFRA hearing for this project on April 20, 2022. Morgan Hill City Council approved the TEFRA hearing associated with an $85,000,000 bond issuance.

CMFA issued bonds on June 2, 2022.

FISCAL AND RESOURCE IMPACT:

There is no fiscal impact on the city. The Bonds will be issued as limited obligations of CFMA, payable solely from revenues and receipts derived from a loan made by CFMA to the Borrower with the Bond proceeds. The Project will be the sole responsibility of the Borrower, and the City will have no financial, legal, moral obligation, liability or responsibility for the Project or the repayment of the Bonds for the financing of the Project. The City bears no liability with respect to issuance of the Bonds. Further, the City is not a party to any financing documents related to the issuance of the Bonds and will contain clear disclaimers that the Bonds are not obligations of the City or the State of California but are to be paid for solely from funds provided by the Borrower.

The Board of Directors of the California Foundation for Stronger Communities, a California non-profit public benefit corporation (the “Foundation”), acts as the Board of Directors for the CMFA. Through its conduit issuance activities, the CMFA shares a portion of the issuance fees it receives with its member communities and donates a portion of these issuance fees to the Foundation for the support of local charities. With respect to the City of Morgan Hill, it is expected that a portion of the issuance fee attributable to the City will be granted by the CMFA to the general fund of the City. It is anticipated the portion of issuance fees that would be returned to the City will be approximately $20,000. Such grant may be used for any lawful purpose of the City.

CEQA (California Environmental Quality Act):

This is not a project but rather an administrative activity that will not result in direct or indirect physical changes in the environment. Thus, the administrative activity of the project is exempt from the California Environmental Quality Act (CEQA) pursuant to

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12 Section 15061(b)(3).

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RESOLUTION NO.25-XX

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF MORGAN

HILL APPROVING THE ISSUANCE OF THE CALIFORNIA MUNICIPAL

FINANCE AUTHORITY MULTIFAMILY HOUSING REVENUE BONDS

IN AN AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED
$85,000,000 FOR THE PURPOSE OF FINANCING OR REFINANCING

THE ACQUISITION, CONSTRUCTION, IMPROVEMENT AND

EQUIPPING OF VILLAGE AT MADRONE APARTMENTS AND

CERTAIN OTHER MATTERS RELATING THERETO
WHEREAS, Village at Madrone, LP (the “Borrower”) a partnership of which JEMCOR Development Partners, LLC (the “Developer”) or a related person to the Developer is the general partner, has requested that the California Municipal Finance Authority (the “Authority”) adopt a plan of financing providing for the issuance of exempt facility bonds for a qualified residential rental project pursuant to Section 142(a)(7) of the Internal Revenue Code of 1986 (the “Code”) in one or more series issued from time to time, including bonds issued to refund such exempt facility bonds in one or more series from time to time, and at no time to exceed $85,000,000 in aggregate principal amount (the “Bonds”), to finance or refinance the acquisition, construction, improvement and equipping of a multifamily rental housing project located at 18730 Miner Lane, Morgan Hill, California (the “Project”); and
WHEREAS, pursuant to Section 147(f) of the Code, the issuance of the Bonds by the Authority must be approved by the City of Morgan Hill (the “City”) because the Project is located within the territorial limits of the City; and
WHEREAS, the City Council of the City (the “City Council”) is the elected legislative body of the City and is one of the "applicable elected representatives" required to approve the issuance of the Bonds under Section 147(f) of the Code; and WHEREAS, the Authority has requested that the City Council approve the issuance of the Bonds by the Authority in order to satisfy the public approval requirement of Section 147(f) of the Code and the requirements of Section 4 of the Joint Exercise of Powers Agreement Relating to the California Municipal Finance Authority, dated as of January 1, 2004 (the “Agreement”), among certain local agencies, including the City; and
WHEREAS, pursuant to Section 147(f) of the Code, the City Council has, following notice duly given, held a public hearing regarding the issuance of the Bonds, and now desires to approve the issuance of the Bonds by the Authority;
NOW, THEREFORE, BE IT RESOLVED, by the City Council of the City of Morgan Hill as follows:

Section 1. The foregoing resolutions are true and correct.

Section 2. The City Council hereby approves the issuance of the Bonds by the Authority.

It is the purpose and intent of the City Council that this resolution constitute approval of the issuance of the Bonds by the Authority, for the purposes of (a) Section 147(f) of the Code by the

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applicable elected representative of the governmental unit having jurisdiction over the area in which the Project is located, in accordance with said Section 147(f) and (b) Section 4 of the Agreement.

Section 3. The issuance of the Bonds shall be subject to the approval of the Authority of all financing documents relating thereto to which the Authority is a party. The City shall have no responsibility or liability whatsoever with respect to the Bonds.

Section 4. The adoption of this Resolution shall not obligate the City or any department thereof to (i) provide any financing to acquire or construct the Project or any refinancing of the Project; (ii) approve any application or request for or take any other action in connection with any planning approval, permit or other action necessary for the acquisition, construction, rehabilitation, installation or operation of the Project; (iii) make any contribution or advance any funds whatsoever to the Authority; or (iv) take any further action with respect to the Authority or its membership therein.

Section 5. The officers of the City are hereby authorized and directed, jointly and severally, to do any and all things and to execute and deliver any and all documents which they deem necessary or advisable in order to carry out, give effect to and comply with the terms and intent of this resolution and the financing transaction approved hereby.

Section 6. This resolution shall take effect immediately upon its adoption.

PASSED, APPROVED AND ADOPTED by the City Council of the City of Morgan Hill at a regular meeting held on the November 19, 2025.

AYES: COUNCIL MEMBERS:

NOES: COUNCIL MEMBERS:

ABSTAIN: COUNCIL MEMBERS:

ABSENT: COUNCIL MEMBERS:

APPROVED: ATTEST:
_____________________________ ____________________________ MARK TURNER, Mayor MICHELLE BIGELOW, City Clerk

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13 CITY COUNCIL STAFF REPORT
MEETING DATE: November 19, 2025
PREPARED BY:

Michelle Bigelow, City Clerk
APPROVED BY: City Manager
APPROVE THE 2026 CITY COUNCIL MEETING SCHEDULE

RECOMMENDATION(S)
Review, discuss, if needed, amend, and approve the 2026 City Council meeting schedule.

The City Council has adopted City Council Policy CP-06-02 regarding its meeting schedule. The team requests that the City Council review its meeting schedule through the beginning of February 2027 (see attached). The following meetings are proposed to be canceled or scheduled:

1. January 7 City Council meeting - canceled per Council Policy CP-06-02.

2. January 21 City Council meeting - canceled to allow the Mayor and Council Members to attend the CalCities Mayors and Council Members Academy.

3. February 4 City Council meeting - canceled due to the Goal Setting Workshop that Friday, February 6, and Saturday, February 7.

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13 4. April 22 City Council meeting - canceled to allow the Mayor and Council Members to attend the Cal Cities City Leaders Summit.

5. July 1, 15, and 22 City Council meetings - canceled pursuant to Council Policy CP-06-02.

6. September 23 City Council meeting - canceled to allow the Mayor and Council Members to attend the Cal Cities Annual Conference.

7. November 25 City Council meeting - canceled pursuant to Council Policy CP-06-

02. 8. December 23 City Council meeting - canceled pursuant to Council Policy CP-06-

02. 9. January 6, 2027 City Council meeting - canceled per Council Policy CP-06-02.

10. January 20, 2027 City Council meeting - canceled to allow the Mayor and Council Members to attend the CalCities Mayors and Council Members Academy.

11. February 3, 2027 City Council meeting - canceled due to the Goal Setting Workshop that Friday, February 5, and Saturday, February 6.

Given the above information, the City Council may wish to retain, adjust, and/or cancel regularly scheduled meetings.

COMMUNITY ENGAGEMENT:

This report serves to inform the public of the 2026 City Council meeting schedule.

ALTERNATIVE ACTIONS:

Not Applicable.

PRIOR CITY COUNCIL AND COMMISSION ACTIONS:

The City Council reviews the meeting schedule annually.

FISCAL AND RESOURCE IMPACT:

There is no fiscal impact associated with this action.

CEQA (California Environmental Quality Act):

Not a Project. Administrative activities of governments that do not result in direct physical changes in the environment do not qualify as a project for purposes of CEQA.

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CITY OF MORGAN HILL

CITY COUNCIL POLICIES AND PROCEDURES
CP-06-02
SUBJECT: CITY COUNCIL MEETING SCHEDULE
EFFECTIVE DATE: April 1, 2023
ORIGINATING DEPT: City Clerk
The City Council has ordained that regular meetings are to be held on the first, third, and fourth Wednesdays of every month at 6:00 p.m. In the event of a legal holiday occurring on a regular City Council meeting day, the meeting(s) will be canceled. Should the Mayor and City Manager determine that the third meeting of the month is not necessary, they shall have the authority to cancel the meeting.

The City Council desires to take official legislative recesses, at various times, to accommodate community and civic commitments, vacations, and the City’s operations schedule. As such, the following meeting schedule will apply for the months of January, July, September, October, November and December of every year:
 For the month of January, should the City furlough its employees the last week in December, the first meeting in January shall be canceled.
 The Council will hold its annual Goal Setting retreat the first Friday and Saturday of February.  The Council will hold its annual Budget Workshop during the month of May.  For the month of July, all meetings are to be canceled for summer recess.  For the months of September and October, regular meetings will be held on the first, third, and fourth Wednesdays, beginning at 6:00 p.m.; unless the meeting date falls on Rosh Hashanah or Yom Kippur. In which case, said meeting will be canceled.
 For the month of November, regular meetings will be held on the first, third, and fourth Wednesdays, beginning at 6:00 p.m.; unless the Wednesday meeting date falls the day before the Thanksgiving Holiday. In which case, said meeting will be canceled.
 For the month of December, regular meetings will be held on the first, third, and fourth Wednesdays, beginning at 6:00 p.m.; unless the Wednesday meeting date(s) fall on the Christmas Holiday and/or during the Holiday furlough. In which case, said meeting(s) will be canceled.

The City Council shall have the ability to adjust and/or add other meeting dates, as deemed appropriate.

This policy shall remain in effect until modified by the City Council respectively.

APPROVED:
__________________________________
MARK TURNER, Mayor
DocuSign Envelope ID: 544A56F9-D8BB-452F-856E-07F5FC45A241

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DRAFT 2026 City Council
Meeting Schedule

Page 1 of 3 ends

Meeting Date Type of Meeting Notes
1/7/2026
Wednesday
Regular CC Canceled per Council Policy
(CP 06-02)
1/21/2026
Wednesday
Regular CC Canceled
Cal Cities Mayors and Council Members Academy
1/28/2026
Wednesday
Regular CC
02/04/2026
Wednesday
Regular CC Canceled Subsequent Goal Setting
02/06/2026
Friday
Special CC Goal Setting Workshop – Day 1
9:00 am – 5:00 pm
02/07/2026
Saturday
Continued from
02/06/2026
Continued Goal Setting Workshop – Day 2
9:00 am – 5:00 pm
02/18/2026
Wednesday
Regular CC
02/25/2026
Wednesday
Regular CC
03/04/2026
Wednesday
Regular CC
03/18/2026
Wednesday
Regular CC
03/25/2026
Wednesday
Regular CC
04/01/2026
Wednesday
Regular CC
04/15/2026
Wednesday
Regular CC
04/22/2026
Wednesday
Regular CC Canceled
Cal Cities City Leaders Summit
05/06/2026
Wednesday
Regular CC
05/20/2026
Wednesday
Regular CC Budget Workshop
5/27/2026
Wednesday
Regular CC
06/03/2026
Wednesday
Regular CC
06/17/2026
Wednesday
Regular CC

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DRAFT 2026 City Council
Meeting Schedule

Page 2 of 3 ends

Meeting Date Type of Meeting Notes
06/24/2026
Wednesday
Regular CC
07/01/2026
Wednesday
Regular CC Canceled per Council Policy
(CP 06-02)
07/15/2026
Wednesday
Regular CC Canceled per Council Policy
(CP 06-02)
07/22/2026
Wednesday
Regular CC Canceled per Council Policy
(CP 06-02)
08/05/2026
Wednesday
Regular CC
08/19/2026
Wednesday
Regular CC
08/26/2026
Wednesday
Regular CC Mid-Year Goal Check-in Workshop
5:00 pm
09/02/2026
Wednesday
Regular CC
09/16/2026
Wednesday
Regular CC
09/23/2026
Wednesday
Regular CC Canceled
Cal Cities Annual Conference 9/23/2026-9/25/2026
10/07/2026
Wednesday
Regular CC
10/21/2026
Wednesday
Regular CC
10/28/2026
Wednesday
Regular CC
11/04/2026
Wednesday
Regular CC
11/18/2026
Wednesday
Regular CC
11/25/2026
Wednesday
Regular CC Canceled per Council Policy
(CP 06-02)
12/02/2026
Wednesday
Regular CC
12/16/2026
Wednesday
Regular CC
12/23/2026
Wednesday
Regular CC Canceled per Council Policy
(CP 06-02)

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DRAFT 2026 City Council
Meeting Schedule

Page 3 of 3 ends

Meeting Date Type of Meeting Notes
1/6/2027
Wednesday
Regular CC Canceled per Council Policy
(CP 06-02)
1/20/2027
Wednesday
Regular CC Canceled
Cal Cities Mayors and Council Members Academy
1/27/2027
Wednesday
Regular CC
02/03/2027
Wednesday
Regular CC Canceled
Subsequent Goal Setting
02/05/2027
Friday
Special CC Goal Setting Workshop – Day 1
9:00 am – 5:00 pm
02/06/2027
Saturday
Continued from
02/05/2027
Continued Goal Setting Workshop – Day 2
9:00 am – 5:00 pm

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14 CITY COUNCIL STAFF REPORT
MEETING DATE: November 19, 2025
PREPARED BY:

Dat Nguyen, Finance Director
APPROVED BY: City Manager
RECEIVE MONTHLY BUDGET UPDATE; SEPTEMBER 2025
FINANCIAL AND INVESTMENT REPORTS; AND CITY MANAGER

AUTHORITY REPORT

RECOMMENDATION(S)
Receive and file reports.

COUNCIL PRIORITIES, GOALS & STRATEGIES
City Council Ongoing Priorities
Preserving and Cultivating Public Trust
2024-2025 Strategic Priorities
Fiscal Sustainability
Community Engagement
REPORT NARRATIVE:

As part of the City Council’s expectation to maintain a high level of transparency and to be responsible stewards of public funds, staff are providing this monthly budget update, along with the Septmeber 2025 financial and investment reports.

September 2025 Financial Report
The Revenue and Expense Summary through September 2025 is included on page 4 of the attached monthly financial and investment reports. Overall, General Fund revenues total $6.1 million or about 11% of the budget. Expenditures and encumbrances through September totaled $16.4 million, of which approximately $2.3 million is attributable to outstanding encumbrances, compared to prior year expenditures, including encumbrances, of $15.6 million. This represents an increase of $0.8 million, including encumbrances, compared to the prior year. Excluding the encumbrances, expenditures also increased by about $0.8 million, primarily due to negotiated salary adjustments, and overall cost increases.

Budget Update
There has been no material change since the last budget update to the Council on September 17, 2025. Regarding water revenue, Morgan Hill residents consumed approximately 6% more water through September compared to the prior three-year average. As a result, no revenue stabilization water rate was implemented.

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14 City Manager’s Authority Report
Pursuant to the City Council Policy 18-05 - Report on delegation of authority to City Manager, Page 21 of Attachment 1 lists the contracts and/or agreements entered into between August 4, 2025 through October 31, 2025 between the amounts of $25,000 to $75,000, or the limit of the California Uniform Public Construction Cost Accounting Act (CUPCCAA).

COMMUNITY ENGAGEMENT:

Inform
Finance staff prepares these financial reports to inform City officials, the Council, the community, and various lenders and stakeholders about the financial health of the organization, which assists each one of the interested parties in making sound financial and investment decisions.

ALTERNATIVE ACTIONS:

Not Applicable
PRIOR CITY COUNCIL AND COMMISSION ACTIONS:

The City Council receives and files the financial and investment report for each month.

At the September 16, 2015 meeting, City Council recommended monthly financial and investment reports be agendized under the Consent Agenda, and quarterly financial and investment reports be presented to City Council as an “Other Business” item.

FISCAL AND RESOURCE IMPACT:

The preparation of the report is a part of the Finance workplan.

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.

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FINANCE DEPARTMENT

CITY OF MORGAN HILL
September 30, 2025 - 25% of Year Complete
Prepared by:

Monthly Financial and Investment Reports

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CITY OF MORGAN HILL, CALIFORNIA
FINANCIAL STATEMENT ANALYSIS - FISCAL YEAR 2025-26
FOR THE MONTH ENDED SEPTEMBER 2025 – 25% OF YEAR COMPLETE  General Fund – Revenues through September totaled $6.1 million, or about 11% of the budgeted as some of the major revenue categories such as property tax are received later in the fiscal year.

Regarding the property tax revenue forecast, the County estimates the City will receive approximately $21.7 million in property tax revenue for the current fiscal year, slightly exceeding the budget of $21.4 million. However, after adjusting for the excess ERAF set-aside of 20%, or $0.6 million, the property tax revenue shows a slight decrease over the budget. As for sales tax, there’s been no changes to prior forecast. The City's current fiscal year sales tax revenue estimate, before tax rebates, is $12.1 million.

The chart below shows historical General Fund revenues by major revenue category from FY21-22 through FY23-24 Actual, Un-audited FY24-25, FY25-26 Budget, and YTD as of September 30, 2025.

General Fund expenditures and encumbrances through September totaled $16.4 million, of which approximately $2.3 million is attributable to outstanding encumbrances, compared to prior year expenditures, including encumbrances, of $15.6 million. This represents an increase of $0.8 million, including encumbrances, compared to the prior year. Excluding the encumbrances, expenditures increased by about $0.8 million, primarily due to negotiated salary adjustments, and overall cost increases.
 Community Services – The Community Services Department’s recreation operations, as reflected in the schedule presented on page 7 of the Monthly Financial and Investments Reports, shows a negative impact to the General Fund of approximately $1.7 million as of September 30, 2025. Recreation operations are expected to be on target with budget.
$16.7 $18.1 $19.1 $19.1 $21.4
$12.9 $12.7 $12.2 $12.1 $12.0
$5.9 $5.7 $6.0 $6.2 $6.0 $6.9 $8.1 $9.2 $9.6 $10.8 $9.7 $7.8 $9.4 $9.5 $7.8 $52.1 $52.4
$56.0 $57.2 $58.0
$6.1
0 10
20 30
40 50
60 70
FY21-22 FY22-23 FY23-24 Un-audited
FY24-25
Budget
FY25-26
YTD
FY25-26
Millions ($)
Historical GF Revenues
Property Tax Sales Tax Franchise and Hotel Taxes Service Charges Other

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CITY OF MORGAN HILL, CALIFORNIA
FINANCIAL STATEMENT ANALYSIS - FISCAL YEAR 2025-26
FOR THE MONTH ENDED SEPTEMBER 2025 – 25% OF YEAR COMPLETE The chart below shows the historical net impact of Recreation Operations to the general fund.

Due to longstanding governmental accounting and budgeting convention, the City’s recreation operations are not charged for indirect costs (known in Morgan Hill as “General Fund Administration”) from the central services departments of City Attorney, City Manager, and Administrative Services.

The City’s other governmental funds, such as Development Services, and the proprietary funds, such as Water and Wastewater, and the Information Services Fund, are assessed such charges through the City’s indirect cost allocation plan, prepared in compliance with the guidelines set forth in the Code of Federal Regulations Title 2, Chapter II, Part 200 (formerly OMB Circular No. A-87), which mandates certain calculation and cost allocation practices that must be followed in order to qualify for Federal grant funding, but which also represents best practice for non-grant funded City operations like utilities and information services.
 Development Services Fund – Revenues through September totaled $1.6 million compared to the prior year to date amount of approximately $1.3 million. Expenditures, including encumbrances, totaled $1.8 million.
 Debt Service Funds – Expenditures through September totaled $2,018. The debt service for the first half of the year includes both interest and principal, while the second half will include interest only.

Debt service payments were scheduled when the bonds were issued and are budgeted for the months specified in the underlying bond documents. The General Fund’s portion of the annual debt service payments is approximately $200,000, less than one percent of the General Fund’s budgeted revenues. ($2.0)
($1.5)
($1.0)
($0.5)
$0.0
$0.5
FY16-17 FY17-18 FY18-19 FY19-20 FY20-21 FY21-22 FY22-23 FY23-24 Un-audited FY24-25
FY25-26
Budget
Millions (S)
Historical Net GF Impact

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CITY OF MORGAN HILL, CALIFORNIA
FINANCIAL STATEMENT ANALYSIS - FISCAL YEAR 2025-26
FOR THE MONTH ENDED SEPTEMBER 2025 – 25% OF YEAR COMPLETE  Wastewater Operations – Revenues through September 30, 2025 totaled $3.6 million. Expenditures and outstanding encumbrances totaled $4.3 million or 23% of the budget. The table below shows historical Wastewater Operations revenues and expenditures from FY21-22 through FY23-24 Actual, Un-audited FY24-25, FY25-26 Budget, and YTD as of September 30, 2025. (amount in millions) FY21-22 FY22-23 FY23-24
Un-audited
FY23-24
Budget
FY25-26
YTD
FY25-26
Revenues 14.9 15.3 15.2 18.2 18.4 3.6
Expenditures 14.8 16.0 14.9 18.1 18.5 4.3
Operating Margin 0.1 (0.7) 0.3 0.1 (0.1) (0.7)
Operating Margin
without Encumbrances (0.7) 0.1 0.3 0.1 (0.1) (0.6)
 Water Operations – Water Operations includes Utility Billing, Water Conservation, and Water Operations. Revenues through September 30, 2025 totaled $4.7 million. Water Operations expenditures, including outstanding encumbrances, totaled $5.1 million. Morgan Hill residents consumed about 6% more water through September compared to the prior three-year average. As such, no revenue stabilization water rate was implemented. The table below shows Water Operations revenues and expenditures from FY21-22 through FY23-24 Actual, Un-audited FY24-25, FY25-26 Budget, and YTD as of September 30, 2025.
(amount in millions) FY21-22 FY22-23 FY23-24
Un-audited
FY24-25
Budget
FY25-26
YTD
FY25-26
Revenues 16.0 18.1 18.7 21.5 23.5 4.7
Expenditures 15.2 18.0 19.1 21.5 23.8 5.1
Operating Margin 0.8 (0.4) 0.1 - (0.3) (0.4)
Operating Margin
without Encumbrances 0.1 0.8 (0.4) - (0.3) 0.1
 Investments – Eight securities were called, and nine new securities were purchased. Total interest earnings received on investments were $813,000 during the month.

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% OF ACTUAL PLUS % OF

FUND NAME ACTUAL BUDGET ENCUMBRANCES BUDGET
General 6,092,592 $ 11% $ 16,427,355 25%
Development Services 1,643,080 28% 1,816,385 26%
Wastewater Operations 3,643,027 20% 4,288,931 23%
Wastewater Other 2,547,312 6% 6,705,490 8%
Water Operations 4,737,452 20% 5,114,132 22%
Water Other 2,292,392 18% 10,388,383 26%
Other Special Revenues * 1,305,083 18% 2,733,462 19%
Capital Projects & Streets 2,363,389 7% 10,800,616 24%
Debt Service 174,458 25% 2,018 0%
Internal Service 2,811,006 17% 5,719,258 36%
TOTAL FOR ALL FUNDS 27,609,791 $ 12% $ 63,996,029 21%
* Includes all Special Revenue Funds except Development Services Fund and Street Funds.

REVENUES EXPENSES
0% 5% 10% 15% 20% 25% 30% 35% 40%
General
Development
Services
Wastewater
Operations
Wastewater Other
Water Operations
Water Other
Other Special
Revenues *
Capital Projects
& Streets
Debt Service
Internal Service
Morgan Hill YTD Revenue & Expense Summary
September 30, 2025 - 25% of Year Complete
Revenues to Budget Expenses to Budget
Percentage of Actual to Budget
25%

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% OF PRIOR YEAR % CHANGE FROM

REVENUE CATEGORY BUDGET ACTUAL BUDGET TO DATE PRIOR YEAR Property Tax 21,369,792 $ 25,230 $ 0% 25,899 $ -3%
Sales Tax 11,989,269 1,082,920 9% 1,025,941 6%
Franchise Tax 3,354,166 - - N/A
Hotel Tax 2,658,340 477,305 18% 502,529 -5%
Other Agencies 940,183 92,326 10% 210,641 -56%
Service Charges 10,794,856 2,846,867 26% 2,926,782 -3%
Interest/Other 3,468,411 804,056 23% 860,115 -7%
Transfers In 3,411,140 763,889 22% 751,546 2%
TOTAL REVENUES 57,986,156 $ 6,092,592 $ 11% 6,303,453 $ -3% 0% 5% 10% 15% 20% 25% 30%
Property Tax
Sales Tax
Franchise Tax
Hotel Tax
Other Agencies
Service Charges
Interest/Other
Transfers In
Total Revenues
Percent of Actual to Budget
Morgan Hill YTD General Fund Revenues
September 30, 2025 - 25% of Year Complete
25%

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ACTUAL PLUS PRIOR YTD PLUS % CHANGE FROM
EXPENDITURE CATEGORY BUDGET ENCUMBRANCES % OF BUDGET ENCUMBRANCES PRIOR YEAR Administration $ 7,097,361 $ 1,462,785 21% 1,272,196 $ 15% Community Services 20,176,055 6,015,000 30% 5,759,120 4% Police 26,079,133 5,803,081 22% 5,419,265 7%
Fire 11,212,073 2,831,719 25% 2,772,404 2%
Transfers Out 1,418,558 314,769 22% 364,558 -14%
TOTAL EXPENDITURES $ 65,983,180 $ 16,427,355 25% 15,587,542 $ 5% 0% 10% 20% 30% 40%
Administration
Community
Services
Police
Fire
Transfers Out
Total Expenditures
Percent of Actual to Budget
Morgan Hill YTD General Fund Expenditures
September 30, 2025 - 25% of Year Complete
25%

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City of Morgan Hill
Recreation Report - Fiscal Year 2025-26
For the Month Ended September 30, 2025
25% of Year Complete
% of
Budget September 2025 YTD Budget
Revenues
Membership Services & Rec Programs 6,830,960 $ 453,398 $ 1,836,975 $ Facility Rentals 1,245,612 131,119 424,759
Community Services 138,498 4,009 13,797
Transfers in 100,000 6,250 25,000
Total Revenues 8,315,070 $ 594,775 $ 2,300,530 $ 28%
Less: Expenditures
Membership & Program Services $ 347,258 7,541,945 $ 1,810,931 $ Facility Rentals 1,451,514 65,236 282,131
Community Services 883,254 16,815 192,829
Total Expenditures 9,876,714 $ 429,308 $ 2,285,891 $ 23% Net Impact without encumbrances (1,561,644) $ 165,467 $ 14,639 $ Encumbrances - - 1,739,956
Net Impact with encumbrances (1,561,644) $ 165,467 $ (1,725,316) $

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The chart below shows cash balances by fund type reconciled to the City's financial system:

City of Morgan Hill
Monthly Investment Report - September 30, 2025
The following are the snapshots of City's investment portfolio as of September 30, 2025. The first chart shows the portfolio composition by investment type:

LAIF - $0.1M
< 1%
CA Class - $18.0M
9% Treasury - $13.8M
7%
Money Market -
$2.3M
1%
Federal Agency Issues-
$154.2M
78%
Certificate of Deposits -
$1.2M
< 1%
Bond Reserves/Trust -
$8.3M
4%
Cash & Other Deposits - $0.4M
< 1%
Investment Portfolio Composition - $198.3 Million
LAIF - $0.1M
CA Class - $18.0M
Treasury - $13.8M
Money Market - $2.3M
Federal Agency Issues-
$154.2M
Certificate of Deposits -
$1.2M
Bond Reserves/Trust -
$8.3M
Cash & Other Deposits -
$0.4M
General Fund, $22.3M
Development Services,
$1.7M
Water - Operations,
$2.2M
Water Other, $34.4M
Sewer - Operations,
$1.4M
Sewer Other, $52.0M
Other Special Revenue,
$18.8M
Streets and Capital
Projects, $40.5M
Debt Service , $0.5M
Internal Service,
$23.8M
Agency Funds (assessment
dists./refundable deposits),
$0.7M
Cash Balances by Fund Type - $198.3 Million

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The following chart illustrates a yield comparison by month among the City's portfolio, LAIF and 2-Year US Treasury:

The chart below illustrates monthly average days to maturity of the City's portfolio along with the weighted average yield for the past two years:

0.00%

1.00%

2.00%

3.00%

4.00%

5.00%

6.00%
Sep-23
Oct-23
Nov-23
Dec-23
Jan-24
Feb-24
Mar-24
Apr-24
May-24
Jun-24
Jul-24
Aug-24
Sep-24
Oct-24
Nov-24
Dec-24
Jan-25
Feb-25
Mar-25
Apr-25
May-25
Jun-25
Jul-25
Aug-25
Sep-25
Yield Portfolio vs. Benchmarks
LAIF Yield 2 Yr US-Treasury

2.70%

2.80%

2.90%

3.00%

3.10%

3.20%

3.30%

3.40%

3.50%
0 100
200
300
400
500
600
700
800
900
1000
Sep-23
Oct-23
Nov-23
Dec-23
Jan-24
Feb-24
Mar-24
Apr-24
May-24
Jun-24
Jul-24
Aug-24
Sep-24
Oct-24
Nov-24
Dec-24
Jan-25
Feb-25
Mar-25
Apr-25
May-25
Jun-25
Jul-25
Aug-25
Sep-25
Days Yield
Portfolio Yield and Maturity Trends
Avg Days to Maturity Yield
CITY

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City of Morgan Hill
Investment Portfolio Detail
As of September 30, 2025
Investment Settlement Cost Book % of Market YTM Next Call Date of Type CUSIP Date Value Value Portfolio Value at Cost Date Maturity L A I F $ 63,918 $ 0.0% 63,918 $ 4.21% 63,994
California C L A S S 17,992,961 17,992,961 9.1% 17,992,961 4.27% WFB Money Market 2,114,831 2,114,831 1.1% 2,114,831 4.10% US Bank - Portfolio of Securities
Dreyfus Treasury Agency MM 261908107 182,626 0.1% 182,626 4.14% 182,626 Treasury Note 91282CCZ2 10/8/2021 1,987,656 1,997,522 1.0% 1,944,740 1.00% 9/30/2026 9/30/2026 Treasury Note 912828U24 6/13/2022 1,904,688 1,975,759 1.0% 1,962,340 3.16% 11/15/2026 11/15/2026 Treasury Note 91282CFL0 9/30/2024 2,031,719 2,025,378 1.0% 2,013,680 3.53% 9/30/2029 9/30/2029 Treasury Note 91282CLL3 10/1/2024 1,994,323 1,994,261 1.0% 1,990,780 3.53% 9/15/2027 9/15/2027 Treasury Note 91282CCV1 10/4/2024 1,822,536 1,865,852 0.9% 1,862,420 3.61% 8/31/2028 8/31/2028 Treasury Note 31282CFJ5 10/7/2024 1,949,794 1,954,731 1.0% 1,959,060 3.76% 8/31/2029 8/31/2029 Treasury Note 91282CFY2 12/19/2024 1,959,077 1,962,124 1.0% 2,012,900 4.39% 11/30/2029 11/30/2029 FHLMC Bond 3134GWZG4 10/20/2020 2,000,000 2,000,000 1.0% 1,996,200 0.60% 10/20/2025 10/20/2025 FHLMC Bond 3134GW3X2 10/27/2020 2,000,000 2,000,000 1.0% 1,994,860 0.63% 10/27/2025 10/27/2025 FFCB Bond 3133EMFR8 11/3/2020 2,000,000 2,000,000 1.0% 1,993,280 0.54% 10/5/2025 11/3/2025 FNMA Bond 3135GA4P3 11/18/2020 2,000,000 2,000,000 1.0% 1,990,680 0.65% 11/18/2025 11/18/2025 FHLMC Bond 3134GXEJ9 11/24/2020 2,000,000 2,000,000 1.0% 1,989,800 0.64% 11/24/2025 11/24/2025 FFCB Bond 3133EMHF2 11/24/2020 1,000,000 1,000,000 0.5% 0.60% 10/5/2025 11/24/2025 994,810 FHLMC Bond 3134GXCS1 11/25/2020 3,000,000 3,000,000 1.5% 2,984,040 0.63% 11/25/2025 11/25/2025 FHLMC Bond 3134GXFA7 11/30/2020 2,000,000 2,000,000 1.0% 1,989,400 0.65% 11/26/2025 11/26/2025 FFCB Bond 3133EMLC4 12/22/2020 2,000,000 2,000,000 1.0% 1,983,900 0.47% 10/5/2025 12/22/2025 FHLB Bond 3130AKQ74 1/22/2021 2,000,000 2,000,000 1.0% 1,979,260 0.63% 11/22/2025 1/22/2026 FNMA Bond 3135G06R9 1/28/2021 2,000,000 2,000,000 1.0% 1,978,160 0.55% 11/28/2025 1/28/2026 FHLB Bond 3130AKRN8 1/28/2021 2,000,000 2,000,000 1.0% 1,978,280 0.65% 11/28/2025 1/28/2026 FHLB Bond 3130ALCV4 2/24/2021 2,000,000 2,000,000 1.0% 1,974,660 0.75% 11/24/2025 2/24/2026 FHLB Bond 3130ALDB7 2/25/2021 2,000,000 2,000,000 1.0% 1,974,280 0.66% 11/25/2025 2/25/2026 FHLB Bond 3130AKZ25 2/26/2021 2,000,000 2,000,000 1.0% 1,973,300 0.65% 11/26/2025 2/26/2026 FHLB Bond 3130ALGS7 3/10/2021 2,000,000 2,000,000 1.0% 1,973,180 0.85% 12/10/2025 3/10/2026 FHLB Bond 3130ALEP5 3/16/2021 2,000,000 2,000,000 1.0% 1,970,880 0.70% 12/16/2025 3/16/2026 FHLB Bond 3130ALDN1 3/16/2021 2,000,000 2,000,000 1.0% 1,971,780 0.80% 12/16/2025 3/16/2026 FHLB Bond 3130AMNH1 6/9/2021 2,000,000 2,000,000 1.0% 1,964,280 1.08% 10/5/2025 6/9/2026 FHLB Bond 3130AMYJ5 6/30/2021 2,000,000 2,000,000 1.0% 1,958,980 1.00% 12/30/2025 6/30/2026 FHLB Bond 3130AMYP1 7/15/2021 3,000,000 3,000,000 1.5% 2,939,430 1.13% 10/15/2025 7/15/2026 FHLB Bond 3130ANJC5 8/26/2021 2,000,000 2,000,000 1.0% 1,948,900 0.80% 8/26/2026 8/26/2026 FHLB Bond 3130ANLW8 8/26/2021 3,000,000 3,000,000 1.5% 2,928,750 1.00% 11/26/2025 8/26/2026 FHLB Bond 3130ANLZ1 8/26/2021 2,000,000 2,000,000 1.0% 1,949,440 0.90% 8/26/2026 8/26/2026 FHLB Bond 3130A8XY4 9/13/2021 2,103,340 2,019,599 1.0% 1,965,880 0.82% 9/11/2026 9/11/2026 FFCB Bond 3133EM4X7 9/28/2021 1,982,960 1,996,749 1.0% 1,946,760 0.98% 9/10/2026 9/10/2026 FHLB Bond 3130APCH6 9/29/2021 3,000,000 3,000,000 1.5% 2,924,310 1.13% 10/5/2025 9/29/2026 FHLB Bond 3130ANZE3 9/30/2021 2,000,000 2,000,000 1.0% 1,945,200 0.88% 9/30/2026 9/30/2026 FHLB Bond 3130AP6N0 9/30/2021 3,000,000 3,000,000 1.5% 2,923,800 1.05% 12/30/2025 9/30/2026 FHLB Bond 3130AP6M2 9/30/2021 3,000,000 3,000,000 1.5% 2,922,240 1.02% 12/30/2025 9/30/2026 FHLB Bond 3130APCG8 10/19/2021 2,000,000 2,000,000 1.0% 1,944,520 1.00% 10/19/2025 10/19/2026 FHLB Bond 3130APNX9 11/18/2021 2,000,000 2,000,000 1.0% 1,946,860 1.30% 11/18/2025 11/18/2026 FHLB Bond 3130AQHU0 1/19/2022 2,000,000 2,000,000 1.0% 1,962,960 1.74% 1/19/2027 1/19/2027 FHLMC Bond 3134GXUZ5 6/15/2022 2,000,000 2,000,000 1.0% 1,997,600 3.28% 12/15/2025 12/15/2025 FHLB Bond 3130ASPE3 7/28/2022 2,000,000 2,000,000 1.0% 1,998,260 4.30% 10/28/2025 7/28/2027 FHLMCMTN Bond 3134HAKY8 9/13/2024 2,985,210 2,988,308 1.5% 2,994,030 4.11% 12/13/2025 9/13/2029 FHLB Bond 3130B2P58 9/26/2024 2,003,014 2,000,000 1.0% 1,996,120 3.87% 9/10/2026 9/10/2029 FHLB Bond 3130B35N9 10/8/2024 2,000,000 2,000,000 1.0% 2,000,000 4.50% 10/1/2025 10/1/2029 FHLMCMTN Bond 3134HARE5 10/11/2024 2,000,000 2,000,000 1.0% 1,995,020 4.75% 10/11/2025 10/11/2029 FHLB Bond 3130B36N8 10/15/2024 1,944,000 1,995,150 1.0% 1,992,100 4.32% 4/15/2026 10/15/2029 FHLMCMTN Bond 3134HAC92 11/19/2024 3,000,000 3,000,000 1.5% 3,003,990 5.00% 11/19/2025 11/19/2029 FFCB Bond 3133ERF48 12/4/2024 2,000,000 2,000,000 1.0% 2,002,720 4.77% 12/4/2025 12/4/2028 FHLB Bond 3130B5A73 2/26/2025 2,000,000 2,000,000 1.0% 2,011,320 4.75% 8/26/2026 2/26/2030 FHLMCMTN Bond 3134HBBE0 3/11/2025 2,000,000 2,000,000 1.0% 1,995,120 4.88% 12/11/2025 3/11/2030 FNMA Bond 3136GABW8 3/12/2025 2,000,000 2,000,000 1.0% 1,999,080 5.00% 12/12/2025 3/12/2030

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Investment Settlement Cost Book % of Market YTM Next Call Date of Type CUSIP Date Value Value Portfolio Value at Cost Date Maturity FFCB Bond 3133ETDL8 4/17/2025 2,000,000 2,000,000 1.0% 1,999,680 4.87% 10/17/2025 10/17/2029 FHLB Bond 3130B64X1 4/30/2025 2,000,000 2,000,000 1.0% 1,998,320 4.50% 10/17/2025 4/17/2028 FAMCMTN Bond 31424WZC9 5/7/2025 3,000,000 3,000,000 1.5% 2,988,360 4.55% 5/7/2026 5/7/2030 FHLMCMTN Bond 3134HBQZ7 5/19/2025 2,000,000 2,000,000 1.0% 2,001,000 4.50% 11/19/2025 5/19/2027 FHLB Bond 3130B6FS0 5/28/2025 2,000,000 2,000,000 1.0% 2,005,540 4.75% 5/14/2026 5/14/2030 FAMCMTN Bond 31424WB50 5/28/2025 2,000,000 2,000,000 1.0% 1,998,200 4.74% 5/28/2026 5/28/2030 FFCB Bond 3133ER3L3 6/6/2025 2,029,443 2,000,000 1.0% 2,002,700 4.69% 2/13/2026 2/13/2029 FAMCMTN Bond 31424WG30 6/26/2025 1,200,000 1,200,000 0.6% 1,207,200 4.33% 6/26/2026 6/26/2028 FFCB Bond 3133ETMB0 6/27/2025 2,000,775 2,000,000 1.0% 2,004,800 4.65% 6/24/2026 6/24/2030 FAMCMTN Bond 31424WG55 7/1/2025 2,000,000 2,000,000 1.0% 2,006,860 4.60% 7/1/2026 7/1/2030 FFCB Bond 3133ETNA1 7/2/2025 2,000,000 2,000,000 1.0% 2,004,280 4.50% 7/2/2026 1/2/2030 FHLMCMTN Bond 3134HBYC9 7/15/2025 2,000,000 2,000,000 1.0% 2,002,760 4.75% 1/15/2026 7/15/2030 FHLMCMTN Bond 3134HBZA2 7/15/2025 2,000,000 2,000,000 1.0% 2,000,820 4.50% 1/15/2026 7/14/2028 FHLMCMTN Bond 3134HBA35 7/22/2025 2,000,000 2,000,000 1.0% 1,999,460 4.60% 10/21/2025 7/21/2028 FHLMCMTN Bond 3134HBB59 7/30/2025 2,000,000 2,000,000 1.0% 2,004,700 4.64% 4/30/2026 7/30/2030 FNMA Bond 3136GAM22 8/12/2025 2,988,270 2,998,316 1.5% 2,992,470 4.14% 2/12/2026 8/12/2030 FAMCMTN Bond 31424WN81 8/12/2025 2,000,000 2,000,000 1.0% 2,000,180 4.39% 8/12/2026 8/12/2030 FFCB Bond 3133ETUP0 8/20/2025 2,000,000 2,000,000 1.0% 1,996,720 4.49% 2/20/2026 5/20/2030 FFCB Bond 3133ETUN5 8/25/2025 2,000,000 2,000,000 1.0% 1,998,340 4.45% 2/25/2026 2/25/2030 FHLB Bond 3130B7KG8 8/25/2025 2,000,000 2,000,000 1.0% 1,995,420 4.38% 11/25/2025 8/25/2028 FFCB Bond 3133ETWC7 9/2/2025 2,000,000 2,000,000 1.0% 2,000,300 4.35% 12/2/2025 3/2/2029 FNMA Bond 3136GAQF9 9/3/2025 2,000,000 2,000,000 1.0% 1,991,220 4.25% 6/3/2026 6/3/2030 FFCB Bond 3133ETWB9 9/5/2025 2,000,000 2,000,000 1.0% 1,998,920 4.31% 12/5/2025 9/5/2028 FFCB Bond 3133ETXY8 9/16/2025 2,000,000 2,000,000 1.0% 1,997,480 4.00% 9/16/2026 9/16/2030 FHLB Bond 3130B7SF2 9/18/2025 2,000,222 2,000,000 1.0% 1,997,460 4.00% 9/17/2026 9/17/2030 FNMA Bond 3136GAUR8 9/25/2025 2,000,000 2,000,000 1.0% 1,999,540 4.20% 3/18/2026 9/18/2030 FNMA Bond 3136GAVD8 9/26/2025 2,000,000 2,000,000 1.0% 1,996,200 4.13% 6/26/2026 9/26/2030 FNMA Bond 3136GAVW6 9/30/2025 2,000,000 2,000,000 1.0% 1,997,140 4.45% 12/30/2025 9/30/2030 CD - Morgan Stanley Bank 61690DGT9 11/8/2023 250,000 0.1% 250,000 5.05% 11/8/2028 11/8/2028 259,965 CD - Morgan Stanley Private Bank 61768EE82 11/8/2023 250,000 0.1% 250,000 5.05% 11/8/2028 11/8/2028 259,965 CD - American Express 02589AF98 11/8/2023 250,000 0.1% 250,000 5.00% 11/8/2028 11/8/2028 259,603 CD - State Bank India 8562834U7 11/24/2023 250,000 0.1% 250,000 5.00% 11/24/2028 11/24/2028 262,000 CK - JPMorgan Chase 46659CLN8 9/30/2025 250,000 0.1% 250,000 4.13% 9/30/2030 9/30/2030 250,448 Sub Total/Average $ 169,319,654 $ 169,406,376 85.4% 168,255,016 $ 2.85% Total City Managed/Average $ 189,491,364 $ 189,578,086 95.6% 188,426,803 $ 3.00% Bond Reserve Accounts - Held By Trustees $ 460,619 $ 0.2% 460,619 $ 460,619 Cash/Deposits $ 403,811 $ 0.2% 403,811 $ 403,811
PARS and CALPERS CERBT Trust $ 7,887,404 $ 7,887,404 4.0% $ 10,694,389 GRAND TOTAL/AVERAGE $ 198,243,198 $ 198,329,920 100.0% 199,985,622 $

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Invested Book Value % of Market
in Fund Yield End of Month Total Value
Investments
State Treasurer LAIF - City All Funds Pooled 4.21% $ 63,918 0.0% $ 63,994 California CLASS All Funds Pooled 4.27% 17,992,961 9.1% 17,992,961 US Bank - Portfolio of Securities All Funds Pooled 2.85% 169,406,376 85.4% 168,255,016 WFB MMA All Funds Pooled 4.10% 2,114,831 1.1% 2,114,831 SUBTOTAL $ 189,578,086 95.6% 188,426,803 $
Bond Reserve Accounts - held by trustees
Zions Bank - Civic Center/Library Facility
Blackrock Liq Fund Debt Service 3.78% 83 0.0% 83
Zions Bank - MH Police Facility Lease Revenue Bonds
Blackrock Liq Fund Debt Service 3.78% 109 0.0% 109
BNY - RDA Bonds
Dreyfus Cash Mgmt 521 Agency Fund 3.70% 460,428 0.2% 460,428 SUBTOTAL 460,619 0.2% 460,619
Other Cash/Deposits
General Checking All Funds 357,961 0.2% 357,961
Workers' Comp Administrators Workers' Comp 30,000 0.0% 30,000 Petty Cash & Emergency Cash General Fund 15,850 0.0% 15,850 CALPERS CERBT - OPEB Trust 5,237,404 2.6% 7,079,011
PARS - PENSION Trust 2,650,000 1.3% 3,615,379
SUBTOTAL 8,291,215 4.2% 11,098,200
Total Cash and Investments $ 198,329,920 100.0% $ 199,985,622

CASH ACTIVITY SUMMARY
FY 2025-26
Unaudited
07/01/2025 Change in 9/30/2025
Fund Type Balance Cash Balance Balance
General Fund $ 28,702,713 $ (6,445,993) $ 22,256,720
Development Services 1,246,457 482,628 1,729,085
Water - Operations 2,679,551 (466,935) 2,212,615
Water Other 32,583,151 1,820,352 34,403,503
Sewer - Operations 2,580,060 (1,163,281) 1,416,779
Sewer Other 49,922,041 2,035,073 51,957,115
Other Special Revenue 18,977,650 (135,489) 18,842,161
Streets and Capital Projects 40,999,603 (490,817) 40,508,787 Debt Service 355,257 172,172 527,429
Internal Service 27,988,139 (4,170,296) 23,817,843
Agency Funds (assessment dists./refundable deposits) 6,701,471 (6,043,588) 657,883 Total $ 212,736,093 $ (14,406,173) $ 198,329,920
Note: See Investment Porfolio Detail for maturities of "Investments." Market values are obtained from the City's investment brokers' monthly reports.

I certify that information on the investment report has been reconciled to the general ledger and bank statements and that there are sufficient funds to meet the expenditure requirements of the City for the next six months. The portfolio is in compliance with the City of Morgan Hill Investment Policy and all State laws and regulations.

Prepared by: ____________________________________ Approved by:

Gina Nazareno, Senior Accountant
Reviewed by: ____________________________________
Dat Nguyen, Finance Director Cindy Murphy, Treasurer

CITY OF MORGAN HILL CASH AND INVESTMENT REPORT
FOR THE MONTH OF SEPTEMBER 30, 2025
FOR THE FISCAL YEAR OF 2025-26

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City of Morgan Hill
Year to Date Revenues - Fiscal Year 2025-26
For the Month Ended September 30, 2025
25% of Year Complete

CURRENT INCR (DECR)
ADOPTED AMENDED YTD % PRIOR FROM PRIOR %

BUDGET BUDGET ACTUAL OF BUDGET YTD YTD CHANGE
010 GENERAL FUND
TAXES
Property Tax - Secured/Unsecured $ 17,345,642 17,945,642 $ n/a - $ - $ n/a - Property Tax - RPTTF Residual Distribution 3,098,634 3,098,634 n/a - - n/a - Property Tax - Supplemental Roll 325,515 325,515 25,230 8% 25,899 (669) -3% Sales Tax 12,711,087 11,511,087 1,046,452 9% 991,800 54,652 6% Public Safety Sales Tax 478,182 478,182 36,468 8% 34,141 2,326 7% Transient Occupancy Taxes 2,958,340 2,658,340 477,305 18% 502,529 (25,224) -5% Franchise (Refuse ,Cable ,PG&E) 3,354,166 3,354,166 n/a - - n/a - Property Transfer Tax 642,000 642,000 106,531 17% 80,805 25,726 32% TOTAL TAXES 40,913,566 40,013,566 1,691,985 4% 1,635,174 56,811 3%

LICENSES/PERMITS
Business License 200,000 200,000 61,688 31% 61,879 (191) 0% Other Permits 82,750 82,750 100,930 122% 100,509 421 0% TOTAL LICENSES/PERMITS 282,750 282,750 162,618 58% 162,388 229 0%

FINES AND PENALTIES
Parking Enforcement 9,800 9,800 862 9% 2,573 (1,711) -66% Bails & Fines 55,000 55,000 5,753 10% 4,774 21% 979
Administrative Citations 20,000 20,000 6,500 33% 11,150 (4,650) -42% TOTAL FINES AND PENALTIES 84,800 84,800 13,116 15% 18,497 (5,382) -29%

OTHER AGENCIES
Motor Vehicle in-Lieu 63,654 63,654 70,915 111% - 70,915 n/a Other Revenue - Other Agencies 940,183 434,545 92,326 10% 210,641 (118,315) -56% TOTAL OTHER AGENCIES 498,199 1,003,837 163,241 16% 210,641 (47,399) -23%

CHARGES CURRENT SERVICES
Police False Alarm Charge 33,500 33,500 3,805 11% 6,037 (2,232) -37% Business License Application Review 84,872 84,872 11,873 14% 13,649 (1,776) -13% Membership Services & Rec Programs 6,830,960 6,830,960 1,836,975 27% 1,752,626 84,348 5% Facility Rentals 1,245,612 1,245,612 424,759 34% 442,161 (17,402) -4% Community Services 138,498 138,498 13,797 10% 25,488 (11,691) -46% General Administration Overhead 1,727,037 1,727,037 454,119 26% 439,028 15,091 3% Other Charges Current Services 734,377 734,377 101,540 14% 247,793 (146,253) -59% TOTAL CURRENT SERVICES 10,794,856 10,794,856 2,846,867 26% 2,926,782 (79,915) -3%

OTHER REVENUE
Use of money/property 1,283,417 1,583,417 368,917 23% 543,239 (174,322) -32% Other Revenues 811,790 548,648 81,959 10% 55,186 26,774 49% TOTAL OTHER REVENUE 1,832,065 2,395,207 450,876 19% 598,425 (147,548) -25%

TRANSFERS IN
One Time Transfer 165,000 165,000 41,250 25% 41,250 0% - Public Safety Facilities Fund 50,000 50,000 12,500 25% 12,500 0% - Supplemental Law Enforcement Fund 100,000 100,000 n/a - - n/a - Countywide Solid Waste 563,961 544,328 140,990 26% 135,082 5,908 4% Streets 851,932 851,932 144,179 17% 148,089 (3,910) -3% Park Maintenance 650,000 650,000 162,500 25% 162,500 n/a - Sewer Operations 434,390 434,390 108,598 25% 103,425 5,173 5% Water Operations 434,390 434,390 108,598 25% 103,425 5,173 5% Open Space 81,100 81,100 20,275 25% 20,275 n/a -
Park Development 100,000 100,000 25,000 25% 25,000 n/a - TOTAL TRANSFERS IN 3,430,773 3,411,140 763,889 22% 751,546 12,343 2% TOTAL GENERAL FUND 57,837,009 57,986,156 6,092,592 11% 6,303,453 (210,861) -3%

SPECIAL REVENUE FUNDS
202 STREET MAINTENANCE
Gas Tax 2105 - 2107.5 851,932 851,932 142,339 17% 146,404 (4,065) -3% Interest / Other Revenue/Other Charges 1,665 1,665 1,840 111% 1,685 155 9% 202 STREET MAINTENANCE 853,597 853,597 144,179 17% 148,089 (3,910) -3%

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City of Morgan Hill
Year to Date Revenues - Fiscal Year 2025-26
For the Month Ended September 30, 2025
25% of Year Complete

CURRENT INCR (DECR)
ADOPTED AMENDED YTD % PRIOR FROM PRIOR %

BUDGET BUDGET ACTUAL OF BUDGET YTD YTD CHANGE

SPECIAL REVENUE FUNDS
205 SUPPLEMENTAL LAW ENFORCEMENT FUND
Interest Income 11,065 11,065 4,541 41% 5,034 (492) -10% Police Grant/SLEF/JAG 100,000 100,000 n/a - - n/a -
205 SUPPLEMENTAL LAW ENFORCEMENT FUND 111,065 111,065 4,541 4% 5,034 (492) -10% 206 DEVELOPMENT SERVICES
Building Fees 3,655,850 3,578,850 866,765 24% 844,214 22,551 3% Planning Fees 954,276 1,059,276 311,007 29% 198,319 112,688 57% Engineering Fees 723,341 723,341 377,285 52% 241,371 135,914 56% Other Revenue/Current Charges 544,851 516,851 88,023 17% 61,321 26,702 44% 206 DEVELOPMENT SERVICES 5,878,318 5,878,318 1,643,080 28% 1,345,226 297,854 22% 207 LONG RANGE PLANNING 827,760 827,760 242,881 29% 186,108 56,773 31% 215 and 216 HCD BLOCK GRANT
Interest Income/Other Revenue 994 994 615 62% 880 (265) -30% 215 and 216 HCD BLOCK GRANT 994 994 615 62% 880 (265) -30% 225 ASSET SEIZURE 1,631 1,631 929 57% 1,343 (414) -31%
229 LIGHTING AND LANDSCAPE 207,135 207,135 1,665 1% 2,605 (940) -36% 230 COMMUNITY FACILITIES DISTRICT 28,314 28,314 1,432 5% 2,017 (584) -29% 232 ENVIRONMENTAL PROGRAMS 525,286 525,286 123,788 24% 119,265 4,524 4% 234 MOBILE HOME PARK RENT STAB. 2,447 2,447 757 31% 4,183 (3,426) -82% 236 HOUSING MITIGATION 3,061,720 3,478,220 333,528 10% 454,230 (120,702) -27% 240 EMPLOYEE ASSISTANCE 481 481 2,158 449% 1,839 17% 319 246 COUNTYWIDE SOLID WASTE 2,393,478 1,716,866 554,839 32% 432,896 121,943 28% 255 HOUSING SUCCESSOR AGENCY 418,260 418,260 37,627 9% 266,243 (228,615) -86% 260 PUBLIC ART 869 869 323 37% - 323 n/a
TOTAL SPECIAL REVENUE FUNDS 14,311,356 14,051,244 3,092,343 22% 2,969,957 122,386 4%

CAPITAL PROJECTS FUNDS
301 PARK DEVELOPMENT 2,324,852 2,324,852 142,266 6% 1,652,734 (1,510,468) -91% 302 PARK MAINTENANCE 1,008,792 1,008,792 16,423 2% 37,028 (20,605) -56% 303 LOCAL DRAINAGE 3,672,294 3,672,294 32,639 1% 358,199 (325,560) -91% 304 LOCAL DRAINAGE/NON AB1600 28,357 187,838 31,830 17% 69,667 (37,837) -54% 306 AGRICULTURE & OPEN SPACE PRESERVATION 10,461 10,461 54,685 523% 44,221 10,464 24% 308 STREET CIP 7,777,340 7,777,340 595,709 8% 619,781 (24,073) -4% 309 TRAFFIC IMPACT 3,584,714 3,584,714 160,189 4% 1,162,573 (1,002,384) -86% 315 PUBLIC SAFETY FACILITIES IMPACT 2,217,137 2,217,137 602,711 27% 1,294,174 (691,463) -53% 346 PUBLIC FACILITIES NON-AB1600 26,226 26,226 16,733 64% 33,350 (16,616) -50% 347 PUBLIC FACILITIES IMPACT 994,483 994,483 39,529 4% 289,455 (249,926) -86% 348 LIBRARY 2,180,740 2,180,740 220,121 10% 1,186,079 (965,958) -81% 350 UNDERGROUNDING 47,258 47,258 15,511 33% 23,179 (7,668) -33% 360 COMMUNITY/REC IMPACT FUND 3,802,095 3,802,095 232,061 6% 1,962,035 (1,729,973) -88% 375 QUIMBY FEE 4,268,487 4,268,487 58,803 1% 1,221,556 (1,162,753) -95% TOTAL CAPITAL PROJECTS FUNDS 31,943,236 32,102,717 2,219,210 7% 9,954,030 (7,734,820) -78%

DEBT SERVICE FUNDS
420 CIVIC CENTER DEBT 302,376 302,376 76,155 25% 76,167 0% (12) 441 POLICE FACILITY BOND 394,304 394,304 98,303 25% 97,239 1,064 1% TOTAL DEBT SERVICE FUNDS 696,680 696,680 174,458 25% 173,406 1,053 1%

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Morgan Hill City CouncilNovember 19, 2025

Morgan Hill City Council
November 19, 2025