Morro Bay City Council
September 8, 2026

CITY OF MORRO BAY
City Council Regular Meeting Agenda

Tuesday, September 8, 2026, 5:30 p.m.

Veterans Memorial Hall
209 Surf St., Morro Bay, CA
Public Participation
Public participation is offered in the following ways:
• Community members may attend the meeting in person at the Morro Bay Veterans Hall.

Alternatively, members of the public may watch the meeting and speak during general Public Comment or on a specific agenda item by logging into the Zoom webinar using the information provided below. Please use the "raise hand" feature to indicate your desire to provide public comment.
•
• Zoom webinar link: https://us02web.zoom.us/j/82429164990 Or Telephone Attendee: 1 (669) 444-9171 or 1 (669) 900-9128 or 1 (346) 248-7799; Webinar ID: 824 2916 4990. Press *9 to raise hand for public comment. •
• Meetings are also livestreamed on the City's website.

Community Members are encouraged to submit agenda correspondence via email to the City Council at [email protected] prior to the meeting. Agenda correspondence received by 10:00 a.m. on the meeting day will be posted on the City website.
•
Pages

1. ESTABLISH QUORUM AND CALL TO ORDER

2. PLEDGE OF ALLEGIANCE

3. REPORTS

3.a Closed Session Report

3.b Mayor and Councilmembers' Reports, Announcements and Presentations

3.c City Manager Reports, Announcements and Presentations

3.d Subcommittee Reports - Verbal Update of Current Subcommittee Activities

1. Water Reclamation Facility & Morro Bay / Cayucos Sanitary District JPA

2. Morro Bay Power Plant (Vistra)

3. Morro Elementary School

4. RECOGNITION AND PRESENTATIONS

4.a National Estuary Program "State of the Bay" Presentation 5

5. PUBLIC COMMENT
Members of the audience wishing to address the Council on City business matters not on the agenda may do so at this time. For those desiring to speak on items on the agenda, but unable to stay for the item, may also address the Council at this time.

Public comment is an opportunity for members of the public to provide input to the governing body. To increase the effectiveness of the Public Comment Period, the City respectfully requests the following guidelines and expectations be followed:
•
Those desiring to speak are asked to complete a speaker slip, which are located at the entrance, and submit it to the City Clerk. However, speaker slips are not required to provide public comment.
•
When recognized by the Mayor, please come forward to the podium to speak.

Though not required, it is helpful if you state your name, city of residence and whether you represent a business or group. Unless otherwise established by the Mayor, comments are to be limited to three minutes. •
All remarks should be addressed to Council, as a whole, and not to any individual member thereof.
•
The Council respectfully requests that you refrain from making slanderous, profane or personal remarks against any elected official, commission and/or staff.
•
Please refrain from public displays or outbursts such as unsolicited applause, comments or cheering.
•
Any disruptive activities that substantially interfere with the ability of the City Council to carry out its meeting will not be permitted and offenders will be requested to leave the meeting.
•
Your participation in City Council meetings is welcome and your courtesy will be appreciated.
•
The Council in turn agrees to abide by its best practices of civility and civil discourse according to Resolution No. 07-19.
•

6. CONSENT AGENDA
Unless an item is pulled for separate action by the City Council, the following actions are approved without discussion. The public will also be provided an opportunity to comment on consent agenda items.

Recommended Action
Approve Consent Agenda Items 6.a through 6.c as submitted.

6.a Approval of Minutes
(City Clerk)
Recommended Action
Approve as submitted.

1. August 11, 2026 - Regular Council Meeting 33

2. August 19, 2026 - Special Council Meeting 39

3. August 25, 2026 - Special Closed Session Meeting 41
43

4. August 25, 2026 - Regular Council Meeting

6.b Fourth Quarter Investment Report (period ending June 30, 2026) for Fiscal Year (FY) 2025-26
50 (Finance Department)
Recommended Action
Receive the attached Fourth Quarter Investment Report (period ending June 30, 2026) for FY 2025-26.

6.c Resolution No. 48-26 Approving Adjustment to Lease Site Maps for Lease Sites 49/49W, 50/50W, 51/51W and 52/52W at 495 Embarcadero Road 55 (Harbor Department/Public Works Department)
Recommended Action
Staff recommends the City Council adopt Resolution No. 48-26:

Approve the adjustments to Lease Sites 49/49W, 50/50W, 51/51W, and 52/52W located at 495 Embarcadero.

1. Authorize the City Manager or his designee to revise the approved Master Lease agreement language to reflect the updated legal descriptions and maps of the lease sites as proposed.

2. 7. PUBLIC HEARING ITEMS
None.

8. BUSINESS ITEMS

8.a Framework for the Tidelands Business License Program (TBLP) 71 (Harbor Department)
Recommended Action
Review the proposed Tidelands Business License Program and provide recommendations for any modifications to staff before the item is presented to Planning Commission for a Major Modification Permit request, after which it will return to Council for final approval.

8.b Support for the City of Paso Robles Bid on the San Luis Obispo County Ambulance Services Contract
77 (Fire Department)
Recommended Action
Adopt Resolution No. 47-26 expressing support for the City of Paso Robles to submit a bid for the San Luis Obispo County Ambulance Services Contract and supporting a robust, transparent, and accountable ambulance transport system that reinvests in the San Luis Obispo County Emergency Medical System (EMS) and other community health initiatives.

9. COUNCIL DECLARATION OF FUTURE AGENDA ITEMS

10. ADJOURNMENT

The next Regular Meeting will be held on September 22, 2026.

This agenda is subject to amendment up to 72 hours prior to the date and time set for the meeting. Please refer to the agenda posted at City Hall, 595 Harbor Street, Morro Bay, CA 93442 for any revisions or call the Clerk's office at (805) 772-6205 for further information.

Materials related to an item on this agenda submitted to the City Council after distribution of the agenda packet are available for public inspection upon request by calling the City Clerk's office at (805) 772-6205.

In compliance with the Americans Disability Act, if you need special assistance to participate in a City meeting, please contact the Clerk's office 24 hours prior to the meeting to insure reasonable arrangements can be made to provide accessibility to the meeting.

STATE OF THE BAY | 2026
A report on the health of the Morro Bay Estuary

How healthy are the estuary and the lands that surround it? Morro Bay is a unique area on California’s Central Coast where fresh water from our creeks joins with the salty
waters of the ocean to form an estuary, an ecologically rich area that supports abundant eelgrass beds, a thriving shellfish farming industry, and a bustling tourist destination that draws visitors from around the world.

The Morro Bay National Estuary Program is a local
nonprofit that works to protect and restore Morro Bay
and the lands that surround it for people and wildlife.

For thirty years, the program has conducted monitoring, restoration, and education efforts in collaboration with the community, government, nonprofits, and
landowners. We work to preserve natural habitats while
maintaining balanced uses of the bay.

Every three years, the Estuary Program creates a State of the Bay Report centered around some of the common
questions we get about the health of the estuary and
watershed.

Cover photo by Mike Jones, @AzHiAzIaM
Authored by Estuary Program staff
Ann Kitajima with great support from Nick Soares,
Makenzie O’Connor, Carolyn Geraghty, and Jenn Fields.

The Estuary Program sincerely thanks its many partners, volunteers, and committee members for their dedication to the Morro Bay estuary and their continued support. This report was funded in part by a grant from the U.S. EPA.

Questions Answered in This Report
Is water in the creeks and bay clean enough
for fish and aquatic life? 2
Does Morro Bay support healthy
eelgrass beds? 6
Is Morro Bay safe for swimming? 9
Is the bay clean enough to support
commercial shellfish farming? 10
Do the estuary and watershed support
a healthy population of steelhead? 12
Are the bay and creeks impacted
by accelerated sedimentation? 14
Are bird populations that depend on the bay
and surrounding lands stable? 16
How will extreme weather events likely affect
the Morro Bay watershed and estuary? 18
Are important natural areas being protected,
enhanced, and restored? 22
The Black Hill trail in Morro Bay State Park overlooks the Morro Bay tidal marsh. Photo courtesy of Marlin Harms.

Morro Bay National Estuary Program Page 6 of 81
The Morro Bay Estuary and its Watershed
The Morro Bay watershed contains a network of creeks that drain rainfall and other fresh water from 48,000 acres of land into Morro Bay. Fresh water from the land meets with salty water from the ocean to create a unique environment called an estuary. This connection between the land and the estuary means that what happens on the land has a large impact on the health of the bay.

How to Read Estuary Health Symbols
The Estuary Health Symbols represent how the status
of each question is changing over time. A round symbol
indicates that the trend is stable. An up arrow (ñ) indicates an improving trend, while a down arrow indicates a worsening trend (ò). The color of the rectangular base of the arrow indicates the status of historical data and the color of the point of the arrow indicates the status of the newer data. The color of the symbol indicates
the status as follows: Good/Very Good (green), Fair
(yellow), Poor (orange), Very Poor (red), and Unknown
(gray).

This symbol indicates that the water quality
was Very Poor and has improved to Poor.

This symbol indicates that the trend is stable
but we lack adequate data to assign a quality
indicator.

Watershed Boundary
Creeks

MORRO BAY, CA
Nitrate Status
Very Good/Good
Fair
Poor
Very Poor
Unknown
Nitrate Status
Very Good/Good
Fair
Poor
Very Poor
Unknown
STATE OF THE BAY 2026 Page 7 of 81
Is water in the creeks and bay clean enough
for fish and aquatic life?
Some areas are healthy and others are degraded.

Fish and aquatic life require clean waters that have
adequate oxygen and are free of pollutants. To better
understand whether the waters of the bay and creeks
support the most sensitive wildlife, Estuary Program
staff and our dedicated volunteers conduct ongoing
monitoring of oxygen levels, nitrate pollution, and
creek health indicators.

Bay Dissolved Oxygen
Nitrates for Chorro Creek
Creek Health
The waters of the Morro Bay estuary are home
to fish, invertebrates, and other types of aquatic
life, many of which require oxygen to thrive. To
better understand the health of the bay, Estuary Program volunteers kayak out in the early morning hours to measure the lowest oxygen levels of the day at seven bay sites. This monitoring effort has been conducted for over 20 years, and the data consistently shows a trend of
decreasing oxygen as you move from the front bay to the back bay. The deeper waters of the front bay easily mix with the cold, well-oxygenated water pushed in from the ocean by incoming tides. Conversely in the back bay, the shallow waters limit tidal mixing, leading to lower oxygen levels. Although lower than ideal, baywide oxygen levels have remained relatively stable over time. While conditions remain Very Poor at the furthest back bay
sites, data indicate significant improvements in oxygen levels at the Sharks Inlet and Cuesta Inlet sites.

Bay Oxygen Status
Very Good/Good
Fair
Poor
Very Poor
Bay Oxygen Status
N
Morro Bay
Sandspit
Los Osos
2 Morro Bay National Estuary Program Page 8 of 81
Nitrates in the Watershed
Reports of algal blooms are becoming more
frequent, with some of these blooms producing toxins harmful to people and animals.

While these blooms can be influenced by factors like
water temperature and currents, excess nutrients
such as nitrates can also drive them. Nitrates can
come from sources like agricultural and residential
fertilizing, stormwater runoff, and wastewater treatment plants. Even if a bloom is not toxic, excess algae growth can crowd out beneficial plants and deplete
oxygen from the water, making it harder for fish and
other aquatic life to survive. Tracking nitrate levels in our local creeks is essential for understanding overall creek health.

Nitrate Status
Very Good/Good
Fair
Poor
Very Poor
Unknown
Watershed Boundary
The map shows an analysis of nitrate concentrations for creek segments throughout the Morro Bay watershed. Data indicate that Upper Los Osos Creek, Upper Chorro Creek, and the creeks that drain into Chorro Creek (Dairy, Pennington, San Bernardo, and San Luisito Creeks) have low, or Good, levels of nitrates, which supports a healthier aquatic environment. Middle and Lower Chorro Creek and Warden Creek score Very Poor for nitrate levels, although Chorro Creek has shown a marked improvement over time. High nitrate concentrations can cause imbalances in the water quality, resulting in low oxygen levels that can harm sensitive wildlife like steelhead trout. Grayed-out creek segments indicate areas without enough data for assessment.

STATE OF THE BAY 2026 3 Page 9 of 81
Creek Health in the Watershed
Trend status: Scores remain stable. No scores were available from areas that we suspect are heavily impacted (shown in gray).

Water quality data help us understand
whether a creek can support aquatic life.

Another way to assess this is by monitoring
the organisms living in the creek. By collecting and
analyzing the macroinvertebrates (animals without a
backbone that you can see with the naked eye) living
in a creek, we can determine whether the habitat is
suitable for sensitive species like steelhead trout. Some macroinvertebrate species are sensitive to pollution
and will thrive only in clean waters, while others can
tolerate very poor water quality conditions. Creeks
with more pollution-sensitive species typically provide better habitat for aquatic life than creeks with more
pollution-tolerant species.

The map illustrates the average health scores for each creek or stretch of creek in the Morro Bay watershed, using data going back nearly 30 years. The creek segments colored green have Good scores, meaning they have higher quality habitat that can support sensitive species of macroinvertebrates. Sections of creeks colored red have scored as Very Poor, meaning that the creek may not be able to support any sensitive macroinvertebrates. Factors such as water levels, water quality, plant cover, and sediment in the creek can influence habitat quality.

Creek Health
Very Good/Good
Fair
Poor
Very Poor
Unknown
Watershed Boundary
4 Morro Bay National Estuary Program Page 10 of 81
Creek Health Recovery After Winter 2023
Storm events can play an important role for
creek-dwelling macroinvertebrates since high-intensity
storms and flooding can alter habitat conditions, making it challenging for sensitive species to thrive. Following the large storms of January 2023, creek health scores
in the Morro Bay watershed indicated high levels of
disturbance, especially in the tributaries of Pennington, San Bernardo, and Dairy Creeks. The series of photos
below illustrates how the storms of January 2023 affected Pennington Creek. The high flows caused severe bank
erosion and stripped away vegetation. By 2024, many of
these sites were on the rebound, with Pennington, San
Bernardo, and Dairy Creek scores improving by 50% or
more. These improvements indicate a relatively quick
recovery of sensitive macroinvertebrate species in these tributaries, despite the severe impacts of the 2023 storms.

How We Monitor Creek Health
Each spring we collect macroinvertebrates and take
measurements of the habitat to determine whether the
creek would support sensitive species.

These photos show the same site on Pennington Creek before and after the large storms of early January 2023.

To collect macroinvertebrate samples, we scrub the rocks and stir up the sediment on the creek bottom. This releases the macroinvertebrate larvae which drift with the current into our net.

After collecting our sample, we empty the contents of the net into a sieve to sort out the sticks, rocks, and leaves. The macroinvertebrates are then preserved and sent to a taxonomy lab for identification and counting. This sample from Dairy Creek contains a large stonefly larva, a species that typically indicates good water quality for sensitive aquatic life.

January 10th January 4 , 2023 th, 2023
STATE OF THE BAY 2026 5 Page 11 of 81
Does Morro Bay support healthy eelgrass beds?
Yes, the amount of eelgrass in the bay has increased rapidly over the last few years, with acreage surpassing pre-decline levels and likely exceeding the maximum levels that can be sustainably supported in the bay.

If you’ve spent any time on the bay lately,
you’ve seen the long blades of eelgrass
that are now abundant in our waters. This
seagrass puts down roots in the bay floor, helping
to reduce erosion and improve water quality. This
plant also sequesters carbon and serves as habitat
and a food source for wildlife. After the near total
loss of eelgrass in Morro Bay, its current abundance
is remarkable.

For over two decades, the Estuary Program has worked
with partners to study and monitor eelgrass. Mapping
efforts indicated an increase from just 13 acres in 2017 to 750 acres in 2023. The reasons for the decline and
rapid recovery are complex and likely include many
factors such as changes in water quality and elevation.

The 2023 acreage likely exceeds what the bay can sustain long-term, and future maps are expected to show a slight decline to a more sustainable level.

This series of maps clearly illustrates the large swings in eelgrass acreage (shown in yellow) observed in Morro Bay. Eelgrass acreage declined from 344 acres in 2007 to only 13 acres in 2017. Around this time, small patches of eelgrass began appearing in areas that had experienced loss. Eelgrass has been steadily increasing since then, with 750 acres mapped in 2023.

Fall 2007 (344 acres) Fall 2017 (13 acres) Spring 2023 (750 acres) Eelgrass Acreage: 2007, 2017, and 2023
Eelgrass Extent
0 N

0.5 1 2
Miles
0 N

0.5 1 2
Miles
6 Morro Bay National Estuary Program Page 12 of 81
Bay Elevation and Eelgrass
The Estuary Program partnered with Dr. Ryan Walter
of Cal Poly’s Physics Department to better understand
the relationship between eelgrass and bay-elevation
change. The figure on the left shows the differences
in elevation from 2010 (pre-eelgrass decline) to 2019
(during eelgrass recovery). Following eelgrass loss, the areas shown in red indicate where erosion occurred
and the bay floor became deeper. This is a common
result of eelgrass loss since the plant’s root structure stabilizes sediment on the bay floor, and the floating
eelgrass blades help dampen the erosive effects of
the currents and waves. This analysis showed erosion
occurring at over 90% of the locations where eelgrass
was lost.

It’s possible that the erosion and deepening of large
areas that had previously supported eelgrass was key
in driving the plant’s recovery. Eelgrass thrives in a
“Goldilocks” depth range. If the waters are too deep,
the plants can’t get enough light for photosynthesis.

But if the waters are too shallow, eelgrass may dry
out when exposed at low tides. It is possible that the
erosion and subsequent deepening returned parts of
the bay to the right depth for eelgrass to survive and
thrive. In areas where eelgrass returned to the bay, the analysis from 2019 to 2022 (illustrated in the figure on the right) shows that these parts of the bay (shown
in blue) trapped sediment (became shallower) since
eelgrass was once again stabilizing the bay floor.
2010 to 2019 elevation change (m) 2019 to 2022 elevation change (m) accretion
erosion
This data is meant to be informational and should not be used for navigational, regulatory, or decision-making purposes.

STATE OF THE BAY 2026 7 Page 13 of 81
Bay Fish Populations Shift with Eelgrass Abundance
Morro Bay’s eelgrass beds provide essential shelter and nursery grounds for many species of fish. Monitoring
efforts have assessed fish communities at different
stages of eelgrass abundance, illustrating how fish
species respond to changes in habitat. In 2006 and
2007, Dr. John Stephens of Occidental College conducted a baywide fish study when eelgrass covered approximately 344 acres of the bay. Nearly a decade
later, Dr. Jennifer O’Leary of Cal Poly repeated this
work when eelgrass had declined to only 13 acres. In
2023 and 2024, the Estuary Program completed similar monitoring when eelgrass was at a record high of nearly 750 acres.

During the most recent monitoring effort, over 8,000
fish representing 24 unique species were sampled
near the shoreline, within the intertidal flats, and in Morro Bay’s open channels. Bay pipefish, a slender
green fish that resembles eelgrass, were the most
abundant species. In contrast, during periods of low
eelgrass acreage, species that prefer bare mud and
sand, like speckled sanddab and staghorn sculpin,
were much more common. These results highlight
how eelgrass coverage has a direct influence on fish
communities.
0 20
40 60
Low Medium High
Eelgrass Abundance
Percent of Fish (%)
Species
Staghorn sculpin
Bay pipefish
Fish Population in Tidal Flats
The graph shows the percent of two types of fish captured within tidal flats where eelgrass tends to grow. In times of low eelgrass abundance, species like staghorn
sculpin that prefer bare mud and sand were dominant.

In contrast, during times of high eelgrass abundance,
species like bay pipefish that prefer eelgrass habitat
were more prevalent.

During 2023 and 2024, fish were sampled from Morro Bay’s shoreline, intertidal flats, and open channels. For shoreline locations, like the one pictured above, nets called beach seines were used to collect fish. All fish collected during the study were identified, measured, and then safely released.

Bay pipefish are long, green, slender fish. Their unique appearance allows them to blend in with eelgrass. Our surveys showed that these fish were more abundant during times of high eelgrass acreage. 8 Morro Bay National Estuary Program Page 14 of 81
Is Morro Bay safe for swimming?
Yes, most of the time in the locations we test.

Morro Bay is a jewel of the Central Coast,
attracting residents and visitors for sailing,
paddling, and swimming. These activities are a
big part of what makes the bay special, but they can only be enjoyed safely when the water is clean. Pollutants
like bacteria, viruses, and protozoa can cause illnesses in people and wildlife. Potential sources of these pollutants are pets, stormwater runoff, wildlife, wastewater spills, or boat waste holding tanks that are not operated properly.

For nearly 20 years, Estuary Program staff and volunteers have ventured out to the bay each month to monitor for
indicator bacteria, which are microorganisms that indicate whether fecal contamination may be present. This long-term record helps us track trends in water quality and potential impacts on bay uses such as recreation
and shellfish farming.

Coleman Beach is a popular recreation location in Morro Bay.

This map shows the eight sites where the Estuary
Program has monitored water quality monthly from
2005 through 2024. The green color of the circles indicates that bacteria levels are low and that these sites are typically safe for swimming. However, runoff from a storm can carry pollutants including bacteria into the
bay, so public health officials recommend staying out
of the water for 72 hours following a storm.

Bay Bacteria Status
Very Good/Good
Fair
Poor
Very Poor
A Healthy and Active Estuary:

Monitoring Bay Use
In 2023, the Estuary Program began tracking recreational use at eight popular coastal-access sites on the bay. Cal Poly students and community volunteers conducted
surveys to track how much time visitors spent and the
main recreational activities they engaged in at each site.

This information can be used to estimate each site’s
economic value and to track how bay use changes over
time. When paired with water quality and site condition data, this information can indicate how people’s use
of the bay shifts with changing conditions and help us
prioritize restoration for popular access sites.

N
Morro Rock
Highway 1
Morro Bay
Sandspit
Los Osos
STATE OF THE BAY 2026 9 Page 15 of 81
Is the bay clean enough to support commercial shellfish farming? Yes, in active harvesting areas.

The tranquil waters of the Morro Bay estuary
support a thriving aquaculture industry. The
Morro Bay Oyster Company and Grassy Bar
Oyster Company provide Pacific oysters to restaurants
and grocery stores locally and beyond. Oysters spend
about 12 to 18 months in the waters of Morro Bay
before reaching market size. The California Department
of Public Health oversees testing to ensure shellfish
growing waters remain clean and safe.

The crosshatched portions of the map illustrate the
lease areas where shellfish farming could potentially
occur. Areas shown in green undergo ongoing water
quality testing for bacteria to determine if the waters are clean enough for shellfish harvesting. All active shellfish farming operations occur within these areas. Orange
areas indicate either historically poor water quality or insufficient data to assess conditions.

Active Growing Area
Inactive Growing Area
Bacteria (Fecal Coliform) Status
Shellfish Lease Status
Good
Poor
Morro Bay Shellfish Growing Areas
Sandspit
Los Osos
State Park Marina
Salt Marsh
Creeks Outlet
to the Bay
In Morro Bay, oysters are grown in mesh bags. If left undisturbed, oysters will grow in clumps. Traditionally, oyster farmers had to manually shake the bags to separate the shellfish. Instead of doing this by hand, oyster farmers in Morro Bay now use a clever method that lets the tides do this work. They string the oyster bags up on cables that are secured to posts anchored in the bottom of the bay. During low tides, the bags hang from the cables, but during high tides, floats on the bags rise and tip the oysters to the bottom of the bag. This periodic mixing of the oysters by the tides saves many hours of human labor.
10 Morro Bay National Estuary Program Page 16 of 81
Water Quality Data by Year
Shellfish Farming Research Partnerships
Our partners at Cal Poly are leading multiple research
efforts to support shellfish farming. Dr. Alexis Pasulka of the Biology Department works with the Estuary
Program and our volunteers to collect bay water
samples for phytoplankton identification and genetic
analysis. Dr. Pasulka’s research seeks to improve understanding of the factors driving harmful algal blooms to better predict the appearance of plankton species that
can impact shellfish farms.

Dr. Kevin Johnson of the Biology Department and
California Sea Grant is working to better understand
the presence of native Olympia oysters (Ostrea lurida)
in the bay. Once abundant, no Olympia oysters were
found during surveys in 2009. More recent surveys identified Olympia oysters throughout the bay, and research now focuses on where and when reproduction occurs. A
better understanding of their life cycle will guide restoration efforts to support recovery of this native species.

Year
Average concentration of fecal
coliform in water sample
14 12
10 8
6 4
2 0
2019 2020 2021 2022 2023 2024
Average Concentration of Bacteria for
One Oyster Farming Monitoring Site
The graph shows the average bacteria levels in the
water for each year at one of the monitoring sites shown on the oyster growing areas map. The bacteria levels
must remain below the regulatory threshold (represented by the red line) for the shellfish to be safe for consumption. Bacteria levels at this site, as well as all sites pictured on the map, have been consistently safe
over the last six years.

A student examines a water sample to identify the plankton it contains. Certain species produce biotoxins that can harm wildlife, including shellfish growing at local farms, and people.

A graduate student places tiles in the bay where larvae of different marine animals, including Olympia oysters, will attach and grow.

Photo courtesy of Kevin M. Johnson.

STATE OF THE BAY 2026 11 Page 17 of 81
Do the estuary and watershed support a healthy
population of steelhead?
No, the local steelhead population continues to be
threatened even with some habitat improvement.

The Morro Bay watershed is home to a unique species
called steelhead trout (Oncorhynchus mykiss). These
fish are born in freshwater streams like Chorro Creek.

Some of these fish spend their entire lives in the creek and are known as resident rainbow trout. Others,
known as steelhead, spend a few years in fresh water
and estuarine environments before journeying to the
ocean. Whether a fish becomes a steelhead trout or
remains a resident rainbow trout depends on genetic
and environmental factors.

Steelhead require healthy creeks, estuaries, and ocean
habitats throughout their life cycle. The Estuary Program works to protect creek habitat, water quantity, and water quality to benefit this threatened fish population.

There are many environmental variables that can affect
steelhead populations, like warming temperatures,
available habitat, and the amount of water in creeks.

The Estuary Program and our partners work to address
as many of these factors as we can, and reducing the
population of predators is one way we can help support
our watershed’s steelhead.

Protecting Native Steelhead
from Invasive Predators
Sacramento pikeminnow (Ptychlocheilus grandis) are
invasive fish that compete with the steelhead in our
watershed for habitat and food. Adult pikeminnow also
consume juvenile steelhead. In 2017, we began pikeminnow management efforts to remove them from our creeks to support steelhead recovery. Our early work
indicated that removing one pikeminnow can protect
around 150 to 200 juvenile steelhead annually.

The dots on the graph show the density of adult
pikeminnow (number of fish in a stretch of creek) at different Chorro Creek sites since our management efforts began in 2017. The solid line shows the decreasing
trend in adult pikeminnow density after several years
of suppression. The analysis indicates that with more
years of pikeminnow removal, it becomes increasingly
unlikely to find large pikeminnow at a site.

A juvenile steelhead trout swims along a creek bed in Los Osos Creek. Steelhead require clear, clean water to thrive.
0 20
40 60
1 2 3 4 5 6 7
Pikeminnow Management Year
Adult Pikeminnow Density
12 Morro Bay National Estuary Program Page 18 of 81
Tracking Steelhead Growth and Movement
We recently completed a steelhead tracking study over
two years of spawning seasons to monitor the growth
and movement of steelhead to support our understanding of how and when these fish migrate between our creeks, the estuary, and the ocean. This helps us
identify times of year when fish need enough water
flowing through creeks to migrate and when we should
avoid certain activities that might interfere with their movement.

A total of 1,225 steelhead trout were captured during
the study, and 870 were large enough to tag. Of the
201 tagged fish detected at the antennas, nearly 60%
were likely resident trout that would spend their
entire lifespan in the creeks. The remaining 81 were
fish that moved into the estuary to smolt (transition
from freshwater to saltwater habitat), a process that
occurred primarily between January and April. Most
of these smolts left the creeks and did not return,
while a handful moved back and forth between
Chorro Creek and the estuary.

This study provided fascinating new information, and
we hope to expand the effort to better understand how
steelhead utilize other freshwater tributaries like San Bernardo, Pennington, and Dairy Creeks.

The method used to track fish for the project is called markrecapture. Backpack electrofishers were used to temporarily stun and capture fish to be weighed and measured.

As tagged fish move through the creeks and into the estuary, we monitor their movements with stationary PIT-tag antennas in lower Chorro Creek. This special type of antenna stretches across the creek so that fish can easily swim over it. As fish pass by it, their unique identifiers are recorded. If tagged fish were recaptured during the study period, we weighed and measured them to track their growth.

During initial capture, steelhead of sufficient size were anesthetized, implanted with a Passive Integrated Transponder (PIT) tag, and returned to the creek. These tags are small microchips that uniquely identify each fish, similar to the microchips used for dogs and cats.

This illustration shows two forms of a steelhead trout as it prepares for life in the ocean in a process known as smolting. As the fish move from freshwater to saltwater habitats, they lose their speckled appearance and dark spots (above) and become more silver (below), a change that allows for better camouflage in the estuary and ocean. Illustrations by Catie Michel.

STATE OF THE BAY 2026 13 Page 19 of 81
Are the bay and creeks impacted by accelerated
sedimentation?
Yes. Analysis shows that large storm events can greatly alter and degrade creek habitat for sensitive species like steelhead. Sedimentation impacts are more complex in
the estuary, where sea level rise could outpace marsh
elevation increases, resulting in major shifts in habitat.

The movement of sediment is a naturally occurring process in a watershed like Morro Bay. Erosion of stream banks and nearby lands can benefit habitat diversity by creating gravel bars that support steelhead or by forming sandbars that plants can colonize. However, excess erosion from events like intense rainfall after wildfire can have negative impacts on habitat by degrading water quality, clogging stream beds, and smothering eelgrass in the bay.

The Estuary Program works with partners to manage
erosion and other causes of sedimentation that threaten the health of the creeks and estuary. Another factor
to consider with sediment is its relationship to shifts in sea level. Rising waters across the globe present an emerging challenge to tidal marsh habitats like those
in the Morro Bay estuary that are vulnerable to inundation. Although these areas increase in elevation as sediment from the watershed washes down Chorro
and Los Osos Creeks and settles there, rising seas will eventually outpace this natural process. If marsh areas are continually inundated with water, analysis indicates that the plant and animal communities present in the
marsh today will be replaced by plants and animals that can survive in mudflats by the end of the century. While both habitats have value, this would represent a loss of the estuary’s unique and fragile tidal marsh ecosystem.

To track marsh elevation changes over time, the U.S.

Geological Survey (USGS) monitors four sites in Morro
Bay. This map shows the increase in marsh elevation at
each site since 2013. Historical data indicates annual
increases averaging 1.59 mm in the high marsh and 1.98
mm in the low marsh, enough to keep pace with the current rates of sea level rise. But if the rates of rising waters increase as they are projected to do, areas like Morro
Bay’s marsh habitat will flood more often and could eventually transition to mudflats or open water. The Estuary Program is working with USGS to develop adaptation
strategies to reduce habitat loss and coastal flood risks.

Monitoring Elevation Change
in the Morro Bay Salt Marsh:
2013 to 2025
High marsh elevation increase: 19.26 mm
State Park Marina Low marsh elevation increase: 23.96 mm Salt Marsh
South Bay Boulevard
14 Morro Bay National Estuary Program Page 20 of 81
Over the past twenty years, the Estuary Program has
supported land acquisition, protection, restoration, and monitoring at the Chorro Creek Ecological Reserve at
the foot of Hollister Peak. The goals of our floodplain restoration efforts are to reduce sediment flowing to
the estuary, support water quality for fish and other
wildlife, and help recharge groundwater. During large
storms in 2021 and 2022, the site operated as designed
by trapping sediment and slowing the flow of water to
reduce flooding.

The next challenges came during the major storms of
2023. The largest storm that year was estimated to be a 100-year storm, meaning that a storm of that magnitude
has a 1% chance on average of occurring in any given
year. The area received nine inches of rain in the first three weeks of January. Water levels on Chorro Creek
reached nearly 23 feet on January 9, the highest level
recorded at this site since monitoring began in 1979.

Post-storm assessments of the site indicate that changes to channels in some restored areas could potentially
impede the passage of fish through the creek. The site
will require adaptive management to address areas
of erosion, improve site stability, and ensure effective sediment trapping and habitat quality.
2021 to 2024 Elevation Change (Feet)
< -3.0
-3.0 to -2.0
-2.0 to -1.0
-1.0 to -0
0 to 1.0

1.0 to 2.0

2.0 to 3.0
> 3.0
Monitoring Cross Sections
Elevation Control Point
Weathering the Storms: Chorro Creek Ecological Reserve
This aerial image of the Chorro Creek Ecological Reserve shows the creek channel and surrounding floodplain
overlaid with elevation changes measured since 2021.

The shades of orange and red denote areas where the
elevation dropped, primarily in the creek channel where it was eroded by heavy storm flows. The shades of blue
show where elevation increased. This was primarily in the floodplain areas where the flows spread out and slowed, leaving the sediment behind rather than carrying it down to the estuary. Figure courtesy of WRA, Inc.

STATE OF THE BAY 2026 15 Page 21 of 81
Tracking Morro Bay Shorebirds
To help track Morro Bay’s diverse shorebird population, Point Blue Conservation Science and the Morro Coast Audubon Society conduct annual surveys in
the estuary, on the sandspit, and on Morro Strand.

Volunteers venture out on foot and by kayak to designated survey areas where they can identify and count overwintering birds without disturbing them.

During the latest survey conducted in November 2024,
marbled godwits and willets were the most common bird found in the front bay, western sandpipers dominated the mid-bay, and least sandpipers were most
abundant in the back bay.

Since 2010, Morro Bay’s survey results have contributed to a broader study to monitor shorebird populations
across the Pacific Flyway from Chile to Canada. By monitoring shorebirds at their wintering areas in thirteen countries each year, these collaborative efforts generate species-level population trends for the Pacific Flyway
to guide research, monitoring, management, and conservation efforts.

Are bird populations that depend on the bay
and surrounding lands stable?
Yes, the diversity of birds in the Morro Bay area appears stable, but some types of birds face difficult conditions or are changing their behavior due to forces such as habitat loss.

The Morro Bay estuary and watershed provide a
variety of habitats that support a wide diversity of
bird species. Understanding the health of bird populations is a crucial tool for tracking environmental health. Across the country, a third of U.S. birds need
conservation action for protection, which safeguards
both habitats and the economy. About 100 million
Americans are birdwatchers, with bird-related
expenditures reaching approximately $100 billion
in 2022.

Morro Bay Shorebird Numbers from 2010 to 2024
Year
Number of Shorebirds
0 5000
10000
15000
2010 2012 2014 2016 2018 2020 2022 2024
After steadily declining for years,
Morro Bay shorebird abundance significantly increased in 2024. It is too early to tell whether this is a temporary change or an indication of recovery. Shorebirds from other areas
can become temporarily displaced
due to wildfire smoke, predators, and
human disturbance. The displaced
birds then contribute to short-term
population increases in nearby areas.

Future surveys will help determine if
this population increase is sustained
in Morro Bay and whether trends are
similar across the Pacific Flyway.
16 Morro Bay National Estuary Program Page 22 of 81
Monitoring Los Osos Bird Populations
To monitor land bird populations on State Parks
property near Los Osos Creek, the Monitoring Avian
Productivity and Survivorship (MAPS) program brings
together local volunteers and birding experts. The Los
Osos site, established nearly 20 years ago, is one of
approximately 300 active stations across North America
collecting valuable, long-term datasets.

The team sets up mist nets to safely catch birds. The birds are then identified, and the age class, sex, and breeding condition are recorded before birds are carefully banded and released. The team also gathers feathers for the
Bird Genoscape Project for genetic sequencing. Taken
together, this information helps scientists better understand migratory patterns and population connectivity.

Recent data from the Los Osos sites indicate that song
sparrows and Wilson’s warblers were the most abundant,
collectively making up over a third of the birds captured and released. Wilson’s warblers are unexpectedly successful at the Los Osos site, amidst the backdrop of a declining population throughout most of their range.

These results highlight the importance of the collaborative aspect of the MAPS project, which brings together partner organizations throughout North and South
America to better understand bird population dynamics
and prioritize the conservation of at-risk species.

A team of trained volunteers, students, and permitted bird banders gather each year to conduct surveys in Los Osos from May through August. Photo courtesy of Los Osos MAPS station participants.

Wilson’s warblers were found to be abundant at the Los Osos site.

Photo courtesy of Los Osos MAPS station participants.

Tree swallows are a relatively rare find at the Los Osos site. Photo courtesy of Los Osos MAPS station participants.

STATE OF THE BAY 2026 17 Page 23 of 81
Year
Number of Extreme Rainfall Events
0 2
4 6
8 1960 1980 2000 2020 2040 2060 2080 2100
Rainfall (inches)

6.3–9.5

9.5–12.6

12.6–15.8
How will extreme weather events likely affect
the Morro Bay watershed and estuary?
More severe storms, flooding, extended periods of drought, increased wildfire risk, and other extreme weather events could have major impacts on humans, wildlife, and habitats in the watershed and estuary.

Floods, drought, heat waves, torrential rains — extreme weather events are becoming increasingly common
around the globe. Changes in these types of weather
events are not predictable, with shifts expected in
the frequency and magnitude of the extremes. A year
with record rainfall can be followed by several years of drought. Studying as well as planning and developing adaptation strategies for these extreme events is crucial to improving resiliency. The Estuary Program
works with partners to improve understanding of these
potential changes and develop adaptations to protect
both human infrastructure and natural habitats.

Extreme Rainfall Events
Extreme precipitation events are expected to increase in frequency throughout the rest of the century. An extreme precipitation event is a four-day period with exceptionally high rainfall totals compared to historical data. The colors in the graph indicate the projected inches of rainfall per year for a four-day event, and the height of each bar indicates the number of extreme rainfall events per year in the Morro Bay area. 18 Morro Bay National Estuary Program Page 24 of 81
Local Impacts of Winter 2023
The winter of 2023 is still fresh in the minds of local residents. The graph below shows the water levels in
Chorro Creek at Canet Road, the site of a San Luis
Obispo County water level gauge. A bridge over the
creek provides access for residents living across the
creek from Highway 1. When waters reach twelve feet,
they hit the bottom of the bridge (represented by the
orange dotted line). During the winter of 2022 to 2023, there were several storms that caused creek flow to
overtop the bridge.

This series of photos shows changes in creek flows at
Chorro Creek in January 2023. Between January 5 and
January 10, the water level reached 23 feet, with the
bridge under about ten feet of water. In the photo on the right, debris from the severe storm can be seen piled up against the bridge. A total of 5.35 inches of rain fell on January 9, the highest rainfall since historic flooding in March 1995 when 6.77 inches of rainfall were recorded.

Water Level ()
0 3
6 9
12 15
18 21
24 Oct 2022
Nov 2022
Dec 2022
Jan 2023
Feb 2023
Mar 2023
Apr 2023
May 2023
Jun 2023
Jul 2023
Aug 2023
Sep 2023
Water Level in Chorro Creek in 2022 to 2023
Canet Gauge (Station 753)
Approx. Bottom of Channel (3.70 †)
Approx. Bottom of Bridge (12.1 †)
Chorro Creek at Canet Road in January 2023.

January 4th, 2023 January 5th, 2023 January 10th, 2023
STATE OF THE BAY 2026 19 Page 25 of 81
Safeguarding Infrastructure
With intense rainfall comes an increased risk of flooding.

Low-lying infrastructure and natural habitats can be vulnerable when waters rise. The storms of 2023 highlighted the vulnerability of transportation corridors in the watershed when the community of Los Osos was temporarily cut off due to flooded roads. These vital roadways are
central to community life, underscoring the need for the development of adaptations to protect them.

The San Luis Obispo Council of Governments (SLOCOG)
launched a program with funding from Caltrans to
develop solutions to improve car and bicycle transportation between Morro Bay and Los Osos and protect natural habitats. The project created an inventory of transportation infrastructure and habitats and developed a model to predict water movement and flow patterns. SLOCOG
will create a summary of coastal hazards and vulnerability assessments to better understand risks in this area.

This is the parking area at Windy Cove during an extreme high tide.

If sea levels rise to the higher end of the predicted range, portions of South Bay Boulevard and State Park Road near Windy Cove could face daily tidal flooding like this by 2060.

The Virtual Planet tool shows potential flood impacts. The top image shows State Park Road during current high tide conditions, while the bottom image shows the same area under 1.8 feet of sea level rise. Tools like this help visualize future impacts to infrastructure and habitats. 20 Morro Bay National Estuary Program Page 26 of 81
Nature-Based Solutions to Reduce Flooding
The Coastal San Luis Resource Conservation District
(CSLRCD) leads another effort to address flooding.

This organization owns the Chorro Flats area, the
floodplain adjacent to lower Chorro Creek (pictured
on the right) that flooded during the January storms.

The floodplain, which was restored in 1997, is thought
to be close to its capacity for retaining sediment and
reducing flooding. The CSLRCD is looking at naturebased solutions to increase floodplain capacity, including land acquisition and floodplain restoration.

Protecting Habitats for the Future
The 400-acre tidal marsh where Los Osos and Chorro
Creeks enter the estuary provides a unique habitat for
wildlife and plants adapted to saltwater inundation
from incoming tides. Rising sea levels and coastal
flooding threaten this area as higher water levels may
drown marsh plants and reduce the habitat available for wildlife. The Estuary Program has partnered with USGS
to develop strategies to help preserve the marsh and
transition habitats for the wildlife that live there. This work involves using sediment and water-level monitoring data to model how water might move across the estuary with the tides as sea levels rise over time. The work helps identify potential ways to reduce damage
to fragile ecosystems, such as providing upland space
where the marsh could expand or adding sediment to
raise marsh elevation.

View of lower Chorro Creek and Chorro Flats from Black Hill.

USGS staff use surface elevation tables to measure
elevation changes of the
marsh surface. In general, the
salt marsh is gaining in elevation as sediment is deposited from Chorro and Los Osos
Creeks. But if the rate of sea
level rise accelerates in the
future, this sensitive marsh
habitat may eventually transition into mudflats.

STATE OF THE BAY 2026 21 Page 27 of 81
Are important natural areas being protected, enhanced,
and restored?
Yes, more than 5,400 acres have been protected, and thirtyeight projects have been completed to improve natural areas and water quality.

The Estuary Program works with many partners to protect, restore, and enhance habitat in the Morro Bay estuary and the lands that
surround it. These efforts support open space, healthy
habitats, clean water, and resilient lands for people
and for wildlife.

This map shows the lands that are conserved and protected through public ownership, easements, and private preserves. The map also illustrates the locations of projects such as floodplain restoration, invasive plant removal, and stormwater management infrastructure.

Morro Bay Watershed Habitat Protected, Enhanced, and Restored Chorro Creek
Ecological Reserve
Los Padres
National Forest
Camp San Luis Obispo
Cuesta College
Public-owned
and Managed
Open Space
Easements
and private
preserves
Watershed
Boundary
Creeks
Watershed
improvement
projects along
streams
Watershed
improvement
projects
Major roads
22 Morro Bay National Estuary Program Page 28 of 81
Projects to Protect Habitats
Training the Next Generation of Land Stewards
Grasslands require active management to protect sensitive species and restore native habitat. Livestock grazing reduces the presence of invasive non-native plants and
manages the fuel that can feed wildfires.

The Estuary Program recently provided funding for
water infrastructure to help establish Cuesta College’s Ranch Education Program on their 75-acre grassland
property. This new program supports workforce development for sustainable ranch management practices and improves grassland habitat through livestock grazing. Each semester around thirty students are trained in hands-on agricultural skills, including sustainable
grazing practices and methods to maintain and monitor
ranch lands. This work enhances the health and fire
resilience of grassland habitat in our watershed.

Studying the Past to Create a Better Future
Understanding landscape conditions before major
changes from Euro-American development provides
valuable information for management and restoration
efforts in our watershed. The Estuary Program has
embarked on a three-year historical ecology study that
involves collecting archival data such as photos, maps, and journals, compiling the information, and synthesizing it to create maps of historical habitat conditions. This effort documents information like the paths that waterways originally took, the types of plants and animals present, and Indigenous land management practices.

The project creates a habitat map of conditions in the
late 18th through mid-19th centuries and a report
describing landscape processes and ecological functions.

Rather than attempting to recreate the past, the ultimate goal is to use this knowledge to inform sustainable land management and restoration.

Protecting Dunes Through Invasive Plant Management
Iceplant, while a common sight on our coast, is not
native to the Morro Bay watershed. Originally introduced in California in the early 1900s to stabilize soil along roads and railroad tracks, it quickly spread.

Iceplant crowds out native plants and reduces dune
resilience against storms and erosion. It also threatens local rare and federally listed species like California seablite and Western snowy plovers.

In partnership with the Coastal San Luis Resource
Conservation District, California State Parks, University of California at Santa Barbara, California Dune Science Network, California Conservation Corps, and others,
the Estuary Program has supported iceplant management and monitoring efforts on the dunes for the past three years. The effort improved more than 160 acres of dune habitat previously dominated by iceplant.

Cuesta College’s newly established Ranch Education Program is helping to train the next generation of ranchers in sustainable land management practices. Photo courtesy of Shelly Ingram.

This USGS topographic map from 1900 shows the bay entrance when Morro Rock was an island, prior to construction of the causeway that connected it to the shoreline. This is an example of the type of material gathered to understand historical conditions in the Morro Bay area.

STATE OF THE BAY 2026 23 Page 29 of 81
Data Notes
The data used in this report is the cumulative work of many organizations. The data is informational and not intended to be used for regulatory or decision-making activities. While every effort has been made to ensure accuracy, the Estuary Program and its partners assume no responsibility for errors and omissions, even if advised of the possibility of such damage.

Is water in the creeks and bay clean enough
for fish and aquatic life?
The analysis for nitrates and bay oxygen utilized the Central Coast Regional Water Quality Control Board (Water Board) scoring method outlined in the California Central Coast Healthy Watersheds Project – Part 1, Report Cards for Scoring Water Quality Data to Characterize Health and Change. The analysis looked at all available data. The trend was determined by assessing data before and after January 1, 2014 for comparison.

The nitrate indicator symbol was calculated for levels on lower Chorro Creek. For the creek health scores, the California Stream Condition Index was utilized, and scores for individual sites were averaged to represent conditions on each creek segment.

Does Morro Bay support healthy eelgrass beds?
The eelgrass maps from 2007 and 2017 were created using multi-spectral imagery collected in the fall and an automated classification scheme. The map for 2023 was created using drone imagery and sonar data collected in the spring and an enhanced classification scheme. All three maps were ground-truthed by Estuary Program staff. The 2019 baywide topobathy lidar survey and 2022 lidar survey were conducted in partnership with NOAA’s Office of Coastal Management. Analysis of the elevation changes in conjunction with eelgrass loss was conducted by Dr.

Ryan Walter of Cal Poly. The results from the baywide fish studies utilize data collected by Occidental College, Cal Poly/Sea Grant, and the Estuary Program. The bars in the graph represent two particular species caught as a percent of total fish captured in that habitat type.

Is Morro Bay safe for swimming?
The map includes enterococcus data collected and analyzed by Estuary Program volunteers from 2005 through 2024 using the IDEXX method. The scoring, status, and trends were based on the Water Board’s method (see water quality section above for reference). The trend was determined by assessing data before and after January 1, 2014 for comparison. The recreational use monitoring effort follows methods developed by the EPA’s Office of Research and Development. Data collected during four-hour continuous surveys aids in the development of visitation curves, from which daily visitation can be extrapolated by counting the number of parked cars at each site.

Is the bay clean enough to support commercial
shellfish farming?
Data and updates to the lease areas in the map were provided by the CA Department of Public Health. The bacteria data from 2019 through 2024 were analyzed for the geometric mean of the fecal coliform concentration.

Do the estuary and watershed support a healthy
population of steelhead?
Fisheries data collection and pikeminnow suppression efforts were conducted by Stillwater Sciences from 2017 to 2023 along Chorro Creek. The dots on the graph indicate the density of pikeminnow longer than 70 mm in segments of Chorro Creek where suppression efforts have been conducted annually since 2017 and does not reflect all data collected. The solid line indicates the overall trend in fish size. Stillwater Sciences developed the study protocol and conducted the steelhead growth study on Chorro and San Luisito Creeks from 2022 through 2024.

Are the bay and creeks impacted by accelerated
sedimentation?
The sediment elevation table data were collected and analyzed by the U.S. Geological Survey from 2013 to 2025. Analysis of storm impacts on Chorro Creek Ecological Reserve were conducted by WRA, Inc. The map uses the NAVD 88 vertical datum.

Are bird populations that depend on the bay
and surrounding lands stable?
National bird conservation statistics come from the North American Bird Conservation Initiative’s (NABCI) 2025 State of the Birds Report. Morro Bay shorebird surveys follow methods outlined in Reiter et al. 2020. The shorebird abundance graph uses survey results provided by Point Blue Conservation Science.

In this graph, no bar is present for 2012 because a survey was not conducted that year. Los Osos bird population data and trends were provided by the Powell II Monitoring Avian Productivity and Survivorship (MAPS) Station. Bird banding at the Los Osos station is conducted in collaboration with the Institute for Bird Populations, California Central Coast Joint Venture, and is facilitated by the California State Parks San Luis Obispo Coast District.

How will extreme weather events likely affect
the Morro Bay watershed and estuary?
The extreme rainfall projections come from Cal-Adapt. Results were projected for the future using the HadGEM2-ES model (warmer/drier) and the RCP 8.5 emission scenario (assumes emissions rise strongly until 2050 and plateau around 2100).

The graph of water levels in Chorro Creek is from SLO County Public Works’ Department web portal at https://wr.slocountywater.org/. Information on the SLOCOG project is available on their website. Sea level rise projections at Windy Cove are from Virtual Planet Technologies LLC.

Are important natural areas being protected,
enhanced, and restored?
The map includes publicly and privately protected lands and areas where restoration and conservation projects have occurred.

The map includes projects by partners such as California State Parks, Coastal San Luis Resource Conservation District, The Land Conservancy of San Luis Obispo County, San Luis Obispo County, Morro Coast Audubon Society, and many others.

Maps in this report were created using ArcGIS Pro software.

ArcGIS Pro is a trademark of Esri and is used by the Estuary Program under a maintained license. Base map and service layer data for maps throughout this report were provided by San Luis Obispo County, Bureau of Land Management, Esri, HERE, Garmin, GeoTechnologies Inc., USGS, METI/NASA, NGA, EPA, USDA, and Maxar.

For more details on these data sources, please visit our website at library.MBNEP.org
24 Morro Bay National Estuary Program Page 30 of 81
An Estuary Program volunteer collecting bay water quality data. Estuary Program volunteers monitoring flow on Chorro Creek.

This project has been funded wholly or in part by the United States Environmental Protection Agency under assistance agreements CE-98T25101 and 4T-98T47301 to the Bay Foundation of Morro Bay. The contents of this document do not necessarily reflect the views and policies of the Environmental Protection Agency, nor does the EPA endorse trade names or recommend the use of commercial products mentioned in this document.

What can you do to help Morro Bay?
Develop Bay-Friendly Habits
Even small actions can make a difference. Here are
some things you can do to help protect the bay and
the lands that surround it.

PICK IT UP. Cleaning up pet waste helps keep harmful
bacteria out of the bay and creeks, protecting the waters for people and wildlife.

MANAGE THAT TRASH. Put trash in the right receptacle
so it doesn’t end up in the bay where it can harm wildlife.

WATCH WHAT GOES DOWN THE DRAIN. Stormdrains
direct runoff into the nearest waterway, whether that’s a creek or the bay. Help keep chemicals, trash, and yard waste out of drains.

BE A RESPONSIBLE BOATER. Make sure that your boat’s
waste-holding tank is free of leaks and always dispose
of your waste properly on shore.

Help Keep Morro Bay Healthy
There are many ways you can support the Estuary
Program’s work to help keep Morro Bay clean and
healthy.

VOLUNTEER with us and our partners to support monitoring, restoration, education, and research efforts.

MBNEP.org/volunteer
LEARN more about this special place and how to help
protect it by subscribing to our blog. MBNEP.org/blog
DONATE to support our program’s work. Every donation,
no matter the size, helps. MBNEP.org/donate
STATE OF THE BAY 2026 25 Page 31 of 81
Morro Bay National Estuary Program
601 Embarcadero, Suite 11
Morro Bay, CA 93442
MBNEP.org For the online version of
this report and additional
information, visit this link.

1 MINUTES - MORRO BAY CITY COUNCIL

REGULAR MEETING
August 11, 2026, 5:30 p.m.

Veterans Memorial Hall
209 Surf St., Morro Bay, CA
Members Present: Mayor Carla Wixom
Council Member Jeff Eckles
Council Member Cyndee Edwards
Council Member Zara Landrum
Council Member Bill Luffee
Staff Present: City Manager John Craig
Assistant City Attorney Robert Schultz
City Clerk Dana Swanson
Public Works Director David LaCaro
Community Development Director Airlin Singewald
Police Chief Amy Watkins
Harbor Director Chris Munson
Utilities Division Manager Damaris Hanson
Maintenance Division Manager Carlos Mendoza
_____________________________________________________________________

1. ESTABLISH QUORUM AND CALL TO ORDER
Mayor Wixom called the meeting to order at 5:31 p.m. with all members present.

Council Member Edwards announced she was participating remotely under SB 707 "just cause" provisions due to a medical condition and that no other adults were present in the remote location.

2. PLEDGE OF ALLEGIANCE

3. REPORTS

3.a Closed Session Report
No closed session meeting was held since the last Regular Meeting.

3.b Mayor and Councilmembers' Reports, Announcements and Presentations

3.c City Manager Reports, Announcements and Presentations

3.d Subcommittee Reports - Verbal Update of Current Subcommittee Activities

1. Water Reclamation Facility & Morro Bay / Cayucos Sanitary District JPA

2. Morro Bay Power Plant (Vistra)

2 3. Morro Elementary School

4. RECOGNITION AND PRESENTATIONS

5. PUBLIC COMMENT
 Karen Hammon, Morro Bay, suggested the City offer a sewer lateral repair rebate program to offset the increasing cost for homeowners to replace Orangeburg sewer lines.
 Jeff Heller, Morro Bay, appreciated the Mayor and Council for stepping up to serve in public office.
 Linda Winters, Morro Bay, commented on recently attended events and welcomed new Public Works Director LaCaro.
 Sydney Ramos, Morro Bay, expressed concern about automated license plate reader (ALPR) cameras and asked that Council not renew the current contract.  Sean Green, Morro Bay, commented on lease terms provided in Items 6.b and

6.c. Regarding Item 8.a, he opposed the permanent use of porta potties.  Michelle Howard-Leicester, Morro Bay, urged Morro Bay to join other cities in cancelling its ALPR contract.
 Nicole Dorfman, Morro Bay, echoed resident concerns about ALPR cameras, requested an update on massage ordinance implementation and, on behalf of REACT Alliance, announced a 3rd offshore wind leaseholder pulled out of the Humbolt area.
 Margaret Carman, Morro Bay, agreed with previous speakers' concerns regarding use of ALPRs, thanked Council for consideration of a letter opposing the proposed MPAs, and asked if construction costs for City Hall Annex repairs were covered by insurance.
 Betty Winholtz, Morro Bay, announced she is running against Marilyn Roger for Trustee Area 1 on the School District Board.
 Dawn Beattie, Morro Bay, looked forward to working with the Public Works Director regarding maintenance of Cloisters' pond and culverts and hoped to resume quarterly meetings with the City.
 Alphonsus Rawson offered suggestions to improve the city and agreed with previous comments regarding ALPRs, adding his belief some have been unable to shut off the cameras despite canceling contracts.

End of public comment.

6. CONSENT AGENDA
Unless an item is pulled for separate action by the City Council, the following actions are approved without discussion. The public will also be provided an opportunity to comment on consent agenda items.
 Betty Winholtz, Morro Bay, appreciated Mr. Green's comments on Items 6.b &

6.c, adding her concern about extending leases to a 50-year term.

3 End of public comment.

Staff commented on Item 6.f noting, in addition to the alternatives provided in the staff report, the Council may choose to leave the PWAB member position vacant for the brief duration of the current term. Regarding Item 6.d, City Manager Craig requested the resolution language be amended to authorize the City Manager or his designee to execute documents related to the grant application.

Mayor Wixom pulled Items 6.e & 6.f. Council Member Landrum pulled Item 6.d.

Motion by Council Member Landrum
Seconded by Council Member Eckles
Approve Consent Agenda Items 6.a through 6.c as submitted.

Ayes (5): Mayor Wixom, Council Member Eckles, Council Member Edwards, Council Member Landrum, and Council Member Luffee
CARRIED (5 to 0)

6.a Approval of Minutes
Approve as submitted.

1. July 28, 2026 - Regular Council Meeting

2. July 28, 2026 - Special Closed Session Meeting

6.b Adoption of Resolution No. 43-26 Approving a New Lease Agreement with Bayside Landing, Inc. Lease Sites 49-52/49W-52W, Located at 431, 451 and 495 Embarcadero
Adopt Resolution No. 43-26, approving a 40-year Master Lease Agreement with Bayside Landing, Inc., (Paul Gillen) for Lease Sites 49-52/49W-52W.

6.c Adoption of Resolution No. 44-26 approving a Lease Amendment between the City of Morro Bay and THMT, Inc. for Lease Site 122-123/122W-123W located at 1205 Embarcadero (Harbor Hut Restaurant)
Adopt Resolution No. 44-26 approving lease amendment for Lease Site 122- 123/122W-123W (Harbor Hut) located at 1205 Embarcadero.

6.d Adoption of Resolution No. 45-26 authorizing application and acceptance for California's Department of Resources Recycling and Recovery (CalRecycle) Grants for Beverage Container Recycling Grant (BCRG) City Manager Craig requested resolution be changed to authorize City Manager or designee, rather than Public Works Director, to submit and accept the grant application.

Motion by Council Member Landrum
Seconded by Council Member Luffee
Staff recommends the City Council adopt Resolution No. 45-26 authorizing the City Manager or his designee to:

4 1. Submit the application and accept and administer any grant award to CalRecycle for any and all CalRecycle Beverage Container Recycling Grant (BCRG) Program grants;

2. To act as the City’s representative in administration of the grant, including but not limited to, applications, agreements, and amendments that are necessary to implement and secure payment of CalRecycle grants to the City; if the application is successful.

Ayes (5): Mayor Wixom, Council Member Eckles, Council Member Edwards, Council Member Landrum, and Council Member Luffee
CARRIED (5 to 0)

6.e Authorization for the Mayor to Execute and Submit a Letter of Opposition to the California Department of Fish and Wildlife and California Fish and Game Commission Regarding Marine Protected Area Petitions 2023- 19MPA, 2023-20MPA, and 2023-29MPA
Mayor Wixom pulled the item for brief Council comments and encouraged those with strong feelings on this issue to submit written correspondence.

Motion by Mayor Wixom
Seconded by Council Member Luffee
Staff recommends the City Council authorize the Mayor to execute and transmit, on behalf of the City Council, a letter of opposition to the California Department of Fish and Wildlife (CDFW) and the California Fish and Game Commission (CFGC) regarding Marine Protected Area (MPA) petitions 2023-19MPA (Chitqawi SMCA), 2023-20MPA (Point Buchon SMCA and SMR), and 2023-29MPA (Mishopshno SMCA), requesting denial of petition 2023-19MPA and deferral of petitions 2023-20MPA and 2023-29MPA pending meaningful consultation with the City of Morro Bay and local fishing community stakeholders.

Ayes (5): Mayor Wixom, Council Member Eckles, Council Member Edwards, Council Member Landrum, and Council Member Luffee
CARRIED (5 to 0)

6.f Accept Withdrawal of Public Works Advisory Board Appointee, Lyn Wickham, and Confirm Appointment of Michael Lucas to fill the Unscheduled Vacancy
Following brief discussion, there was concurrence to leave the position open until the annual recruitment, rather than bring someone up to speed for that short period of time.

Motion by Mayor Wixom
Seconded by Council Member Eckles
Accept the withdrawal of Public Works Advisory Board Appointee, Lyn Wickham, due to an unforeseen medical condition, and keep the seat open until the next round of recruitments.

5 Ayes (5): Mayor Wixom, Council Member Eckles, Council Member Edwards, Council Member Landrum, and Council Member Luffee
CARRIED (5 to 0)

7. PUBLIC HEARING ITEMS

8. BUSINESS ITEMS
The Council took a brief recess at 7:00 p.m. and reconvened at 7:10 p.m.

8.a Morro Bay City Park - Discussion of Current Conditions, Community Input, and Direction to Staff Regarding Near-Term Improvements and a Process for Future Planning
City Manager Craig introduced the item and turned to Council Member Eckles to present his report.

Staff responded to Council questions.

Mayor Wixom opened public comment.
 Betty Winholtz, Chairperson of the Recreation & Parks Commission, hoped the Council would refer the item to the Commission for discussion at its September meeting so they can make recommendations to PWAB and City Council.
 Nicole Dorfman, Morro Bay, suggested reimagining the space and making a small portion of the park a beautiful garden that's easy to maintain, then some of the rest could be re-zoned for housing.  Linda Winters, Morro Bay, agreed with the need for improved lighting and welcomed guidance on how she can better help those using the park to contribute in a positive way.
 Margaret Carman, Morro Bay, was supportive of additional lighting with an awareness of how the lighting would affect neighbors.

End of public comment.

Following Council discussion, with an overarching goal of "clean, safe and open", there was concurrence on the following next steps:
 Short-term items to be completed by staff include improved lighting, new signage (no smoking), working with local grocers to manage shopping carts, and enhanced visibility of law enforcement.
 Longer-term items include separate review by the Recreation & Parks Commission and Public Works Advisory Board to evaluate options, receive community input and make recommendations on restroom reopening, programming activities and overall park use, cameras, banners and trees.

No formal action was taken by the Council.

9. COUNCIL DECLARATION OF FUTURE AGENDA ITEMS

6 Council Member Landrum requested Harbor Advisory Board input regarding fueling options on the waterfront.

Council Member Landrum requested a more in-depth conversation of ALPR cameras.

Council Member Landrum requested but did not receive majority support for discussion of traffic control on the Embarcadero during busy weekends. The circulation plan is being reviewed as part of the Waterfront Master Plan Update.

Council Member Landrum suggested forming a steering committee to make recommendations on future use and redevelopment of the former wastewater treatment plant property, including hospitality, developers, RV people, landscape architects, etc. to advise on the project. A majority of Council supported the request if the committee is formed after the Waterfront Master Plan is complete.

10. ADJOURNMENT
The meeting adjourned at 8:49 p.m.

Respectfully submitted,
/s/ Dana Swanson, City Clerk

1 MINUTES - MORRO BAY CITY COUNCIL

SPECIAL MEETING OF CITY COUNCIL
August 19, 2026, 5:00 p.m.

Veterans Memorial Hall
209 Surf St., Morro Bay, CA
Members Present: Mayor Carla Wixom
Council Member Jeff Eckles
Council Member Cyndee Edwards
Council Member Zara Landrum
Council Member Bill Luffee
Staff Present: City Manager John Craig
City Attorney Brian Stack
Deputy Clerk Heather Goodwin
_____________________________________________________________________

1. ESTABLISH QUORUM AND CALL TO ORDER
Mayor Wixom called the meeting to order at 5:00 pm, with all members present.

Council Member Edwards announced she was participating remotely under SB 707 "just cause" provisions due to a medical condition and that no other adults were present in the remote location.

2. PUBLIC COMMENT FOR ITEMS ON THE AGENDA
Linda Winters, Morro Bay, spoke in support of holding an election and stated that registered voters should have the opportunity to choose their representatives.

Mike Gerson, Morro Bay, a candidate for City Council, expressed appreciation for being considered for appointment and stated his support for protecting the political process and holding the November 3 election.

Margaret Carman, Morro Bay, expressed support for holding the November election, stating that it would give residents an opportunity to review the candidates’ positions on the issues. She stated that the cost of holding an election was worthwhile and expressed a preference for paper ballots.

Betsy Gaudette-Cross, Morro Bay, expressed support for holding an election and stated that residents' voices should be heard. She noted that an election would provide an opportunity for residents to learn more about the candidates and their positions.

Michelle Howard-Leicester, Morro Bay, stated that, as an immigrant to the United States, she understood the importance of elections and the right to vote. She expressed support for holding the November election.

2 Betty Winholtz, Morro Bay, emphasized the importance of ensuring that young and new voters understand that this is an election and that City Council Members are elected rather than self-appointed. She noted that this sets an important example for future and new voters.

June Swall, Morro Bay, expressed support for holding the November election and stated that circumstances could change between an appointment and the election, making it important to keep the election process open and allow citizens to vote.

End of public comment.

3. SPECIAL MEETING AGENDA ITEM(S)

3.a Consideration of Cancellation of the November 3, 2026 General Municipal Election
City Manager Craig presented the report and responded to Council inquires.

Motion by Council Member Eckles
Seconded by Council Member Landrum
Not approve Resolution No. 46-26 providing for the appointment of nominated candidates to the offices of the city that were to be elected on Tuesday, November 3, 2026, in lieu of holding the election.

Ayes (5): Mayor Wixom, Council Member Eckles, Council Member Edwards, Council Member Landrum, and Council Member Luffee
CARRIED (5 to 0)

4. ADJOURNMENT
The meeting adjourned at 5:25 pm
Respectfully submitted,
/s/ Heather Goodwin, Deputy City Clerk

1 MINUTES - MORRO BAY CITY COUNCIL

CLOSED SESSION MEETING
August 25, 2026, 3:00 p.m.

City Hall Conference Room
595 Harbor Street, Morro Bay, CA
Members Present: Mayor Carla Wixom
Council Member Jeff Eckles
Council Member Cyndee Edwards
Council Member Zara Landrum
Council Member Bill Luffee
Staff Present: City Manager John Craig
City Attorney Brian Stack
_____________________________________________________________________

1. ESTABLISH QUORUM AND CALL TO ORDER
Mayor Wixom called the meeting to order at 3:00 p.m. with all members present.

Council Member Edwards announced she was participating remotely under SB 707 "just cause" provisions due to a medical condition and that no other adults were present in the remote location.

2. CLOSED SESSION PUBLIC COMMENT
Mayor Wixom opened public comment for items on the agenda; seeing none, the public comment period was closed.

3. SUMMARY OF CLOSED SESSION ITEMS

4. THE COUNCIL WILL CONVENE IN CLOSED SESSION

4.a CONFERENCE WITH REAL PROPERTY NEGOTIATOR - GOVERNMENT CODE SECTION 54956.8
Property: 1700 Embarcadero, Morro Dunes RV Park
Property Negotiators: Kathy Claasen, Morro Dunes Trailer Park & Campgrounds, Inc.

Agency Negotiators: John Craig, City Manager; Brian Stack, City Attorney Negotiations: Price and Terms of Payment

4.b CONFERENCE WITH LEGAL COUNSEL - POTENTIAL LITIGATION Significant exposure to litigation pursuant to Government Code Section 54956.9(d)(2): (one potential case)

2 4.c PUBLIC EMPLOYEE PERFORMANCE EVALUATION
Conduct an employee evaluation of the City Manager pursuant to Government Code Section 54957.

5. RECONVENE IN OPEN SESSION
The City Council reconvened in Open Session. The Council did not take any reportable action in accordance with the Brown Act.

6. ADJOURNMENT
The meeting adjourned at 5:29 p.m.

Respectfully submitted,
/s/ Dana Swanson, City Clerk

1 MINUTES - MORRO BAY CITY COUNCIL

REGULAR MEETING
August 25, 2026, 5:30 p.m.

Veterans Memorial Hall
209 Surf St., Morro Bay, CA
Members Present: Mayor Carla Wixom
Council Member Jeff Eckles
Council Member Cyndee Edwards
Council Member Zara Landrum
Council Member Bill Luffee
Staff Present: City Manager John Craig
City Attorney Brian Stack
City Clerk Dana Swanson
Finance Director Emily Conrad
Public Works Director David LaCaro
Community Development Director Airlin Singewald
Police Chief Amy Watkins
Fire Chief Dan McCrain
Harbor Director Chris Munson
Utilities Division Manager Damaris Hanson
Michael Codron, EMBC Planning Strategies
Utilities Project Manager Matt Evers
_____________________________________________________________________

1. ESTABLISH QUORUM AND CALL TO ORDER
Mayor Wixom called the meeting to order at 5:40 p.m. with all members present.

Council Member Edwards announced she was participating remotely under SB 707 "just cause" provisions due to a medical condition that prevents her from participating in person.

2. PLEDGE OF ALLEGIANCE

3. REPORTS

3.a Closed Session Report
City Attorney Stack announced the Council met in closed session to discuss three items: (1) real property negotiations matter regarding Morro Dunes RV Park located at 1700 Embarcadero, (1) potential litigation matter, and (1) Public Employee Performance Evaluation regarding the City Manager. No reportable action was taken under the Brown Act on any item.

3.b Mayor and Councilmembers' Reports, Announcements and Presentations

2 3.c City Manager Reports, Announcements and Presentations

3.d Subcommittee Reports - Verbal Update of Current Subcommittee Activities None

1. Water Reclamation Facility & Morro Bay / Cayucos Sanitary District JPA

2. Morro Bay Power Plant (Vistra)

3. Morro Elementary School

4. RECOGNITION AND PRESENTATIONS

4.a Hunger Action Month Proclamation
Presented to Savannah Colevans, SLO Food Bank Director of Community Engagement.

5. PUBLIC COMMENT
 Sugar Cliff, Grandma's Mercantile on Main, spoke favorably about the Saturday Downtown Farmers' Market and hoped no changes would be considered.  Linda Winters, Morro Bay, commented on Monday Night Dinners and recently attended meetings and events.
 Lynda Merrill, Morro Bay, spoke in support of purchasing Morro Elementary School and advocated for the continued free use of the Community Center Studio by the Friday Life Drawing group.
 Camille Watkin, Morro Bay, asked if the City would consider lowering the flag in honor of Dolly Parton.
 Sydney Ramos, Morro Bay, urged the City to agendize discussion and take a stand against a nationwide video surveillance system.
 Linda Donnelly, Morro Bay, shared her recent experience at the Rock and Coleman Park bathrooms and thanked the Maintenance worker who attended to restroom supply needs on a Sunday evening.
 Betty Winholtz, Recreation & Parks Commission Chair, shared a portion of an email from a Cambria representative congratulating the Recreation Division on a successful flag football season and championship weekend.  Marlene Owens, Morro Bay, encouraged the City to move forward with the purchase of Morro Elementary in honor of Lila Keiser and her dedication to providing safe playgrounds and ball fields.
 Margaret Carman, Morro Bay, advocated for a full-time children's librarian and restored library operating hours.
 Layla Fabans commented in support of the City's purchase of Morro Elementary.

End of public comment.

6. CONSENT AGENDA

3 Unless an item is pulled for separate action by the City Council, the following actions are approved without discussion. The public will also be provided an opportunity to comment on consent agenda items.
 Betty Winholtz, Morro Bay, commented on Item 6.e, seeking clarification regarding hydrogeological investigations. Regarding Items 6.b and 6.f, she asked when to expect clarification regarding board communications to the Council.

Regarding Item 6.d, she asked that the reserve policy discussion be part of the conversation regarding the purchase of Morro Elementary.

End of public comment.

Council Member Landrum pulled Items 6.b, 6.c and 6.f.

Motion by Council Member Eckles
Seconded by Council Member Luffee
Approve Consent Agenda Items except 6.b, 6.c and 6.f as submitted.

Ayes (5): Mayor Wixom, Council Member Eckles, Council Member Edwards, Council Member Landrum, and Council Member Luffee
CARRIED (5 to 0)

6.a Approval of Proclamations
Approve as submitted.

1. Proclamation declaring September 2026 to be "Hunger Action Month"

6.b Water Reclamation Facility Project WRF Quarterly Report Public Works staff responded to Council questions.

Motion by Council Member Landrum
Seconded by Council Member Luffee
Receive and file the Fiscal Year (FY) 2026 Quarterly Report for April – June for the Water Reclamation Facility Program (WRF Program).

Ayes (5): Mayor Wixom, Council Member Eckles, Council Member Edwards, Council Member Landrum, and Council Member Luffee
CARRIED (5 to 0)

6.c Designation of Voting Delegate and Alternate at League of California Cities 2026 Annual Conference Business Meeting and provide direction as necessary
Motion by Council Member Luffee
Seconded by Council Member Landrum
Appoint Mayor Wixom as the City's voting delegate at the League of California Cities Annual Conference with Council Member Landrum and City Manager Craig as alternates.

4 Ayes (5): Mayor Wixom, Council Member Eckles, Council Member Edwards, Council Member Landrum, and Council Member Luffee
CARRIED (5 to 0)

6.d Quarterly Update on the Status on City Council 2025-2027 Goals Receive an update from staff on the City’s progress on City goals established in March 2025.

6.e Easement Agreement and Deed Between Morro Bay Power Company LLC and the City of Morro Bay for the Recycled Water Facilities Infrastructure

1. Approve the easement agreement and deed (Agreement) between Morro Bay Power Company LLC and the City of Morro Bay necessary for the implementation of the Recycled Water Project, in substantially the form attached, subject to review and approval by the City Attorney as to form and legal effect.

2. Authorize the City Manager to execute the Agreement and related documents and make any non-substantive amendments consistent with the terms approved by Council, subject to review and approval by the City Attorney as to form and legal effect.

6.f GSI Extraction Well Project Agreement Amendment No. 1 Public Works staff responded to Council inquiries.

Motion by Council Member Landrum
Seconded by Council Member Luffee
Authorize the City Manager to execute Amendment No. 1 with GSI Water Solutions (GSI) to extend the term of the agreement and increase contract budget in the amount of $53,188.00 for additional hydrogeologic support services on the Morro Basin Wellfield Rehabilitation Project.

Ayes (5): Mayor Wixom, Council Member Eckles, Council Member Edwards, Council Member Landrum, and Council Member Luffee
CARRIED (5 to 0)

7. PUBLIC HEARING ITEMS
None.

8. BUSINESS ITEMS

8.a Acceptance of the Morro Elementary School Site Due Diligence Report; Determination Regarding the City's Intent to Purchase the Property; and Direction to Staff Regarding Close of Escrow
City Manager Craig and Due Diligence Manager Michael Codron, EMBC Planning Strategies, presented the report.

5 The Council took a brief recess at 6:58 p.m. and reconvened at 7:09 p.m. with all members present.

City Manager Craig relayed his communications with the San Luis Coastal Unified School District regarding deal points for short-term financing of the property purchase.

Mayor Wixom opened public comment for Item 8.a.
 Tina Wener, Morro Bay, looked forward to more details about financing and development options.
 Barry Branin, Morro Bay, spoke in support of the purchase noting it could be paid for with proceeds from the sale of other city-owned properties.  Pat Mangione, Morro Bay, commented on need to fund street repair and other projects, opposed moving the library, supported the preservation of historic buildings and hoped plans would include revenue generating ideas.
 Tim Crowley, Morro Bay, had fond memories of Morro Elementary but was concerned about funding for the purchase and ongoing maintenance needs.
 Courtney Shepler, Morro Bay, appreciated staff work on short-term financing and suggested it would help to have clarity on both the current commitment and future plans.
 Janice Peters, Morro Bay, was impressed with the condition of the property and was confident various rental income could cover costs and provide the city with a beautiful civic center.
 Glenn Silloway, President of the Morro Bay Historical Society, shared they prepared a draft historic preservation ordinance for the City, in part, to preserve these buildings. He wished to see a document listing all capital expenditures, this project being part of many, invite public participation to evaluate development alternatives then, once a final plan can be priced, put it to a vote of the people.
 Marlys McPherson, Morro Bay, questioned how the purchase fits into our current budget and future forecast, did not believe the City has to own the property to control future development through zoning and entitlements, and preferred the school district keep the property and run the risk of finding a developer.
 Shirley Fraser, Morro Bay, supported moving forward under these favorable financial terms, noting ultimate control of the property lies with the city if we purchase it. She believed there may be room for compromise on renovation costs.
 Mike Gerson, Morro Bay, envisioned a path forward with minimal impact to the City's financial reserves, looked forward to special meetings to hear what the community wants to see, personally leaned toward preserving the fields and open space and making it a public park and civic plaza,

6 with workforce housing on the north end of the parcel and senior housing at the current city hall site.
 D'Arcy Castro, Friends of Morro Elementary, encouraged the City to proceed in escrow, stating it was in the best interest to retain control of such an important piece of land. She appreciated the due diligence reports and believed retrofitting Morro Elementary versus new construction would save money.
 Semu Torres thanked those who have worked on this project and supported moving forward with the purchase.
 Judy Setting, Morro Bay, appreciated the school district's offer to finance the purchase but preferred the City remain debt-free. She wished to keep the library and mural intact and that new housing development be located on other city-owned properties.
 Debbie Highfill, Morro Bay, was supportive of the purchase and hoped the sports fields and programs presently on site would remain.  Linda Donnelly, Morro Bay, commented on potential consequences of not buying the property and urged the City to move forward with the purchase.
 Nicholas Cueva and Jamiee Motley spoke in support of the City purchasing this important historical site.
 Tunde Banffy-Stapleton, offered strong support for acquiring the property and hoped the Montessori school would remain.

End of public comment.

Staff responded to Council inquiries.

Motion by Council Member Landrum
Seconded by Council Member Luffee

1. Receive and accept the Morro Elementary School Site Due Diligence Report; and

2. Make a determination, pursuant to Section 1.5 of the Purchase and Sale Agreement, to find the Property suitable for City purposes and confirm the City’s intent to purchase the Property and proceed through the due diligence period; and

3. Based on the determination, direct staff to proceed to close of escrow and return to the City Council in October with the final terms of the purchase, including the potential for seller financing.

Ayes (4): Mayor Wixom, Council Member Eckles, Council Member Landrum, and Council Member Luffee
Noes (1): Council Member Edwards
CARRIED (4 to 1)

7 9. COUNCIL DECLARATION OF FUTURE AGENDA ITEMS
None.

10. ADJOURNMENT
The meeting adjourned at 8:14 p.m.

Respectfully submitted,
/s/ Dana Swanson, City Clerk

Prepared By: EC Dept Review: EC
City Manager Review: JC City Attorney Review: BS
Prepared By: EC Dept Head Review: EC
City Manager Review: JC City Attorney Review: BS
Staff Report
TO: Honorable Mayor and Councilmembers DATE: August 31, 2026 FROM: Emily Conrad, Finance Director
SUBJECT: Fourth Quarter Investment Report (period ending June 30, 2026) for Fiscal Year (FY) 2025-26

RECOMMENDED ACTION
Receive the attached Fourth Quarter Investment Report (period ending June 30, 2026) for FY 2025-26.

FISCAL IMPACT
There is no fiscal impact associated with this recommendation.

DISCUSSION
The Fourth Quarter Investment Report for FY 2025-26 is summarized below:
(1) Par Value is the face value of investments.
(2) Market Value is the amount in which investments could be sold. (3) WAM is the Weighted Average Maturity, the average time (days) a security will mature.

The City’s total portfolio averaged an interest rate slightly lower than LAIF by 0.225% during the period of April through June 2026. Over this quarter, the Mechanics Bank interest rate remained stable at 3.74% while the LAIF interest rate decreased slightly from 3.98% to 3.92%.

The City’s investments earned interest of $842,171 during the quarter, an increase of $44,665 over prior quarter earnings of $797,506. The increase over prior quarter is attributable to a AGENDA NO: 6.b
MEETING DATE: September 8, 2026
Cash and Pooled Investment Portfolio at June 30, 2026
Institution Par Value¹ Market Value² WAM³
Mechanics Bank (interest earning accounts) $36,277,843 $36,277,843 0 Local Agency Investment Fund (LAIF) $41,438,968 $41,392,241 0 Zions Bancorporation (CDs and Treasury Notes) $11,931,000 $11,916,164 77 Subtotal Pooled Investment Portfolio $89,647,812 $89,586,249 Mechanics Bank (operating/non-interest earning) $3,978,897 $3,978,897 0 TOTAL IN TREASURY $93,626,708 $93,565,145

temporary increased cash balance in the money market account, detailed further below. For comparison, the same period in FY 2024-25 earned interest totaling $884,023.

The Mechanics Bank Money Market interest earnings for FY 2025-26 were $1,204,576 as compared to $1,171,825.09 in FY 2024-25, a change of +$32,751. Similar to LAIF, interest rates declined over the year from 4.52% to 3.74% or 0.78%. However, $5.5 million was transferred in to this account from the 0.01% Sweep account in April, allowing an increase in earnings over prior year. The transfer of cash was a strategy to increase interest earnings for the period while cash was available in the sweep account. By August, the cash was transferred back to the sweep account for programmed operational costs.

The LAIF interest earnings for FY 2025-26 were $1,674,824 as compared to the $1,775,524 in FY 2024-25, a decrease of -$100,700 which is not surprising given the steady and slow decline in interest rates over the year from 4.34% to 3.92% or 0.42% with no additional cash deposits made.

During this quarter, two three-year certificates of deposit (CDs) matured: US Alliance Federal Credit Union for $249,000 at 4.7% and Greenstate Credit Union for $248,000 at 4.9%. These matured assets were replaced with two three-year CDs: Wells Fargo for $249,000 at 4.2% and First Financial Bank USA at 4.1%.

At the end of the third quarter, the City’s total unaudited cash balance was about $99 million. This cash represents the City’s many different inflows of resources recorded across 47 different funds with varying restrictions. Of that cash balance, $13.2 million (13%) is in the General Fund and General Fund Emergency Reserve. Approximately $61.7 million (62%) of the City’s cash holdings belonged to the enterprise funds (Harbor, Transit, Water, and Sewer funds), resources that are not available for use for general government operations. The remainder was in special revenue funds, internal service funds, and fiduciary funds, each with restricted use and unavailable for use for general government operations. Staff is in the process of closing the financial books and the annual audit is underway, therefore cash balances per fund may change.

Staff continue to monitor cash flows and interest rates closely to maximize earnings.

CONCLUSION
Staff recommends that the City Council receive the Fourth Quarter Investment Report (period ending June 30, 2026) for Fiscal Year 2025-26.

ATTACHMENT(S)

1. Fourth Quarter Investment Report for FY 2025-26 (period ending June 30, 2026)

LIQUID INSTRUMENTS

INVESTMENT

OR CUSIP PAR PURCHASE MARKET ACCRUED MARKET W/ INTEREST MATURITY DAYS TO NUMBER INSTITUTION VALUE PRICE VALUE INCOME ACCRUED INC. RATE DATE MATURITY LAIF LOCAL AGENCY INVESTMENT FUND 41,438,968 41,438,968 41,392,241 404,517 41,796,758 3.92% DAILY 1 POOLED MONEY INVESTMENT ACCOUNT:
41,438,968 41,438,968 41,392,241 404,517 41,796,758
MM MECHANICS BANK - MONEY MARKET 36,023,835 36,023,835 36,023,835 - 36,023,835 3.74% DAILY 1 SWEEP MECHANICS BANK - SWEEP 254,008 254,008 254,008 - 254,008 0.01% DAILY 1 MECHANICS BANK - PUBLIC CHECKING 3,978,897 3,978,897 3,978,897 3,978,897 0.00% MONEY MARKET ACCOUNT: 40,256,740 40,256,740 40,256,740 - 40,256,740 SUBTOTAL LIQUID INSTRUMENTS: 81,695,708 81,695,708 81,648,981 404,517 82,053,498

NON-LIQUID INSTRUMENTS

INVESTMENT

OR CUSIP PAR PURCHASE MARKET ACCRUED MARKET W/ INTEREST MATURITY DAYS TO NUMBER INSTITUTION VALUE PRICE VALUE INCOME ACCRUED INC. RATE DATE MATURITY 254673Q33 Zions Bank-Discover Bank Greenwood 245,000 245,000 244,782 3,038 247,820 3.35% 8/17/2026 48 22282XAF7 Zions Bank-Covantage Cr Un Antigo WI 247,000 247,000 247,053 1,067 248,120 4.15% 8/24/2026 55 130162AX8 Zions Bank-California Cr Un Glendale 243,000 243,000 243,444 4,218 247,662 5.15% 8/28/2026 59 444425AC6 Zions Bank-Hughes Fed Cr Un Tuscon Az 248,000 248,000 248,518 35 248,553 5.15% 8/31/2026 62 065427BG0 Zions Bank-Bank Utah Ogden Utah 244,000 244,000 244,089 4,248 248,337 4.10% 1/26/2027 210 856285G21 Zions Bank-State Bank of India NY 250,000 250,000 246,600 1,690 248,290 1.75% 2/9/2027 224 25844MBN7 Zions Bank-Dort Finl Cr Un Grand Blanc 246,000 246,000 247,527 3,041 250,568 5.00% 2/26/2027 241 41138NAB4 Zions Bank-Hapo Comnty Cr Un Richland 248,000 248,000 249,521 985 250,506 5.00% 2/26/2027 241 02589ABQ4 Zions Bank-American Express Natl 247,000 247,000 243,536 1,529 245,065 2.00% 3/9/2027 252 14042TFJ1 Zions Bank-Capital One 246,000 246,000 243,379 1,419 244,798 2.70% 4/13/2027 287 16863LAG0 Zions Bank-Chief Finl Fed Cred Un 249,000 249,000 248,413 479 248,892 3.90% 7/12/2027 377 38151PGG0 Zions Bank-Goldman Sachs Bk USA 245,000 245,000 243,165 3,825 246,990 3.70% 1/27/2028 576 19058RAE1 Zions Bank-Coastal1 Cr Un Pawtucket RI 249,000 249,000 248,852 - 248,852 4.15% 1/31/2028 580 05580A4P6 Zions Bank-BMW Bk North Amer Utah 244,000 244,000 247,427 1,430 248,857 4.90% 11/17/2028 871 61690D5J3 Zions Bank-Morgan Stanley Bk NA 244,000 244,000 243,732 938 244,670 4.25% 5/29/2029 1,064 61776NSR5 Zions Bank-Morgan Stanley Private Bk 244,000 244,000 243,732 938 244,670 4.25% 5/29/2029 1,064 (continued on next page)

CITY OF MORRO BAY

QUARTERLY PORTFOLIO PERFORMANCE
6/30/2026

CITY OF MORRO BAY

QUARTERLY PORTFOLIO PERFORMANCE
6/30/2026
NON-LIQUID INSTRUMENTS (continued)

INVESTMENT

OR CUSIP PAR PURCHASE MARKET ACCRUED MARKET W/ INTEREST MATURITY DAYS TO NUMBER INSTITUTION VALUE PRICE VALUE INCOME ACCRUED INC. RATE DATE MATURITY 8824ITWN6 Zions Bank-Texas Exchange Bk Crowley 249,000 249,000 245,026 205 245,230 3.75% 8/28/2029 1,155 949764XA7 Zions Bank-Wells Fargo 249,000 249,000 247,711 29 247,740 4.20% 5/29/2030 1,429 32022RF51 Zions Bank-First Fincl Bk USA 245,000 245,000 242,808 771 243,579 4.10% 6/3/2030 1,434 45780PDC6 Zions Bank-Institution for Svgs Newbury 249,000 249,000 242,879 126 243,005 3.70% 8/26/2030 1,518

CERTIFICATES OF DEPOSIT
4,931,000 4,931,000 4,912,194 30,010 4,942,204
3133EP5S0 Zions Bank-Federal Farm Cr Bks 3,000,000 2,988,009 3,004,215 35,615 3,039,830 4.25% 3/20/2028 629 3133EP3B9 Zions Bank-Federal Farm Cr Bks 2,000,000 1,989,780 1,998,593 31,571 2,030,164 4.13% 2/13/2029 959

FEDERAL FARM CREDIT
5,000,000 4,977,789 5,002,808 67,186 5,069,994
91282CKA8 Zions Bank-US Treasury Note 2,000,000 1,984,850 2,001,162 30,767 2,031,929 4.13% 2/15/2027 230 U.S. TREASURY NOTES & BONDS
2,000,000 1,984,850 2,001,162 30,767 2,031,929
SUBTOTAL NON-LIQUID INSTRUMENTS: 11,931,000 11,893,639 11,916,164 127,962 12,044,126 93,626,708 93,589,347 93,565,145 532,479 94,097,624
6/30/2026 6/30/2026
842,171 3,372,779 87.292% 3.695% 77
Portfolio holdings as of the quarter ended 6/30/2026, are in compliance with the current Investment Policy. With 87.605% of the portfolio held in liquid instruments, allowing the City to meet cash flow needs for at least six months, in compliance with the investment policy approved by the City Council in June 2026. The investment policy will be updated annually as required by state law.

QUARTERLY

RECORDED

INTEREST AT

WEIGHTED

AVERAGE

DAYS TO

MATURITY

WEIGHTED

AVERAGE

RATE OF

EARNINGS
YTD

RECORDED

INTEREST AT
% OF
LIQUID

PORTFOLIO

HOLDINGS
TOTAL LIQUID AND NON-LIQUID INVESTMENTS:

CITY OF MORRO BAY

QUARTERLY PORTFOLIO PERFORMANCE
6/30/2026

QUARTERLY PERFORMANCE COMPARISON - PORTFOLIO VS LAIF
6/30/2025 9/30/2025 12/31/2025 3/31/2026 6/30/2026
Portfolio - weighted average rate of earnings 4.153% 3.936% 3.655% 3.390% 3.695% LAIF - quarterly earnings rate 4.400% 4.340% 4.200% 3.980% 3.920% Portfolio over -(under) LAIF -0.247% -0.404% -0.545% -0.590% -0.225% Quarterly
Investment
Return
PARS OPEB Public Agency Retirement Services 3,256,329 10.28% DAILY DAILY 1 PARS Pension
Trust Public Agency Retirement Services 3,639,999 8.43% DAILY DAILY 1 6,896,328

CHANGES FROM PRIOR QUARTERLY REPORT

MATURED INSTRUMENTS PAR PURCHASE INTEREST PURCHASE MATURITY

CERTIFICATES OF DEPOSIT VALUE PRICE RATE DATE DATE
US Alliance FCU Rye NY 249,000 249,000 4.700% 5/26/2023 5/26/2026 Greenstate Credit Union 248,000 248,000 4.900% 5/31/2023 6/1/2026 U.S. OBLIGATIONS
TOTAL MATURED VALUE 497,000

NEW INSTRUMENTS PAR PURCHASE INTEREST PURCHASE MATURITY

CERTIFICATES OF DEPOSIT VALUE PRICE RATE DATE DATE
Wells Fargo 249,000 249,000 4.200% 5/29/2026 5/29/2030
First Fincl Bk USA 245,000 245,000 4.100% 6/3/2026 6/3/2030 U.S. OBLIGATIONS
TOTAL NEW INSTRUMENTS 494,000

PUBLIC AGENCY RETIREMENT SERVICES (PARS) - LEAGALLY RESTRICTED INVESTMENTS EXCLUDED FROM

WEIGHTED PORTFOLIO

Prepared By: NLS Dept Head Review: CM
City Manager Review: JC City Attorney Review: BS
Staff Report
TO: Honorable Mayor and City Council DATE: September 3, 2026 FROM: Chris Munson, Harbor Director
Nate Stong, P.E., City Engineer
SUBJECT: Resolution No. 48-26 Approving Adjustment to Lease Site Maps for Lease Sites 49/49W, 50/50W, 51/51W and 52/52W at 495 Embarcadero Road

RECOMMENDED ACTION
Staff recommends the City Council adopt Resolution No. 48-26:

1. Approve the adjustments to Lease Sites 49/49W, 50/50W, 51/51W, and 52/52W located at 495 Embarcadero.

2. Authorize the City Manager or his designee to revise the approved Master Lease agreement language to reflect the updated legal descriptions and maps of the lease sites as proposed.

ALTERNATIVES
No alternatives are being presented.

FISCAL IMPACT
Each of the lease sites is proposed to extend 40 feet west, for a total added area of 4,550.92 square feet. There is no fiscal impact with the adjustment in the lease site boundaries since the terms of the lease have been approved by prior action.

BACKGROUND/DISCUSSION
Morro Bay’s waterfront, harbor and beaches are an enterprise fund zone held in trust with the State.

On December 9, 1974, the City Council adopted Resolution No. 77-74 approving the “Lease Site Maps” as the official reference document for City lease sites. These maps include all those tide and submerged areas held in trust by the City of Morro Bay for the State of California. These maps have been adjusted from time to time based upon direction from City Council to accommodate new and modified lease sites.

Adjustment of the boundaries for Lease Sites 49/49W through 52/52W were included as a condition of approval for Conditional Use Permit CUP24-04 which was approved by City Council Resolution No. 04-25 on January 28, 2025. The Planning Commission subsequently approved Major Revision MAJ25-001 to CUP24-04 by Resolution PC04-25 at its regular meeting on September 16, 2025. The project consists of a seven-room hotel and retail development at 431, 451, 471 and 495 Embarcadero Road. Each of the four lease sites is proposed to extend 40 feet westerly into the harbor, while maintaining 10 feet outside of the channel line. Staff recommends the City Council approve the lease site adjustments to facilitate the development as approved by CUP24-04 and MAJ25-001.

AGENDA NO: 6.c
MEETING DATE: September 8, 2026

In addition, the Master Lease Agreement adopted by Resolution No. 43-26 currently identifies the leased premises by reference to the prior lease site maps. To accurately reflect the revised lease site configuration resulting from the redevelopment project approved through CUP24-04 and MAJ25-001, the Master Lease language will be updated to reference the current map and legal descriptions attached to the lease agreement as Attachment A, Resolution No.# 48-26. This update will replace the prior map reference with the newly prepared Attachment A and ensure the Master Lease accurately identifies the leased premises consistent with the approved lease line adjustments.

The paragraph above Section 1.01 Term of the Master Lease agreement shall read as the following:

The Premises is shown and described in the maps and legal descriptions attached hereto as Attachment A, which are incorporated herein by reference and made a part of this Lease. The maps and legal descriptions set forth in Attachment A have been updated to reflect changes to the Premises resulting from the approval of Conditional Use Permit CUP24.04 and MAJ25-001 and shall constitute the current description and delineation of the Premises for purposes of this Lease.

ATTACHMENT(S)

1. Resolution No. 48-26

2. Attachment A to Resolution – Legal Descriptions and Maps

RESOLUTION NO. 48-26

RESOLUTION OF THE CITY COUNCIL

OF THE CITY OF MORRO BAY, CALIFORNIA

APPROVING ADJUSTMENTS TO LEASE LINE MAPS
LEASE SITES 49/49W, 50/50W, 51/51W and 52/52W

T H E C I T Y C O U N C I L
City of Morro Bay, California
WHEREAS, on December 9, 1974, the City Council approved the “Lease Site Maps” dated November 1974, and these maps include all those tide and submerged areas held in trust by the City of Morro Bay for the State of California; and
WHEREAS, the “Lease Site Maps” have been revised at various times by the City Council of Morro Bay to reflect new lease sites and adjustments in lease site boundaries; and WHEREAS, City desires to adjust the boundaries for Lease Sites 49/49W, 50/50W, 51/51W and 52/52W to accommodate uses authorized by Conditional Use Permit CUP24-04 and MAJ25-001 by City Council Resolution No. 04-25 for existing and future leases; and WHEREAS, the attached legal descriptions and maps provided as Attachment A clearly identifies each lease site and its boundaries for easy reference and access; and WHEREAS, the legal descriptions and maps attached hereto as Attachment A shall be incorporated into the Master Lease agreement adopted by the City Council pursuant to Resolution No. 43-26, and shall replace the prior lease site map references for the affected lease sites, thereby ensuring that the Master Lease accurately reflects the lease site boundaries resulting from the approved redevelopment project; and
NOW, THEREFORE, BE IT RESOLVED the City Council of the City of Morro Bay, California does hereby adjust the boundaries of lease sites 49/49W, 50/50W, 51/51W and 52/52W, and hereby designates the attached Attachment A as the official reference document for said lease sites.

PASSED AND ADOPTED by the City Council of the City of Morro Bay at a regularmeeting thereof held on the 8
th day of September 2026 on the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:

RECUSE:
______________________________
CARLA WIXOM, Mayor
ATTEST:
_____________________________
DANA SWANSON, City Clerk

Attachment A: Legal Descriptions and Plat Maps
Lease Sites 49 & 49W
Exhibit A: Legal Descriptions
Exhibit B: Plat Map
Lease Sites 50 & 50W
Exhibit A: Legal Descriptions
Exhibit B: Plat Map
Lease Sites 51 & 51W
Exhibit A: Legal Descriptions
Exhibit B: Plat Map
Lease Sites 52 & 52W
Exhibit A: Legal Descriptions
Exhibit B: Plat Map

Legal Description for REVISION OF LEASE SITES 49 & 49W
8/21/2026 EXHIBIT A Page 1 of 2 exhibit-A-49&49W.docx
PARCEL ONE, LEASE SITE 49 –
A portion of South Street as shown on Parcel Map No. MB-68-30, in the City of Morro Bay, County of San Luis Obispo, State of California, recorded October 10, 1968, in Book 3 of Parcel Maps, Page 10, records of said County, more particularly described as follows.

Beginning at the southeasterly corner of Parcel 1 as shown on said Parcel Map, being the intersection of the northerly line of said South Street and the westerly line of the Embarcadero as shown on said Parcel Map;
Thence along said westerly line of Embarcadero, South 08 10’ 02” East, 50.22 feet to the intersection of the southerly line of said South Street with said westerly line of Embarcadero; Thence along said southerly line of South Street, South 76 27’ 22” West, 19.58 feet to the intersection with the line noted as “Shore Control” on said Parcel Map; Thence along said “Shore Control” line, North 13 30’ 46” West, 50.00 feet to a point on the northerly line of said South Street;
Thence along said northerly line of South Street, North 76 27’ 22” East, 24.26 feet to the Point of Beginning.

The above described PARCEL ONE contains approximately 1096 square feet (0.025 acres), and is shown on the attached EXHIBIT B attached hereto and made a part hereof, for information only.

This description has been prepared by me in
accordance with provisions of the Professional Land
Surveyors Act.
. .
____________________________________
Robert J. Reese, LS 6208 2026.08.21

Legal Description for REVISION OF LEASE SITES 49 & 49W
8/21/2026 EXHIBIT A Page 2 of 2 exhibit-A-49&49W.docx
PARCEL TWO, LEASE SITE 49W –
A portion of South Street as shown on Parcel Map No. MB-68-30, in the City of Morro Bay, County of San Luis Obispo, State of California, recorded October 10, 1968, in Book 3 of Parcel Maps, Page 10, records of said County, AND ALSO a portion of Morro Bay as shown on the Map of the Grant to County of San Luis Obispo, in said City and County, as recorded September 12, 1958, in Book 1 of Miscellaneous Maps, Page 2, records of said County, more particularly described as follows.

Commencing at the southeasterly corner of Parcel 1 as shown on said Parcel Map, being the intersection of the northerly line of said South Street and the westerly line of the Embarcadero as shown on said Parcel Map;
Thence along said northerly line of South Street, South 76 27’ 22” West, 24.26 feet to the intersection with the line noted as “Shore Control” on said Parcel Map, being the TRUE POINT OF BEGINNING; Thence along said “Shore Control” line, South 13 30’ 46” East, 50.00 feet to the intersection with southerly line of said South Street;
Thence along said southerly line of South Street, South 76 27’ 22” West, 40.00 feet to a point 10 feet easterly, as measured at right angles, of the westerly line of said South Street as shown on said Parcel Map;
Thence parallel with said westerly line of South Street, North 13 30’ 46” West, 38.00 feet to a point 12 feet southerly, as measured at right angles, from said northerly line of South Street; Thence parallel with and 12 feet southerly of, as measured at right angles, said northerly line of South Street and its westerly prolongation, South 76 27’ 22” West, 50.00 feet to a point in Morro Bay; Thence parallel with said westerly line of South Street, North 13 30’ 46” West, 12.00 feet to the intersection with the westerly prolongation of said northerly line of South Street to a point in Morro Bay;
Thence along said westerly prolongation and said northerly line of South Street, North 76 27’ 22” East, 90.00 feet to the TRUE POINT OF BEGINNING.

The above described PARCEL TWO contains approximately 2600 square feet (0.060 acres), and is shown on the attached EXHIBIT B attached hereto and made a part hereof, for information only.

This description has been prepared by me in
accordance with provisions of the Professional Land
Surveyors Act.
. .
____________________________________
Robert J. Reese, LS 6208 2026.08.21

Legal Description for REVISION OF LEASE SITES 50 & 50W
8/21/2026 EXHIBIT A Page 1 of 2 exhibit-A-50&50W-2026-08-21.docx PARCEL ONE, LEASE SITE 50 –
A portion of Parcel 1 as shown on Parcel Map No. MB-68-30, in the City of Morro Bay, County of San Luis Obispo, State of California, recorded October 10, 1968, in Book 3 of Parcel Maps, Page 10, records of said County, more particularly described as follows.

Beginning at the northeasterly corner of said Parcel 1 as shown on said Parcel Map; Thence along the easterly line of said Parcel 1, being the westerly line of the Embarcadero as shown on said Parcel Map, South 08 10’ 02” East, 22.31 feet to the southeasterly corner of said Parcel 1;
Thence along the southerly line of said Parcel 1, South 76 27’ 22” East, 24.26 feet to the intersection with the line noted as “Shore Control” on said Parcel Map; Thence along said “Shore Control” line, North 13 30’ 46” West, 22.21 feet to a point on the northerly line of said Parcel 1;
Thence along said northerly line of Parcel 1, North 76 27’ 22” East, 26.34 feet to the Point of Beginning.

The above described PARCEL ONE contains approximately 562 square feet (0.013 acres), and is shown on the attached EXHIBIT B attached hereto and made a part hereof, for information only.

This description has been prepared by me in
accordance with provisions of the Professional Land
Surveyors Act.
. .
____________________________________
Robert J. Reese, LS 6208 2026.08.21

Legal Description for REVISION OF LEASE SITES 50 & 50W
8/21/2026 EXHIBIT A Page 2 of 2 exhibit-A-50&50W-2026-08-21.docx PARCEL TWO, LEASE SITE 50W –
A portion of Parcel 1 as shown on Parcel Map No. MB-68-30, in the City of Morro Bay, County of San Luis Obispo, State of California, recorded October 10, 1968, in Book 3 of Parcel Maps, Page 10, records of said County, AND ALSO a portion of Morro Bay as shown on the Map of the Grant to County of San Luis Obispo, in said City and County, as recorded September 12, 1958, in Book 1 of Miscellaneous Maps,

Commencing at the northeasterly corner of said Parcel 1; Thence along the northerly line of said Parcel 1, South 76 27’ 22” West, 26.34 feet to the intersection with the line noted as “Shore Control” on said Parcel Map, being TRUE POINT OF BEGINNING;
Thence along said “Shore Control” line, South 13 30’ 46” East, 22.21 feet to the intersection with the southerly line of said Parcel 1;
Thence along said southerly line of Parcel 1, South 76 27’ 22” West, 50.00 feet to the southwesterly corner of said Parcel 1;
Thence along the westerly prolongation of said southerly line of Parcel 1, South 76 27’ 22” West, 40.00 feet to a point in Morro Bay;
Thence parallel with said westerly line of Parcel 1, North 13 30’ 46” West, 22.21 feet to the intersection with the westerly prolongation of the northerly line of said Parcel 1, a point in Morro Bay;
Thence along said westerly prolongation of the northerly line of said Parcel 1, North 76 27’ 22” East, 40.00 feet to the northwesterly corner of said Parcel 1; Thence continuing along said northerly line of Parcel 1, North 76 27’ 22” East, 50.00 feet to the TRUE POINT OF BEGINNING.

The above described PARCEL TWO contains approximately 1999 square feet (0.046 acres), and is shown on the attached EXHIBIT B attached hereto and made a part hereof, for information only.

This description has been prepared by me in
accordance with provisions of the Professional Land
Surveyors Act.
. .
____________________________________
Robert J. Reese, LS 6208 2026.08.21

Legal Description for REVISION OF LEASE SITES 51 & 51W
8/21/2026 EXHIBIT A Page 1 of 2 Exhibit-A-51&51W.docx
PARCEL ONE, LEASE SITE 51 –
A portion of Parcel 2 as shown on Parcel Map No. MB-68-30, in the City of Morro Bay, County of San Luis Obispo, State of California, recorded October 10, 1968, in Book 3 of Parcel Maps, Page 10, records of said County, more particularly described as follows.

Beginning at the northeasterly corner of said Parcel 2; Thence along the easterly line of said Parcel 2, South 08 10’ 02” East, 50.23 feet to the southeasterly corner of said Parcel 2;
Thence along the southerly line of said Parcel 2, South 76 27’ 22” West, 26.34 feet to the intersection with the line noted as “Shore Control” on said Parcel Map; Thence along said “Shore Control” line, North 13 30’ 46” West, 50.01 feet to the intersection with the northerly line of said Parcel 2;
Thence along said northerly line of Parcel 2, North 76 27’ 22” East, 31.02 feet to the Point of Beginning.

The above described PARCEL ONE contains approximately 1434 square feet (0.033 acres), and is shown on the attached EXHIBIT B attached hereto and made a part hereof, for information only.

This description has been prepared by me in
accordance with provisions of the Professional Land
Surveyors Act.
. .
____________________________________
Robert J. Reese, LS 6208 2026.08.21

Legal Description for REVISION OF LEASE SITES 51 & 51W
8/21/2026 EXHIBIT A Page 2 of 2 Exhibit-A-51&51W.docx
PARCEL TWO, LEASE SITE 51W –
A portion of Parcel 2 as shown on Parcel Map No. MB-68-30, in the City of Morro Bay, County of San Luis Obispo, State of California, recorded October 10, 1968, in Book 3 of Parcel Maps, Page 10, records of said County, AND ALSO a portion of Morro Bay as shown on the Map of the Grant to County of San Luis Obispo, in said City and County, as recorded September 12, 1958, in Book 1 of Miscellaneous Maps,

Commencing at the northeasterly corner of said Parcel 2; Thence along the northerly line of said Parcel 2, South 76 27’ 22” West, 31.02 feet to the intersection with the “Shore Control” line as shown on said Parcel Map, being the TRUE POINT OF BEGINNING;
Thence along said “Shore Control” line, South 13 30’ 46” East, 50.01 feet to the intersection with the southerly line of said Parcel 2;
Thence along said southerly line of Parcel 2, South 76 27’ 22” West, 50.00 feet to the southwesterly corner of said Parcel 2;
Thence along the westerly prolongation of said southerly line of Parcel 2, South 76 27’ 22” West, 40.00 feet to a point in Morro Bay;
Thence parallel with the westerly line of said Parcel 2, North 13 30’ 46” West, 50.01 feet to the intersection with the westerly prolongation of the northerly line of said Parcel 2, a point in Morro Bay;
Thence along the westerly prolongation of said northerly line of Parcel 2, North 76 27’ 22” East, 40.00 feet to the northwesterly corner of said Parcel 2; Thence continuing along said northerly line of Parcel 2, North 76 27’ 22” East, 50.00 feet to the TRUE POINT OF BEGINNING.

The above described PARCEL TWO contains approximately 4501 square feet (0.103 acres), and is shown on the attached EXHIBIT B attached hereto and made a part hereof, for information only.

This description has been prepared by me in
accordance with provisions of the Professional Land
Surveyors Act.
. .
____________________________________
Robert J. Reese, LS 6208 2026.08.21

Legal Description for REVISION OF LEASE SITES 52 & 52W
8/21/2026 EXHIBIT A Page 1 of 2 Exhibit-A-52&52W-2026-08-21.docx PARCEL ONE, LEASE SITE 52 –
A portion of Parcel 3 as shown on Parcel Map No. MB-68-30, in the City of Morro Bay, County of San Luis Obispo, State of California, recorded October 10, 1968, in Book 3 of Parcel Maps, Page 10, Records of said County, more particularly described as follows.

Beginning at the northeasterly corner of said Parcel 3; Thence along the easterly line of said Parcel 3, South 08 10’ 02” East, 90.42 feet to the southeasterly corner of said Parcel 3;
Thence along the southerly line of said Parcel 3, South 76 27’ 22” West, 31.02 feet to the intersection with the line noted as “Shore Control” on said Parcel Map; Thence along said “Shore Control” line, North 13 30’ 46” West, 90.02 feet to a point on the northerly line of said Parcel 3;
Thence along said northerly line of Parcel 3, North 76 27’ 22” East, 39.45 feet to the Point of Beginning.

The above described PARCEL ONE contains approximately 3172 square feet (0.073 acres), and is shown on the attached EXHIBIT B attached hereto and made a part hereof, for information only.

This description has been prepared by me in
accordance with provisions of the Professional Land
Surveyors Act.
. .
____________________________________
Robert J. Reese, LS 6208 2026.08.21

Legal Description for REVISION OF LEASE SITES 52 & 52W
8/21/2026 EXHIBIT A Page 2 of 2 Exhibit-A-52&52W-2026-08-21.docx PARCEL TWO, LEASE SITE 52W –
A portion of Parcel 3 as shown on Parcel Map No. MB-68-30, in the City of Morro Bay, County of San Luis Obispo, State of California, recorded October 10, 1968, in Book 3 of Parcel Maps, Page 10, records of said County, AND ALSO a portion of Morro Bay as shown on the Map of the Grant to County of San Luis Obispo, in said City and County, as recorded September 12, 1958, in Book 1 of Miscellaneous Maps,

Commencing at the northeasterly corner of said Parcel 3; Thence along the northerly line of said Parcel 3, South 76 27’ 22” West, 39.45 feet to the intersection with the line noted as “Shore Control” on said Parcel Map, being the TRUE POINT OF BEGINNING;
Thence along said “Shore Control” line, South 13 30’ 46” East, 90.02 feet to the intersection with the southerly line of said Parcel 3;
Thence along said southerly line of Parcel 3, South 76 27’ 22” West, 50.00 feet to the southwesterly corner of said Parcel 3;
Thence along the westerly prolongation of said southerly line of Parcel 3, South 76 27’ 22” West, 40.00 feet to a point in Morro Bay;
Thence parallel with the westerly line of said Parcel 3, North 13 30’ 46” West, 14.80 feet to a point in Morro Bay;
Thence parallel with said southerly line of Parcel 3, North 76 27’ 22” East, 39.00 feet to a point in Morro Bay, 1 foot westerly of said westerly line of Parcel 3, as measured at right angles;
Thence parallel with and one foot westerly of said westerly line of Parcel 3, North 13 30’ 46” West, 75.22 feet to the intersection with the westerly prolongation of the northerly line of said Parcel 3;
Thence along the westerly prolongation of said northerly line of Parcel 3, North 76 27’ 22” East, 1.00 foot to the northwesterly corner of said Parcel 3; Thence continuing along said northerly line of Parcel 3, North 76 27’ 22” East, 50.00 feet to the intersection with said “Shore Control” line, the TRUE POINT OF BEGINNING.

The above described PARCEL TWO contains approximately 5168 square feet (0.119 acres), and is shown on the attached EXHIBIT B attached hereto and made a part hereof, for information only.

This description has been prepared by me in
accordance with provisions of the Professional Land
Surveyors Act.
. .
____________________________________
Robert J. Reese, LS 6208 2026.08.21

Prepared By: CM/LT Dept Review : CM/LT
City Manager Review: JC City Attorney Review: BS
Staff Report
TO: Honorable Mayor and City Council DATE: August 28, 2026 FROM: Chris Munson, Harbor Director
Lori Thompson, Harbor Business Manager
SUBJECT: Framework for the Tidelands Business License Program (TBLP)

RECOMMENDED ACTION
Review the proposed Tidelands Business License Program and provide recommendations for any modifications to staff before the item is presented to Planning Commission for a Major Modification Permit request, after which it will return to Council for final approval.

ALTERNATIVES
The City Council can decide to not pursue the program or provide alternatives.

FISCAL IMPACT
Licenses may provide modest additional revenue through direct fees. Additional revenue should be realized through patronage to other Morro Bay businesses that may not occur without the amenities the licenses offer from the licensees. Decreased liability and associated costs due to insurance requirements and oversight.

BACKGROUND
At the May 2025 Harbor Advisory Board (HAB) meeting, staff introduced the concept of a License Agreement Program for non-brick-and-mortar, non-competing businesses operating in the Tidelands Trust Area. The HAB formed an Ad-Hoc committee to explore potential frameworks and policy options.

The committee met between May and October 2025, focusing primarily on street and mobile vendors along the Embarcadero amid concerns that these vendors could compete with brick-and-mortar businesses. Brick-and-mortar businesses expressed concerns that mobile operators, such as food trucks, may not be subject to the same requirements, including rent and hours of operation, though they remained supportive of food trucks affiliated with existing businesses and new mobile concepts that do not create conflicts. The committee emphasized the importance of fairness, echoing stakeholder concerns about competition with brick-and-mortar businesses.

Building on that work, staff are now focusing their efforts to include existing water-related businesses operating in Morro Bay Harbor, such as charters, and marine services.

Having a license program for tidelands can provide many benefits. The primary objectives of this program are the following:

AGENDA NO: 8.a
MEETING DATE: September 8, 2026

 Provide coastal dependent, coastal related, and visitor serving business opportunities in areas where lease sites don’t exist
 Increase visitation to Morro Bay and its other businesses  Establish insurance requirements, environmental compliance, and oversight for businesses already operating in the harbor.
 Provide additional revenue to the Harbor Fund directly from licensees and increased patronage to existing lease sites.

DISCUSSION
The City of Morro Bay currently lacks a unified licensing process for harbor-related business activities such as non-permanent vendors, passenger charters, dive and vessel repair services, and other mobile or service-based marine businesses. These businesses have no fixed place of business or lease space on the waterfront but would like to conduct marina-related business in the bay. At present, these businesses operate under a patchwork of a city business licenses or informal approvals, leading to inconsistencies in oversight without insurance compliance or environmental accountability.

To develop a more equitable and transparent framework, staff reviewed the City of Santa Barbara Waterfront Department’s Business Activity Permit (BAP) and Port San Luis Harbor District’s License to do Business on District Property programs – both long-standing, successful models that regulate similar commercial activities, as well as programs from several other cities. The proposed Tidelands Business License Program (TBLP) is comparable to these but tailored for Morro Bay.

The proposed TBLP will establish a formal license requirement for all businesses within the Tidelands that do not have a brick-and-mortar tidelands lease.

The TBLP is divided into two categories:

1. Marine Service / Charter License

2. Non-Permanent Businesses License

1. Marine Services / Charters
These licenses are straightforward and will not require significant evaluation beyond staff reviewing the application, proof of insurance, city business license, USCG Captain’s License (charters), and a fixed fee. The intent for this license category is primarily to ensure businesses operating in our harbor have insurance, business license, and ensure they comply with environmental and safety standards.

While the marine services will have a nominal fee to cover the cost of administration, charter operations will have a higher annual fee to maintain fairness with charters at lease sites.

This would apply to business types which are not conducted from a lease site, including:
 Charters
o Sightseeing (six-pack)
o Sportfishing (six-pack)
o Kayak excursions
 Marine Services
o Mooring Inspections
o Diving Services
o Vessel Maintenance & Services

Currently, there is no location for charter boat operators to pick-up and drop-off passengers. They are not allowed to use City slips or docks. The Harbor Department is evaluating options and will revisit options with the Council in the future. For now, licenses for sightseeing and sportfishing charters will not be available but should be included in the TBLP in preparation for it.

Administration
The Harbor Department will be authorized to issue, renew, condition, or revoke permits.

The Harbor Director will establish administrative procedures, including application forms, documentation requirements, and inspection checklists.

License Duration and Fees
Marine Services & Charter Licenses under the TBLP will be issued annually and renewable each fiscal year. Fee amounts would be set by City Council resolution to ensure administrative cost recovery and flexibility. Staff recommends aligning renewal with the fiscal year (July 1 – June 30).

Santa Barbara’s current fee structure and renewal date:
 Services
Fee: $50.00/ year
Renewal Date: By August 1
 Charter Operators
Fee: $500.00/ year
Renewal Date: By August 1
 Late Renewals
Fee: $35.00 + BAP Fee
Renewal Date: After August 1
Proposed Morro Bay fee structure and renewal dates:

Services
Fee: $50.00/ year
Renewal Date: By July 1
Charter Operators
Fee: $500.00/ year
Renewal Date: By July 1
Late Renewals
Fee: $35.00 + TBLP Fee Renewal Date: After July 1
Operational Standards
Each TBLP holder would be required to:

Comply with City, State, and Federal marine safety and navigation laws.

Maintain pollution prevention and waste management practices consistently with a Clean Marina program acceptable by the Habor Department and City Harbor Rules and Regulations.

Conduct operations in a manner that does not obstruct navigation, interfere with public access, or create safety hazards.

Maintain required insurance and current business city license.

Enforcement and Revocation
The Harbor Director may revoke or suspend a permit for:

Failure to maintain compliance with permit conditions or insurance requirements.

Environmental violations or unsafe operational practices.

Misrepresentation or material omission in the application process.

Repeated public complaints or operational conflicts not resolved through corrective action.

At inception of the program, we are not proposing a limit on the number of Marine Services and Charters, but that may be reevaluated if saturation or conflicts arise.

Upon full implementation, operating without an TBLP would constitute a code violation enforceable through administrative citation or other remedies authorized by the Municipal Code.

2. Non-Permanent Business License
This license category is intended for businesses on land but within the tidelands which are not lease sites but have more of a fixed presence or defined area of operation. Examples include:
 Food Trucks / Carts*
 Mobile Retail Sales*
 Kayak/SUP Rentals at Beaches and Parking Lots*
 Surfboard & Wetsuit Rentals at Beaches and Parking Lots  Beach Sundries and Equipment
 Mobile Sauna
 Surf Camps / Lessons
 Recurring Organized Outdoor Fitness Classes
 Bike Rentals
 Recurring Wedding Site Use
 Seasonal Entertainment, exhibits, displays
* Only open to existing tidelands leaseholders.

The City already has Municipal Code 17.30.140 ‘Nonpermanent vendors’ which lists the standards for businesses that operate out of a moveable structure, stand, cart, truck, or trailer. However, some of the standards will prevent most of the types of businesses covered in the TBLP from being possible.

These standards include a maximum duration of six hours per day and 90 days per 12-month period, only being allowed on paved surfaces, and only one vendor per day per lot. The code allows for deviations from the standards through a Major Modification Permit request with Planning Commission, but it is costly and time consuming. Rather than requiring each tidelands business license applicant to go through this process, the TBLP will be reviewed instead by the Planning Commission to allow the deviations. While the standards have a purpose, their intent is for generic nonpermanent vendor applicants which do not face the same level of scrutiny. The TBLP proposals will be vetted by staff and approved by Council, where they can be better conditioned and tailored on a case-by-case basis.

Prospective licensees will need to submit a proposal which includes:
a) Business information and proposed activity
b) Business Plan and estimated revenues
c) Hours and days of operation
d) Proposed rent
e) Site plan and location
f) Experience
g) Three references
h) Non-refundable application fee (to match Sidewalk Vending Permit fee, currently $430) Proposals will be evaluated by Harbor Department staff, and the final license agreement will be taken to City Council for approval. Licenses which require further negotiations may be discussed at closed

session. Staff will evaluate proposals by the following criteria:
i. Does the business maximize public benefit and is the best use of a location ii. Is the business coastal dependent, coastal related, or visitor serving iii. Will the business compliment other waterfront businesses or impact them iv. Viability of business and fit with Morro Bay
v. Business experience and financial capacity
vi. Will the business draw visitors to Morro Bay
Non-Permanent Business Licenses will be valid for two-years and can be renewed for another twoyears administratively if both parties agree on the existing terms. Businesses will be required to submit proof of insurance with the City of Morro Bay included as additionally insured.

At inception, the Harbor Department will take proposals and issue licenses on an ongoing basis. If licenses become competitive or widespread, staff will evaluate limiting the amount of business types, limiting the number of licenses per area, or only allowing proposals during an annual RFP period.

During this inception period, if a similar business is proposed that will likely impact an existing license, the competing proposals will be evaluated at the end of the two-year term prior to any extension. If a license is underused and/or delinquent in fee payments, the City reserves the right to revoke it.

The Harbor Department currently has a pilot license with California Sauna Club which has been in operation for over a year. The intent of this pilot license was to provide insights into how the program could work and what modifications were necessary. The business has been successful and has drawn visitors to Morro Bay. Their current term expires in February 2027, when their new license under the formal program will be brought to City Council. If the Harbor Department receives a proposal from a competing sauna business before then, the competing proposals will be evaluated.

Next Steps After City Council Approval of the Framework  Apply to Planning Commission for a Major Modification Permit request to Planning Commission to modify the nonpermanent vendor regulations for vendors that are in the Harbor program. If approved, the modifications would only apply to vendors in the licensing program approved through the Harbor Department and not to all vendors citywide.  Work alongside the City Attorney to develop license agreements, establish insurance requirements, and update municipal codes tailored to support program administration and enforcement.
 Returning to City Council with the final program adoption  Apply for a Coastal Development Permit for the program, if required. The Coastal Development Permit would be processed by the Coastal Commission since tidelands are within the Coastal Commission’s original jurisdiction.

Other Considerations
 Develop a dedicated Commercial Charter Loading/Offloading Dock or designated slip to be reserved for active TBLP holders. This facility could operate under a reservation or timelimited use system managed by the Harbor Department, allowing commercial charter operators to load or unload passengers and gear without interfering with general public or recreational users.

 If the business types open only to existing leaseholders are not being utilized and there is an identified need, consider opening them to non-leaseholders.  Create an online application process to streamline operations and reduce staff workload, as the program would increase administrative responsibilities without requiring the addition of new personnel.
 Periodically, the program could be brought back to either HAB, Planning Commission, and/or City Council for review and modification (e.g. every two years)

CONCLUSION
Staff recommends the City Council review the framework for the Tidelands Business License Program and make modifications as it sees fit. After incorporating any changes, the program will be presented to Planning Commission for a Major Modification Permit request before returning to City Council for final adoption.

ATTACHMENT(S)

1. Links to other comparable business operation programs:

Commercial Identification Cards - Ventura Port District Doing Business at the Waterfront | City of Santa Barbara Port San Luis RFP for 2025 License to do Business on District Property

Prepared By: DM Dept Review: DM
City Manager Review: JC City Attorney Review: BS
Staff Report
TO: Honorable Mayor and City Council DATE: August 26, 2026 FROM: Daniel McCrain, Fire Chief
SUBJECT: Support for the City of Paso Robles Bid on the San Luis Obispo County Ambulance Services Contract

RECOMMENDED ACTION
Adopt Resolution No. 47-26 expressing support for the City of Paso Robles to submit a bid for the San Luis Obispo County Ambulance Services Contract and supporting a robust, transparent, and accountable ambulance transport system that reinvests in the San Luis Obispo County Emergency Medical System (EMS) and other community health initiatives.

ALTERNATIVES

1. Adopt Resolution as presented.

2. Amend Resolution and adopt as amended.

3. Decline to adopt the resolution and provide direction to staff.

FISCAL IMPACT
There is no new fiscal impact to the City from the adoption of this resolution. If the association of cities is selected as the provider, fronted by the City of Paso Robles, there will be a cost share for initial start-up expenses for each association City that is expected to be reimbursed by the association. If the City joins the association those costs would be allocated by use to all members.

The decision whether to join the association if the association is the successful proposer, would be subject to future consideration and approval by the City Council.

DISCUSSION
The San Luis Obispo County Board of Supervisors holds the statutory authority to contract for ambulance services within the County by the State EMS Act. Ambulance transport services are currently provided to the entire county by San Luis Ambulance Services. The County is preparing to release a competitive process to award the ambulance services contract, which represents a critical opportunity to modernize and improve EMS delivery Countywide. The County will receive bids for the provision of these services and the County alone will decide what entity will provide those services throughout the County.

Currently, the City of Morro Bay, through its Fire Department, is responsible for providing fire, EMS AGENDA NO: 8.b
MEETING DATE: September 8, 2026

first-response, hazardous materials mitigation, and rescue operations within our jurisdictional boundary. However, ambulance transport services are contracted through the County.

The seven incorporated cities’ city managers and the San Luis Obispo County Fire Chiefs Association have unanimously expressed their support for the City of Paso Robles, acting as the Lead Agency, to submit a bid for the County ambulance services contract on behalf of the cities that join the endeavor. If this bid is successful, the provision of ambulance services will be managed by all cities that opt to join the ambulance association. This initiative is intended to foster a community-based EMS model with stronger accountability and transparency.

The Paso Robles-led model will:
 Provide an innovative EMS delivery model where the City of Paso Robles serves as the lead agency, subcontracting to a private ambulance provider, with oversight provided by an executive committee made up of the seven cities’ city managers ensuring transparency and accountability.
 Enhance service delivery with greater local involvement and oversight.  Provide additional funding for EMS-centric programs and allow reinvestment into City EMS services.
 Foster regional cooperation by uniting the cities, community service districts, and fire agencies in a shared vision for EMS improvement.
 Support proactive and preventative programs addressing mental health, substance abuse, and services for unhoused community members.
 Reinvest excess revenues after operational costs back into local communities to improve public health outcomes.

By adopting this resolution, the Morro Bay City Council is supporting an opportunity for enhanced ambulance services and a more sustainable EMS system that is responsive to the evolving needs of our community.

CONCLUSION
The County of San Luis Obispo’s ambulance transport system has been relatively unchanged for many decades. Until now the Ambulance transport system has never gone out to RFP (Request for Proposals) despite two previous grand jury reports recommending an RFP process. The California EMS Act requires an RFP process at a minimum of every 10 years, with a limited exception for sole source extensions to existing grandfathered operators at the County’s discretion. In October 2025, the County Board of Supervisors voted to move forward with going out to RFP for the ambulance services contract. This competitive bidding process is intended to maximize innovation, enhance value within the existing EMS system, and safeguard consumers by ensuring the highest possible level of care at the most cost-effective rate. Again, the County alone has the statutory authority and responsibility to select the agency providing ambulance transport service within the County.

The proposed public private partnership represents a collaborative approach to improve the EMS service delivery model in San Luis Obispo County. This partnership has been developed by all seven Cities’ City Managers and multiple CSD’s within SLO County as an option to improve the level of service to the citizens in our communities. Multiple counties throughout the state are transitioning away from traditional service delivery models to public private partnerships. These partnerships combine the strengths of government oversight, transparency, and accountability with the service delivery expertise of the private ambulance industry.

The Public Provider Ground Emergency Medical Transport (PPGEMT) program provides federal and state reimbursements for ground emergency medical transport available exclusively to public entities.

The proposed partnership model is eligible for this additional reimbursement program that is not available to the current provider or other for-profit providers. Under the Alliance Model, 100% of those reimbursements flow back into the EMS system, helping offset EMS costs, system enhancements, innovations, equipment upgrades, and training.

The County Board of Supervisors (BOS) will choose the service delivery provider from the eligible responses received during the RFP period. The BOS may select the incumbent provider, an alternate for-profit provider, or the Paso Robles led public private partnership. If the partnership were to be selected by the BOS, an MOU would come back to the City Council for consideration and approval.

This resolution is to formally support the City of Paso Robles response to the County Ambulance RFP to ensure a range of options for ambulance services is available for consideration by the Board of Supervisors .

ATTACHMENT(S)

1. Resolution No. 47-26 supporting the City of Paso Robles Bid on the San Luis Obispo County Ambulance Services Contract

RESOLUTION NO. 47-26

A RESOLUTION OF THE CITY COUNCIL

OF THE CITY OF MORRO BAY, CALIFORNIA,

SUPPORTING THE CITY OF PASO ROBLES IN SUBMITTING A BID FOR THE COUNTY OF SAN LUIS OBISPO’S AMBULANCE SERVICES CONTRACT

T H E C I T Y C O U N C I L
City of Morro Bay, California
WHEREAS, the City Council of the City of Morro Bay controls, through statutory authority and policy, the provision of fire suppression, emergency medical services (EMS), hazardous materials mitigation, and rescue operations within its jurisdictional boundaries; and WHEREAS, pursuant to State law, the San Luis Obispo County Board of Supervisors holds authority over the regulation and contracting of ambulance transport services within San Luis Obispo County; and
WHEREAS, the County of San Luis Obispo is going out to bid for the ambulance services contract which creates potential opportunities for significant improvements to the ambulance transport system and consideration of a more dynamic community-based model; and WHEREAS, the City of Morro Bay City Council supports an enhanced ambulance transport system that is robust, transparent, accountable, and which reinvests revenues back into local communities after expenses to support proactive programs addressing mental health, substance abuse, and the needs of unhoused community members; and WHEREAS, a public private partnership alliance model would be expected to provide additional funding opportunities for EMS-centric programs and allow direct reinvestment into local EMS operations, including the City of Morro Bay’s Fire Department, thereby improving overall public safety and service delivery within the City; and WHEREAS, the seven city managers representing the incorporated cities of San Luis Obispo County, as well as the San Luis Obispo County Fire Chiefs Association, have unanimously endorsed and expressed support for the City of Paso Robles submitting a bid for the San Luis Obispo County ambulance services contract under the proposed alliance model; and WHEREAS, a goal of the Paso Robles-led alliance model would be to foster strong local partnerships, accountability, and transparency, as well as encourage collaborative governance across jurisdictions that directly benefit all communities within San Luis Obispo County, including the City of Morro Bay; and
WHEREAS, the City Council believes that consideration of the Paso Robles-led alliance model offers an opportunity to build an EMS system that is more responsive to community needs

and better aligned with modern public safety practices, while ensuring that revenues are invested back into the people and services of San Luis Obispo County.

NOW, THEREFORE BE IT RESOLVED, by the City Council of the City of Morro Bay:

SECTION 1. The City Council of the City of Morro Bay hereby expresses its strong support for the City of Paso Robles to submit a bid for the County of San Luis Obispo’s ambulance services contract under a public private partnership alliance model.

SECTION 2. The City Council further supports the pursuit of a comprehensive, transparent, and accountable EMS system that prioritizes community needs, reinvests revenues locally, and provides sustainable funding for EMS-related and preventative public health programs.

SECTION 3. The City Council encourages the San Luis Obispo County Board of Supervisors and all relevant decision-makers to give full consideration to the Paso Robles-led alliance model, which holds exciting promise to deliver direct and meaningful benefits to residents of Morro Bay and all communities throughout the County.

PASSED AND ADOPTED by the City Council of the City of Morro Bay, at a regular meeting thereof held on the 8th day of September 2026 by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN
RECUSE:
______________________
CARLA WIXOM, Mayor
ATTEST:
_________________________
DANA SWANSON, City Clerk