Palm Springs City Council
July 24, 2023

Item 3C - Page 79

LIST OF HOUSING SITES

SITE APN STATUS ACREAGE GENERAL PLAN ZONING TRIBAL/PRIVATE TYPE 24 669414054 Vacant 0.22 MDR R2 SP Private 2-4 DU
25 504121001 Vacant 0.61 MU R2 SP Private APTS
26 508122011 Vacant 0.11 MDR R2 Private 2-4 DU
26 508122010 Vacant 0.11 MDR R2 Private 2-4 DU
26 508124014 Vacant 0.14 MDR R2 Private 2-4 DU
27 680035014 Vacant 0.26 MDR R2 Private 2-4 DU
28 507022007 Vacant 0.24 MDR R2 Private 2-4 DU
29 680034011 Vacant 0.23 MDR R2 Private 2-4 DU
30 508133008 Vacant 0.14 MDR R2 Private 2-4 DU
31 508132022 Vacant 0.12 MDR R2 Private 2-4 DU
31 508132021 Vacant 0.14 MDR R2 Private 2-4 DU
32 504073014 Vacant 0.23 LDR R2 Private 2-4 DU
33 504224019 Vacant 0.20 LDR R2 Private 2-4 DU
33 504224018 Vacant 0.21 LDR R2 Private 2-4 DU
34 504060021 Vacant 0.23 LDR R2 Private 2-4 DU
35 504060023 Vacant 0.22 LDR R2 Private 2-4 DU
36 507061013 Vacant 0.13 MU R3 Private 2-4 DU
36 507061012 Vacant 0.15 MU R3 Private 2-4 DU
37 680044004 Vacant 0.23 HDR R3 Private 2-4 DU
38 508141001 Vacant 0.16 MDR R2 Private 2-4 DU
39 507024010 Vacant 0.23 MDR R2 Private 2-4 DU
40 505182005 Vacant 0.35 MU R2 Private 2-4 DU
41 504092021 Vacant 0.17 LDR RGA6 Private 2-4 DU
41 504092020 Vacant 0.17 LDR RGA6 Private 2-4 DU
41 504092019 Vacant 0.19 LDR RGA6 Private 2-4 DU
42 504082016 Vacant 0.28 LDR RGA6 Private 2-4 DU
43 504091012 Vacant 0.27 MU RGA6 Private 2-4 DU
44 504083001 Vacant 0.23 LDR RGA6 Private 2-4 DU
45 504122005 Vacant 0.46 LDR RGA6 Private 2-4 DU
46 504102003 Vacant 0.27 LDR RGA6 Private 2-4 DU
47 504092006 Vacant 0.23 LDR RGA6 Private 2-4 DU
47 504092008 Vacant 0.23 LDR RGA6 Private 2-4 DU
48 504102006 Vacant 0.28 LDR RGA6 Private 2-4 DU
49 504092017 Vacant 0.24 LDR RGA6 Private 2-4 DU
50 504083016 Vacant 0.22 LDR RGA6 Private 2-4 DU
51 504082007 Vacant 0.30 LDR RGA6 Private 2-4 DU
52 504101005 Vacant 0.28 LDR RGA6 Private 2-4 DU
53 669330047 Vacant 12.11 HDR R1 Private APTS
54 669330047 Vacant 110.77 MDR R1 Private 4-6 DU
55 504270002 Vacant 0.34 MU C1/R2 Private APTS
55 504270006 Vacant 0.38 MU PD Private APTS
55 504270001 Vacant 0.56 MU C1/R2 Private APTS
55 504270003 Vacant 0.58 HDR R2 Private APTS
55 504270005 Vacant 1.04 MU C1/R2 Private APTS
55 504270008 Vacant 1.09 MU PD Private APTS
55 504270007 Vacant 1.50 MU PD Private APTS

Item 3C - Page 80

LIST OF HOUSING SITES

SITE APN STATUS ACREAGE GENERAL PLAN ZONING TRIBAL/PRIVATE TYPE 56 507100041 Vacant 1.14 MU PD Private APTS
57 507100042 Medical 3.89 MU PD Private APTS
58 507100026 Office 1.34 MU PD Private APTS
59 501031028 Vacant 3.64 MU PD Tribal-Fee APTS
60 501031028 Vacant 3.64 MU PD Tribal-Fee APTS
61 505182010 Vacant 0.99 MU PD Public APTS
62 505182004 Vacant 0.76 MU PD Public APTS
197.19Total Acreage:

Item 3C - Page 81

ATTACHMENT E

Item 3C - Page 82
Item 3C - Page 83
2023 BOARD OF DIRECTORS

PRESIDENT
Todd Hooks
Agua Caliente Band of
Cahuill a fndians
Immediate Past President
Deborah McGarrey
Southern California Gas Company
1st VICE PRESIDENT
Tom Dubose
Dubose Design Group, Inc.

SECRETARY/TREASURER
Pedro Rincon
Osborne Rincon CP As

VICE PRESIDENT

OF ASSOCIATES
Allan Levin
Allan Levin & Associates

CHIEF EXECUTIVE OFFICER
Gretchen Gutierrez

DIRECTORS
Fred BeIV 2023 PA C Clinirmrm
Nobel! Energy Solutions
Brian Bened.etti
Brian Benedetti Construction
Mark Bened etti
Dede Callanan
Ca!Best Title
Mario Gonzales
GHA Companies
Joe Hayes
First Bank
Jeremy Roos
Free Volt
Dave Lippert
Lippert Constmction, Inc
Paul Mahoney
PMA Adve rtising
Bruce Maize
01T Builders
Russ Martin
Mission Springs Water
District
Dan Olivier
Nethery Mueller Olivier
Alan Pace
Pe!ra GeoSc iences
. Kevin Pillow
AC Houston Lumber
John Powe ll, Jr.

Coachella Valley Water District
Mike Rowe
MSA Consu lting
Phil Smith
Sunrise Company
Alissa Vatter
Fidelity National Title
Jeff Wattenbarger
Wattenbarger Construction
desert valleys builders association
July 12, 2023
City of Palm Springs
3200 E. Tahquitz Canyon Way
Palm Springs, CA 92262
Attn: Palm Springs City Council Members
Scott Stiles, City Manager
RE:

Jeffrey S. Ballinger, City Attorney
City Council Meeting July 24 2023 .

Proposed lnclusionary Policies
Dear Members of the Council, Mr. Stiles, Mr. Ballinger, Mr. Fagg:

On behalf of the Desert Valleys Builders Association {DVBA} thank you for the opportunity to provide written comments with regards to the Planning Commission meeting of June 28th , 2023 as well as to the ongoing discussion about inclusionary policies for housing and other new development projects . We look forward to being fully engaged with the City Council and staff on this issue as you continue the discussion on the pros/cons of this type of program.

While on the surface the use of inclusionary housing as an ordinance by a governing agency appears to have the potential for the benefit of additional housing units at an affordable price; the reality of either set-aside units (of any to be determined percentage or amount) or an in-lieu fees or other such mitigating options; does not in reality translate into more affordable units.

The burden of placing a number of units into a more "affordable" market price point under a for-sale scenario or a set-aside of units for a rental property at a reduced rental rate, means that the remaining for sale units and/or rental units (those which are market rate listed) must bear the burden of the costs of subsidizing the affordable units. This includes, but is not limited to, the cost differential on fees, · construction materials, land costs & development and labor. This will in turn drive up the cost of the market rate units, further exacerbating the cost of homeownership or rental availability.
34360 Gateway Drive • Palm Desert • CA 92211
(7 60) 776-7001 office • (7 60) 77 6-7002 fax
www.TheDVBA.org
Item 3C - Page 84
2023 BOARD OF DIRECTORS

PRESIDENT
Todd Hooks
Agua Caliente Band of
Cahuilla fndians
Immediate Past President
Deborah McGarrey
Southern California Gas Company
1st VICE PRESIDENT
Torn Dubose
Dubose Design Group , lnc.

SECRETARY/TREASURER
Pedro Rincon
Osborne Rincon CP As

VICE PRESIDENT

OF ASSOCIATES
Allan Levin
Allan Levin & Associates
CfilEF EXECUTIVE OFFICER
Gretchen Gutierrez

DIRECTORS
Fred BelV 2023 PAC Chairman
Nobell Energy Solutions
Brian Benedetti
Brian Benedetti Construction
Mark Benedetti
Dede Callanan
Ca!Best Title
Mario Gonzales
GHA Companies
Joe Hayes
First Bank
Jeremy Roos
Free Volt
Dave Lippert
Lippert Constrnction, Inc
Paul Mahoney
PMA Advert ising
Bruce Maize
01T Builders
Russ Martin
Miss ion Springs Water
District
Dan Olivier
Nethery Mueller Olivier
Alan Pace
Petra GeoSciences
. Kevin Pillow
AC Houston Lumber
John Powell , Jr.

Coachella Valley Water District
Mike Rowe
MSA Consulting
Phil Smith
Sunrise Company
Alissa Vatter
Fidelity National Title
Jeff Wattenbarger
Wattenbarger Construction
desert valleys builders association
The report issued by City Consultant, Economic & Planning Systems, Inc., states that an inclusionary policy "may" raise the pricing of housing. There is no "may raise the cost of housing" as this is an additional fee whether it is through the payment of the mitigation fee and/or in the cost of the set aside units.

Two examples:

Mit igation Fee paid on Single Family Detached Home/Marke t Rate Sales Price Addit ional Cost per residence
Average single family home is 2,000 sq. ft x $10/ft = $20,000 Average single family home is 2,000 sq. ft x $15/ft = $30,000 Average single family home is 2,000 sq. ft x $20/ft = $40,000 Average single family home is 2,000 sq. ft x $25/ft = $50,000 Set Aside Unit s:

Market rate has to bear burden of the set aside units
Example :
40 single fam ily un its t o be bu ilt with/10% of units to be built for affordable Set aside= 4 un its which must be sold at affordable index price (well below market rate)
Cost of construct ion is the same for all 40 units/ no diffe rential is prov ided (As an estimate ) Average price per for sale uni t if all 40 built at market Rate = $900K
(As an estimate) Average price per for sale unit if only 32 sold at market Rate = $1.325M (have to cover the $425K difference plus original market pri ce)
Sales price of affordable units= $475 ,000/est imated sales price The DVBA is prepari ng to conduct its Tri-Annua l Fee Report during the summer of 2024 . This report provides real-ti me data on the cost of construction permits within each of the Coachella Valley jurisdictional cities, including Palm Springs. The previous report, completed in December 2019 (COVID 19 forced an additional year for review ), produced a report where in the costs of fees placed the City as the 2nd most expensive commun ity for resident ial const ruction permits in the Coachella Valley. Furt her, at the t ime of that publication, the City was only separated from · being the most expensive by $135 dollars under t he 2019 report. Since that report was issued, the City has taken Annual Fee Increases tied to the CPI Index each of the last 3 years, including most recently CPI adjustment increase in May of 2023 of 6.3%, effective July 24, 2023.
34360 Gateway Drive • Palm Desert • CA 9221 l
(7 60) 77 6-700 l office • (7 60) 77 6-7002 fax
www.TheDVBA.org
Item 3C - Page 85
2023 BOARD OF DIRECTORS

PRESIDENT
Todd Hooks
Agua Caliente Band of
Cahuilla Indians
Immediate Past Presiden~
Deborah McGarrey
Southern California Gas Company
1st VICE PRESIDENT
Tom Dubose
Dubose Design Group, lnc.

SECRETAR Y/ TREASURER
Pedro Rincon
Osborne Rincon CP As

VICE PRESIDENT

OF ASSOCIATES
Allan Levin
Allan Levin & Assoc iates
cmEF EXECUTIVE OFFICER
Gretchen Gutierrez

DIRECTO RS
Fred BelV2023 PA C Cliaimum
Nobell Energy Solutions
Brian Benedetti
Brian Benedett i Construct ion
Mark Benedetti
Dede Callanan
Ca!Best Title
Mario Gonza les
GHA Companies
Joe Hayes
First Bank
Jeremy Roos
Free Volt
Dave Lippert
Lippert Constrnction, Inc
Paul Mahoney
PMA Advertising
Bruce Maize
0 1T Builders
Russ Martin
Mission Springs Water
District
Dan O livier
Nethe ry Mueller Olivier
Alan Pace
Petra GeoSciences
. Kevin Pillow
AC Houston Lumber
John Powell, Jr.

Coachella Valley Water District
Mike Rowe
MSA Consult ing
Phil Smith
Sunrise Company
Alissa Vatter
Fideli ty Nat ional Title
Jeff Watten barger
Wattenbarger Constrnction
desert valleys builders association
Further, as was previously stated in the Staff Report, dated April 12, 2023, as noted under the Attachment A, page 4; the City of Palm Springs has limited land available for consideration as designated fo r residential housing units . With nearly 40-45% of the approximately 370 acres held withi n the Agua Caliente Band of Cahuilla Indians land portfolio, th is potentially means that availability of land shrinks to 225 acres+/ -.

On parcels less than 5 acres in size (the majority of iand still available), this means that 4-5 units per acre max., equals 650-1100 units in total. The City has over the past 4 years (2012-2022) issued an average of 210 permits a year, which means that there is a very real issue of land availability challenges for long term growth within the City.

Also, as was noted in the Staff Report of June 28th, 2023, a number of Northern California cities do indeed use an inclusionary policy in a variety of formats.

Howeve r, the actual number of units generated once the policy has been adopted with in a municipality has not been fully disclosed/reported in many locals. There may be a nominal increase in units produced, but more likely a negative impact to the cost of housing product ion has occurred .

Our prior document of correspondence , dated April 7, 2022 also included informat ion related to these next two paragraph statements and should also be placed in the note s for consideration of discussion.

The first documen t presents California State Government Code (G.C. 65585 (k), concerning the potential liability by a local governing agency if said agencies policies create an imped iment to housing development through t he increase placement of burdens for construction. The implementation of an inclusio nary policy that requires a set aside of units and/or a mitigation in-lieu fee, could and in most likelihood, will not provide addit ional housing and may lead to the development community looking to alternative jurisdictions to const ruct housing.

The second document is a referenced case study provided by the National Association of Homebuilders , Feb. 2021, stat ing that any $1000 increase in a median new home sales price further eliminates an addit ional 153,967 households out of the market nationw ide. Roughly 60 percent of all U.S. households are not able to afford a new median priced home. This number will be further exacerbated should inclusionary policie s by enacted, with the set aside units or subsidized units.have the cost different ial added to the market rates unit s (both new and rental propert ies). 34360 Gateway Drive II Palm Desert • CA 92211
(7 60) 776-7001 office • (7 60) 77 6-7002 fax
www.TheDVBA.org
Item 3C - Page 86
2023 BOARD OF DIRE CTORS

PRESIDENT
Todd Hooks
Agua Caliente Band of
Cahuilla fndians
Immediate Past PresideJtt
Deborah McGar rey
Southern California Gas Company
1st VICE PRESID ENT
Torn Dubose
Dubose Design Group, Inc.

SECRET ARY/ TREASURER
Pedro Rincon
Osborne Rincon CP As

VICE PRESIDENT

OF ASSOCIATES
Allan Levin
Allan Lev in & Assoc iates
cmEF EXECUTIVE OFFICER
Gretchen Gutierrez

DIREC TORS
Fred BelV 2023 PA C Chaimum
Nobell Energy Solut ions
Brian Benedetti
Brian Benedetti Construction
Mark Benedetti
Dede Callanan
Ca!Best Title
Mario Gonzales
GHA Companies
Joe Hayes
First Bank
Jeremy Roos
Free Volt
Dave Lippe rt
Lippert Construction, Inc
Paul Mahoney
PMA Advertising
Bruce Maize
OiT Builders
Russ Martin
Mission Springs Water
District
Dan Olivier
Nethery Mueller Olivier
Alan Pace
Petra GeoSciences
. Kevin Pillow
AC Houston Lumber
John Powell , Jr.

Coachella Valley Water District
Mike Rowe
MSA Consulting
Phil Smith
Sunrise Company
Alissa Vatter
Fidelity National Title
Jeff Wattenbarger
Wat tenbarger Constrnction
desert valleys builders association
As referenced within the 2nd document, increases in market rate housing (whether single family detached or other owned residences) is becoming increasingly unattainable. The past 60.days of sales activity within the City of Palm Springs shows a median sales price of $1.3M dollars, including both new construction and resale home residences/townhomes.

Further burdeni ng new residential construct ion, with either an in-lieu fee or mitigated set-aside residences; with further exacerbate the issue of pricing and place addit ional homes out of reach for homebuyers and renters.

Additionally, while The DVBA study being conducted does not include review of the impacts of a mitigated fee for commercial/industrial/other employment driven segments of new construction; the additional cost of a square footage fee will most likely make many developers & builders reconsiders or withdraw from consideration any future construction within the City. Those indust ries are also facing similar challenges with supply/demand & labor force issues; and an adoption of this proposed cost will have a negative impact on many financial proformas .

Therefore, we request that a thorough review of all sides of this issue be considered, including any pote ntial unintended consequences of any lnclusionary Policies will have on economic growth, additional housing and business industries for the City.

The DVBA appreciates the opportunity to provide input and engagement with this matter and looks forward to continuing the discussion on this item .

Thank y0u,
/!
--------­~ retclien Guti;;rez
\CEO I 0-viA
34360 G ateway Drive s Palm Desert • CA 92 21 1
(7 60) 77 6-700 l office • (7 60) 77 6-7002 fax
www.TheDVBA. org
Item 3C - Page 87
2023 BOARD OF DIRECT ORS

PRESIDENT
Todd Hooks
Agua Caliente Band of
Cahuilla fndians
Immediate Past Presidellt
Deborah McGarrey
Southern California Gas Company
1st VICE PRESIDENT
Tom Dubose
Dubose Design Group, Inc.

SECRETARY/TREASURER
Pedro llincon
Osborne Rincon CP As

VICE PRESIDENT

OF ASSOCIATES
Allan Levin
Allan Levin & Associates
CfilEF EXECUTIVE OFFICER
Gretchen Gutierrez

DIRECTORS
Fred Be1V2023 PA C Chaimw11
Nobel! Energy Solutions
Brian Benedetti
Brian Benedetti Construction
Mark Benedetti
Dede Callanan
Ca!Best Title
Mario Gonzales
GHA Companies
Joe Hayes
First Bank
Jeremy Roos
Free Volt
Dave Lippert
Lippert Construction, Inc
Paul Mahoney
PMA Advertising
Bruce Maize
On Builders
Russ Martin
Mission Springs Water
District
Dan Olivier
Nethery Mueller Olivier
Alan Pace
Petra GeoSciences
Kevin Pillow
AC Houston Lumber
John Powell, Jr.

Coachella Valley Water District
Mike Rowe
MSA Consulting
Phil Smith
Sunrise Company
Alissa Vatter
fidelity National Title
Jeff Wattenbarger
Wattenbarger Construction
desert valleys builders association
Copy att ached and link attached
hereto : https ://leginfo . legislatu re.ca .gov /fac es/cod es displaySection .xhtm I? sectio nNum=655 85.&lawCod e=GOV
(Copy attached ) and link hereto: https ://www.hahb.org/­ /media/NAHB/news -and-econom ics/docs/hou sing-economics-plus/special­ studies/2021/spec ial-study-nahb -priced-out-es timates-for -2021-feb ruary- 2021.pdf? ga=2.93034525.1411435084 .1617852535-
1937296336 .1617852 535
34360 Gateway Drive 111 Palm Desert • CA 92211
(7 60) 776-7001 office • (7 60) 77 6-7002 fax
www.TheDVBA.org

CITY COUNCIL STAFF REPORT
07/24/2023
SUBJECT:

REQUEST TO AMEND CHAPTER 6.15 OF THE PALM SPRINGS MUNICIPAL

CODE RELATING TO MOBILE FOOD VENDING VEHICLE REGULATIONS RECOMMENDATION:

Waive the reading of the ordinance text in its entirety and read by title only; and1.

Introduce on first reading an Ordinance entitled, “AN ORDINANCE OF THE CITY OF PALM SPRINGS, CALIFORNIA, AMENDING CHAPTER 6.15 OF THE

PALM SPRINGS MUNICIPAL CODE RELATING TO MOBILE FOOD VENDING VEHICLE REGULATIONS.”

2. Attachments
Item 3D

CITY COUNCIL STAFF REPORT

DATE: JULY 24, 2023 BUSINESS & LEGISLATIVE

SUBJECT: REQUEST TO AMEND CHAPTER 6.15 OF THE PALM SPRINGS

MUNICIPAL CODE RELATING TO MOBILE FOOD VENDING VEHICLE

REGULATIONS

FROM: Scott C. Stiles, City Manager

BY: Flinn Fagg, Deputy City Manager

SUMMARY:

This is a request for minor amendments to Palm Springs Municipal Code (PSMC) Chapter

6.15 relating to the regulations for Mobile Food Vending Vehicles (food trucks). This topic was most recently discussed at the City Council meeting of March 9, 2023.

RECOMMENDATION:

1. Waive the reading of the ordinance text in its entirety and read by title only; and

2. Introduce on first reading Ordinance No. ____, “AN ORDINANCE OF THE CITY OF PALM SPRINGS, CALIFORNIA, AMENDING CHAPTER 6.15 OF THE PALM

SPRINGS MUNICIPAL CODE RELATING TO MOBILE FOOD VENDING
VEHICLE REGULATIONS.”

BACKGROUND:

The City’s Mobile Food Vending Vehicle Ordinance was adopted by City Council in 2015.

Prior to adopting the ordinance, the City assembled a stakeholder group comprised of restaurant owners, Main Street representatives, and other downtown representatives to study the issue and review regulations from other municipalities. The recommendations of the stakeholder group informed the content of the ordinance that was eventually adopted by the City Council. The ordinance has not been updated since it was adopted in 2015.

The City Council considered proposed modifications to the food truck ordinance on March 9, 2023, in conjunction with the discussion of the sidewalk vending ordinance. While the City Council did not take action on the ordinance, direction was provided to staff to Item 3D - Page 1
City Council Staff Report
July 24, 2023 -- Page 2
Mobile Food Vending Vehicle Ordinance

generally facilitate food truck operations in the city. However, the general consensus did not support eliminating the prohibition of food trucks in the downtown area.

STAFF ANALYSIS:

Based on direction from the City Council at the March 9th meeting, the following amendments are proposed to the Mobile Food Vending Vehicle Ordinance to facilitate greater opportunities for food truck owners to operate in the city:

• Food Trucks in Public Parks – Section 6.15.110(B): Food trucks are currently prohibited in public parks; the proposed amendment would allow food trucks in all public parks under most conditions. Food trucks would not be permitted in parks where there is an active concession agreement, unless otherwise authorized by the director of the Parks & Recreation Department. Exceptions may be warranted when the food truck is vending food items that are different than that offered by the park concessionaire, or in larger parks where the food truck is located distant from the concession operation and will not compete for the same customers as the concessionaire.
• Streets Where Permitted – Section 6.15.110(C)(3): It is proposed that food trucks be allowed to operate on streets where the maximum speed limit is 40 miles per hour or less, which is an increase over the current regulation, which only allows food trucks on streets where speed is 35 miles per hour or less. Based on the number of streets where the speed limit has been adjusted downward, this should open additional areas where food trucks may vend. Please note that no revision is proposed to the prohibition of food trucks in the downtown area. • Hours of Operation – Section 6.15.110(G): Currently, food trucks are only permitted to operate from 9:00am to 5:00pm during the winter months and from 9:00am to 7:00pm during the summer months. Under the proposed ordinance, the allowable hours of operation for food trucks would be expanded to match approximately the same hours as is proposed for sidewalk vendors (7:00am to 3:00am). Food trucks in public parks would be restricted to the hours that the park is open to the general public.

While no major changes are proposed to the section of the ordinanc e that describes exceptions, it is important to note that the existing exceptions listed in Section 6.15.170 allow the following:

• Food trucks are permitted on private property upon approval of a Land Use Permit.

Applicants must obtain proof of consent from the property owner as part of the application submittal. To further facilitate this use, the Department of Planning Services will charge the Minor Land Use Permit fee ($438) versus the standard Land Use Permit fee ($1,642).
• Food trucks may service a business or a residence when the owner has pre- arranged for such services. Please note that in residential zones, food trucks may only provide services to the residential owner and their guests and cannot vend to the general public.

Item 3D - Page 2
City Council Staff Report
July 24, 2023 -- Page 3
Mobile Food Vending Vehicle Ordinance

• Food trucks are permitted to vend on school property, provided the use is authorized by the school district or school administrator. • Food trucks servicing construction sites are exempt from the locational restrictions and operat ional procedures that are otherwise required of other food truck vendors.

In addition to these existing exceptions , clarifications are proposed to address the following situations:

• It is proposed that language be added to clarify that food trucks are permitted as part of a temporary special event. While this has been allowed historically, clarifying language has been added to Section 6.15.170 to explicitly allow the use. • It is proposed that Section 6.15.110(A) be clarified pertaining to the prohibition in the downtown area to specify that food trucks are permitted downtown when part of a temporary special event, allowed on private property via a Land Use Permit, or when providing a service to a business at the request of the business owner.

These exceptions are listed in Section 6.15.170 of the ordinance.

ENVIRONMENTAL ASSESSMENT
:

The proposed Ordinance is not subject to the California Environmental Quality Act (“CEQA”) (Public Resources Code Section 21000 et seq.) pursuant to Section 15060(c)(2) of the State Guidelines, because the text amendment will not result in a direct or reasonably foreseeable indirect physical change in the environment and is not a “project” as that term is defined in Section 15378 of the State CEQA Guidelines.

FISCAL IMPACT:

Additional revenue may be generated through the issuance of licenses for food trucks; however, the additional revenue will be offset by the staff costs necessary to administer the program.

REVIEWED BY:

Deputy City Manager: Flinn Fagg
City Attorney: Jeffrey S. Ballinger
City Manager: Scott Stiles

ATTACHMENTS:

A. Draft Ordinance (Redline)
Item 3D - Page 3

ATTACHMENT A

Item 3D - Page 4
ORDINANCE NO. ____

AN ORDINANCE OF THE CITY OF PALM SPRINGS ,

CALIFORNIA, A MENDING PALM SPRINGS MUNICIPAL
CODE CHAPTER 6.15 RELATIVE TO MOBILE FOOD

VENDING VEHICLES, AND MAKING CONFORMING

AMENDMENTS TO PALM SPRINGS MUNICIPAL CODE
SECTION 11.44.060 (PROHIBITED CONDUCT IN CITY
PARKS).

City Attorney’s Summary
The proposed ordinance amends the City’s current
operational standards for Mobile Food Vending Vehicles (food truck), to provide parity with proposed sidewalk vending regulations and encourage food truck businesses.

A. The City of Palm Springs, California (“City”) is a municipal corporation, duly organized under the California Constitution and laws of the State of California; and

B. P ursuant to the police powers delegated to it by the California Constitution, the City has the authority to enact laws which promote the public health, safety, and general welfare of its citizens, including the regulation of mobile food vehicle vending; and

C. The City Council finds that, unless properly regulated, mobile food vending vehicles pose a unique risk to the health, safety, and welfare of the public, including, but not limited to, impacts to traffic, pedestrian and patron safety, and general consumer protection; and

D. The City Council also finds that, when properly regulated, mobile food vending vehicles allow for individual entrepreneurship opportunities, expand the economic base of the city, augment food vending activities before or after general business hours, and add to a vibrant street that is desirable for both residents and tourists.

THE CITY COUNCIL OF THE CITY OF PALM SPRINGS DOES HEREBY ORDAIN AS FOLLOWS:

SECTION 1
. That the findings and determinations reflected above are true and correct, and are incorporated by this reference herein as the cause and foundation for the action taken by the and through this Ordinance.

SECTION 2. Palm Springs Municipal Code Chapter 6.15 (“Mobile Food Vending Vehicles”), is hereby amended in its entirety to read as follows:

CHAPTER 6.15 MOBILE FOOD VENDING VEHICLES

“6.15.010 Purpose—Intent.

Item 3D - Page 5
Ordinance No. _____

The City Council expressly finds that vehicles in which produce, confections, and food products are prepared, cooked, and/or carried for purposes of retail sale on the public streets pose special dangers to the public health, safety, and welfare of children and residents in the City of Palm Springs. It is the purpose and intent of the City Council, in enacting this, to provide responsible companies and individuals who engage in the operation of Mobile Food Vending Vehicles with clear and concise regulations to prevent safety, traffic, and health hazards, as well as to preserve the peace.

6.15.020 Definitions.

As used in this Chapter:

“Downtown Palm Springs” means the area gen erally bounded by both sides of Vista Chino on the north, both sides of the alignment of Palm Canyon Drive, Alejo Road, Belardo Road, North Museum Drive, E. Tahquitz Canyon Way, and Belardo Road on the west, both sides of Ramon Road on the south, and both sides of Palm Canyon Drive and Indian Canyon Drive on the east.

“Food” means items intended primarily for consumption by human beings.

“Mobile Food Vending Vehicle” means any Category 1, 3, 4, or 5 mobile food facility as defined by Riverside County Ordinance No. 580.5, as may be amended from time to time, that is equipped or primarily used for the preparation and retail sale of food on any public street, alley, parking lot, or highway within the City. The inventory of these vehicles need not be necessarily limited to produce, food, or confections.

“Mobile Food Vendor” means any person who:

1. Conducts or permits or causes the operation of Mobile Food Vending Vehicles;

2. Owns, operates, controls, manages, or leases Mobile Food Vending Vehicles; or

3. Contracts with persons to drive and vend from Mobile Food Vending Vehicles.

“Mobile Food Vendor’s permit” means a permit issued by the City Manager authorizing the holder thereof to engage in the business of food vending.

“Operator” means any person who drives, operates or vends from a Mobile Food Vending Vehicle and shall include the driver and assistant on each Mobile Food Vending Vehicle.

“Park” means all grounds, buildings, improvements, and areas dedicated to use by the public for park, recreation, or open space purposes and over which the City has acquired right of use for such purposes. The term “Park” includes sidewalks, trails, and pathways in or around park facilities, park strips, and other grounds of any park.

Item 3D - Page 6
Ordinance No. _____

“Person” means any natural person, firm, partnership, association, corporation, or stockholder and includes, but is not limited to, owners, operators, drivers, lessors, and lessees of food trucks.

“Temporary Special Event” means an event that is permitted pursuant to Palm Springs Zoning Code Section 94.02.01, or as otherwise permitted and authorized by the City.

“Vend” or “vending” means offering food products of any kind for preparation or sale from a Mobile Food Vending Vehicle as defined in this section on a street, alley, highway or a place open to the public within the City and includes the movement or standing of a Mobile Food Vending Vehicle for the purpose of preparing food for retail sale, or searching for, obtaining or soliciting retail sales of products.

6.15.030 Permit—Required.

No person shall operate or cause the operation of a Mobile Food Vending Vehicle in the City without a Mobile Food Vendor’s permit issued pursuant to the provision of this Chapter and any other license or permit required under any other provision of this code.

Additionally, a mobile food facility permit issued by the county of Riverside and certificates of inspection from the Office of the Fire Marshal, are required for each and every Mobile Food Vending Vehicle before the Mobile Food Vendor’s permit is issued.

6.15.040 Permit—Term—Renewal.

The term of the Mobile Food Vendor permit, unless sooner suspended or revoked, shall be annual. Upon the expiration of such term, the permittee may renew the permit by paying the renewal fee as is established by resolution of the City Council. If there are substantial changes in the original application, a new application shall be required in conformance with Section 6.15.050.

6.15.050 Application for Mobile Food Vendor Permit—Contents—Required Fee.

A.

Any person who desires to obtain a permit to operate or cause the operation of one or more Mobile Food Vending Vehicles shall obtain an appl ication from the City Manager. Prior to submitting such application a nonrefundable fee, as established by resolution of the City Council, shall be paid to the City Manager to defray, in part, the cost of the investigation and report required by this Chapt er.

After an application permit has been filed with the City Manager, the City Manager shall cause an investigation to be made by the health officer and chief of police.

Permit issuance fees required under this Chapter shall be in addition to any license, permit or fee required under any other Chapter of this code.

B.

Neither the filing of an application for a permit, nor the payment of an application fee, shall authorize the vending from, operation or management of a Mobile Food Item 3D - Page 7
Ordinance No. _____

Vending Vehicle until such permit has been granted or renewed.

C. Each applicant for a permit to conduct business as a Mobile Food Vendor shall furnish the following information:

1. The present or proposed address from which the business is to be conducted;

2. The full true name under which the business will be conducted;

3. The full true name and any other names used by the applicant;

4. The present residence and business address and telephone numbers of the applicant;

5. A general description of the kinds of merchandise that the Mobile Food Vending Vehicles will vend;

6. The number of vehicles to be owned, operated or controlled by the applicant and the makes, body styles, years, serial and engine numbers, state license plate numbers, and names and addresses of the registered and/or legal owners of each vehicle;

7. A description of the logo, color scheme, insignia, and any other distinguishing characteristics of applicant’s vehicles;

8. Insurance in the manner and form required by this Chapter from a responsible, solvent insurance carrier authorized to issue public liability and property damage insurance in the state of California;

9. The full and true nam es, addresses and telephone numbers of all persons employed or intended to be employed, or with whom the applicant has contracted, leased or intends to contract with as driver operator of the applicant’s vending vehicles, and in addition, their:
a.

California driver’s license or other identification commonly accepted in commercial undertakings; and
b. Food worker’s certificate.

10. If the applicant is a corporation, the name shall be stated exactly as set forth in its articles of incorporation. The applicant shall show the name and residence address of each of the officers, directors, and each stockholder, owning not less than ten percent of the stock of the corporation, and the address of the corporation itself, if different than the applicant’s place of business. If the applicant is a partnership, the application shall show the name and residence address of each of the partners, including limited partners, and the address of the partnership itself, if different than the applicant’s place of business;

11. All criminal convictions of the principals, operators, drivers, excluding minor traffic offenses (any traffic offense designated as a felony shall not be construed as a minor traffic offense), stating the date, place, nature and sentence of each such conviction;

12. The applicant, if other than an individual, shall also furnish the following information:
a.

Each business address of th e applicant for the three- year period immediately preceding the date of the application and the inclusive Item 3D - Page 8
Ordinance No. _____

dates of each such business,
b. The nature of the business or firm for the three- year period immediately preceding the date of the application, and
c. The permit history of the applicant for the three- year period immediately preceding the date of the filing of the application, including whether such applicant, in previously operating in this or any other city, county, state or territory, has ever had any similar license or permit, or franchise revoked or suspended, and if so, the circumstances of such suspension or revocation;

13. Such other identification and/or information as the City Manager may require in order to discover the truth of the matters required to be set forth in the application.

6.15.060 Investigation of Application.

The City Manager shall act to approve or deny an application for a Mobile Food Vendor’s permit under this Chapter within a reasonable period of time and in no event shall the City Manager act to approve or deny said permit later than ninety days from the date the application was accepted as complete by the City Manager. Every Mobile Food Vendor permit issued pursuant to this Chapter will terminate at the expiration of one year from the date of its issuance unless sooner suspended or revoked.

6.15.070 Permit—Issuance.

A. The City Manager shall grant the Mobile Food Vendor’s permit if the City Manager finds that all of the following requirements have been met:

1. The required fees have been paid;

2. The application conforms in all respects to the provisions of this Chapter;

3. The applicant has not knowingly made a material misrepresentation of fact in the application;

4. The applicant has fully cooperated in the investigation of the application;

5. The applicant if an individual; or any of the directors, officers or stockholders holding more than ten percent of the stock of the corporation; or any of the partners, including limited partners, or profit interest holder, manager or other person principal ly in charge of the operation of the existing or proposed business of vending from a food vending truck or a natural person employed or contracted with to be a driver has not been convicted or pleaded nolo contendere or guilty within five years prior to hi s or her application for a permit to a misdemeanor or felony crime of moral turpitude or drug-related misdemeanor or felony crime, including, but not limited to:
a.
the sale of a controlled substance specified in California Health Safety Code Sections 11054 through 11058;
b.
the sale, distribution or display of harmful or obscene matter; c. indecent exposure;
d. selling or disposing of lottery tickets;
Item 3D - Page 9
Ordinance No. _____

e. permitted gambling, pool selling or bookmaking; or in the case of applications for an operator’s permit, alcohol or drug- related traffic offenses.

B. The City Manager is specifically authorized to obtain state summary criminal history record information as provided for in Section 11105 of the California Penal Code. Any co mplaint for the above- listed charges pending before a court of law shall cause the application to be considered pending until adjudication of the complaint.

6.15.080 Permit—Denial.

A.

If the City Manager finds that the requirements set forth in Section 6.15.070 have not been met, the City Manager shall deny the application for a Mobile Food Vendor’s permit. In the event the application is denied by the City Manager, written notice of such denial shall be given to the applicant specifying the basis for such denial. Notice of denial shall be deemed to have been served if, in fact, it is personally served to the applicant or when deposited in the United States mail with prepaid postage and addressed to the applicant at his or her residence address as set forth in the application.

B.

Any applicant whose application for a Mobile Food Vendor permit has been denied by the City Manager, may submit an appeal in writing to the City Clerk within fifteen days of such denial. The City Council may refer the appeal to a hearing officer.

6.15.090 Permit—Revocation.

A.

Any vendor permit may be suspended or revoked by the City Manager for any of the following reasons:

1. Falsehood of any information supplied by the permittee upon which issuance of the permit was based;

2. Failure of the permittee to notify the City Manager within two weeks of any change occurring subsequent to the issuance of the permit in the information supplied by the permittee upon which issuance of the permit was based;

3. Failure of the permittee, or of any employees or subcontractors of the permittee, to comply with the regulations set forth in
Sections 6.15.110 through 6.15.160 inclusive; or

4. Violation by the permittee, or any employee, subcontractor or independent contractor of the permittee, of any state law or municipal ordinance while in the course of conducting vending operations from food trucks pursuant to the permit.

B.

No such suspension or revocation shall become effective until the permit holder has been notified in writing of the right of such permit holder to appeal the Item 3D - Page 10
Ordinance No. _____

suspension or revocation. Notification of the permit holder shall be made either by personal delivery or by certified or registered mail, return receipt requested, addressed to the permit holder at such permit holder’s residence address as set forth on the application for a permit. If an appeal is filed, the suspension or revocation shall be stayed and shall become effective only upon decision of the Administrative Appeals Board. The suspension or revocation shall become effective after the timely appeal period has expired. The appeal shall be in writing and filed with the City Clerk within fifteen days of effective date of suspension or revocation.

C.

No person whose permit is revoked shall be eligible to apply for a new permit for a period of one year following such revocation.

6.15.100 Mobile Food Vending Vehicle Regulations.

A.

Each Mobile Food Vending Vehicle shall have a current, valid county of Riverside grade card/decal health inspection sticker affixed to the lower right side of the windshield and a current, valid business license decal affixed as specified in Section 5.04.200 of this code.

B. Each individual who drives, operates or vends from a Mobile Food Vending Vehicle shall have on his or her person a current, valid California driver’s license and a food worker certificate pursuant to Section 6.07.020 of this Code, which he or she shall make available for inspection by law enforcement officials or code compliance officers upon request.

C. Condition/Appearance of Site.

1. The site where a Mobile Food Vending Vehicle is parked shall be maintained in a safe and clean manner at all times.

2. Exterior storage of refuse, equipment or materials associated with the food vending truck is prohibited.

3. The Mobile Food Vending Vehicle shall maintain vehicular and pedestrian circulation and access consistent with all local and state regulations.

4. Any Mobile Food Vending Vehicle parked out of the public right -of-way to conduct business must have the written consent of the property owner to do so. If such a food vending truck has written permission from the property owner, up to four tall stand-up cocktail-type tables but, no chairs, no fences or other site furniture (permanent or otherwise) shall be permitted.

D. Litter Control.

1. A ny Mobile Food Vending Vehicle licensed by the county of Riverside as a Category 4 or Category 5 mobile food facility shall provide a minimum of two thirty-two-gallon litter receptacles within fifteen feet of the vehicle. The receptacles will serve both employees and customers.

Item 3D - Page 11
Ordinance No. _____

2. The Mobile Food Vending Vehicle vendor shall maintain the subject property and adjacent right-of-way free of litter on and within one hundred feet of the vending site.

3. All refuse shall be removed from the vending site and properly disposed of within thirty minutes of the close of vending for the day at that site.

E. Security.

1. The vendor shall install signage indicating that loitering is not permitted and customers may only remain on the lot for up to thirty minutes after receiving their food.

2. The vendor shall enforce the no-loitering rule.

3. The serving or consumption of alcohol shall be prohibited at vending sites.

F. Toilets and Handwashing Facilities. In order for a Mobile Food Vending Vehicle to remain parked and con ducting business in one location longer than one hour , it must be situated within two hundred feet travel distance of a legally approved and permitted toilet and handwashing facility, or as otherwise approved by the City Manager, to ensure that restroom facilities are available to Mobile Food Vending Vehicle employees. The Mobile Food Vending Vehicle operator must have permission of the property owner to use the toilet and handwashing facility.

G. Mobile Food Vending Vehicles operating as part of a temporary special event
permitted by the City Manager shall comport with the permissions and restrictions of the approved permit.

6.15.110 Prohibited Conduct.

A. No person shall vend from a Mobile Food Vending Vehicle which is stopped, parked, or standing on any public street or public
parking lot within Downtown Palm
Springs, except as otherwise specified in Section 6.15.170 of this Code.

B.

No Mobile Food Vending Vehicle shall be permitted in any City Park with a concession stand operated by a vendor under exclusive contract with the City , unless otherwise authorized by the City Manager or the City Manager’s designee.

C. No person shall vend from a Mobile Food Vending Vehicle which is stopped, parked, or standing on any public street or parking lot when the following apply:

1. When the Mobile Food Vending Vehicle is parked within five hundred (500) feet of the nearest property line of any school serving students 18 years of age or younger,
or any public park unless that school is a college, university, or vocational school that primarily serves students older than eighteen years of age, unless the Mobile Food Vending Vehicle is associated with a certified farmers market that is open at the time that the food vending truck is conducting business;

3. When the posted speed limit on the public street, alley or highway is greater Item 3D - Page 12
Ordinance No. _____

than thirty-five forty (40) miles per hour;

4. When the Mobile Food Vending Vehicle is parked in violation of any other provision of this Code, or the California Vehicle Code;

5. When any part of the Mobile Food Vending Vehicle is open to prospective customers other than on the side of the vehicle next to the right side of the street, alley or highway;

6. When the Mobile Food Vending Vehicle is not stopped, parked or standing on the right side of the street, alley or highway;

7. When the prospective customer is standing or sitting in another vehicle;

8. When the prospective customer is located in that portion of the street, alley or highway which is open to vehicular traffic.

D. No person shall operate, or cause to be operated, any Mobile Food Vending Vehicle with sound-amplifying equipment in operation per Section 5.92.030 of this code.

E. No person shall back up a Mobile Food Vending Vehicle to make or attempt a sale.

F. No minor shall ride in or on a Mobile Food Vending Vehicle.

G. Such vehicles shall operate only between the hours of 7:00am and 3 :00am.

Monday through Sunday as follows:

1. October 1st through April 30th: nine a.m. to five p.m.

2. May 1st through September 30th: nine a.m. to seven p.m.

Vending hours in public parks shall be limited to the hours that the park is open to the general public.

6.15.120 Insurance Requirements.

A. It is unlawful for any person to own, lease, drive, operate or cause or permit to be driven or operated any Mobile Food Vending Vehicle in the City unless such person has submitted with his or her application for a permit the required insurance policies outlined in this section, which shall be issued by an insurance company currently authorized by the insurance commi ssioner to transact business of insurance in the state of California, with an assigned policyholders’ rating of A- (or higher) and financial size category Class VII (or larger) in accordance with the latest edition of Best’s Key Rating Guide, unless otherwise approved by the City’s Risk Manager. Such policies shall conform in all respects to the requirements of this Chapter.

B. The required motor vehicle liability policy shall insure the owner, driver, and any other person using or responsible for the use of any Mobile Food Vending Vehicle with the consent, expressed or implied, of such owner, driver or person, against loss from the liability imposed upon such owner, driver or person by law for injury to, or death of, any person, or damage to property growing out of the maintenance, Item 3D - Page 13
Ordinance No. _____

operation or ownership of any Mobile Food Vending Vehicle in an amount not less than one million dollars combined single limit for each accident, no aggregate.

Automobile insurance shall be at least as broad as Insurance Service Office Form CA 00 01 covering bodily injury and property damage for all activities of the Mobile Food Vending Vehicle.

C. The permittee shall maintain commercial general liability insurance with coverage at least as broad as Insurance Services Office Form CG 00 01, in an amount not less than one million dollars per occurrence, two million dollars general aggregate, for bodily injury, personal injury, and property damage, including without limitation, blanket contractual liability. Defense costs shall be paid in addition to the limits.

The policy shall contain no endorsements or provisions limiting coverage for: (1) contractual liability; (2) cross liability exclusion for claims or suits by one insured against another; or (3) contain any other exclusion contrary to the permit.

D. The permittee shall maintain workers’ compensation insurance (statutory limits) and employer’s liability insurance (with limits of at least one million dollars). The permittee shall submit to the City Manager, along with the certificate of insurance, a waiver of subrogation endorsement in favor of the City of Palm Springs, its officers, agents, employees and volunteers.

E. The permittee may opt to utilize umbrella or excess liability insurance in meeting insurance requirements. In such circumstances, the permittee shall obtain and maintain an umbrella or excess liability insurance policy with limits of not less than four million dollars that will provide bodily injury, personal injury and property damage liability coverage at least as broad as the primary coverages set forth above, including commercial general liability and employer’s liability. Such policy or policies shall include the following terms and conditions:

1. A drop down feature requiring the policy to respond if any primary insurance that would otherwise have applied proves to be uncollectible in whole or in part for any reason;

2. Pay on behalf of wording as opposed to reimbursement;

3. Concurrency of effective dates with primary policies;

4. Policies shall “follow form” to the underlying primary policies; and

5. Insureds under primary policies shall also be insureds under the umbrella or excess policies.

F. Cancellation, termination, or reduction in coverage of any insurance policy filed with the City pursuant to this Chapter shall be just cause for the City Manager to revoke the license.

G. As a condition of being granted a license pursuant to this Chapter, the permittee shall promise, on an application form provided by the City Manager, to indemnify and hold the City of Palm Springs free and harmless from any and all liability, claims, loss, damages, or expenses, including attorney’s fees and court costs, Item 3D - Page 14
Ordinance No. _____

arising by reason of the death or injury of any person, including the permittee or any person who is an employee or agent of the permittee, or by reason of property damage to or destruction of any property, including property owned by the permittee or any person who is an employee or agent of the permittee.

H. Every insurance policy and every certificate of motor vehicle liability insurance filed within the City pursuant to the provisions of this Chapter shall contain the following endorsements:

1. It is hereby understood and agreed that, notwithstanding expressions consistent with or contrary thereto, each policy is expressly issued to cover a motor vehicle regulated by the provisions of Chapter 10 of the Palm Springs Municipal Code. Each policy shall inure to, and be for the benefit and protection of, anyone who shall sustain any damages or injury, or to the heirs, personal representatives, administrators, executors or assigns of any such person who may be so damaged or injured or suffer death, by reason of the operation of the motor vehicle or from the defective condition thereof.

Liability under this policy shall in no manner be abrogated or abated by the death or dissolution of the insured;

2. There is continuing liability up to the full amount of each policy, notwithstanding any action or recovery thereon;

3. No cancellation or reduction in coverage of each policy for any reason whatsoever shall become effective until the expiration of thirty days after written notice of such cancellation or reduction in coverage shall have been given to the City Clerk of the City of Palm Springs. Said period of thirty days to commence running from the date said notice is actually received in the office of the City Clerk;

4. All such policies shall provide, or be endorsed to provide, that the City of Palm Springs and its officers, officials, employees, and agents shall be additional insureds with regard to liability and defense of suits or claims arising out of the performance under this permit. This provision shall also apply to any excess liability policies;

5. All insurance coverage maintained or procured pursuant to this permit shall be endorsed to waive subrogation against the City of Palm Springs, its elected or appointed officers, agents, officials, employees and volunteers or shall specifically allow the permittee or others providing insurance evidence in compliance with these specifications to waive their right of recovery prior to a loss. Permittee shall waive its own right of recovery against the City of Palm Springs;

6. All insurance coverages shall be primary and any other insurance, deductible, or self-insurance maintained by the indemnified parties shall not contribute with this primary insurance. Policies shall contain or be endorsed to contain such provisions.

I. The permittee shall give City Manager prompt and timely notice of claims made or suits instituted that arise out of or result from the permittee’s performance under Item 3D - Page 15
Ordinance No. _____

this permit, and that involve or may involve coverage under any of the required liability policies.

J. The permittee shall execute and maintain its work so as to avoid injury or damage to any person or property. In carrying out its services, permittee shall at all times be in compliance with all applicable local, state and federal laws, rules and regulations, and shall exercise all necessary precautions for the safety of employees and the public appropriate to the nature of the work and the conditions under which the work is to be performed.

K. Requirements of specific coverage features or limits contained in this section are not intended as a limitation on coverage, limits or other requirements, or a waiver of any coverage normally provided by any insurance. Specific reference to a given coverage feature is for purposes of clarification only as it pertains to a given issue and is not intended by any party or insured to be all inclusive, or to the exclusion of other coverage, or a waiver of any type.

L. The permittee acknowledges and agrees that any actual or alleged failure on the part of the City Manager to inform the permittee of noncompliance with any requirement imposes no additional obligations on the City of Palm Springs nor does it waive any rights hereunder.

6.15.130 Inspection of Mobile Food Vending Vehicles.

A. In addition to other equipment required by law, each Mobile Food Vending Vehicle shall be equipped with the following:

1. A convex mirror mounted so that the occupant of the driver’s seat can see the area in front of the truck which is obscured by the vehicle’s hood; and

2. A back-up alarm audible for a distance of at least one hundred feet.

B. In addition to such inspection of the Mobile Food Vending Vehicle as may be required by other agencies, the City’s Fire Marshal shall perform an inspection of each Mobile Food Vending Vehicle before it is put into service within city limits, and annually thereafter, coincident with renewal of the Mobile Food Vendor’s permit. The City’s Fire Marshal shall issue a certificate of inspection to Mobile Food Vending Vehicles compliant with fire safety regulations.

6.15.140 Required Signs and Lettering.

A. There shall be displayed in a conspicuous place on both the front and back of the Mobile Food Vending Vehicle appropriate warning signs or lettering, e.g., for Mobile Food Vending Vehicles permitted by the county of Riverside as Category 3 mobile food facilities (ice cream trucks) “CAUTION CHILDREN.” The lettering shall not be less than six inches in height and lettering shall be in contrast to the color of the background upon which they are placed.

Item 3D - Page 16
Ordinance No. _____

B. There shall be displayed in a conspicuous place on both the right and left side of the Mobile Food Vending Vehicle lettering permanently affixed showing the nature of the company or operator of the Mobile Food Vending Vehicle and the business address and telephone number of the owner or operator. The lettering shall not be less than four inches in height, and shall be in contrast to the color of the background upon which they are placed.

C. No other lettering, numbering, price lists, signs or insignia shall be displayed on the right and left side of the Mobile Food Vending Vehicle so as to interfere with the visibility of the lettering required in subsection B of this Section.

6.15.150 Applicability of Regulations to Existing Businesses.

The provisions of this Chapter shall be applicable to all persons and businesses described in this Chapter whether the activities described in this Chapter were established before or after the effective date of the ordinance enacting this Chapter into law. All such persons and businesses shall have thirty days from said effective date to file a completed application for vendors’ permits with the City Manager.

6.15.160 Nuisance; Violation and Penalty.

A. Any Mobile Food Vending Vehicle operated contrary to the provisions of this Chapter is declared to be unlawful and a public nuisance and the City Attorney may, in addition to or in lieu of prosecuting a criminal action hereunder, commence an action or actions, proceeding or proceedings, for the abatement, removal or enjoinment thereof, in the manner provided by law, and may take such other steps and may apply to such court or courts as may have jurisdiction to grant such relief as will abate or remove such establishment and restrain and enjoin any person from operating a Mobile Food Vending Vehicle contrary to the provisions of this Chapter.

B. Every person, whether acting as an individual owner, employee of the owner, operator, or employee of the operator, or whether acting as an agent or independent contractor for the owner, employee, or operator, or acting as a participant or worker in any way directly or indirectly sells or distributes food or beverage from a Mobile Food Vending Vehicle as defined in this Chapter without first obtaining a Mobile Food Vending Vehicle permit from the City Manager, or that otherwise violates any provision of this Chapter, shall be punishable as specified in Sections 1.01.140 and 1.01.150 of this Code.

6.15.170 Exceptions.

The provisions of Section 6.15.110 shall not apply to:

Item 3D - Page 17
Ordinance No. _____

A. Mobile Food Vending Vehicles servicing construction sites.

B. The delivery or sale of pre- ordered goods or services to a private residence or business with the prior consent of the owner, occupant, lessee, or the designee of such persons, including without limitation employees.

C. Food vending on school property with the consent of school authorities.

D. Food vending on private property with the consent of the owner, lessee, or legal occupant of the property and with a valid land use permit and associated fee, if applicable.

E. Food vending as part of a temporary special event, subject to permissions and restrictions as identified in the temporary special event permit.”

SECTION 3. Amendment of Section 11.44.060(10). Palm Springs Municipal Code Section 11.44.060(10) (“Prohibited Conduct”) is hereby amended to read as follows:

“(10) No person in a park shall conduct or participate in any picnic, or prepare or serve any food, except in an area designated by the city manager for such purpose,
or except as authorized in Chapter 6.15 (Mobile Food
Vendors) of this Code;”

SECTION 4 . Severability
. If any section, sentence, clause or phrase of this
Ordinance or the application thereof to any entity, person or circumstance is held for any reason to be invalid or unconstitutional, such invalidity or unconstitutionality shall n ot affect other provisions or applications of this Ordinance which can be given effect without the invalid provision or application, and to this end the provisions of this Ordinance are severable. The City Council of the City of Palm Springs hereby declares that it would have adopted this Ordinance and each section, sentence, clause or phrase thereof, irrespective of the fact that any one or more section, subsections, sentences, clauses or phrases be declared invalid or unconstitutional.

SECTION 5. CEQA
. This Ordinance is exempt from the requirements of the California Environmental Quality Act (“CEQA”) pursuant to State CEQA Guidelines, as it is not a “project” and has no potential to result in a direct or reasonably foreseeable indirect physical change to the environment [14 Cal. Code Regs. § 15378(a)]. Further, this Ordinance is exempt from CEQA as there is no possibility that this Ordinance or its implementation would have a significant negative effect on the environment [14 Cal. Code Regs. § 15061(b)(3)].

SECTION 6. Effective Date
. This Ordinance shall become effective thirty (30)
days following its adoption.

Item 3D - Page 18
Ordinance No. _____

PASSED, APPROVED, AND ADOPTED BY THE PALM SPRINGS CITY
COUNCIL THIS _____ DAY OF ______________, _________.

GRACE ELENA GARNER
MAYOR

ATTEST:

BRENDA PREE, MMC

CITY CLERK

Item 3D - Page 19
Ordinance No. _____

CERTIFICATION

STATE OF CALIFORNIA )
COUNTY OF RIVERSIDE ) ss.

CITY OF PALM SPRINGS )

I, BRENDA PREE, City Clerk of the City of Palm Springs, California, do hereby certify that Ordinance No. ____ is a full, true, and correct copy, and was introduced at a regular meeting of the Palm Springs City Council on _________ and adopted at a regular meeting of the City Council held on __________ by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:

IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City of Palm Springs, California, this ______ day of ______________, _________.

BRENDA PREE, MMC

CITY CLERK
Item 3D - Page 20

CITY COUNCIL STAFF REPORT
07/24/2023
SUBJECT:

INTRODUCTION AND FIRST READING OF A PROPOSED ORDINANCE OF THE CITY OF PALM SPRINGS, CALIFORNIA, AMENDING CHAPTER 5.26 OF THE

PALM SPRING MUNICIPAL CODE REGARDING THE HOTEL OPERATIONS

INCENTIVE PROGRAM
RECOMMENDATION:

Waive reading of the text and introduce for first reading proposed an Ordinance entitled, “AN ORDINANCE OF THE CITY OF PALM SPRINGS, CALIFORNIA, AMENDING CHAPTER 5.26 OF THE PALM SPRING MUNICIPAL CODE, REGARDING THE HOTEL OPERATIONS INCENTIVE PROGRAM.”
Attachments
Item 3E

CITY COUNCIL STAFF REPORT
DAT
E: JULY 24, 2023 BUSINESS & LEGISLATIVE
SUBJ
ECT: INTRODUCTION AND FIRST READING OF A PROPOSED ORDINANCE

OF THE CITY OF PALM SPRINGS, CALIFORNIA, AMENDING CHAPTER

5.26 OF THE PALM SPRING MUNICIPAL CODE REGARDING THE

HOTEL OPERATIONS INCENTIVE PROGRAM
FR
OM: Scott C. Stiles, City Manager
BY: Com
munity & Economic Development Department
SUMMARY:

The H
otel Operations Incentive Program (Program) is scheduled to expire on December 31, 2023. It is being recommended that the Program be extended until December 31, 2028, and modified to change the calculation of the Transient Occupancy Tax (TOT) Increment that is shared between the City and hotel s. TOT Increment is the difference between the TOT Base and the amount of transient occupancy tax owed to the City. The TOT Base is calculated using the average of the past thirty -six months of TOT paid by the hotel. Some hotels do not have thirty -six month s of TOT payments and are thus unable to participate in the Program. The proposed Ordinance clarifies that, in certain instances, such hotels may still be eligible to participate in the Program and sets forth the reduced incentive that such hotels are eligible to receive under the Program. The draft ordinance making these changes is provided as Attachment A.

RECOMMENDATION:

Wai
ve reading of the text and introduce for first reading proposed Ordinance No. _____, “AN ORDINANCE OF THE CITY OF PALM SPRINGS, CA LIFORNIA, AMENDING CHAPTER 5.26 OF THE PALM SPRING MUNICIPAL CODE, REGARDING THE HOTEL OPERATIONS INCENTIVE PROGRAM.”
BACKGROUND:

The C
ity of Palm Springs adopted Chapter 5.26 of its Municipal Code in December, 2007 (Ordinance 1730, effective January 2008) to provide an incentive program for the operation and maintenance of quality and first class hotel facilities which enhance the tourist and travel experience for visitors to the City of Palm Springs, maximize the use of Item 3E - Page 1
the City’s Convention Center, provide attractive and desirable visitor-serving facilities and experiences, and assist the City in achieving its tourism goals.

The Program could be used for several types of hotels (comfort hotels, first class hotels, and renovation of hotels). Each of these hotels were classified as N ew ( hotels to be constructed), or Existing (hotels, constructed, occupied, and used as a hotel on or before January 1, 2006).

New hotels qualified for the Program if they were fully entitled as a hotel after January 1, 2008, but before December 31, 2014, and were under construction prior to December 31, 2017. After December 31, 2017, no additional N ew Hotels were accepted into the Program. It should be noted that City Council approved Program extensions for the Dream Hotel and Orchid Tree Hotel.

Existing hotels were those that were constructed, occupied, and used as a hotel on or before January 1, 2006. Renovations to E xisting Hotels were required to be under construction no later than December 31, 2014 and completed no later than December 31, 2015. After December 31, 2015, no additional E xisting Hotels were accepted into the Program.

In early 2019, the Program was revived for Existing H otels as the Phase II Renovation Project Hotels Program and included the following terms:
• R enovations made by the hotel shall not be less than $5,000 per room.

• The City reimburses the hotel with 50% of the annual TOT Increment . TOT Increment is the difference between the TOT Base and the amount of transient occupancy tax owed to the City. The TOT Base is calculated using the average of the past thirty-six months of TOT paid by the hotel.

• Share period will be limited to 10 years.

• The Program would not be available for construction of new hotels.

• Amounts of TOT reimbursed to hotels under the Program will not exceed the amount of the hotel renovation investment.

• The Tax Base formula requires the hotel have a thirty-six (36) month period to establish the annual Tax Base.

• The base TOT level will be adjusted on an annual basis at a rate of 3% or increase in the Consumer Price Index (“(All items in Riverside-San Bernardino-Ontario, CA, all urban consumers, not seasonally adjusted”; Area “Riverside- San Bernardino- Ontario, CA) from the prior year for the most recent month available.

• The hotel must be in operation for a period of five (5) years prior to the date when the City accepts the Program application.

• Renovations must be completed no later than December 31, 2023.

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STAFF ANALYSIS:

The proposed Ordinance would make the following changes:

• Extend the Program until December 31, 2028.

• Clarify that the five (5) year required operating period need not be continuous or immediately preceding the date the Program application is deemed complete.

• Allow for hotels that do not have thirty-six (36) months of TOT payment history, or hotels that have not been in operation for a total of at least five (5) years in the fifteen (15) years immediately preceding the date the Program application is deemed complete, to receive an incentive of up to fifty percent (50%) of the TOT increment [or seventy-five percent (75%) for hotels in Class I Historic buildings] in for a reduced period of only five (5) years.

• Eliminate annual CPI adjustment and replace with a one-time CPI adjustment after the fifth year of operation (for hotels eligible to receive the 10-year incentive) or the second year of operation (for hotels eligible to receive the 5- year incentive payment).

Maintaining an attractive City is an important part of a tourism economy. Palm Springs already has several architectural resources and natural beauty which contributes to the City’s success as a desirable location. There remain, however, several hotel properties in need of renovation; the proposed program amendments will assist in providing desirable incentives to reinvigorate the city’s hotel stock.

ENVIRONMENTAL ASSESSMENT
:

The recommended action is not a “project” for purposes of the California Environ mental Quality Act (CEQA), as that term is defined by CEQA guidelines (Guidelines) section 15378.

ALIGNMENT WITH STRATEGIC PLANNING:

Quality of Life (1D), Advance Economic Development – Stimulate investment in activities that create living wage employment opportunities and increase livability of the community.

FISCAL IMPACT:

Funds used to reimburse the hotel s are from net-new TOT revenues – that is revenue above the TOT revenues previously received from each participating hotel (TOT Increment). That amount is divided between the hotel and City with each receiving 50% of the annual TOT Increment. Under the proposed amendment, it is likely more hotels will qualify for the program creating more new TOT revenues and higher room rates based on the improved quality of the hotel facility.

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While the new TOT revenue cannot be known before participating hotels are identified, recent Program participants in just their first year of operations after renovations have generated TOT revenues that are 200% higher than their TOT base. Of that amount, 50% is allocated to the hotel and 50% is allocated to the City. This represents approximately $56,000 of new revenue for each participating hotel for reimbursement of their improvements, and approximately $56,000 from each participating hotel to the City for a ten-year period. For hotels that do not have thirty-six (36) months of TOT payment history the payment period will be limited to five (5) years.

REVIEWED BY:

Department Director: Jay Virata
Deputy City Manager: Flinn Fagg
City Manager: Scott Stiles

ATTACHMENTS:

A. Draft Ordinance

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ATTACHMENT A

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ORDINANCE NO. ____

AN ORDINANCE OF THE CITY OF PALM SPRINGS,
CALIFORNIA, AMENDING CHAPTER 5.26 OF THE PALM

SPRING MUNICIPAL CODE, REGARDING THE HOTEL

OPERATIONS INCENTIVE PROGRAM

City Attorney Summary
This Ordinance extends the City’s Hotel Operations Incentive Program, with certain modifications, for existing hotels that undertake specified renovation projects involving significant investment, subject to certain limitations.

WHEREAS, t he City of Palm Springs (“City”) is a charter city organized pursuant to Article XI, Section 5 of the California Constitution and pursuant to the authority so granted, the City has the power to make and enforce within its limits all ordinances and regulations with respect to municipal affairs not in conflict with its own charter.

WHEREAS, Chapter 5.26 of the Palm Springs Municipal Code establishes the Hotel Operations Incentive Program (“Program”), whereby existing hotels in the City are eligible to receive certain incentives when they undertake specified renovation projects involving significant investment.

WHEREAS, Ordinance No. 1972, adopted by the City Council on February 6, 2019, re- instated the Program and included a sunset date of December 31, 2023.

WHEREAS, currently, hotels that have not been in operation for the previous 36 months are not eligible to participate in the Program because Chapter

5.26 does not specify how to calculate the Phase II Renovation Project Transient Occupancy Tax Base for such hotels.

WHEREAS, the City Council desires to extend the sunset date of the Program, to establish parameters under which hotels without 36 months of transient occupancy tax may participate in the Program, and to make certain other adjustments to the Program.

THE CITY COUNCIL OF THE CITY OF PALM SPRINGS DOES ORDAIN AS FOLLOWS:

SECTION 1
. Incorporation of Recitals. That the findings and
determinations reflected above are true and correct, and are incorporated by this reference herein as the cause and foundation for the action taken by and through this Ordinance.

SECTION 2. Amendment of Palm Springs Municipal Code Section

5.26.020. Section 5.26.020 of the Palm Springs Municipal Code shall be amended in its entirety, to read as follows:

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“5.26.020 Definitions.

For the provisions of this Chapter, the following definitions shall apply:
“Adjusted tax rate” means the hotel operations incentive program tax rates which shall be exclusively utilized for the calculation of the operating assistance to be paid by the City to qualified operators of hotels participating in the hotel performance incentive program. For hotels of one hundred twenty-four rooms or less, the adjusted tax rate shall be ten and nine-tenths percent of the rent charged by the operator of the hotel for transient occupancies. For hotels of one hundred twenty -five rooms or more, the adjusted tax rate shall be twelve and one-tenths percent of the rent charged by the operator of the hotel for transient occupancies. The adjusted tax rate set forth in this Section shall exclusively apply for the calculation of any and all operating assistance for the term of the hotel performance incentive program without regard to any increases at any time in the City of Palm Springs’ transient occupancy tax rates.
“Certified Renovation Investment” means the amount of money that the operator of a Renovation Hotel plans to invest in the course of a Phase II Renovation Project, and (i) documents to the City’s satisfaction, in its Hotel Operations Incentive Program application, all improvements proposed, and subsequently (ii) certifies in writing, to the City Manager or their designee, upon completion of the project, the actual costs and expenses incurred. If a Phase II Renovation Project includes hotel rooms, the amount of the investment shall not be less than five thousand dollars ($5,000.00) per room subject to the project. If the project includes any common area or amenity, or any other area for guest use at the hotel, the amount of the investment shall not be less than the amount, if any, invested in rooms, added to the total number of rooms at the hotel that will exist at the end of the project multiplied by five thousand dollars ($5,000.00). “Committable rooms program” means the Palm Springs conventio n center’s committable rooms program which provides the convention center with a list of hotel properties and a count of hotel rooms available, one year in advance or more, for potential reservation by meeting groups and/or conventions in the City.
“Comfort hotel” means a hotel which provides appropriate standards of physical features and operational services established for hotels by the American Automobile Association, J.D. Power & Associates, Forbes, or Smith’s Travel Research Service.

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“Construction” means the process of making, building, fabricating, installing, and setting up tangible physical enhancements to a hotel that include without limitation, one or more of the following: (i) modification of an existing structure or amenity, (ii) new or upgraded furniture, fixtures or equipment, (iii) new or upgraded landscaping. Construction may address hotel rooms, common areas, and/or other areas for guest use. “Existing hotel” means a property that was constructed, occupied, and used as a hotel on or before January 1, 2006.
“First class hotel” means a hotel which provides standards of physical features and operational services which meet or exceed the higher rating criteria established for hotels by the American Autom obile Association, J.D. Power & Associates, Forbes, or Smith’s Travel Research Service.
“First class hotel standard” means standards of physical features and operation which qualify a hotel as a first class hotel and which include operation of t he hotel on a twenty -four hours per day/seven day a week basis with housekeeping services, food and beverage services, room services, banquet and meeting services, concierge and bellman services, and parking services.
“Fully entitled” means a hotel that has received and/or been issued all discretionary permits and entitlements from the City required for the construction of a new hotel.
“Hotel” means any property containing four (4) or more guest rooms used by four (4) or more guests for compensation and where the guest rooms are designed and intended as transient occupancy accommodations. “New hotel,” “first class new hotel,” and “comfort new hotel” means a hotel or first class hotel or comfort hotel that is or was fully entitled as a hotel after January 1, 2008, but before December 31, 2014 and which is under construction prior to December 31, 2017. The term “new hotel” does not include all, or any portion of, or addition to, an existing hotel. “Operating covenants” means the covenants described in
Section 5.26.050
of this Code.
“Operator” means the person who is proprietor of a hotel, whether in the capacity of owner, lessee, sub- lessee, mortgagee in possession, licensee, franchisee, or any other capacity, or the assignee or designee of such proprietor.

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“Phase II Renovation Project” means a hotel improvement project constructed by a Renovation Hotel commencing no more than twelve (12) months after the City’s execution of the operating covenant for that hotel, and completed no later than December 31, 2028. The hotel may suspend all or some of its operations during construction of the project. Collection and payment to the City of transient occupancy tax under Chapter 3.24 of
this Code for any portion of the hotel that remains open during construction of the project shall continue until the project’s completion, without any consideration to the operator pursuant to this Chapter. Whether the hotel suspends operations or not, collection and payment to the City of transient occupancy tax under Chapter

3.24 of this Code by a Phase II Renovation
Project hotel pursuant to this Chapter shall commence immediately on the Renovation Approval Date.
“Phase II Renovation Project Transient Occupancy Tax Base” means the annual average, during the thirty -six (36) month period prior to the date when the City deems the Hotel Operations Incentive Program application of a potential Renovation Hotel to be complete, of transient occupancy tax owed to the City.
“Phase II Renovation Project Transient Occupancy Tax Base Adjustment” means the following: (a) for Phase II Renovation Project hotels eligible to receive an incentive pursuant to Section 5.26.040(d)(2), the one- time increase to the Phase II Renovation Project Transient Occupancy Tax Base after the fifth anniversary date of the Renovation Approval Date of the hotel, or ( b) for Phase II Renovation Project hotels eligible to receive an incentive pursuant to Section 5.25.040(d)(3), the one- time increase to the Phase II Renovation Project Transient Occupancy Tax Base after the second anniversary date of the Renovation Approval Date of the hotel. This increase shall be in an amount equal to three percent (3%), or the annual percentage change in the most recent month’s data in the Consumer Price Index, whichever is higher. The Consumer Price Index used in calculating this adjustment shall be the “Consumer Price Index, Los Angeles -Long Beach-Anaheim, All Items, 1982-84=100 base, All Urban Consumers (CPI- U).”
“Phase II Renovation Project Transient Occupancy Tax Increment” means the amount of transient occupancy tax that a Renovation Hotel owes to the City annually, pursuant to Chapter 3.42
of this Code, after the
Renovation Approval Date, minus the Phase II Renovation Project Transient Occupancy Tax Base as adjusted by the Transient Occupancy Tax Base Adjustment.
“Qualified renovation program” means a property improvement program undertaken by an existing hotel which invests no less than fifteen thousand dollars per room, or invests no less than one million dollars in Item 3E - Page 9
ancillary non-hotel room facilities and/or space. The property improvement program shall be comprehensively executed in a single renovation project on the property and be under construction no later than December 31, 2014 and completed no later than December 31, 2015.
“Renovation Approval Date” is the date of the City’s final inspection and approval of improvements constructed pursuant to a Phase II Renovation Project.
“Renovation Hotel” means a “hotel” as defined in Palm Springs Zoning Code Section 91.00.00
, as the City may amend that section from
time to time, which hotel participates in the Hotel Operations Incentive Program as a Phase II Renovation Project hotel. Upon the adoption of this ordinance, “hotel” is defined “ any building or portion thereof containing six (6) or more guest rooms used by six (6) or more guests, for compensation (excepting jails and hospitals), where provision for cooking may be made in a limited number of individual suites, and which rooms are designed and intended as temporary or overnight accommodat ions.” In order to qualify and apply for participation in the Hotel Operations Incentive Program under this Chapter, a Renovation Hotel must be in operation for a period of five (5) years prior to the date when the City accepts the Hotel Operations Incentive Program application of an operator of a proposed Renovation Hotel as complete. This five (5) year period may include changes in the ownership and/or name of the hotel in question and may include lapses in operation. Additionally, the five (5) year period is not required to be the five (5) years immediately preceding the date when the City accepts the Hotel Operations Incentive Program application of an operator of a proposed Renovation Hotel as complete. However, a Renovation Hotel shall only be eligible to receive an incentive pursuant to Section 5.26.040(d)(2), if the Renovation Hotel has been in operation for a total of at least five (5) years within the fifteen (15) years immediately preceding the date when the City accepts the Hotel Operations Incentive Program application of an operator of a proposed Renovation Hotel as complete. A Renovation Hotel that has not been in operation for a total of at least five (5) years in the fifteen (15) years immediately preceding the date when the City accepts the Hotel Operations Incentive Program application of an operator of a proposed Renovation Hotel as complete shall only be eligible to receive an incentive pursuant to Section 5.26.040(d)(3). No property that operates as a Homeshare or Vacation Rental pursuant to Chapter

5.25 of this Code may
also operate as a Renovation Hotel or receive any payment under this Chapter.
“Transient occupancy” means an uninterrupted stay of no more than twenty-eight consecutive calendar days.

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“Transient occupancy tax base” means the average of the last thirty- six months of annualized transient occupancy tax owed to the City by an existing hotel prior to the commencement of a qualified renovation program. “Transient occupancy tax increment” means the difference between the transient occupancy tax base and the amount of transient occupancy tax owed to the City by an existing hotel after the recordation of the operating covenants by the City.
“Under construction” means that all necessary discretionary entitlements have been approved by the City of Palm Springs, grading and building permits have been issued, and that inspection approvals by the City of Palm Springs of grading and foundations to grade level have been obtained, vertical construction of hotel rooms has begun, and the operating covenants have been recorded.”
SECTION 2. Amendment of Palm Springs Municipal Code
Section 5.26.040. Section 5.26.040 of the Palm Springs Municipal Code shall be amended in its entirety, to read as follows:

“Section 5.26.040 Incentive Program.

(a) First Class New Hotels. The City shall pay to an operator of a first class new hotel an amount equal to seventy -five percent (75%) of the adjusted tax rate. Such payments shall be made for thirty years or until the operator has been paid fifty million dollars, whichever event occurs first.

The City and a qualified participant under this Section may enter into an agreement, at the sole discretion of the City, to receive an increase in the percent of the adjusted tax rate, for no longer than the first two years of the qualified participant’s Incentive program.

Without regard to any preceding conditions of this Section, the program shall terminate at any point the first class new hotel is not operated as a first class hotel.
(b) Comfort New Hotels. The City shall pay to an operator of a comfort hotel with 125 or more rooms an amount equal to fifty percent of the adjusted tax rate and such payments shall be made for twenty years or until the operator has received twenty -five million dollars, whichever event occurs first. The City shall pay to an operator of a comfort hotel with 51 to 124 rooms an amount equal to fifty percent of the adjusted tax rate and such payments shall be made for ten years or until the Operator has received twenty million dollars, whichever event occurs first. The City shall pay to an operator of a comfort hotel with 49 or fewer rooms an amount equal to fifty Item 3E - Page 11
percent of the adjusted tax rate and such payments shall be made for ten years or until the Operator has received fifteen million dollars, whichever event occurs first. Without regard to any preceding conditions of this Section, the program shall terminate at any point the deluxe hotel is not operated as a comfort hotel.
(c) Existing Hotels. The City shall pay to an operator of an existing hotel an amount equal to fifty percent of the transient occupancy tax increment collected and remitted to the City pursuant to Chapter 3.24 of this Code and
such payments shall be made for ten years, or until the operator has received twenty-five million dollars, whichever event occurs first. (d) Phase II Renovation Project Hotels. Operators shall only receive an incentive pursuant to this Chapter in accordance with this Section 5.26.040
(d).
(1) On a hotel’s Renovation Approval Date, the City shall inspect that hotel, and verify that the operator has implemented all Phase II Renovation Project improvements, and that the improvements remain on-site. Further, on or before a hotel’s Renovation Approval Date, th e operator of that hotel shall submit to the City such documentation as the City may require, and thereby certify and demonstrate the expenditure of that operator’s Certified Renovation Investment. Any unexpended portion of the Certified Renovation Investment shall be subtracted from the Certified Renovation Investment as that sum pertains to an operator’s recoupment of same in accordance with Section 5.26.040
(d)(2).
(2) For a Phase II Renovation Project hotel with thirty -six ( 36) complete months of transient occupancy tax payments in the past three (3) years prior to the date when the City deems the Hotel Operations Incentive Program application of a potential Renovation Hotel to be complete and that has been in operation for at least a total of five (5) years within the fifteen (15) years immediately preceding the date when the City accepts the Hotel Operations Incentive Pro gram application of an operator of a proposed Renovation Hotel as complete, the City shall on an annual basis, return, reimburse and pay to the operator of a Phase II Renovation Project hotel an amount equal to fifty percent (50%) of the Phase II Renovation Project Transient Occupancy Tax Increment collected and remitted to the City. Renovation Hotels that are Class 1 Historic Sites as defined in Palm Springs Municipal Code Chapter 8.05 , shall
receive an amount equal to seventy-five percent (75%) of the Phase II Renovation Project Transient Occupancy Tax Increment. The City shall continue making such payments until the ten (10) year anniversary of the first payment hereunder, or until an operator has Item 3E - Page 12
recouped their Certified Renovation Investment, whichever occurs first. Notwithstanding any other provision in this Chapter, City payments to an operator, or the successor of an operator of a Phase II Renovation Project hotel under this Section 5.26.040 (d) shall
terminate immediately and permanently at the end of any period of thirty (30) days during which the hotel in question is not operated as a hotel, unless the City has consented to a suspension of operations pursuant to an operating covenant.
(3) For a Phase II Renovation Project hotel with less than thirty six (36) complete months of transient occupancy tax payments in the past three (3) years prior to the date when the City deems the Hotel Operations Incentive Program application of a potential Renovation Hotel to be complete or that has not been in operation for a total of at least five (5) years in the fifteen (15) years immediately preceding the date when the City accepts the Hotel Operations Incentive Program application of an operator of a proposed Renovation Hotel as complete, the City shall on an annual basis, return, reimburse and pay to the operator of a Phase II Renovation Project hotel an amount equal to fifty percent (5 0%) of the Phase II Renovation Project Transient Occupancy Tax Increment collected and remitted to the City. Renovation Hotels that are Class 1 Historic Sites as defined in Palm Springs Municipal Code Chapter 8.05
, shall receive an amount
equal to seventy -five percent (75%) of the Phase II Renovation Project Transient Occupancy Tax Increment. The City shall continue making such payments until the five (5) year anniversary of the first payment hereunder, or until an operator has recouped their Certified Renovation Investment, whichever occurs first. Notwithstanding any other provision in this Chapter, City payments to an operator, or the successor of an operator of a Phase II Renovation Project hotel under this Section 5.26.040(d) shall terminate immediately and permanently at the end of any period of thirty (30) days during which the hotel in question is not operated as a hotel, unless the City has consented to a suspension of operations pursuant to an operating covenant.
(e) No Renovation Hotel receiving any amount of Phase II Renovation Project Transient Occupancy Tax Increment or any other consideration pursuant to an operating covenant entered pursuant to this Chapter may apply for any additional benefit pursuant to this Chapter, based upon a second Phase II Renovation Project or otherwise, until the termination of that Renovation Hotel’s receipt of such consideration or benefit in accordance with Section 5.26.040
(d)(2).”

SECTION 4. Severability. If any section or provision of this Ordinance is Item 3E - Page 13
for any reason held to be invalid or unconstitutional by any court of competent jurisdiction, or contravened by reason of any preemptive legislation, the remaining sections and/or provisions of this Ordinance shall remain valid. The City Council hereby declares that it would have adopted this Ordinance, and each section or provision thereof, regardless of the fact that any one or more section(s) or provision(s) may be declared invalid or unconstitutional or contravened via legislation.

SECTION 5. CEQA. The City Council determines that the adoption of this Urgency Ordinance is exempt from environmental review under the California Environmental Quality Act (“CEQA”) pursuant to the following provisions of the CEQA Guidelines, 14 California C ode of Regulations, Chapter 3: th is Ordinance is exempt under CEQA Guidelines Section 15378(b)(5) in that it is not a “project” under CEQA, and will not result in direct or indirect physical changes in the environment.

SECTION 6. Adoption, Certification, and Publication. The Mayor shall sign and the City Clerk shall certify to the passage and adoption of this Ordinance and shall cause the same, or the summary thereof, to be published and posted pursuant to the provisions of law and this Ordinance shall take effect thirty (30) days after passage.

PASSED, APPROVED, AND ADOPTED BY THE PALM SPRINGS CITY
COUNCIL this _____ day of ______________, 2023.

GRACE ELENA GARNER
MAYOR
ATTEST:

BRENDA PREE, MMC

CITY CLERK

CERTIFICATION

STATE OF CALIFORNIA )
COUNTY OF RIVERSIDE ) ss.

CITY OF PALM SPRINGS )
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I, BRENDA PREE, City Clerk of the City of Palm Springs, California, do hereby certify that Ordinance No. ____ is a full, true, and correct copy, and was adopted without introduction at a regul ar meeting of the City Council held on _________________, 2023 by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:

IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City of Palm Springs, California, this ______ day of _________, 2023.

BRENDA PREE, MMC

CITY CLERK

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