Palo Alto City Council
May 23, 2022

1 City Council
Special Meeting
Monday, May 23, 2022
5:30 PM
Council Chamber & Virtual
Pursuant to AB 361 Palo Alto City Council meetings will be held as “hybrid” meetings with the option to attend by teleconference/video conference or in person. To maximize public safety while still maintaining transparency and public access, members of the public can choose to participate from home or attend in person. Information on how the public may observe and participate in the meeting is located at the end of the agenda. Masks are strongly encouraged if attending in person.

HOW TO PARTICIPATE

VIRTUAL PARTICIPATION
CLICK HERE TO JOIN (https://cityofpaloalto.zoom.us/j/362027238) Meeting ID: 362 027 238 Phone:1(669)900-6833
The meeting will be broadcast on Cable TV Channel 26, live on YouTube at https://www.youtube.com/c/cityofpaloalto, and streamed to Midpen Media Center at https://midpenmedia.org.

TIME ESTIMATES
Time estimates are provided as part of the Council's effort to manage its time at Council meetings. Listed times are estimates only and are subject to change at any time, including while the meeting is in progress. The Council reserves the right to use more or less time on any item, to change the order of items and/or to continue items to another meeting. Particular items may be heard before or after the time estimated on the agenda. This may occur in order to best manage the time at a meeting or to adapt to the participation of the public.

PUBLIC COMMENTS
Public C omments w ill be accepted both in person and v ia Zoom for up to th ree minutes or an amount of t ime determined b y the Chair. All request s to sp eak will be ta ken until 5 minutes a fter the s taff’s pr esentation. W ritten pu blic comments can be su bmitted in a dvance to [email protected] g and will be provid ed to th e Council and available f or inspection on the C ity’s website. Please clearly indicate which agenda item you a re referencing in your email subject lin e.

PowerPoints, videos, or other media to be presented during public comment are accepted only by email to [email protected] at least 24 hours prior to the meeting. Once received, the City Clerk will have them shared a t public comment for the specified item. To uphold s trong cybersecurity m anagement practices, USB’s o r other physical e lectronic storage d evices are n ot accepted

CALL TO ORDER

AGENDA CHANGES, ADDITIONS AND DELETIONS
2 S pecial Meeting May 23, 2022
Materials related to an item on this agenda submitted to the Board after distribution of the agenda packet are available for publ
ic inspection at www.CityofPaloAlto.org.

PUBLIC COMMENT (5:30 - 5:50 PM)
Members of the public may speak to any item NOT on the agenda. Council reserves the right to limit the duration of Oral Communications period to 30 minutes.

CONSENT CALENDAR (5:50 - 6:00 PM)
Items will be voted on in one motion unless removed from the calendar by three Council Members.

1. Approve Minutes from the May 09, 2022 City Council Meeting

2. Approval of Contract Number C21179569 with Brown Reynolds Watford Architects for an Amount Not- to-Exceed $797,178 to Provide Architectural Design Services for the Fire Station No. 4 Replacement - Capital Improvement Program Project PE-18004

3. Approval of 1) Increase of Construction Contingency for Contract No.

C20174550 with Granite Construction in the Amount of $185,302; and 2) Budget Amendments in the Electric Fund for the Electric Customer Connection project (EL -89028), the Fiber Optics Fund for the Fib er Optics Network –System Improvements project (FO -10001), and the Capital Improvement Fund for the Highway 101 Pedestrian/Bicycle Overpass project (PE-11011)

4. Approval of Contract No. C22183901 with Genuine Parts Company dba Napa Auto Parts for an Amount Not-to-Exceed $2,306,433 for an On - Site Fleet Parts and Inventory Program for a Three -Year Term from January 24, 2022 through January 23, 2025, with Pricing Set by Cooperative Sourcewell Contract No. 110520 with Genuine Auto Parts Company dba Napa Integrated Business Solutions; and Approve and Authorize the City Manager or Their Designee to Execute an Amendment to Contract No. C22183901 to Extend the Term for up to One Additional Year through January 24, 2026 (Provided that the Cooperative Sourcewell Cont ract is Extended for an Additional Year) for an Additional Amount Not to Exceed $831,227 (Annual Amount Is Subject to Adjustment Provided the Total Contract Amount Is Not Exceeded), for a Total Not to Exceed Amount of the Contract, if Extended, of $3,137,660

5. Adoption of a Resolution of Intent to Not Levy Assessments for the Business Improvement District (BID) in FY2023, and Setting Public Hearing for June 6, 2022

6. Approval of the Acceptance of State of California Citizens Options for Public Safety (COP S) Funds of $103,648 and a Budget Amendment in the Supplemental Law Enforcement Services Fund
3 Speci al Meeting May 23, 2022
Materials related to an item on this agenda submitted to the Board after distribution of the agenda packet are available for public ins
pection at www.CityofPaloAlto.org.

7. Adoption of a Resolution Certifying Compliance with the California Surplus Land Act as Required by MTC's One Bay Area Grant (OBAG) Grant Programs

8. Authorize the City Manager to Commit Two Million Dollars ($2,000,000) from the City's Affordable Housing Funds for the Affordable Housing Project at 525 E. Charleston Avenue.

9. Adoption of a Resolution Authorizing a City Grant Application for the State Local Housin g Trust Fund Program, Designation of Affordable Housing Funds as Local Matching Funds, Commitment to Targeting the Grant and Local Matching Funds, Approval of Grant Specific Underwriting and Other Financial Standards, and Authorization of City Manager or Designee to Manage the Grant

10. Approval of Amendment Number 2 to Contract Number C17164727 with Professional Account Management, LLC. for Parking Citation Processing and Collections to Extend the Term and Increase the Amount by $70,000, for a new Not-To-Exceed Total of $720,000

11. Approval of Amendment #4 to Contract C18171057 with AECOM and Extend the Term to A pril 2024 and Increase the Not -to-Exceed Compensation by $722,170 for Additional Studies of Railroad Grade Separation Alternatives for a Total Not-to-Exceed of $3,596,828

12. SECOND READING: Review and provide feedback on the proposed permanent parklet standards and program policies; and Adopt an interim ordinance and resolution to continue the pilot parklet program until December 31, 2022 (FIRST READING: May 9, 2022: PASSED 7-0) ACTION ITEMS (6:00 PM)
Include: Reports of Committees/Commissions, Ordinances and Resolutions, Public Hearings, Reports of Officials, Unfinished Business and Council Matters.

13. 1310 Bryant Street (Castilleja School Project) PUBLIC HEARING/QUASI JUDICIAL/LEGISLATIVE: Certification of an Envir onmental Impact Report (EIR) and Approval of Applications for (1) a Conditional Use Permit (CUP) Amendment to Increase Student Enrollment Initially to 450 Students Followed by Phased Co nditional Increases to 540 Students; (2) a Parking Adjustment to Enable On-Site Parking Reduction; (3) a Variance to Replace Campus Gross Floor Area; (4) Architectural Review of Campus Redevelopment. Additionally, (5) Adoption of a Zoning Text Amendment Ex empting Some Below -Grade Parking Facilities from Gross Floor Area. Zone District: R -1(10,000).

Environmental Review: Final Environmental Impact Report (EIR) Published July 30, 2020; Draft EIR Published July 15, 2019 Q&A
Public Letter
Applicant
Presentation
Staff
Presentation
4 Special Meeting May 23, 2022
Materials related to an item on this agenda submitted to the Board after distribution of the agenda packet are available for public inspection at www.CityofPaloAlto.org.

COUNCIL MEMBER QUESTIONS, COMMENTS, ANNOUNCEMENTS
Members of the public may not speak to the item(s)

ADJOURNMENT

OTHER INFORMATION
Standing Committee Meetings

Finance Committee Meeting May 24, 2022
Schedule of Meetings
Public Letters to Council

5 Special Meeting May 23, 2022
Materials related to an item on this agenda submitted to the Board after distribution of the agenda packet are available for public inspection at www.CityofPaloAlto.org.

PUBLIC COMMENT INSTRUCTIONS

Members of the Public may provide public comments to teleconference meetings via email, teleconference, or by phone.

1. Written public comments may be submitted by email to [email protected].

2. Spoken public comments using a computer will be accepted through the teleconference meeting. To address the Council, click on the link below to access a Zoom -based meeting. Please read the following instructions carefully.

A. You may download the Zoom client or connect to the meeting in- browser. If using your browser, make sure you are using a current, up-to-date browser: Chrome 30+, Firefox 27+, Microsoft Edge 12+, Safari 7+. Certain functionality may be disabled in older browsers including Internet Explorer.

B. You may be asked to enter an email address and name. We request that you identify yourself by name as this will be visible online and will be used to notify you that it is your turn to speak.

C. When you wish to speak on an Agenda Item, click on “raise hand.” The Clerk will activate and unmute speakers in turn. Speakers will be notified shortly before they are called to speak.

D. When called, please limit your remarks to the time limit allotted.

E. A timer will be shown on the computer to help keep track of your comments.

3. Spoken public comments using a smart phone will be accepted through the teleconference meeting. To address the Council, download the Zoom application onto your phone from the Apple App Store or Google Play Store and enter the Meeting ID below. Please follow the instructions B-E above.

4. Spoken public comments using a phone use the telephone number listed below. When you wish to speak on an agenda item hit *9 on your phone so we know that you wish to speak. You will be asked to provide your first and last name before addressing the Council. You will be advised how long you have to speak. When called please limit your remarks to the agenda item and time limit allotted.

5. PowerPoints, videos, or other media to be presented during public comment are accepted only by email to [email protected] at least 24 hours prior to the meeting. Once received, the City Clerk will have them shared at public comment for the specified item. To uphold strong cybersecurity management practices, USB’s or other physical electronic storage devices are not accepted.

CLICK HERE TO JOIN Meeting ID: 362 027 238 Phone:1(669)900-6833

City of Palo Alto (ID # 14410)
Office of the City Clerk
City Council CAO Report

Meeting Date: 5/23/2022 Report Type: Consent Calendar

Title: Approve Minutes from the May 09, 2022 City Council Meeting From: Lesley Milton, City Clerk

Staff recommends Council to review and approve the minutes as presented.

ATTACHMENTS:
• Attachment1.a: Attachment A: 20220509amCCsm (PDF)
1 Packet Pg. 6

CITY COUNCIL

DRAFT ACTION MINUTES

Special Meeting
May 9, 2022
The City Council of the City of Palo Alto met on this date in the Council Chambers and by virtual teleconference at 5:00 P.M.

Present: Burt, Cormack, DuBois, Filseth, Kou, Stone, Tanaka

Absent: None
Closed Session

1. CONFERENCE WITH CITY ATTORNEY - EXISTING LITIGATION
Subject: Julio Arevalo v. City of Palo Alto U.S. District Court, Northern District, Case # 3:20 -cv-04157-CRB Authority:

Government Code Section 54956.9(d)(1)
MOTION: Council Member Cormack moved, seconded by Council Member Filseth to go into Closed Session.

MOTION PASSED: 7-0
Council went into Closed Session at 5:05 P.M.

Council returned from Closed Session at 5:45 P.M.

There were no announcements for the Public.

Special Orders of the Day

2. Affordable Housing Month Proclamation 2022

NO ACTION TAKEN
Agenda Changes, Additions and Deletions
None
Public Comment
Consent Calendar
Council Member Tanaka registered a no vote on Agenda Item Number 8.

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DRAFT ACTION MINUTES

(Sp.) City Council Meeting
Draft Action Minutes: 05/09/2022
Council Member Kou registered a no vote on Agenda Item Number 9.

MOTION: Council Member DuBois moved, seconded by Council Member Cormack to approve Agenda Item Numbers 3-10.

3. Approve Minutes from the April 18, 2022 and City Council Meeting, April 25, 2022 City Council Meeting

4. Adoption of a Resolution 10034 Designating Redwood Tree at 1019 Forest Court as a New Heritage Tree #5 and Removing Previously Designated Silver Maple at 1872 Edgewood Drive From the List of Heritage Trees

5. Resolution 10035 of the Council of the City of Palo Alto Approving the Execution of Two Assignment Agreements to Assign Palo Alto's Base Resource Percentage Received Under the 2025- 2054 Contract With the Western Area Power Administration to the Northern California Power Agency

6. Approval of Construction Contract Number C22182558 with Enterprise Roofing Service, Inc. in an Amount Not -to-Exceed $497,233 to Replace the Existing H Wing Roof at Cubberley Community Center, Capital Improvement Program Project CB - 16002; and Authorization of Contract Contingency in an Amount Not- to-Exceed $49,723 for Related, Additional but Unforeseen Work Which May Develop During the Project.

7. Approval of Contract Amendment No. 1 to Contract Number C21179340 with Baker Tilly US, LLP. to Increase the Not -to-Exceed Compensation by $2,126,250 and Extend the Term for Three Additional Years for Continued Audit Services

8. Approval of $900,000 Budget Amendment in the Refuse Fund for Fiscal Year 2022 for Collection, Hauling, and Disposal of Refuse for an Administrative Correction

9. Second Reading of an Ordinance 5548 Clarifying Ambiguities in Height Transitions, Adding RMD to the list of Residential Districts and Amending the Setback for the RM-40 Zone District
MOTION SPLIT FOR THE PURPOSE OF VOTING:

MOTION PASSED FOR ITEMS 3-7: 7-0

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DRAFT ACTION MINUTES

(Sp.) City Council Meeting
Draft Action Minutes: 05/09/2022
MOTION PASSED FOR ITEM 8 PASSED: 6-1, Tanaka no
MOTION PASSED FOR ITEM 9 PASSED: 6-1, Kou no
City Manager Comments

Action Items

10. Review and provide feedback on the proposed permanent parklet standards and program policies; and Adopt an interim ordinance and Resolution 10036 to continue the pilot parklet program until December 31, 2022
MOTION: Council Member DuBois moved, seconded by Vice Mayor Kou to direct staff to:

A. Adopt the interim ordinance and resolution;
B. Update the guidelines for new temporary parklets and incorporate into the permanent ordinance the following:

I. Prohibit use of vinyl, tents or canopies;
II. Prohibit parklets from blocking handicapped or curb ramps III. State a preference for plants as barriers;
IV. Shift to a maximum of 36” in enclosure height;
C. Consider pre-approved designs as part of the permanent ordinance; D. Until adoption of a permanent ordinance, property owners do not have the right to determine the use of the public space in front of their properties; and
E. Research and return with more information on electric heating options for the permanent ordinance
MOTION PASSED: 7-0

11. Approve and Authorize City Manager to Execute Non- Binding Letter of Intent with First Tee Silicon Valley Towards Establishing a Public Private Partnership for Practice Facility Infrastructure Improvements at the Baylands Golf Links and Long-Term Facility Use Access for the First Tee Silicon Valley’s Youth Development Teaching Program

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DRAFT ACTION MINUTES

(Sp.) City Council Meeting
Draft Action Minutes: 05/09/2022
MOTION: Council Member Stone moved, seconded by Mayor Burt to approve the letter of intent for establishing a partnership with First Tee Silicon Valley Youth Development Teaching Program.

MOTION PASSED: 7-0

12. Report on Palo Alto's Response to Hate Crimes and Hate Incidents, and Discussion of the Policy and Services Committee Recommendation that the City Council Consider the Idea of Developing a Misdemeanor Ordinance to Deter Hateful Speech and Support the Human Relations Commission (HRC) to Bring the FBI and Community Resources to Palo Alto to do Community Education on Hate Crimes
MOTION: Vice Mayor Kou moved, seconded by Council Member Stone to receive the report, support the Human Relations Commission to bring the FBI and/or other community resources to Palo Alto to f urther community education on hate crimes and support hate crimes legislation (Assembl y Bill 1947).

MOTION PASSED: 7-0
Council Member Questions, Comments and Announcements
Adjournment: The meeting was adjourned at 11:14 P.M.

ATTEST: APPROVED:
____________________ ____________________
City Clerk Mayor NOTE: Action minutes are prepared in accordance with Palo Alto Municipal Code (PAMC) 2.04.160(a) and (b). Summary minutes (sense) are prepared in accordance with PAMC Section 2.04.160(c). Beginning in January 2018, in accordance with Ordinance No. 5423, the City Council found action minutes and the video/audio recordings of Council proceedings to be the official records of both Council and committee proceedings. These recordings are available on the City’s website.

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City of Palo Alto (ID # 11691)
City Council Staff Report

Meeting Date: 5/23/2022 Report Type: Consent Calendar

City of Palo Alto Page 1

Title: Approval of Contract Number C21179569 with Brown Reynolds Watford Architects for an Amount Not -to-Exceed $797,178 to Provide Architectural Design Services for the Fire Station No. 4 Replacement - Capital Improvement Program Project PE -18004
From: Ci ty Manager
Lead Department: Public Works

Recommendation
Staff recommends that Council approve and authorize the City Manager or their designee to execute Contract No. C21179569 (Attachment A) with Brown Reynolds Watford Architects, Inc. (“BRW Architects”) for a total not-to-exceed amount of $ 797,178 for design services, including $725,162 for basic services and $72,016 for Additional Services (as defined in the contract), for the Fire Station 4 Replacement capital improvement program project (CIP PE-18004).

Background
Fire Station 4, located at 3600 Middlefield Road, is an approximately 4,100 square foot ( SF) structure built in 1954. The existing fire station building does not serve the current needs of the Fire Department and does not effectively use the current 0.6-acre portion of the property.

In 2002, the City contracted with Biggs Cardosa Associates, Inc. to perform a seismic evaluation for six fire stations (Stations 1, 2, 3, 4, 5 and 8). In the case of Fire Stations 3 and 4, Biggs Cardosa reported significant seismic deficiencies and potential for instability of soils due to liquefaction and concluded that replacement of these two stations may be necessary to meet essential service standards for fire station buildings. In 2005, the City contracted with RRM Design Group (RRM) to perform a Replacement Needs Assessment Study for Fire Stations 3 and 4, including:

• Existing and future operational needs of the Fire Department • Geotechnical investigation and geohazards evaluation
• Hazardous materials testing
• Site analysis and massing studies
• Environmental assessment
• Building system description
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City of Palo Alto Page 2

• Cost estimate
• Project schedule

The RRM Study provides program and other feasibility level information that will be used as the basis to begin design of the new Fire Station 4 following confirmation with the Fire Department.

The new Fire Station 4 design will also accommodate the Fire Department’s operational needs to provide updated spaces that will support existing and future fire apparatus and personnel, and fit contextually within Mitchell Park and the surrounding neighborhoods. Features included in the feasibility study that will be included in the new design include drive through apparatus bays and a training room.

The Fire Station 3 (PE-15003) and Fire Station 4 (PE-18004) Replacement projects are part of the 2014 Council Infrastructure Plan. The Fire Station 3 project was completed in March 2020 , and fire personnel have been using the station since then.

Discussion
The contract with BRW Architects c onsists of basic services including preparation of schematic designs, design development, construction documents, and LEED certification , as well as Additional Services, defined in the contract as any work that is determined by CITY to be necessary for the proper completion of the Project, but which is not included within the contract’s Scope of Services . Additional Services must be approved via written Task Order by the City’s Project Manager, as detailed in the contract.

Summary of Solicitation Process
1,244 vendors were notified by PlanetBids , the City’s online e -Procurement system, regarding the Request for Proposals (RFP) by the City on July 23, 2020. Vendors had 26 days to respond to the RFP. A mandatory pre -proposal meeting was held on August 3, 202 0, and 25 vendors attended the meeting . The solicitation closed on August 18, 2020. The City received eight proposals, but two proposals were disqualified as nonresponsive.

Table #1: Summary of Request for Proposal
Company Name Location
(City, State)
Selected for
Oral Interview?
Brown Reynolds Watford Architects, Inc. San Francisco, CA Yes CJW Architecture Portola Valley, CA No
Loving and Campos Associates, Architects Walnut Creek, CA No RossDrulisCusenbery Architecture Sonoma, CA Yes
Shah Kawasaki Architects Oakland, CA Yes
WLC Architects Folsom, CA No
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City of Palo Alto Page 3

Range of Proposal Amounts Submitted $627,877 - $1,118,748

An evaluation committee, consisting of representatives from the Public Works Engineering Services Division and the Fire Department, reviewed the proposals. The committee carefully reviewed each firm's qualifications and submittal in response to the criteria identified in the RFP. The committee reviewed each firm's qualifications relative to its experience in fire station design and in working with the City’s Architectural Review Board process. Consideration was also given to the quality of the proposers’ project approach, performance on past fire station and other essential services projects, qualifications of the specific staff to be assigned to the project and understanding of the project goals. Three firms were invited to participate in oral interviews on October 5, 2020. Brown Reynolds Watford Architects , Inc. (BRW Architects) was selected because of the depth and quality of their design exp erience, particularly with respect to working with challenging sites , and creating a design that considers the context of their site.

One of BRW Architects’ references noted how the ir fire station design fit well into the neighborhood by complementing the surrounding areas and their understanding of the market when estimating the construction cost. Another reference shared their positive experience in value engineering with BRW Architects that was necessary to fit the project within the agency’s budget.

Due to budget constraints caused by the COVID-19 pandemic and per Council’s direction in June 2020, Fire Station 4 construction funding was deferred to F iscal Year 2024. City Staff deferred the contract award for design in order to ensure design would comply with the most current building codes and sustainability standards prior to construction. Deferral of the design also allowed for the design of building systems and specifications of special equipment to incorporate or consider the newest technology available.

Summary of Contract
The contract is divided into three phases.
• Phase 1 includes schematic design, design development, public outreach, programming, and initial design. This phase will include exploration of the feasibility of incorporating a microgrid into the design which would offset power for daily operations and possibly provide backup power during emergencies. The microgrid assessment will include calculation of anticipated energy demand for the new station design and recommendation for the best fit microgrid system to capture savings and offset peak loads. This will also include a cost estimate of the proposed system.

• Phase 2 includes construction documents, where BRW Architects will finalize the construction set of documents and obtain permit approvals.

• Phase 3 is during construction and includes construction administration and LEED Certification. During this last phase, BRW Architects will assist in providing clarifications or design details during construction as well as submit required do cumentation on 2 Packet Pg. 13

City of Palo Alto Page 4

behalf of the City for LEED Certification.

This contract is on the City’s professional services contract template, which permits the City to terminate without cause/for convenience by providing written notice to BRW Architects. In the event the City finds itself facing a challenging budget situation, and it is determined that City resources need to be refocused elsewhere, the City can terminate for convenience. The contract’s Phases are divided to ensure comfortable stopping point s, should final design or construction of Fire Station 4 be put on hold. Other options include termination due to non - appropriation of funds or amending the contract to reduce the cost, for example, by reducing the scope of work. The contract may also be temporaril y suspended by written notice of the City Manager.

Timeline
The design of Fire Station 4 will be completed within 20 months following the issuance of the Notice to Proceed. The longer design duration was given to ensure sufficient time is allocated for p ublic outreach, planning entitlement s, Architectural Review Board ( ARB) review, and permitting. Subsequently, construction of the improvements is expected to begin in Spring 2024.

Resource Impact
A total of $10,167,779, including salary and benefit costs for City staff, has been planned for the Fire Station 4 Replacement project (PE -18004), with $ 674,588 appropriated in FY 2022 , $4.75 million planned for FY 202 4, and $4.6 3 million planned for 2025 as part of the 2022 -2026 Capital Improvement Plan. The City has also requested federal earmark funding for the project.

Staff plans to encumber $ 379,828 of the contract in FY 2022. The remaining $ 415,088 of the contract will be encumbered in FY 202 4 to complete the work, subject to the FY 202 4 budget process and Council’s appropriation of funds for FY 202 4, in alignment with the planned timing of the project and phases of the contract.

Policy Implications
The approval of the contract for the design of Fire Station 4 is consistent with City policies and furthers the goals of Policy C-3.2 of Community Services & Facilities of reinvesting in aging facilties to improve their usefulness and appearance.

Stakeholder Engagement
The scope of the project includes three community workshops for public input during the schematic design phase of Fire Station 4 . Community workshops will include representatives from BRW Architects, Public Works Engineering, and the Fire Department. Staff plans to promote these workshops through a news release, social media, Nextdoor, and on the City’s project website.

Environmental Review
This project is categorically exempt from the provisions of the California Environmental Quality 2 Packet Pg. 14

City of Palo Alto Page 5

Act (CEQA) under Section 15302 of the CEQA Guidelines as “Replacement or Reconstruction of Existing Structures” and no further Environmental review is expected to be necessary. A notice of CEQA exemption will be filed in conjunction with the planning entitlement process.

Attachments:
• Attachment2.a: Attachment A: Brown Reynolds Watford Architects Contract, C21179569
2 Packet Pg. 15

Professional Services
Rev. April 27, 2018

CITY OF PALO ALTO CONTRACT NO. C21179569

AGREEMENT BETWEEN THE CITY OF PALO ALTO
AND
BROWN REYNOLDS WATFORD ARCHITECTS, INC.

FOR PROFESSIONAL SERVICES

This Agreement for Professional Services (this “Agreement”) is entered into as of this 23rd day of May 2022, by and between the CITY OF PALO ALTO, a California chartered municipal corporation (“CITY”), and BROWN REYNOLDS WATFORD ARCHITECTS , INC., a Texas Corporation, located at 1620 Montgomery Street, Suite 320, San Francisco, CA 94111 ("CONSULTANT").

RECITALS

The following recitals are a substantive portion of this Agreement and are incorporated herein.

A. CITY intends to replace Fire Station No. 4 located on Middlefield Road and E. Meadow Road with a new fire station (the “Project”) and desires to engage a consultant to provide design services in connection with the Project (the “Services,” as further detailed herein).

B. CONSULTANT has represented that it , its employees and subconsultants, possess the necessary professional expertise, qualifications, and capability, and all required licenses and/or certifications to provide the Services.

C. CITY in reliance on these representations desires to engage CONSULTANT to provide the Services as more fully described in Exhibit “A”, attached to and made a part of this Agreement.

NOW, THEREFORE, in consideration of the recitals, covenants, terms, and conditions, in this Agreement, the parties agree:

AGREEMENT

SECTION 1. SCOPE OF SERVICES. CONSULTANT shall perform the Services described at Exhibit “A” in accordance with the terms and conditions contained in this Agreement. The performance of all Services shall be to the reasonable satisfaction of CITY.

SECTION 2. TERM.

The term of this Agreement shall be from the date of its full execution through 12/31/2025 unless terminated earlier pursuant to Section 19 of this Agreement.

SECTION 3. SCHEDULE OF PERFORMANCE. Time is of the essence in the performance of Services under this Agreement. CONSULTANT shall complete the Services within the term of this Agreement and in accordance with the schedule set forth in Exhibit “B”, attached to and made DocuSign Envelope ID: 318133C4-F750-4C09-8493-0D1F796AC182

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Professional Services
Rev. April 27, 2018

a part of this Agreement. Any Services for which times for performance are not specified in this Agreement shall be commenced and completed by CONSULTANT in a reasonably prompt and timely manner based upon the circumstances and direction communicated to the CONSULTANT.

CITY’s agreement to extend the term or the schedule for performance shall not preclude recovery of damages for delay if the extension is required due to the fault of CONSULTANT.

SECTION 4. NOT TO EXCEED COMPENSATION . The compensation to be paid to CONSULTANT for performance of the Services described in Exhibit “A” (also referred to herein as the “Basic Services”) shall be based on the compensation structure described in Exhibit C, entitled “COMPENSATION ,” including any reimbursable expenses specified therein , and the maximum total compensation shall not exceed Seven Hundred Twenty -Five Thousand One Hundred Sixty -Two Dollars ($725,162.00). CONSULTANT agrees to complete all Basic Services, within this amount. The hourly rate schedule, if applicable, is set out in Exhibit “C-1”, entitled “HOURLY RATE SCHEDULE,” which is attached to and made a part of this Agreement.

Any work performed or expenses incurred for which payment would result in a total exceeding the maximum amount of compensation set forth herein shall be at no cost to the CITY.

Optional Additional Services Provision (This provision applies only if checked and a not-to-exceed compensation amount for Additional Services is allocated below under this Section 4.)

In addition to the not-to-exceed compensation specified above, CITY has set aside the not- to-exceed compensation amount of Seventy-Two Thousand Sixteen Dollars ($72,016.00) for the performance of Additional Services (as defined below). The total compensation for performance of Services, Additional Services and any reimbursable expenses specified in Exhibit “C” shall not exceed Seven Hundred Ninety-Seven Thousand One Hundred Seventy-Eight Dollars ($797,178.00).

“Additional Services” means any work that is determined by CITY to be necessary for the proper completion of the Project, but which is not included within the Scope of Services described at Exhibit “A”. CITY may elect to, but is not required to, authorize Additional Services up to the maximum amount of compensation set forth for Additional Services in this Section 4. CONSULTANT shall provide Additional Services only by advanced, written authorization from CITY as detailed in this Section. Additional Services, if any, shall be authorized by CITY with a Task Order assigned and authorized by CITY’s Project Manager, as identified in Section 13 (Project Management). Each Task Order shall be in substantially the same form as Exhibit “A-1,” entitled “PROFESSIONAL SERVICES TASK ORDER”. Each Task Order shall contain a specific scope of services, schedule of performance and maximum compensation amount, in accordance with the provisions of this Agreement. Compensation for Additional Services shall be specified by CITY in the Task Order, based on whichever is lowest: the compensation structure set forth in Exhibit C, the hourly rates set forth in Exhibit “C-1,” or a negotiated lump sum.

To accept a Task Order, CONSULTANT shall sign the Task Order and return it to CITY’s Project Manager within the time specified by the Project Manager, and upon authorization by CITY (defined as countersignature by the CITY Project Manager), the fully executed DocuSign Envelope ID: 318133C4-F750-4C09-8493-0D1F796AC182

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Professional Services
Rev. April 27, 2018

Task Order shall become part of this Agreement. The cumulative total compensation to CONSULTANT for all Task Orders authorized under this Agreement shall not exceed the amount of compensation set forth for Additional Services in this Section 4.

CONSULTANT shall only be compensated for Additional Services performed under an authorized Task Order and only up to the maximum amount of compensation set forth for Additional Services in this Section 4. Performance of and payment for any Additional Services are subject to all requirements and restrictions in this Agreement.

SECTION 5. INVOICES . In order to request payment, CONSULTANT shall submit monthly invoices to the CITY describing the Services performed and the applicable charges (including , if applicable, an identification of personnel who performed the Services, hours worked, hourly rates, and reimbursable expenses), based upon Exhibit C or, as applicable, CONSULTANT’s schedule of rates set forth in Exhibit “ C-1”. If applicable, the invoice shall also describe the percentage of completion of each task. The information in CONSULTANT’s invoices shall be subject to verification by CITY. CONSULTANT shall send all invoices to the City’s Project Manager at the address specified in Section 13 (Project Management) below. The City will generally process and pay invoices within thirty (30) days of receipt of an acceptable invoice.

SECTION 6. QUALIFICATIONS/STANDARD OF CARE . All of the Services shall be performed by CONSULTANT or under CONSULTANT’s supervision. CONSULTANT represents that it , its employees and subconsultants, possess the professional and technical personnel necessary to perform the Services required by this Agreement and that the personnel have sufficient skill and experience to perform the Services assigned to them. CONSULTANT represents that it, its employees and subconsultants, if any, have and shall maintain during the term of this Agreement all licenses, permits, qualifications, insurance and approvals of whatever nature that are legally required to perform the Services.

All of the Services to be furnished by CONSULTANT under this Agreement shall meet the professional standard and quality that prevail among professionals in the same discipline and of similar knowledge and skill engaged in related work throughout California under the s ame or similar circumstances.

SECTION 7. COMPLIANCE WITH LAWS . CONSULTANT shall keep itself informed of and in compliance with all federal, state and local laws, ordinances, regulations, and orders that may affect in any manner the Project or the perfor mance of the Services or those engaged to perform Services under this Agreement. CONSULTANT shall procure all permits and licenses, pay all charges and fees, and give all notices required by law in the performance of the Services.

SECTION 8. ERRORS/OMISSIONS. CONSULTANT is solely responsible for costs, including, but not limited to, increases in the cost of Services , arising from or caused by CONSULTANT’s errors and omissions, including, but not limited to, the costs of corrections such errors and omissions, any change order markup costs, or costs arising from delay caused by the errors and omissions or unreasonable delay in correcting the errors and omissions.

SECTION 9. COST ESTIMATES. If this Agreement pertains to the design of a public works project, CONSULTANT shall submit estimates of probable construction costs at each phase of DocuSign Envelope ID: 318133C4-F750-4C09-8493-0D1F796AC182

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design submittal. If the total estimated construction cost at any sub mittal exceeds the CITY’s stated construction budget by ten percent (10%) or more , CONSULTANT shall make recommendations to CITY for aligning the Project design with the budget, incorporate CITY approved recommendations, and revise the design to meet the Project budget, at no additional cost to CITY.

SECTION 10. INDEPENDENT CONTRACTOR. CONSULTANT acknowledges and agrees that CONSULTANT and any agent or employee of CONSULTANT will act as and shall be deemed at all times to be an independent contractor and shall be wholly responsible for the manner in which CONSULTANT performs the Services requested by CITY under this Agreement.

CONSULTANT and any agent or employee of CONSULTANT will not have employee status with CITY, nor be entitled to participate in any plans, arrangements, or distributions by CITY pertaining to or in connection with any retirement, health or other benefits that CITY may offer its employees. CONSULTANT will be responsible for all obligations and payments, whether imposed by federal, sta te or local law, including, but not limited to, FICA, income tax withholdings, workers’ compensation, unemployment compensation, insurance, and other similar responsibilities related to CONSULTANT’s performance of the Services, or any agent or employee of CONSULTANT providing same. Nothing in this Agreement shall be construed as creating an employment or agency relationship between CITY and CONSULTANT or any agent or employee of CONSULTANT. Any terms in this Agreement referring to direction from CITY shall be construed as providing for direction as to policy and the result of CONSULTANT’s provision of the Services only, and not as to the means by which such a result is obtained.

SECTION 11. ASSIGNMENT. The parties agree that the expertise and experience of CONSULTANT are material considerations for this Agreement. CONSULTANT shall not assign or transfer any interest in this Agreement nor the performance of any of CONSULTANT’s obligations hereunder with out the prior written approval of the City Manager. Any purported assignment made without the prior written approval of the City Manager will be void and without effect. Subject to the foregoing, the covenants, terms, conditions and provisions of this Agreement will apply to, and will bind, the heirs, successors, executors, administrators and assignees of the parties.

SECTION 12. SUBCONTRACTING.

Notwithstanding Section 11 above, CITY agrees that subconsultants may be used to complete the Services. The subconsultants authorized by CITY to perform work on this Project are:

1. SANDIS

2. Biggs Cardosa Associates

3. YEI Engineers

4. The HLA Group

5. RGD Acoustics

6. Cumming

7. MacNair & Associates

CONSULTANT shall be responsible for directing the work of any subconsultants and for any compensation due to subconsultants. CITY assumes no responsibility whatsoever concerning compensation to subconsultants. CONSULTANT shall be fully responsible to CITY for all acts DocuSign Envelope ID: 318133C4-F750-4C09-8493-0D1F796AC182

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and omissions of a subconsultant. CONSULTANT shall change or add subconsultants only with the prior approval of the City Manager or his designee.

SECTION 13. PROJECT MANAGEMENT. CONSULTANT will assign Christopher Ford, AIA, 1620 Montgomery Street, Suite 320, San Francisco, CA 94111, Telephone: 415 -749-2670, Email: [email protected] as the Project Manager to have supervisory responsibility for the performance, progress, and execution of the Services and to represent CONSULTANT during the day-to-day work on the Project. If circumstances cause the substitution of the CONSULTANT’s Project Manager or any other key personnel of CONSULTANT for any reason, the appointment of a substitute Project Manager and any key new or replacement personnel will be subject to the prior written approval of the CITY’s Project Manager. CONSULTANT, at CITY’s request, shall promptly remove personnel who CITY finds do not perform the Services in an acceptable manner, are uncooperative, or present a threat to the adequate or timely completion of the Project or a threat to the safety of persons or property.

CITY’s Project Manager is Matt Raschke, Public Works Department, Engineering Division, 250 Hamilton Ave., Palo Alto, CA 9430 1, Telephone : 650-496-5937, Email:
[email protected]. The CITY’s Project Manager will be CONSULTANT’s point of contact with respect to performance, progress and execution of the Services. CITY may designate an alternate Project Manager from time to time.

SECTION 14. OWNERSHIP OF MATERIALS. Upon delivery, all work product, including without limitation, all writings, drawings, plans, reports, specifications, calculations, documents, other materials and copyright interests developed under this Agreement shall be and remain the exclusive property of CITY without restriction or limitation upon their use. CONSULTANT agrees that all copyrights which arise from creation of the work pursuant to this Agreement shall be vested in CITY, and CONSULTANT waives and relinquishes all claims to copyright or other intellectual property rights in favor of the CITY. Neither CONSULTANT nor its contractors, if any, shall make any of such materials available to any individual or organization without the prior written approval of the City Manager or designee. CONSULTANT makes no representation of the suitability of the work product for use in or application to circumstances not contemplated by the scope of work.

SECTION 15. AUDITS. CONSULTANT will permit CITY to audit, at any reasonable time during the term of this Agreement and for three (3) years thereafter, CONSULTANT ’s records pertaining to matters covered by this Agreement. CONSULTANT further agrees to maintain and retain such records fo r at least three (3) years after the expiration or earlier termination of this Agreement.

SECTION 16. INDEMNITY.

[Option A applies to the following design professionals pursu ant to Civil Code Section 2782.8: architects; landscape architects; registered professional engineers and licensed professional land surveyors.] 16.1. To the fullest extent permitted by law, CONSULTANT shall protect, indemnify, defend and hold harmless CITY, its Council members, officers, employees and agents (each an “Indemnified Party”) from and against any and all demands, claims, or liability of DocuSign Envelope ID: 318133C4-F750-4C09-8493-0D1F796AC182

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any nature, including death or injury to any person, property damage or any other loss, including all costs and expenses of whatever nature including attorneys fees, experts fees, court costs and disbursements (“Claims”) that arise out of, pertain to, or relate to the negligence, recklessness, or willful misconduct of CONSULTANT, its officers, employees, agents or contractors under this Agreement, regardless of whether or not it is caused in part by an Indemnified Party.

[Option B applies to any consultant who does not qualify as a design professional as defined in Civil Code Section 2782.8. ] 16.1. To the fullest extent permitted by law, CONSULTANT shall protect, indemnify, defend and hold harmless CITY, its Council members, officers, employees and agents (each an “Indemnified Party”) from and against any and all demands, claims, or liability of any nature, including death or injury to any person, property damage or any other loss, including all costs and expenses of whatever nature including attorneys fees, experts fees, court costs and disbursements (“Claims”) resulting from, arising out of or in any manner related to performance or nonperformance by CONSULTANT, its officers, employees, agents or contractors under this Agreement, regardless of whether or not it is caused in part by an Indemnified Party.

16.2. Notwithstanding the above, nothing in this Section 16 shall be construed to require CONSULTANT to indemnify an Indemnified Party from Claims arising from the active negligence, sole negligence or willful misconduct of an Indemnified Party.

16.3. The acceptance of CONSULTANT’s services and duties by CITY shall not operate as a waiver of the right of indemnification. The provisions of this Section 16 shall survive the expiration or early termination of this Agreement.

SECTION 17. WAIVERS. The waiver by either party of any breach or violation of any covenant, term, condition or provision of this Agreement, or of the provisions of any ordinance or law, will not be deemed to be a waiver of any other term, covenant, condition, provisions, ordinance or law, or of any subsequent breach or violation of the same or of any other term, covenant, condition, provision, ordinance or law.

SECTION 18. INSURANCE.

18.1. CONSULTANT, at its sole cost and expense, shall obtain and maintain, in full force and effect during the term of this Agreement, the insurance coverage described in Exhibit "D". CONSULTANT and its contractors, if any, shall obtain a policy endorsement naming CITY as an additional insured under any general liability or automobile policy or policies.

18.2. All insurance coverage required hereunder shall be provided through carriers with AM Best’s Key Rating Guide ratings of A -:VII or higher which are licensed or authorized to transact insurance business in the State of California. Any and all contractors of CONSULTANT retained to perform Services under this Agreement will obtain and maintain, in full force and effect during the term of this Agreement, identical insurance coverage, naming CITY as an additional insured under such policies as required above.

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18.3. Certificates evidencing such insurance shall be filed with CITY concurrent- ly with the execution of this Agreement. The certificates will be subject to the approval of CITY’s Risk Manager and will contain an endorsement stating that the insurance is primary coverage and will not be canceled, or materially reduced in coverage or limits, by the insurer except after filing with the Purchasing Manag er thirty (30) days' prior written notice of the cancellation or modification. If the insurer cancels or modifies the insurance and provides less than thirty (30) days’ notice to CONSULTANT, CONSULTANT shall provide the Purchasing Manager written notice of the cancellation or modification within two (2) business days of the CONSULTANT’s receipt of such notice. CONSULTANT shall be responsible for ensuring that current certificates evidencing the insurance are provided to CITY’s Chief Procurement Officer during the entire term of this Agreement.

18.4. The procuring of such required policy or policies of insurance will not be construed to limit CONSULTANT's liability hereunder nor to fulfill the indemnification provisions of this Agreement. Notwithstanding the policy or policies of insurance, CONSULTANT will be obligated for the full and total amount of any damage, injury, or loss caused by or directly arising as a result of the Services performed under this Agreement, including such damage, injury, or loss arising after the Agreement is terminated or the term has expired.

SECTION 19. TERMINATION OR SUSPENSION OF AGREEMENT OR SERVICES.

19.1. The City Manager may suspend the performance of the Services, in whole or in part, or terminate this Agreement, with or without cause, by giving ten (10) days prior written notice thereof to CONSULTANT. Upon receipt of such notice, CONSULTANT will immediately discontinue its performance of the Services.

19.2. CONSULTANT may terminate this Agreement or suspend its performance of the Services by giving thirty (30) days prior written notice thereof to CITY, but only in the event of a substantial failure of performance by CITY.

19.3. Upon such suspension or termination, CONSULTANT shall deliver to the City Manager imm ediately any and all copies of studies, sketches, drawings, computations, and other data, whether or not completed, prepared by CONSULTANT or its contractors, if any, or given to CONSULTANT or its contractors, if any, in connection with this Agreement. Su ch materials will become the property of CITY.

19.4. Upon such suspension or termination by CITY, CONSULTANT will be paid for the Services rendered or materials delivered to CITY in accordance with the scope of services on or before the effective date (i. e., 10 days after giving notice) of suspension or termination; provided, however, if this Agreement is suspended or terminated on account of a default by CONSULTANT, CITY will be obligated to compensate CONSULTANT only for that portion of CONSULTANT’s services which are of direct and immediate benefit to CITY as such determination may be made by the City Manager acting in the reasonable exercise of his/her discretion. The following Sections will survive any expiration or termination of this Agreement:
14, 15, 16, 19.3, 19.4, 19.5, 20, 25, 27 and 28.

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19.5. No payment, partial payment, acceptance, or partial acceptance by CITY will operate as a waiver on the part of CITY of any of its rights under this Agreement.

SECTION 20. NOTICES.

All notices hereunder will be given in writing and mailed, postage prepaid, by certified mail, addressed as follows:

To CITY: Office of the City Clerk
City of Palo Alto
Post Office Box 10250
Palo Alto, CA 94303

With a copy to the Purchasing Manager

To CONSULTANT: Attention of the Project Manager
at the address of CONSULTANT recited above

SECTION 21. CONFLICT OF INTEREST.

21.1. In accepting this Agreement, CONSULTANT covenants that it presently has no interest, and will not acquire any interest, direct or indirect, financial or otherwise, which would conflict in any manner or degree with the performance of the Services.

21.2. CONSULTANT further covenants that, in the performance of this Agreement, it will not employ subconsultants, contractors or persons having such an interest.

CONSULTANT certifies that no person who has or will have any financial interest under this Agreement is an officer or employee of CITY; this provision will be interpreted in accordance with the applicable provisions of the Palo Alto Municipal Code and the Government Code of the State of California.

21.3. If the Project Manager determines that CONSULTAN T is a “Consultant” as that term is defined by the Regulations of the Fair Political Practices Commission, CONSULTANT shall be required and agrees to file the appropriate financial disclosure documents required by the Palo Alto Municipal Code and the Political Reform Act.

SECTION 2 2. NONDISCRIMINATION. As set forth in Palo Alto Municipal Code section

2.30.510, CON SULTANT certifies that in the performance of this Agreement, it shall not discriminate in the employment of any person due to that person’s race, skin color, gender, gender identity, age, religion, disability, national origin, ancestry, sexual orientation, pregnancy, genetic information or condition, housing status, marital status, familial status, weight or height of such person. CONSULTANT acknowledges that it has read and understands the provisions of Section

2.30.510 of the Palo Alto Municipal Code relating to Nondiscrimination Requirements and the penalties for violation thereof, and agrees to meet all requirements of Section 2.30.510 pertaining to nondiscrimination in employment.

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SECTION 23. ENVIRONMENTALLY PREFERRED PURCHASING AND ZERO WASTE REQUIREMENTS. CONSULTANT shall comply with the CITY’s Environmentally Preferred Purchasing policies which are available at CITY’s Purchasing Department, incorporated by reference and may be amended from time to time. CONSULTANT shall comply with waste reduction, reuse, recycling and disposal requirements of CITY’s Zero Waste Program. Zero Waste best practices include first minimizing and reduc ing waste; second, reusing waste and third, recycling or composting waste. In particular, C ONSULTANT shall comply with the following zero waste requirements:
(a) All printed materials provided by CONSULTANT to C ITY generated from a personal computer and pri nter including but not limited to, proposals, quotes, invoices, reports, and public education materials, shall be double-sided and printed on a minimum of 30% or greater post -consumer content paper, unless otherwise approved by CITY’s Project Manager. Any submitted materials printed by a professional printing company shall be a minimum of 30% or greater post - consumer material and printed with vegetable based inks. (b) Goods purchased by C ONSULTANT on behalf of CITY shall be purchased in accordance with CITY’s Environmental Purchasing Policy including but not limited to Extended Producer Responsibility requirements for products and packaging. A copy of this policy is on file at the Purchasing Division’s office. (c) Reusable/returnable pallets shall be taken back by CONSULTANT, at no additional cost to CITY, for reuse or recycling. C ONSULTANT shall provide documentation from the facility accepting the pallets to verify that pallets are not being disposed.

SECTION 24. COMPLIANCE WITH PALO ALTO MINIMUM WAGE ORDINAN CE.

CONSULTANT shall comply with all requirements of the Palo Alto Municipal Code Chapter 4.62 (Citywide Minimum Wage), as it may be amended from time to time. In particular, for any employee otherwise entitled to the State minimum wage, who performs at least two (2) hours of work in a calendar week within the geographic boundaries of the City, CONSULTANT shall pay such employees no less than the minimum wage set forth in Palo Alto Municipal Code section

4.62.030 for each hour worked within the geographic boundaries of the City of Palo Alto. In addition, CONSULTANT shall post notices regarding the Palo Alto Minimum Wage Ordinance in accordance with Palo Alto Municipal Code section 4.62.060.

SECTION 25. NON-APPROPRIATION

25.1. This Agreement is subject to the fiscal provisions of the Charter of the City of Palo Alto and the Palo Alto Municipal Code. This Agreement will terminate without any penalty (a) at the end of any fiscal year in the event that funds are not appropriated for the following fiscal year, or (b) at any time within a fiscal year in the event that funds are only appropriated for a portion of the fiscal year and funds for this Agreement are no longer available. This section shall take precedence in the event of a conflict with any other covenant, term, condition, or provision of this Agreement.

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SECTION 2 6. PREVAILING WAGES AND DIR REGISTRATION FOR PUBLIC

WORKS CONTRACTS

26.1 This Project is not subject to prevailing wages. CONSULTANT is not required to pay prevailing wages in the performance and implementation of the Project in accordance with SB 7 if the contract is not a public works contract, if the contract does not include a public works construction project of more than $25,000, or the contract does not include a public works alteration, demolition, repair, or maintenance (collectively, ‘improvement’) project of more than $15,000.

OR

26.1. This Project is subject to prevailing wages and related requirements as a “public works” under California Labor Code Sections 1720 et seq. and related regulations.

CONSULTANT is required t o pay general prevailing wages as defined in California Labor Code Section 1773.1 and Subchapter 3, Title 8 of the California Code of Regulations Section 16000 et seq., as amended from time to time. Pursuant to Labor Code Section 1773, the CITY has obtained the general prevailing rate of per diem wages and the general rate for holiday and overtime work in this locality for each craft, classification, or type of worker needed to execute the contract for this Project from the State of California Department of Industrial Relations (“DIR”). Copies of these rates may be obtained at the CITY’s Purchasing Department office. The general prevailing wage rates are also available at the DIR, Division of Labor Statistics and Research, web site (see e.g. http://www.dir.ca.gov/DLSR/PWD/index.htm) as amended from time to time. CONSULTANT shall post a copy of the general prevailing wage rates at all Project job sites and shall pay the adopted prevailing wage rates as a minimum. CONSULTANT shall comply with all applicable provisions of Division 2, Part 7, Chapter 1 of the California Labor Code (Labor Code Section 1720 et seq.) , including but not limited to Sections 1725.5, 1771, 1771.1, 1771.4, 1773.2, 1774, 1775, 1776, 1777.5, 1782, 1810, 1813 and 1815 , and all applicable implementing regulations, including but not limited to Subchapter 3, Title 8 of the California Code of Regulations Section 16000 et seq. (8 CCR Section 16000 et seq.), as amended from time to time. CONSULTANT shall comply with the requirements of Exhibit E, entitled “ DIR REGISTRATION FOR PUBLIC WORKS CONTRACTS”, for any contract for public works construction, alteration, demolition, repair or maintenance , including but not limited to t he obligations to register with, and furnish certified payroll records directly to, DIR.

SECTION 27. MISCELLANEOUS PROVISIONS.

27.1. This Agreement will be governed by the laws of the State of California without regard to conflict of law provisions.

27.2. In the event that an action is brought, the parties agree that trial of such action will be vested exclusively in the state courts of California in the County of Santa Clara, State of California.

27.3. The prevailing party in any action brought to enforce the provisions of this DocuSign Envelope ID: 318133C4-F750-4C09-8493-0D1F796AC182

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Agreement may recover its reasonable costs and attorneys' fees expended in connection with that action. The prevailing party shall be entitled to recover an amount equal to the fair market value of legal services provided by attorneys employed by it as well as any attorneys’ fees paid to third parties.

27.4. This Agreement represents the entire and integrated agreement between the parties and supersedes all prior negotiations, representations, and contracts, either written or oral.

This Agreement may only be amended only by a written instrument, which is signed by authorized representatives of the parties and approved as required under Palo Alto Municipal Code.

27.5. The covenants, terms, conditions and provisions of this Agre ement will apply to, and will bind, the heirs, successors, executors, administrators, assignees, and consultants of the parties.

27.6. If a court of competent jurisdiction finds or rules that any provision of this Agreement or any amendment thereto is void or unenforceable, the unaffected provisions of this Agreement and any amendments thereto will remain in full force and effect.

27.7. All addenda, appendices, attachments, exhibits and schedules (collectively, “exhibits”) referred to in this Agreement are, by such reference, incorporated into this Agreement and deemed to be a part of this Agreement.

27.8 In the event of a conflict between the terms of this Agreement and the exhibits hereto or CONSULTANT’s proposal (if any), the Agreement shall control. In the case of any conflict between the exhibits hereto and CONSULTANT’s proposal (if any), the exhibits shall control.

27.9 All unchecked boxes do not apply to this Agreement.

27.10 The individuals executing this Agreement represent and warrant that they have the legal capacity and authority to do so on behalf of their respective legal entities.

27.11 This Agreement may be signed in multiple counterparts, which, when executed by all the parties, shall together constitute a single binding agreement.

SECTION 28. CONFIDENTIAL INFORMATION.

28.1. In the performance of this Agreement, CONSULTANT may have access to CITY’s Confidential Information (defined below). CONSULTANT will hold Confidential Information in strict confidence, not disclose it to any third party, and will use it only for the performance of its obligations to CITY under this Agreement and for no other purpose.

CONSULTANT will maintain reasonable and appropriate administrative, technical and physical safeguards to ensure the security, confidentiality and integrity of the Confidential Information.

Notwithstanding the foregoing, CONSULTANT may disclose Confidential Information to its employees, agents and subcontractors, if any, to the extent they have a need to know in order to DocuSign Envelope ID: 318133C4-F750-4C09-8493-0D1F796AC182

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perform CONSULTANT’s obligations to CITY under this Agreeme nt and for no other purpose, provided that the CONSULTANT informs them of, and requires them to follow, the confidentiality and security obligations of this Agreement.

28.2. “Confidential Information” means all data, information (including without limitation “Personal Information” about a California resident as defined in Civil Code Section 1798 et seq., as amended from time to time) and materials, in any form or media, tangible or intangible, provided or otherwise made available to CONSULTANT by CITY, d irectly or indirectly, pursuant to this Agreement. Confidential Information excludes information that CONSULTANT can show by appropriate documentation: (i) was publicly known at the time it was provided or has subsequently become publicly known other than by a breach of this Agreement; (ii) was rightfully in CONSULTANT’s possession free of any obligation of confidence prior to receipt of Confidential Information; (iii) is rightfully obtained by CONSULTANT from a third party without breach of any confidentia lity obligation; (iv) is independently developed by employees of CONSULTANT without any use of or access to the Confidential Information; or (v) CONSULTANT has written consent to disclose signed by an authorized representative of CITY.

28.3. Notwithstanding the foregoing, CONSULTANT may disclose Confidential Information to the extent required by order of a court of competent jurisdiction or governmental body, provided that CONSULTANT will notify CITY in writing of such order immediately upon receipt and prior to any such disclosure (unless CONSULTANT is prohibited by law from doing so), to give CITY an opportunity to oppose or otherwise respond to such order.

28.4. CONSULTANT will notify City promptly upon learning of any breach in the security of its systems or unauthorized disclosure of, or access to, Confidential Information in its possession or control, and if such Confidential Information consists of Personal Information, CONSULTANT will provide information to CITY sufficient to meet the notice requ irements of Civil Code Section 1798 et seq., as applicable, as amended from time to time.

28.5. Prior to or upon termination or expiration of this Agreement, CONSULTANT will honor any request from the CITY to return or securely destroy all copies of Confidential Information. All Confidential Information is and will remain the property of the CITY and nothing contained in this Agreement grants or confers any rights to such Confidential Information on CONSULTANT.

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CONTRACT NO. C21179569 SIGNATURE PAGE

IN WITNESS WHEREOF, the parties hereto have by their duly authorized representatives executed this Agreement as of the date first above written.

CITY OF PALO ALTO

____________________________
City Manager

APPROVED AS TO FORM:

__________________________
City Attorney or Designee

BROWN REYNOLDS WATFORD
ARCHITECTS, INC.

Officer 1
By: _________________________________
Name: _______________________________
Title: ________________________________

Officer 2
By: _________________________________
Name: _______________________________
Title: ________________________________

Attachments:

EXHIBIT “A”: SCOPE OF SERVICES
EXHIBIT “A-1” PROFESSIONAL SERVICES TASK ORDER
EXHIBIT “B”: SCHEDULE OF PERFORMANCE
EXHIBIT “C”: COMPENSATION
EXHIBIT “C-1”: SCHEDULE OF RATES
EXHIBIT “D”: INSURANCE REQUIREMENTS
EXHIBIT “E”: DIR REGISTRATION FOR PUBLIC WORKS CONTRACTS

DocuSign Envelope ID: 318133C4-F750-4C09-8493-0D1F796AC182 Principal
Craig Reynolds, FAIA
Principal
Mark Watford

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EXHIBIT “A”

SCOPE OF SERVICES

Fire Station No. 4 is located at 3600 Middlefield Road in Palo Alto. The City proposes to construct a new 2 -story replacement fire station. In addition to the spaces required to support the fire operations, this fire station will include an alternate Emergency Operations Center (EOC)/Training Room to serve th e Fire Department and neighborhood. The number of fire personnel and equipment will remain the same as the existing. The proposed fire station shall be a building code compliant “essential services” facility for emergency response and consists of the follo wing components:
 Demolition of existing fire station buildings and removal of drying rack  Existing fuel station on site (see Task 1 requirements)  Office and public restroom
 Emergency Operations Center (EOC)/Training room
 Two drive through apparatus bays and a stand-by apparatus bay  Firefighter living quarters
 Lobby with computer stations

Additional information can be found in City-provided reports, and Consultant shall review the programming with the City.

The Consultant shall provide professional design and construction administration services to replace the existing Fire Station 4 with a new, LEED Silver certified , Fire Station. The new Fire Station 4 shall be designed to meet the City’s 2019 Energy Reach Code by having an al l-electric design for new construction. The project delivery method is a traditional design -bid-build. These design and construction administration services are to be provided by qualified, licensed professionals, including, but not limited to the followin g professions: civil engineer, structural engineer, mechanical engineer, electrical engineer/lighting design, landscape architect, architect, cost consultant, energy analysis engineer, signage designer, surveyor, arborist, other specialty consultants as ne eded. The Consultant shall present the design to the City of Palo Alto ’s Architectural Review Board (ARB), City Council, community interest groups and various City Departments. The Consultant shall provide construction administration support during the bid period and construction.

The Consultant’s basic Services for the Fire Station No. 4 Replacement Project consists of six (6) Tasks: Task 1, Schematic Design; Task 2, Design Development; Task 3, Construction Documents; Task 4, Construction Administration; and Task 5, LEED Certification. The City’s Project Manager will provide the Consultant a separate written authorization to proceed with each task. Additional Services shall comply with Section 4 and as outlined in the Scope of Services.

PHASE 1 – DESIGN

Task 1 – Schematic Design

1.1 Project Start-up and Programming
a. Consultant and Design Team shall meet with City, Public Art Commission Liaison, DocuSign Envelope ID: 318133C4-F750-4C09-8493-0D1F796AC182

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and Fire Department representatives (4 meetings at 1 hour each). b. Consultant and Design Team shall create Project Management Plan and review with City.
c. Consultant shall review record drawings, reports and studies provided by City.

Consultant shall verify information provided by City to ensure it is updated with current codes.
d. Consultant shall coordinate with City and Fire Department representatives to perform operations review and gather information and comments for the schematic design of a new Fire Station No. 4.
e. Consultant shall perform a space and equipment needs assessment. f. Consultant shall coordinate with US Digital Designs (USDD) on the building layout and other necessary components of the existing ringdown system to be salvaged and installed in the new station. The system was just installed in 2019. g. Consultant shall meet with City and community members interested in the project to obtain community input (3 meetings at 2 hours each).
h. Consultant shall conduct workshops to gather input and respond directly to interested community members.

1.2 Prepare schematic design for Fire Station No. 4.
a. Consultant shall conduct code analysis and ADA assessment. City of Palo Alto Municipal Code is available online for review at:
https://cityofpaloalto.org/gov/city_information/municode/default.asp. b. Consultant shall coordinate design with City and Fire Department representatives. c. Consultant shall coordinate design with the existing third-party cell tower lease holder (Crown Castle) on the relocation/redesign of the telecommu nication facility as necessary.
d. Consultant shall coordinate the design and explore options to remove, upgrade, or relocate the existing on-site fuel station, underground fuel tank system, and associated piping and equipment.
e. Consultant shall prepare site survey for the Project including aerial survey, field survey and record boundary.
f. Consultant shall prepare arborist report for the Project, including a tree survey, detailing the species, size, health and other pertinent information of existing trees at the site. Consultant shall meet with City and Fire Department representatives (3 meetings at 2 hours each).
g. Consultant shall prepare outline specifications and schedule for Project. h. Consultant shall submit 10 full -size sets of the schematic design package to City for review which shall be compromised of the site (plan), architectural (architectural plans, elevations, and sections), structural (basic structural systems), and any relevant supporting material, including material boards.

1.3 Upon completion of s chematic design for Fire Station No. 4, Consultant shall provide a schematic-level construction cost estimate for the Project. Consultant shall meet with City to review cost estimate and compare it to the construction budget to identify opportunities for enhancement or necessity for value engineering.

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1.4 Begin Planning Entitlement process and present schematic designs to City. a. Consultant shall prepare a complete submittal and presentation materials (architectural plans, elevations, and sections as approp riate for the presentation outlined in 1.4.b below) for a Preliminary Architectural Review Board study session. (see submittal checklist at: https://cityofpaloalto.org/civicax/filebank/blobdload.aspx?BlobID=8755) b. Consultant shall present the schematic design to the Architectural Review Board (ARB). (see ARB process outline at:
https://cityofpaloalto.org/news/displaynews.asp?NewsID=201)

1.5 Consultant shall coordinate and meet with project team, as needed, including Public Works Engineering, Public Works Facilities, Fire, Planning, Building, and Utilities Engineering.

Task 1 Meetings and Review:

1. Kick-off meeting with the City project management team to develop the Project Management Plan

2. Three operations and space need assessment meetings with the Fire Department

3. Due diligence review with the Utilities USDD

4. Introduction and process review meeting with the Public Art Commission Liaison

5. Three workshops with city and community members

6. One meeting for internal review for Staff Design Review Committee (DRC)

7. One study session with the ARB

Task 1 Deliverables:

1. Research and Reports
a. Operations Report
b. Space Needs Assessment
c. Site analysis
d. Arborist review
e. Equipment needs and evaluation including existing ring-down system, cell tower, and fuel station

2. Topo and boundary survey

3. LEED goals and priorities statement

4. Cost estimate and value engineering analysis ARB submittal package

5. Outline specifications

Task 1 Decisions and Approvals:

1. Confirmation of the Operation Report

2. Approval of the Space Needs Assessment Report.

3. Selection of site and space arrangement alternatives

4. Approval of schematic design, budget, and schedule

Task 2 – Design Development

2.1 Prepare design development packages for new Fire Station No. 4. a. Consultant shall refine and update schematic design drawings in response to comments from Commissions, Fire Department, ARB, and City representatives.

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b. Consultant shall coordinate with the Public Art Commission Liaison to integrate any chosen public art wi th the Project. Consultant shall attend Public Art Commission (PAC) meetings (2 meetings at 3 hours each) and shall refine and update the design in response to comments from the PAC. Information about Public Art in Capital Improvement Projects is available at this link:
http://www.cityofpaloalto.org/gov/depts/csd/public_art/policies_and_documents.asp c. Consultant shall develop building and site details.
d. Consultant shall prepare in-progress specifications for projects. e. Consultant shall develop interior/exterior design.
f. Consultant shall prepare interior/exterior product/finish boards.

2.2 Consultant shall coordinate and meet with project team, as needed, including Public Works Engineering, Fire, Planning, Building, and Utilities Engineering (fiber optic network, electric, water, and wastewater). Palo Alto also owns and operates the natural gas utility, but current municipal code prohibits natural gas services on new construction. Consultant shall also coordinate with private telecom providers for the new station (AT&T and Comcast).

2.3 Upon completion of design development, Consultant shall a provide design development- level construction cost estimate and a project schedule including time for permits required.

2.4 Apply for Major ARB Approval and present design development packages to City. a. Consultant shall prepare presentation materials and apply for Major ARB review (see Major ARB submittal checklist here:
https://cityofpaloalto.org/civicax/filebank/blobdload.aspx?BlobID=6473). b. Consultant shall submit a PDF version, 10 full -size sets, and 10 half -size sets of the design deve lopment packages to City for ARB review which shall include the architectural, structural, and building systems drawings, and any relevant drawings and materials.
c. Consultant shall present design and obtain approval from City Boards and Commissions. Consultant shall expect 3 meetings at 4 hours each with the staff Design Review Committee (DRC), and the ARB.

2.5 After ARB recommends approval, present the design to City Council when they approve the Record of Land Use Action for the new station (i.e. approval of the entitlements and conditions of approval).

Task 2 Meetings and Review:

1. Design progress review with the Fire Department representatives

2. Budget and schedule progress with the City management team

3. Coordination meetings with Utilities Engineering, AT&T. Comcast, and cell tower

4. Pre-submittal meeting with the Building Department to review geotechnical recommendations, local seismicity findings, and load factors

5. Three meetings with the staff Design Review Committee (DRC)

6. Three meetings with the Architectural Review Board (ARB)

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8. Two Public Art Commission (PAC) meetings

9. City Council presentation after ARB approval

Task 2 Deliverables:

1. Design Development package with revisions for each ARB and DRC meeting a. Plans, schedules, and details to develop the design
b. Equipment and furnishings plan
c. Finishes and materials board

2. Evaluations and Engineering Reports
a. Initial energy model and compliance report
b. LEED Checklist
c. Fixture and equipment cutsheets

3. Cost Estimate
a. Construction
b. Project budget

4. Schedule
a. Allocation for permitting for project
b. Construction timeline
c. Projected completion/commissioning date

5. Entitlement Submittal for Major ARB Approval

Task 2 Decisions and Approvals:

1. ARB approval of the project design.

2. City council approval of the Record of Land Use Action for the new station.

3. City Manager approval of the project design, budget, and schedule with authorization to proceed to final construction documents.

PHASE 2 – FINAL DESIGN AND CONSTRUCTION DOCUMENTS

Task 3 – Construction Documents

3.1 Consultant shall prepare construction documents for a new Fire Station No. 4 following a recommendation of approval by the ARB and formal approval of the Record of Land Use Action by City Council.
a. Consultant shall refine and update design development drawings. b. Consultant shall prepare technical specifications for project in CSI format. c. Consultant shall prepare any documents necessary for removal of underground fuel tank system.
d. Consultant shall coordinate the technical specifications with City’s General Conditions and Construction Contract template.
e. Consultant shall refine interior design.
f. Consultant shall develop final interior product/finish/furnishing boards. g. Consultant shall coordinate with City’s design team.

3.2 Consultant shall electronically submit the 65% and 95% construction documents package in PDF format to City for review which shall include the architectural, structural, building DocuSign Envelope ID: 318133C4-F750-4C09-8493-0D1F796AC182

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systems drawings, and any relevant drawings, materials, and specifications. Anticipated plan sheets for submittal to the City shall include but are not limited to the following:

1. Title Sheet.

2. Stage Construction plan and notes.

3. LEED and Green Building Check List.

4. Architectural Exterior and Interior plans, Elevation, and Finished Schedule.

5. Structural plans and details.

6. MEP plans.

7. Typical cross sections.

8. Cabinetry, doors, and miscellaneous details.

9. Site plan including Landscaping and Irrigation plans and details.

10. Storm drain and stormwater runoff plans and green stormwater infrastructure details.

11. Fuel station and underground gas tank system details for planned removal, upgrade, or relocation.

3.3 Consultant shall provide respective cost estimates and updated project schedules with the submittal of the 65% an d 95% construction documents package. Cost estimates shall be delivered to the City in Excel and PDF formats. Project Schedules shall be delivered to the City in PDF format, MS Project format, or any other format as approved by the City.

3.4 Upon completion of construction documents, Consultant shall provide a final construction cost estimate and a final estimated construction timeline for the Project.

3.5 Consultant shall electronically deliver final 100% construction documents, estimated timeline, and cost estimate to City. All drawings shall be delivered to the City in AutoCAD 2019 and PDF formats.

3.6 Consultant shall work on the City’s behalf for obtaining necessary permits and inspections for the removal and replacement of the emergency generator.

3.7 Consultant shall work on the City’s behalf for obtaining necessary permits and inspections for the removal, relocation, or upgrade of the fuel station and underground gas tank.

3.8 Consultant to coordinate with a separate, City-hired third-party entity for C.3 storm water treatment design review as required by the Building Department . Consultant shall incorporate any design changes resulting from this C.3 storm water treatment design review.

Task 3 Meetings and Review:

1. Design progress review with City and Fire Department representatives

2. Budget and schedule progress with the City management team

3. Pre-submittal ADA compliance review meeting with the City representatives

4. Interior design review with City and Fire Department representatives

5. Three meetings with the staff DRC

6. Design progress review with the PAC Liaison
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7. C.3 storm water treatment design review by third-party

Task 3 Deliverables:

1. 65% and 95% Construction Documents (PDF format)
a. Plans, schedules, and details to full document the construction b. Interior design and material selections
c. Technical Specifications

2. Evaluations and Engineering Reports
a. Energy compliance report
b. Structural Calculations
c. LEED worksheet update

3. Cost Estimate
a. 65% and 95% cost updates
b. Final cost estimate

4. Schedule Update
a. 65% and 95% schedules updates
b. Final schedule

5. Building Permit Submittals
a. Fire Station No. 4 Demolition
b. Emergency Generator Replacement
c. Fuel Station Replacement or Upgrade
d. Fire Station No. 4 Replacement

Task 3 Decisions and Approvals:

1. C.3 Design Approval

2. Building Permit

3. City Council authorization to go to bid

PHASE 3 – CONSTRUCTION ADMINISTRATION

Task 4 – Construction Administration

4.1 Assist City during bid period.
a. Consultant shall assist the City in preparation of construction bid package/s (IFBs) b. Consultant shall review and respond to questions, within 48 hours, during bid period. c. Consultant shall prepare addenda and revisions as required within 48 hours during bid period.
d. Consultant shall attend and assist the City at the pre-bid conferences and the job walk.

4.2 Provide construction support and construction administration services. The not -to-exceed amount identified in Exhibit C assumes a construction contract duration of 18 months. a. Consultant shall assist City in reviewing and responding to submittals within te n (10) working days upon receiving the submittals.
b. Consultant shall respond to construction contractor requests for information within ten (10) working days upon receiving the request.

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c. Consultant shall assist City in clarifying any questions that may arise during the project in a timely manner.
d. Consultant shall assist City in preparing, reviewing and provide comments/solutions to change orders within ten (10) working days upon receiving the change orders. e. Consultant shall attend weekly Project Progress site meetings and as requested or require.
f. Consultant shall issue Architect ’s Supplemental Instructions (ASI ’s) within five (5) working days upon determination that an ASI is needed.

4.3 Consultant shall coordinate construction administration services with Ci ty’s construction manager.

4.4 Consultant shall participate in the final project review and prepare the final review punch list. Consultant shall field verify, perform back checks, and sign off on punch list completion.

4.5 Consultant shall prepare as-built plans for the project within thirty (30) calendar days from the day Notice of Completion is sent to the construction contractor. As-built plans shall be delivered to the City in both AutoCAD 2013 or later version and PDF formats.

Task 4 Meetings and Review:

1. Pre-bid conference and job walk

2. Job kick-off meeting

3. LEED coordination and commissioning meeting.

4. Weekly Progress meetings

5. City Departments

6. Utilities

7. Public Art Commission Liaison

8. City and Community Members

9. Architectural Review Board

10. City Council

Task 4 Deliverables

1. Review and respond to ASIs, RFIs, COs, and other construction documentation

2. Reports

3. Change documents

4. Close-out documents

5. As-built Plans

6. Deferred submittals

7. LEED Silver certification

Task 4 Decisions and Approvals:

1. Construction contract award

2. Progress payment approvals

3. Change order approvals

4. Substantial completion and occupancy approval
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5. Warranty and as-built approval

6. One-year warranty review

Task 5 – LEED Certification

The City intends that the Fire Station No. 4 Replacement Project sh all be designed to meet the standards for LEED Silver or higher certification by USGBC.

5.1 Consultant shall design the Fire Station No. 4 Replacement Project to meet the requirements for LEED V4.1 certification at the Silver or higher level.

5.2 Consultant shall provide LEED project management services needed for the City to obtain LEED certification of the Fire Station No. 4 Replacement Project, develop specifications consistent with LEED and the City ’s policies, and provide the templates, docume ntation, calculations, and energy modeling studies necessary to obtain LEED certification.

5.3 Consultant and relevant sub -consultants shall include at least one LEED accredited professional to support Project Sustainable Building/Green Building design cr iteria as required to achieve LEED certification.

5.4 Consultant shall include in the construction documents appropriate provisions requiring the construction contractor to meet the requirements and provide documentation for City’s submittal to USGBC for LEED certification.

Task 5 Meetings and Review:

1. LEED coordination and commissioning meeting

2. Coordination meetings as needed (may be listed under Tasks 1-4)

Task 5 Deliverables

1. Design to meet LEED Silver or higher certification

2. Documentation for project submittal to USGBC for LEED certification

3. LEED AP professional to support Project

4. LEED Silver or higher certification

Task 5 Decisions and Approvals:

1. Construction contract award

2. Progress payment approvals

3. Change order approvals

4. Substantial completion and occupancy approval

5. Warranty and as-built approval

6. One-year warranty review

MICROGRID ASSESSMENT

The City is considering the addition of a microgrid energy capture/storage system for the new Fire Station No. 4. Consultant shall research various microgrid systems and solutions including the DocuSign Envelope ID: 318133C4-F750-4C09-8493-0D1F796AC182

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space need, initial cost, maintenance cost, and pay -back/energy saving options and select an alternative that has the scalability to achieve the energy capture and storage goals within the budget allocation. Consultant shall calculate and asses s the anticipated energy demand for the new Fire Station No. 4 and review potential LEED credits . Consultant shall produce a separate initial cost estimate to install and incorporate the selected microgrid system. Microgrid assessment is to be performed alongside Task 1.

Deliverables

1. Research and report on recommended best fit microgrid system for the project

2. Initial cost estimate for the selected microgrid system

ADDITIONAL SERVICES

Authorization of Consultant’s use of Additional Services shall comply with Section 4 , and compensation shall not exceed the amount set forth in Section 4. Work that is substantially beyond the Tasks in the Scope of Services may qualify (if approved by City per Section 4 of this Agreement) for Additional Services.

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EXHIBIT A-1

PROFESSIONAL SERVICES TASK ORDER

CONSULTANT shall perform the Services detailed below in accordance with all the terms and conditions of the Agreement referenced in Item 1A below. All exhibits referenced in Item 8 are incorporated into this Task Order by this reference. CONSULTANT shall furnish the necessary facilities, professional, technical and supporting personnel required by this Task Order as described below.

CONTRACT NO.

OR PURCHASE ORDER REQUISITION NO. (AS APPLICABLE)

1A. MASTER AGREEMENT NO. (MAY BE SAME AS CONTRACT / P.O. NO. ABOVE):
1B. TASK ORDER NO.:

2. CONSULTANT NAME:

3. PERIOD OF PERFORMANCE: START: COMPLETION:
4 TOTAL TASK ORDER PRICE: $__________________
BALANCE REMAINING IN MASTER AGREEMENT/CONTRACT $_______________

5. BUDGET CODE_______________
COST CENTER________________
COST ELEMENT______________
WBS/CIP__________
PHASE__________

6. CITY PROJECT MANAGER’S NAME & DEPARTMENT:____________________________________

7. DESCRIPTION OF SCOPE OF SERVICES (Attachment A)
MUST INCLUDE:
 SERVICES AND DELIVERABLES TO BE PROVIDED
 SCHEDULE OF PERFORMANCE
 MAXIMUM COMPENSATION AMOUNT AND RATE SCHEDULE (as applicable)  REIMBURSABLE EXPENSES, if any (with “not to exceed” amount)

8. ATTACHMENTS: A: Task Order Scope of Services B (if any): _____________________________

I hereby authorize the performance of the
work described in this Task Order.

APPROVED:

CITY OF PALO ALTO

BY: ___________________________________

Name: _________________________________

Title: __________________________________

Date: __________________________________

I hereby acknowledge receipt and acceptance of
this Task Order and warrant that I have
authority to sign on behalf of Consultant.

APPROVED:

COMPANY NAME: ______________________

BY: ___________________________________

Name: _________________________________

Title: __________________________________

Date: __________________________________

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EXHIBIT “B”

SCHEDULE OF PERFORMANCE

CONSULTANT shall perform the Services so as to complete each milestone within the number of days/weeks specified below. The time to complete each milestone may be increased or decreased by mutual written agreement of the project managers for CONSULTANT and CITY so long as all work is completed within the term of the Agreement. CONSULTANT shall provide a detailed schedule of work consistent with the schedule below within 2 weeks of receipt of the notice to proceed (NTP).

Milestones
Completion
No. of Weeks From NTP

1. Task 1 – Schematic Design 18 weeks

2. Task 2 – Design Development 52 weeks

3. Task 3 - Construction Documents 87 weeks

4. Task 4 – Construction Administration 165 weeks

5. Task 5 – LEED Certification 245 weeks

Additional Services (if any, per Section 4 of this Agreement)

As needed during the term
of this Agreement per the
schedule approved by
City in the applicable
Task Order.

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EXHIBIT “C”

COMPENSATION

The CITY agrees to compensate the CONSULTANT for Services performed in accordance with the terms and conditions of this Agreement, and as set forth in the budget schedule below.

Compensation shall be calculated based on the hourly rate schedule attached as exhibit C-1 up to the not to exceed budget amount for each task set forth below.

CONSULTANT shall perform the tasks and categories of work as outlined and budgeted below.

The CITY’s Project Manager may approve in writing the transfer of budget amounts between any of the tasks or categories listed below provided that the total compensation for Basic Services, including reimbursable expenses, and the total compensation for Additional Services, do not exceed the amounts set forth in Section 4 (Not to Excee d Compensation) of this Agreement.

BUDGET SCHEDULE NOT TO EXCEED AMOUNT

SERVICES Phase 1 Phase 2 Phase 3 ROW
TOTALS
Task 1 - Schematic Design $117,800 $117,800
Task 2 - Design Development $152,700 $152,700
Task 3 - Construction Documents $ 229,400 $229,400
Task 4 - Construction Administration (FY2023 Funds
will be used on an as-needed basis for FY2023-2025) $157,800 $157,800 Task 5 - LEED Certification $11,952 $19,522 $8,366 $39,840 Task 6 – Microgrid Design Allowance $22,622
TOTAL BASIC SERVICES $305,074 $248,922 $166,166 $720,162 REIMBURSABLE EXPENSES* (as specified in this
exhibit) $5,000* $5,000*
SUBTOTAL (Basic Services & Reimbursable Expenses) $310,074 $248,922 $166,166 $725,162 ADDITIONAL SERVICES* (if any, per Section 4) $72,016 $72,016*

TOTAL NOT-TO-EXCEED AMOUNT

$382,090

$248,922

$166,166

$797,178
* The not -to-exceed amounts for Reimbursable Expenses and Additional Services may each , respectively, be utilized across all Phases of the Agreement, even though these respective not - to-exceed amounts may not show in all Phases in the table above. These specified not-to-exceed DocuSign Envelope ID: 318133C4-F750-4C09-8493-0D1F796AC182

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amounts are cumulative across all Phases; they are not necessarily per-Phase amounts.

REIMBURSABLE EXPENSES

The administrative, overhead, secretarial time or secretarial overtime, word processing, photocopying, in -house printing, insurance and other ordinary business expenses are included within the scope of payment for services and are not reimbursable expenses. CITY shall reimburse CONSULTANT for the following reimbursable expenses at cost. Expenses for which CONSULTANT shall be reimbursed are:

1. Shipping of submittal items for staff Design Review Committee and Architectural Review Board including , but not limited to , materials boards, plans, and other supporting documentation

2. Printing for documents as requested by the City during design and construction

All requests for payment of expenses shall be accompanied by appropriate backup information. Any expense anticipated to be more than $500 shall be approved in advance by the CITY’s Project Manager.

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EXHIBIT “C-1”

SCHEDULE OF RATES

CONSULTANT’s not-to-exceed hourly rate schedule under this Agreement is as provided below in this Exhibit C-1, covering CONSULTANT and its subconsultants, if applicable. Overtime may only be charged if specific approval was granted in writing by the City’s Project Manager in advance. Any overtime incurred without such approval shall be at the CONSULTANT’s own expense to the extent it is above the hourly rates provided in this Exhibit C-1.

CONSULTANT (BRW Architects)
2020-21 2021-22 2022-23
Principal $210 $214 $218
Project Architect / Project Manager $180 $183 $186
Project Coordinator $150 $153 $156
Project Designer $120 $122 $124
Drafter / BIM Modeling / Animations $80 $81 $82
Administrative Assistant $40 $41 $42

Sub-consultants
2020-21 2021-22 2022-23
Principal Engineer/ Principal Landscape
Architect
$210 $214 $218
Project Engineer / Landscape Architect $180 $183 $186
Engineer I $150 $153 $156
Engineer II / Designer $120 $122 $124
Drafter / BIM Modeling $80 $81 $82
Administrative Assistant $40 $41 $42

Mark-up % on sub-consultants 10%

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EXHIBIT “D”

INSURANCE REQUIREMENTS

CONSULTANTS TO THE CITY OF PALO ALTO (CITY), AT THEIR SOLE EXPENSE, SHALL FOR THE TERM OF THE

CONTRACT OBTAIN AND MAINTAIN INSURANCE IN THE AMOUNTS FOR THE COVERAGE SPECIFIED BELOW, AFFORDED BY COMPANIES WITH AM BEST’S KEY RATING OF A -:VII, OR HIGHER, LICENSED OR AUTHORIZED TO TRANSACT INSURANCE BUSINESS IN THE STATE OF CALIFORNIA.

AWARD IS CONTINGENT ON COMPLIANCE WITH CITY’S INSURANCE REQUIREMENTS AS SPECIFIED HEREIN.

REQUIRED TYPE OF COVERAGE REQUIREMENT

MINIMUM LIMITS
EACH

OCCURRENCE AGGREGATE
YES
YES
WORKER’S COMPENSATION
EMPLOYER’S LIABILITY

STATUTORY

STATUTORY STATUTORY STATUTORY
YES

GENERAL LIABILITY, INCLUDING

PERSONAL INJURY, BROAD FORM

PROPERTY DAMAGE BLANKET

CONTRACTUAL, AND FIRE LEGAL

LIABILITY

BODILY INJURY

PROPERTY DAMAGE

BODILY INJURY & PROPERTY
DAMAGE COMBINED.
$1,000,000

$1,000,000

$1,000,000

$1,000,000

$1,000,000

$1,000,000

YES

AUTOMOBILE LIABILITY,

INCLUDING ALL OWNED, HIRED,

NON-OWNED

BODILY INJURY
- EACH PERSON
- EACH OCCURRENCE

PROPERTY DAMAGE

BODILY INJURY AND PROPERTY

DAMAGE, COMBINED
$1,000,000
$1,000,000
$1,000,000

$1,000,000

$1,000,000

$1,000,000
$1,000,000
$1,000,000

$1,000,000

$1,000,000

YES

PROFESSIONAL LIABILITY,

INCLUDING, ERRORS AND

OMISSIONS, MALPRACTICE (WHEN

APPLICABLE), AND NEGLIGENT

PERFORMANCE
ALL DAMAGES $1,000,000
YES

THE CITY OF PALO ALTO IS TO BE NAMED AS AN ADDITIONAL INSURED: CONSULTANT, AT ITS SOLE COST

AND EXPENSE, SHALL OBTAIN AND MAINTAIN, IN FULL FORCE AND EFFECT THROUGHOUT THE ENTIRE TERM

OF ANY RESULTANT AGREEMENT, THE INSURANCE COVERAGE HEREIN DESCRIBED, INSURING NOT ONLY CONSULTANT AND ITS SUBCONSULTANTS, IF ANY, BUT ALSO, WITH THE EXCEPTION OF WORKERS’ COMPENSATION, EMPLOYER’S LIABILITY AND PROFESSIONAL INSURANCE, NAMING AS ADDITIONAL INSUREDS CITY, ITS COUNCIL MEMBERS, OFFICERS, AGENTS, AND EMPLOYEES.

I. INSURANCE COVERAGE MUST INCLUDE:

A. A CONTRACTUAL LIABILITY ENDORSEMENT PROVIDING INSURANCE COVERAGE FOR CONSULTANT’S AGREEMENT TO INDEMNIFY CITY.

II. THE CONSULTANT MUST SUBMIT CERTIFICATES(S) OF INSURANCE EVIDENCING REQUIRED COVERAGE AT THE FOLLOWING URL: HTTPS://WWW.PLANETBIDS.COM/PORTAL/PORTAL.CFM?COMPANYID=25569

III. ENDORSEMENT PROVISIONS WITH RESPECT TO THE INSURANCE AFFORDED TO ADDITIONAL INSUREDS:

A. PRIMARY COVERAGE

WITH RESPECT TO CLAIMS ARISING OUT OF THE OPERATIONS OF THE NAMED INSURED,

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CONTRIBUTING WITH ANY OTHER INSURANCE CARRIED BY OR FOR THE BENEFIT OF THE ADDITIONAL INSUREDS.

B. CROSS LIABILITY

THE NAMING OF MORE THAN ONE PERSON, FIRM, OR CORPORATION AS INSUREDS UNDER

THE POLICY SHALL NOT, FOR THAT REASON ALONE, EXTINGUISH ANY RIGHTS OF THE

INSURED AGAINST ANOTHER, BUT THIS ENDORSEMENT, AND THE NAMING OF MULTIPLE

INSUREDS, SHALL NOT INCR EASE THE TOTAL LIABILITY OF THE COMPANY UNDER THIS POLICY.

C. NOTICE OF CANCELLATION

1. IF THE POLICY IS CANCELED BEFORE ITS EXPIRATION DATE FOR ANY REASON

OTHER THAN THE NON-PAYMENT OF PREMIUM, THE CONSULTANT SHALL PROVIDE CITY AT LEAST A THIRTY (30) DAY WRITTEN NOTICE BEFORE THE EFFECTIVE DATE OF CANCELLATION.

2. IF THE POLICY IS CANCELED BEFORE ITS EXPIRATION DATE FOR THE NON-PAYMENT OF PREMIUM, THE CONSULTANT SHALL PROVIDE CITY AT LEAST A TEN (10) DAY WRITTEN NOTICE BEFORE THE EFFECTIVE DATE OF CANCELLATION.

EVIDENCE OF INSURANCE AND OTHER RELATED NOTICES ARE REQUIRED TO BE FILED WITH THE CITY OF PALO ALTO AT THE FOLLOWING URL:

HTTPS://WWW.PLANETBIDS.COM/PORTAL/PORTAL.CFM?COMPANYID=25569

OR

HTTP://WWW.CITYOFPALOALTO.ORG/GOV/DEPTS/ASD/PLANET_BIDS_HOW_TO.ASP

DocuSign Envelope ID: 318133C4-F750-4C09-8493-0D1F796AC182

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Professional Services
Rev. April 27, 2018

EXHIBIT “E”

DIR REGISTRATION FOR PUBLIC WORKS CONTRACTS

This Exhibit shall apply only to a contract for public works construction, alteration, demolition, repair or maintenance work, CITY will not accept a bid proposal from or enter into this Agreement with CONSULTANT without proof that CONSULTANT and its listed subcontrac tors are registered with the California Department of Industrial Relations (“DIR”) to perform public work, subject to limited exceptions. City requires CONSULTANT and its listed subcontractors, if any, to comply with all applicable requirements of the California Labor Code including but not limited to Labor Code Sections 1720 through 1861, and all applicable related regulations, including but not limited to Subchapter 3, Title 8 of the California Code of Regulations Section 16000 et seq ., as amended from time to time. This Exhibit E applies in addition to the provisions of Section 26 (Prevailing Wages and DIR Registration for Public Works Contracts) of the Agreement.

CITY provides notice to CONSULTANT of the requirements of California Labor Code Section 1771.1(a), which reads:

“A contractor or subcontractor shall not be qualified to bid on, be listed in a bid proposal, subject to the requirements of Section 4104 of the Public Contract Code, or engage in the performance of any contract for public work, as defined in this chapter, unless currently registered and qualified to perform public work pursuant to Section 1725.5. It is not a violation of this section for an unregistered contractor to submit a bid that is authorized by Section 7029.1 of the Business and Professions Code or Section 10164 or 20103.5 of the Public Contract Code, provided the contractor is registered to perform public work pursuant to Section 1725.5 at the time the contract is awarded.”

This Project is subject to compliance monitoring a nd enforcement by DIR. All contractors must be registered with DIR per Labor Code Section 1725.5 in order to submit a bid. All subcontractors must also be registered with DIR. No contractor or subcontractor may be awarded a contract for public work on a public works project unless registered with DIR. Additional information regarding public works and prevailing wage requirements is available on the DIR web site (see e.g. http://www.dir.ca.gov) as amended from time to time.

CITY gives notice to CONSULTANT and its listed subcontractors that CONSULTANT is required to post all job site notices prescribed by law or regulation.

CONSULTANT shall furnish certified payroll records directly to the Labor Commissioner (DIR) in accordance with Subchapter 3, Title 8 of the California Code of Regulations Section 16461 (8 CCR Section 16461).

CITY requires CONSULTANT and its listed subcontractors to comply with the requirements of Labor Code Section 1776, including but not limited to:

Keep accurate payroll records, showing the name, address, social security number, work classification, straight time and overtime hours worked each day and week, and the actual per diem wages paid to each journeyman, apprentice, worker, or other employee employed by, respectively, DocuSign Envelope ID: 318133C4-F750-4C09-8493-0D1F796AC182

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Professional Services
Rev. April 27, 2018

CONSULTANT and its listed subcontractors, in connection with the Project.

The payroll records shall be verified as true and correct and shall be certified and made available for inspection at all reasonable hours at the principal office of CONSULTANT and its listed subcontractors, respectively.

At the request of CITY, acting by its Project Manager, CONSULTANT and its listed subcontractors shall make the certified payroll records available for inspection or furnished up on request to the CITY Project Manager within ten (10) days of receipt of CITY’s request.

CITY requests CONSULTANT and its listed subcontractors to submit the certified payroll records to CITY’s Project Manager at the end of each week during the Project.

If the certified payroll records are not pro vided as required within the 10 -day period, then CONSULTANT and its listed subcontractors shall be subject to a penalty of one hundred dollars ($100.00) per calendar day, or portion thereof, for each worker, and CITY shall withhold the sum total of penalties from the progress payment(s) then due and payable to CONSULTANT.

Inform CITY’s Project Manager of the location of CONSULTANT’s and its listed subcontractors’ payroll records (street address, city and county) at the commencement of the Project, and also provide notice to CITY’s Project Manager within five (5) business days of any change of location of those payroll records.

Eight (8) hours labor constitutes a legal day’s work. CONSULTANT shall forfeit as a penalty to CITY, $25.00 for each worke r employed in the execution of the Agreement by CONSULTANT or any subcontractor for each calendar day during which such worker is required or permitted to work more than eight (8) hours in any one calendar day or forty (40) hours in any one calendar week in violation of the provisions of the Labor Code, and in particular, Sections 1810 through 1815 thereof, except that work performed by employees of CONSULTANT or any subcontractor in excess of eight (8) hours per day, or forty (40) hours during any one week, shall be permitted upon compensation for all hours worked in excess of eight (8) hours per day, or forty (40) hours per week, at not less than one and one -half (1&1/2) times the basic rate of pay, as provided in Section 1815.

CONSULTANT shall secure the payment of workers’ compensation to its employees as provided in Labor Code Sections 1860 and 3700 (Labor Code 1861). CONSULTANT shall sign and file with the CITY a statutorily prescribed statement acknowledging its obligation to secure the payment of workers’ compensation to its employees before beginning work (Labor Code 1861).

CONSULTANT shall post job site notices per regulation (Labor Code 1771.4(a)(2)).

CONSULTANT shall comply with the statutory requirements regarding employment of apprentices including without limitation Labor Code Section 1777.5. The statutory provisions will be enforced for penalties for failure to pay prevailing wages and for failure to comply with wage and hour laws.

DocuSign Envelope ID: 318133C4-F750-4C09-8493-0D1F796AC182

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City of Palo Alto (ID # 13662)
City Council Staff Report

Meeting Date: 5/23/2022 Report Type: Consent Calendar

City of Palo Alto Page 1

Title: Approval of 1) Increase of Construction Contingency for Contract No.

C20174550 with Granite Construction in the Amount of $185,302; and 2) Budget Amendments in the Electric Fund for the Electric Customer Connection project (EL -89028), the Fiber Opti cs Fund for the Fiber Optics Network –System Improvements project (FO -10001), and the Capital Improvement Fund for the Highway 101 Pedestrian/Bicycle Overpass project (PE-11011)
From: City Manager
Lead Department: Public Works

Recommendation
Staff recommends that Council:

1. Approve an additional construction contingency for Contract No. C20174550 with Granite Construction Company in an amount not to exceed $185,302 , and for a total contract contingency amount no t to exceed $1,5 69,794 for the Highway 101 Pedestrian/Bicycle Overpass Project (PE-11011); and

2. Amend the Fiscal Year 2022 Budget Appropriation (requires a 2/3 majority vote) for the following funds:
a. Electric Fund:
i. Decreasing the appropriation for Electric Customer Connection project (EL-89028) in the amount of $10,255;
ii. Increasing the Transfer to the Capital Improvement Fund appropriation in the amount of $10,255;
b. Fiber Optics Fund:
i. Decreasing the appropriation for Fiber Optics Network –System Improvements project (FO-10001) in the amount of $54,290; ii. Increasing the Transfer to the Capital Improvement Fund appropriation in the amount of $54,290;
c. Capital Improvement Fund:
i. Increasing the Transfer from the Electric Fund estimate in the amount of $10,255;
ii. Increasing the Transfer from the Fiber Optics Fund estimate in the amount of $54,290;
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iii. Increasing the Highway 101 Pedestrian/Bicycle Overpass project (PE- 11011) appropriation in the amount of $64,545.

Executive Summary
The Highway 101 Pedestrian/Bicycle Overpass Project construction began in January 2020 and was completed in November 2021. This project was one of the ten 2014 Council Infrastructure Plan projects. The project improves connectivity to the Palo Alto Baylands Nature Preserve, East and West Bayshore Road businesses , and the regional San Francisco Bay Trail network. The project construction was significantly impacted by the global suppl y and material shortages, procurement delays, and personnel and trucking shortages caused by the Covid-19 pandemic.

Additionally, there were unforeseen underground utili ties conflicts and design changes to the railing system to address constructability issues. Such issues resulted in about four months of delay in construction completion, additional change orders , and increased construction management services cost. Althou gh the construction cost is slightly higher than originally anticipated, the overall design and construction cost is within the original $20.4 million budget established for the project at the time of contract award (Staff Report ID# 10646).

Background
The Highway 101 Pedestrian/Bicycle Overpass Project (PE-11011), a new year -round, grade - separated, shared bicycle and pedestrian crossing over Highway 101 was completed in November 2021. The project consists of prefabricated steel trusses over Highway 101 and East and West Bayshore Roads, concrete approach structures, Adobe Creek Reach Trail, landscaping, lighting, amenities, and signage. The project had several environmental, co nstruction, and jurisdictional requirements as it falls within multiple jurisdictions including the City, California Department of Transportation (Caltrans), Santa Clara Valley Water District, a private property located at 3600 West Bayshore Road, and the Baylands Nature Preserve.

On May 23, 2016, Council approved a contract with Biggs Cardosa Associates, Inc. to provide design and engineering services for the bridge (Staff Report ID# 6578). The design contract was amended for final design and right -of-way services in December 2017 (Amendment No. 1, Staff Report ID# 8659), bidding and construction su pport services in June 2019 (Amendment No. 2, Staff Report ID# 10339), and a contract term extension in May 2021 to continue construction support services (Amendment No. 3: St aff Report ID# 11798). Project design was completed in early 2019. Caltrans approved the right -of-way certificati on and encroachment permit in May/June 2019 and granted the Authorization to Proceed (E -76) with construction in August 2019. An invitation for bids was issued on August 14, 2019.

On November 18, 2019, Council approved a construction contract with Granit e Construction Company and a construction management services contract with Zoon Engineering, Inc. (Staff Report ID# 10646). After contract execution, a Notice to Proceed was issued to the contractor in January 2020 with an anticipated construction completion in July 2021.

Discussion
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Construction and Construction Management Contracts
The project construction began in January 2020 with submittals, shop drawings and request fo r information reviews, stakeholder coordination, site reconnaissance, and vegetation removal.

The field construction operation was suspended soon after due to the Covid -19 shutdown in April 2020 per the Santa Clara County Health Orders and construction wor k resumed in late May/early June 2020. The delayed start of construction made it very challenging to complete the new 140 -foot-long bridge over Adobe Creek between June 15 and October 15 (as environmental restriction s require). Prior to beginning any work on the bridge footings, the utilities along West Bayshore Road were to be relocated into a new joint trench. To mitigate potential delays, the construction activities were re -sequenced with simultaneous utilities/Adobe Creek Bridge work on the west side and pile drilling on the east side by working longer shifts and on Saturdays until the Adobe Creek Bridge was installed on October 7, 2020.

Although the project team implement ed mitigation measures to minimize the schedule and budget impacts during construction, the project was significantly impacted by the global material supply chain disruption (e.g., fabrication shops work suspension , personnel shortages, procurement delays, and trucking shortages ) due to the Covid -19 pandemic . The bridge architectural railing fabrication, galvanization, and staining process was hindered the most by these impacts. Additionally, t here were numerous unanticipated underground utilities conflicts and some design changes to the architectural railing which used approximately 80% of the contingency funds for change orders. Some of the underground utilities conflicts included an abandoned PG&E gas line located at 3600 West Bayshore Road (Google parking lot) approximately 14 feet below grade obstructing drilling of three bridge p iles, a need for a robust shoring system to drill piles in close vicinity of the PG&E high pressure gas line on the east side, and utilities conflicts with relocation of electric and fiber utilities along West Bayshore Road.

The architectural railing with integrated lighting is a unique design that required many changes to address fabrication, constructability , and operational issues. These issues resulted in about four months delay in the project completion and budget overruns on the construction and construction management contracts. Although there were delays in the delivery of the three steel trusses, additional cost incurred because of the delays were at the contractor’s expense and did not contribute to the construction contract overruns.

With constru ction complete, t he total change order amount for the Granite Construction Company contract (C20174550) is $1,569,794 , or 11% of the base contract value of $13,844,920—i.e., $185,302 above the 10% contingency budget ($1,384,492 contingency) of the construc tion contract. In addition to the recommended increase of $185,302 to the authorized contingency for the construction contract with Granite Construction Company (C20174550), t he project delays required an additional $40,000 in the construction management s ervices by Zoon Engineering, Inc . The design contract with Biggs Cardosa Associates (C16162262) has adequate funds to complete the construction support services including as-built drawings preparation. However, the contracts with Biggs Cardosa Associates (C16162262) and Zoon Engineering, Inc. (C20175214) both ended on December 31, 2021.

Therefore, a new design contract with Biggs Cardosa Associates in the amount of $20,000 and a 3 Packet Pg. 50

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new construction management services contract with Zoon Engineering, Inc. in th e amount of $40,000, effective January 1, 2022 are in process to continue and complete construction support services. Staff is not seeking Council approval of these new contracts as they are within the City Manager’s approval authority. The total project d esign and construction costs presented in this report account for these new contracts.

A majority of th e additional costs are recommended to be offset by available project budget and the following:

1) Utility Funding for Improvements: The project included betterments to the utilities including spare electrical and fiber conduits. Additional work was performed to address conflicts with utilities betterment (expansion couplers, pull boxes, risers, routing changes, etc. ) at an additional cost of $64,545 which is recommended to be reimbursed by the Utilities Electric and Fiber Optics Funds. Lower than budgeted expenses offset these actions in the Electric Customer Connection (CIP EL-89028) and Fiber Optics Network –System Improvements (CIP FO-10001) projects.

2) Design Expense Savings: The overall design costs for the project were $80,000 below expected levels leaving some capacity for the cost of project delay.

With above budget transfers, the additional project cost is $80,757. Despite this increase the total design and construction cost of the project of $20.39 million remains within the $20.4 million budget established for the project in Fiscal Year 2022 (excluding the utilities betterment costs).

Resource Impact
Based on the recommendations in this report, the total required additional appropriation to the project is estimated to be $65,545, to be funded by transfers from the Utilities Electric and Fiber Optics Funds to reimburse the Capital Improvement Fund for utilities related work that was done as part of the construction of PE -11011. The total design and construction costs are within the $20.4 million budget established for the project for F iscal Year 2022, therefore no change in the project budget beyond the cost associated with the investment in utili ty infrastructure is needed . Any technical accounting clean-up that may be necessary will occur during the Fiscal Year 2022 year-end process.

Policy Implications
The project is consistent with the City’s Comprehensive Plan goals, policies, and programs.

Stakeholder Engagement
Stakeholder engagement is not required for approval of the additional contingency and budget appropriation.

Timeline
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The project construction was completed in November 2021 . Upon Council approval of the additional contingency and budget appropriation, staff will complete project closeout.

Environmental Review
No environmental review is necessary for approval of the additional contingency and budget appropriation.
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City of Palo Alto (ID # 13835)
City Council Staff Report

Meeting Date: 5/23/2022 Report Type: Consent Calendar

City of Palo Alto Page 1

Title: Approval of Contract No. C22183901 with Genuine Parts Company dba Napa Auto Parts for an Amount Not -to-Exceed $2,306,433 for an On -Site Fleet Parts and Inventory Program for a Three -Year Term from January 24, 2022 through January 23, 2025, with Pric ing Set by Cooperative Sourcewell Contract No. 110520 with Genuine Auto Parts Company dba Napa Integrated Business Solutions; and Approve and Authorize the City Manager or Their Designee to Execute an Amendment to Contract No. C22183901 to Extend the Term for up to One Additional Year through January 24, 2026 (Provided that the Cooperative Sourcewell Contract is Extended for an Additional Year) for an Additional Amount Not to Exceed $831,227 (Annual Amount Is Subject to Adjustment Provided the Total Contra ct Amount Is Not Exceeded), for a Total Not to Exceed Amount of the Contract, if Extended, of $3,137,660 From: City Manager
Lead Department: Public Works

Recommendation
Staff recommends that the City Council:

1. Approve and authorize the City Manager or their designee to execute Contract No.

C22183901 with Genuine Parts Company dba Napa Auto Parts (“NAPA”) for an amount not-to-exceed $2,306,433 for an on-site fleet parts and inventory program over a three (3)-year contract term (January 24, 2022 through January 23, 202 5), with pricing set by cooperative Sourcewell Contract No. 110520 with Genuine Auto Parts Comp any dba Napa Integrated Business Solutions ; and

2. Approve and authorize the City Manager or their designee to execute an amendment to Contract No. C22183901 to extend the term for up to one (1) additional year through January 23, 202 6, constituting contract year 4 in alignment with the underlying NAPA/Sourcewell cooperative contract, for an annual contract year 4 amount not to exceed $831,227 (subject to the provisions of Exhibit C) and a total not -to-exceed amount of the contract, if extended, of $3,137,660.

Note: Exhibit C allows adjustment between contract year amounts, provided that the total not - to-exceed amount of the contract over the life of the contract term is not exceeded. 4 Packet Pg. 53

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Background
In August 2016, the City contracted parts operations to NAPA as a three -year pilot after approval from the Fleet Review Committee (FRC), approval from the Finance Committee on May 12, 2016 (CMR# 6887), and final approval from Council on August 15, 2016 (CMR #7027).

Analysis conducted by staff indicated that the pilot with NAPA was successful and benefited the City in overall cost savings. At the conclusion of the City’s pilot with NAPA, the following is a history of contractual relationships with NAPA:
• The pilot ended o n July 21, 2019 and was renewed for one additional year via Amendment No. 1 on August 12, 2019 , which aligned with the term of NAPA’s cooperative contract with Sourcewell (CMR #10512).
• Amendment No. 2 was executed on June 15, 2020 for a second one-year extension through July 21, 2021 and to add funding accordingly (CMR# 11263). • Amendment No. 3 was entered into on July 7, 2021 (Amendment No. 3), to extend the term through January 20, 2022 at no added cost to the City, and an exemption to competitive solicitation was approved under municipal code section 2.30.290 (b)(1) to give staff time to bring forward this request.

Discussion
On December 23, 2020 , NAPA entered into a new competitively-solicitated cooperative contract with Sourcewell (a cooperative purchasing group for government, education, and nonprofit agencies ), for a four-year term (Sourcewell Contract ) with an expiration date of December 29, 2024 . This cooperative contract may be extended up to one additional one -year period upon request of Sourcewell and with written agreement by NAPA to further the term until December 29, 2025. Since NAPA’s current cooperative contract with Sourcewell is valid for the next three years, with an optional (but not yet exercised) one-year extension, staff recommends keeping alignment with the Sourcewell contract. Staff recommends Council approve the contract between the City and NAPA for on -site parts management services for three-years (ending January 23, 202 5), with the option for the City Manager to renew for a fourth year through January 23, 202 6, provided that the underlying NAPA/Sourcewell cooperative contract is renewed. (The Sourcewell agreement requires public agencies using its cooperative agreement to enter into or extend a contract based on that agreement while the agreement’s term is active, however, the contract or extension entered into may have a term longer than that of the cooperative agreement.)

The recommended contract between the City and NAPA will allow for continued on-site fleet parts and inventory ser vices, including NAPA-assigned personnel to procure and manage the auto parts/supplies inventory. Overall, there is a projected annual cost decrease of $58,242 for the first year of this new contract, adjusted for salary and miscellaneous expenses. This reflects the last year of the previous contract’s amount of $781,013 plus a three percent ( 3%) annual increase, less one full-time, on-site, NAPA staff, resulting in the following annual pricing:
• a new contract year 1 amount of $746,201,
• a contract year 2 amount of $768,587 and
• contract year 3 amount of $791,645.
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Notwithstanding the foregoing, Exhibit C of the contract permits the parties to adjust the annual contract year amounts, and/or the amount of Services used by City, if any contract year amount ex ceeds or appears that it may be on track to exceed the aforementioned annual amounts, provided that the total not -to-exceed amount of the contract is not exceeded. The total not-to-exceed amount of the recommended three-year contract is $2,306,433.

Amendment to Extend for Fourth Contract Year
If Council authorizes the City Manager to execute an option to extend the contract for a fourth contract year, as recommended above, and if the underlying Sourcewell cooperative contract is extended and the City exer cises this option to extend, the annual not -to-exceed amount of contract year 4 will be subject to a five percent (5%) increase over the preceding contract year’s not-to-exceed amount, for a contract year 4 annual amount not to exceed $831,227, and the total not-to-exceed amount of the contract shall not exceed $3,137,660. As above, adjustments to the annual contract amounts are permitted provided that the total not -to-exceed amount of the contract is not exceeded.

The Sourcewell Member Pricing identifi ed in the contract provides the same pricing terms as the previous contract . Goods will be billed to the City at a 10% gross margin over NAPA’s acquisition cost, operating expenses will be billed at actual cost with no markup, and NAPA’s return is built into the price of parts, so that no separate fee is billed.

This contract is on the City’s general services agreement template, which permits the City to terminate without cause/for convenience by providing written notice to the contractor. In the event the City finds itself facing a challenging budget situation, and it is determined that City resources need to be refocused elsewhere, the City can terminate for convenience. Other options include termination due to non -appropriation of funds or amending the c ontract to reduce the cost, for example, by reducing the scope of work.

Procurement Process
The City’s Municipal code, PAMC section 2.30.360 (j) identifies the process that allows the use of cooperative purchasing agreements. Quotes for this contract were obtained through the approved cooperative group, Sourcewell, and a proposal was received December 2, 2021 from NAPA (Attachment A).

If this request is not approved, Fleet staff would have to reassume all parts management services. By discontinuing services with NAPA, Fleet and Purchasing staff would have to take on a substantial workload increase to keep up with all the contracts that would be required to conduct business. This would require bringing back one full -time employee and one hourly employee. The City would also be required to purchase back all non -NAPA parts inventory, and would opt to purchase back any NAPA parts inventory necessary to keep on -hand. This buy - back is estimated to cost between $250,000 and $300,000.

Resource Impact
Funding fo r this contract is available in the Fiscal Year 2022 Vehicle Replacement and Maintenance Fund Operating Budget. As an internal service fund, t hese costs are funded by 4 Packet Pg. 55

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revenue collected from vehicle operation and maintenance allocations charged to other Cit y departments and funds. Funding for subsequent years of the contract is subject to appropriation of funds through the annual budget process.

Stakeholder Engagement
Stakeholder engagement is not required for execution of this contract.

Policy Implications
This recommendation does not present any changes to existing City policies.

Environmental Review
Approval of this contract does not constitute a project and is exempt from the requirements of California Environmental Protection Act (CEQA) pursuant to Section 15061(b)(3).

Attachments:
• Attachment4.a: Attachment A: Genuine Parts Company dba Napa Auto Parts Bid;, Incld. 4 Year Projected Budget
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NAPA IBS Sample P&L Item Description
3%
escalation
3%
escalation
5%
Escalation
Customer Purchases 54,375 652,500 672,075 692,237 726,849 Parts Bill For Customer Cost of Goods to NAPA 48,938 587,250 604,868 623,014 654,164 90.00% NAPA IBS Cost of Goods NAPA Margin on Parts 5,438 65,250 67,208 69,224 72,685 10.00% NAPA IBS Gross Margin (Point of Sale) GROSS MARGIN 5,438 65,250 67,208 69,224 72,685 10.00% NAPA IBS Gross Margin (Point of Sale) 0 Centralized Accounting/Admin Fees 544 6,525 6,721 6,922 7,268 1.00% Fixed Expense at .99% of purchases, Accounting & Data Processing Fee 0 Payroll 0 These costs will vary based on scope, hours and responsibilities as required per each contract Manager/Counter Salaries 4,735 56,820 58,525 60,280 63,294 8.71% Cost of Dedicated Parts Manager/Project Manager and any parts clerks for IBS Site Delivery Driver Salaries 0 0 0 0 0 0.00% Delivery Driver Pay - if applicable for a site there will be a charge in this category Pension/401K 245 2,936 3,024 3,115 3,271 0.45% Fixed Expense at .45% of customer monthly purchases Insurance 400 4,800 4,944 5,092 5,347 0.74% Mainly Group Insurance Premiums for on-site NAPA IBS staff Workers Comp Insurance 0 0 0 0 0 0.00% Insurance - General and Worker's Comp for on-site NAPA IBS staff FICA 350 4,200 4,326 4,456 4,679 0.64% Payroll Taxes for NAPA IBS On-Site Employees Total IBS Payroll 5,730 68,756 70,819 72,944 76,591 10.54% 0 Miscellaneous Expenses 0
Delivery Truck Insurance 0 0 0 0 0 0.00% Insurance Coverage for delivery trucks required per contract - if applicable Delivery Maintenance/Gas 0 0 0 0 0 0.00% Vehicle Repairs and Fuel for Delivery Vehicles required per contract - if applicable Truck Payment 0 0 0 0 0 0.00% Lease/Depreciation Payment for any Delivery Trucks required per contract - if applicable Inventory Insurance 0 0 0 0 0 0.00% Small insurance on our on-site inventory assets Shelving/Equipment Depreciation 0 0 0 0 0 0.00% Shelving needed for secure parts location - if customer requires us to add shelving. Cage, etc - if applicable Store Expenses 50 600 618 637 668 0.09% Misc. Store Expenses (Printer Ink, Paper, Barcode Labels etc.) P-Card Card Fees 0 0 0 0 0 0.00% Credit Card Processing Fees - only if agency uses a p-card to pay NAPA parts and or operating statements Phone/Internet 0 0 0 0 0.00% Phone and/or Internet Charges (if not provided from Customer) TAMS Inventory Computer 1,000 12,000 12,360 12,731 13,367 1.84% TAMS Computer & Equipment Lease/Depreciation Expense, Maint./Support Fee's & Tams Misc. Expenses Taxes 250 3,000 3,090 3,183 3,342 0.46% Sales and Use Taxes, Personal Property Tax - only if applicable Freight & Postage 220 2,640 2,719 2,801 2,941 0.40% Estimated Freight Charges Incurred by this Operation to procure special order parts Training 15 180 185 191 201 0.03% Training Materials for NAPA IBS (including Hazmat) Total IBS Misc Expense 1,535 18,420 18,973 19,542 20,519 2.82% TOTAL EXPENSES 7,808 93,701 96,512 99,408 104,378 14.36% Total Monthly Expenses to Operate this IBS Gross Margin Less Expenses -2,371 -28,451 -29,305 -30,184 -31,693 -4.36% ROI for NAPA 5,438 65,250 67,208 69,224 72,685 10.00% NAPA's contracted return on investment Sample Billing Summary
Customer Purchases 54,375 652,500 672,075 692,237 726,849 Parts Bill For Customer including 10% margin Management Fee 0 0 0 0 0 0.00%
Expense Bill 7,808 93,701 96,512 99,408 104,378 14.36% Expense Reimbursement by Customer Adjustment to Customer 0 0 0 0 0 0.00% Margin reimbursement to Customer after all expenses and NAPA ROI are realized Total Cost of Operation 62,183 746,201 768,587 791,645 831,227 *It is important to note that these sample operating statements are issued to inform new, existing and potential Sourcewell members of the flexibility of the NAPA IBS program. ** These sample operating statements reflect NAPA IBS's typical expense structure but all categories are subject to change based on scope, hours and responsibilities as required per each contract.

Pricing Option 10% Margin
10% Margin Model
Sourcewell Monthly First Year % of Purchases
Second Year Third Year Fourth Year

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City of Palo Alto (ID # 14234)
City Council Staff Report

Meeting Date: 5/23/2022 Report Type: Consent Calendar

City of Palo Alto Page 1

Title: Adoption of a Resolution of Intent to Not Levy Assessments for the Business Improvement District (BID) in FY2023, and Setting Public Hearing for June 6, 2022
From: City Manager
Lead Department: Administrative Services

Recommendation
Staff recommends that Council adopt a resolution of intention to decline to levy assessments in the Palo Alto Downtown Business Improvement District (BID) for Fiscal Year 2023 (Attachment A), setting a date and time for the public hearing on the proposal to decline to levy assessments for June 6, 2022, at 5:00 PM or thereafter.

Background
The Palo Alto City Council established the BID in 2004 pursuant to the California Parking and Business Improvement Area Law to maintain economic vitality and physical maintenance of t he Palo Alto Downtown business district. The Council appointed the Palo Alto Downtown Business and Professional Association ( PADBPA), a non -profit corporation, as the advisory board and administrator of the BID. PADBPA, acting through its independent Boar d of Directors, has advised the Council on the method and basis for levy of assessments in the BID and has managed the expenditure of revenues derived from the assessments.

In light of organizational changes at PADBPA and changes resulting from the Covid -19 pandemic, and with the concurrence of the City Council, the City allowed t he contract with PADBPA to expire on June 30, 2020. Council directed staff to work with the Palo Alto Chamber of Commerce and PADBPA to develop options for the transition of the management of the BID.

The Chamber and PADBPA identified a need to build support for a resumption of the BID assessment within the business community before collecting a new assessment and establishing a new management agreement. Both entities supported pla cing the BID on pause for FY 2023.

Discussion
On March 1, 2022 the Finance Committee discussed options for the FY 2023 Business Registry Certificate ( BRC) and BID processes ( CMR 13902 ; Minutes). The Committee reviewed three options for the BRC and BID and forwarded their recommendation to the City Council on April 5 Packet Pg. 58

City of Palo Alto Page 2

4, 2022, CMR 13901 , to restore the BRC in the 2022 -2023 collection timeframe, using the established structure used in pre -pandemic years, while continuing the pause of BID assessments again in FY2023. The Pa lo Alto City Council directed Staff to proceed with this recommendation.

Staff recommends that the Council adopt the attached resolution for FY 2023 with the intention to not collect BID assessments for one additional year. During the upcoming year Counci l directed staff to work with the PADBPA and the Chamber to provide options on the future management of the BID.

If Council adopts the recommendation, the Council should provide notice of its intention to not levy a collection of the BID assessments for F Y 2023 only, and set a public hearing for June 6. At the public hearing, Council will hear and consider any objections to non -collection of assessments due in 2022 and take final action. The decision to not levy assessments payable in 2022 is consistent wi th Council’s rescinding and waiving of assessments due in 2020 ( CMR 11219) and in 2021 (CMR 12255) in response to the pandemic, and would implement the Finance Committee’s recommendation to not levy assessments for FY23 (CMR 13901).

Resource Impact
The BID is set up as a separate fund within the City’s accounting system. In recent years, the BID has required a General Fund subsidy as collected assessments fell short of the costs of operating the BID. Historically, the City acts as the collection agent for BID revenues and reimburses PADBPA’s expenses after receipt and ver ification of invoices. With the BID on pause an estimated $80,000 will not be collected and no BID business activities will be provided.

Additional staff resources include time from the City Manager’s Office and Administrative Services Department to provide oversight to the BID, administer the contract with Avenu, liaise with stakeholders, and prepare the annual reauthorization.

Stakeholder Engagement
Staff has met and coordinated with members of PADBA and the Chamber of Commerce in preparation of these recommendations. In FY 2023 staff will work with these entities to develop options for a new management agreement for the BID.

Environmental Review
The proposed action is not a project for the purposes of the California Environmental Quality Act.

Attachments:
• Attachment5.a: Attachment A: Business Improvement District Resolutoin for FY 2023
5 Packet Pg. 59

ATTACHMENT A

NOT YET APPROVED

Resolution No. _____

Resolution of the Council of the City of Palo Alto Declaring Its Intention to Not Levy Assessments Against Businesses Within the Downtown Palo Alto Business Improvement District for Fiscal Year 2023; and Setting a Time and Place for a Public Hearing on the Proposed Decision Not to Levy Assessments on June 6, 2022 at 5:00 PM or Thereafter, in the Council Chambers

R E C I T A L S

A. The Parking and Business Improvement Area Law of 1989 (the "Law"), California Streets and Highways Code Sections 36500 et seq., authorizes the City Council to levy an assessment against businesses within a parking and business improvement area which is in addition to any assessments, fees, charges, or taxes imposed in the City.

B. Pursuant to the Law, in 2004 the City Council adopted Ordinance No. 4819 establishing the Downtown Palo Alto Business Improvement District (the "District") in the City of Palo Alto.

C. The City Council, by Resolution No. 8416, appointed the Board of Directors of the Palo Alto Downtown Business & Professional Association (“PADBPA”), a California nonprofit mutual benefit corporation, to serve as the Advisory Board for the District (the "Advisory Board").

D. Beginning in March of 2020 and continuing through the present, Downtown businesses have substantially impacted by the COVID-19 pandemic, the public health measures taken to reduce the spread of the virus, and the resulting statewide economic contraction. In recognition of these impacts, the City Council refunded fiscal year 2020 BID assessments and declined to levy assessments in fiscal years 2021 and 2022.

E. As California emerges from the pandemic, local businesses are experiencing additional impacts from changes in on-site and remote work patterns and other developments in the local economy. In addition, PADBPA is experiencing organizational changes.

F. In recognition of the challenges continuing to effect downtown businesses and understanding the need for a new direction on BID management, the City Council has determined not to levy BID assessments for fiscal year 2023 (July 1, 2022 through June 30, 2023).

NOW THEREFORE THE CITY COUNCIL OF THE CITY OF PALO ALTO RESOLVES AS FOLLOWS:

SECTION 1. The Council hereby adopts the above Recitals as findings of the Council.

SECTION 2. Based on the findings herein, the Council intends not to levy or collect assessments for the District for fiscal year 2023 (July 1, 2022 through June 30, 2023). The District shall remain in effect and the Council will consider the levy of assessments for following fiscal years.

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ATTACHMENT A

NOT YET APPROVED

SECTION 3. The City Council hereby fixes the time and place for a public hearing on the proposed determination not to levy assessments against any businesses within the District for fiscal year 2023 as follows:

DATE: June 6, 2022
PLACE: Conducted simultaneously in person at City Hall and via Zoom TIME: 5:00 p.m. or soon thereafter

At the public hearing, the testimony of all interested persons regarding the determination not to levy assessments against any businesses within the District for fiscal year 2023 shall be heard.

SECTION 4. The City Clerk is hereby authorized and directed to provide notice of the public hearing in accordance with law.

SECTION 5. The Council finds that the adoption of this Resolution does not meet the definition of a project under Section 21065 of the California Environmental Quality Act and, therefore, no environmental impact assessment is necessary.

INTRODUCED AND PASSED:

AYES:

NOES:

ABSENT:

ABSTENTIONS:

ATTEST:

City Clerk Mayor
APPROVED AS TO FORM:

City Attorney City Manager or Designee

Director of Administrative
Services

5.a
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City of Palo Alto (ID # 14253)
City Council Staff Report

Meeting Date: 5/23/2022 Report Type: Consent Calendar

City of Palo Alto Page 1

Title: Approval of the Acceptance of State of California Citizens Options for Public Safety (COPS) Funds of $103,648 and a Budget Amendment in the Supplemental Law Enforcement Services Fund
From: City Manager
Lead Department: Police

Recommendation
Staff recommends that the City Council:

1. Approve the acceptance and expenditure of Citizens Options for Public Safety (COPS) funds of $103,648 from the State of California; and

2. Amend the Fiscal Year 2022 Budget Appropriation Ordinance (requires 2/3 approval) for the Supplemental Law Enforcement Services Fund (SLESF) by:
a. Increasing the estimate for Revenue from the State of California in the amount of $103,648; and,
b. Increasing the Police Department Facilities and Equipment expense appropriation in the amount of $103,648.

Background
Since 1997, the California State Legislature has allocated funds to counties and cities for the Citizens Options for Public Safety ( COPS) program. This funding is intended to fill the need for additional resources at the local level to ensure public safety. Under the provisions of Government Code Section 30061 , a percentage of funds are allocated to counties and cities, based upon population, for law enforcement services.

Funds must supplement existing services and are prohibited from supplanting (replacing) state, local, or funds that otherwise would be made available. Supplanting occurs when a local government reduces local funds for an activity, specifically because state funds are available (or expected to be available) to fund that same activity. An example of supplanting could be if Council discontinued Department funding for existing police vehicle maintenance with t he intention of a grant supporting the need to continue the service . Alternatively, if Council discontinued and eliminated a program or service due to resource constraints, with no intention of continuing the service, but the program or serv ice were to be re-started at a later date using grant funds (such as was the case with the Community Service Officers in FY 2019 after being discontinued earlier in the decade) then staff would consider the re -start to be 6 Packet Pg. 62

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additive and not anticipated at the time the de -funding occurred. The use of the grant will be directed toward goods or services not budgeted, nor anticipated, but additive to the goods and services already encumbered through the city budget process for the purposes of enhancing the mission of the Department.

For tracking purposes, each recipient is also required to deposit funding into a separate fund so that these funds are not co-mingled with General Fund dollars. The funds must be used to benefit front -line law enforcement efforts. Finally, as with t he acquisition of any goods or services by the City , the purchasing process will be subject to C ity purchasing policy as established in the municipal code under the direction of the Chief Procurement Officer and as required by the grant funds.

Previous u ses of COPS funds have included restarting the Community Service Officer (CSO) program, purchasing an electronic traffic c itation system , rifle magnifiers, range safety equipment, police training, staff wellness testing, upgrades to patrol vehicle s, and upgraded tools and technology.

Discussion
Staff recommends use of the expected COPS funds in the total amount of $103,648 in the following manners which are compliant with the restrictions of these funds:

Police Officer Training ($20,000)
Training police officers is divided between mandatory and non-mandatory training. Mandatory training is established by the State Board and currently is approximately 12 hours annually per officer, in subjects including firearms, arrest control and driving. Mandatory training is funded through the general fund. Non-mandatory training funding is for categories such as critical incident training (CIT), de-escalation tactics, interpersonal skills, and implicit bias. This funding will support non-mandatory training in these areas, adding (not replacing) to the existing mandatory training provided.

Officer Wellness ($30,000)
Police Officers experience stress in several ways due to the extreme emotional and physical demands of the profession, irregular shift work, and regular exposure to vicarious trauma. As a result, officers' relationships with their friends, families, agencies, and the public they serve can be adversely affected. Funding of this category will enable the Department to add resources, including wellness testing and therapies, during a difficult period in law enforcement. If the grant is approved, testing may include voluntary annual wellness testing and programs to enhance physical and mental wellness such as a part-time contracted Wellness Coordinator to provide programing or using services by service providers such as a wellness app.

Law Enforcement Recruiting ($20,000)
The City does not budget funding for recruiting of Police personnel. Instead , in years when staff vacancies are on the rise, a portion of vacanc y savings may be used to fund recruiting 6 Packet Pg. 63

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operations, or adhoc one -time funding is requested and allocated for a specific recruitment process. For this year, staff believes the effort to keep up with staffing levels in the Department will outstrip the vacan cy savings available to fund these efforts in the coming months , along with overtime to staff general operational vacancies . This funding will enable the Department to enhance the recruiting operation for Police Officers , but not replace current operations . If the funding is approved, enhancements to recruiting could include adding more recruiting events such as at educational institutions to the current inventory of events funded by the general fund. The operational activity around recruiting includes even t registration and supplies, travel, lodging (at times) and overtime to send staff. Small police departments, like PAPD, do not have dedicated staff for recruiting ; instead existing staff re-assigned from other duties perform the recruiting activity, which results in the use of overtime that is not budgeted to deploy staff to recruiting events.

Tools and Equipment ($33,648)
Various tools and equipment in need of update or upgrade, beyond what is allocated in the general fund include interview room upgrade s such as recording equipment, in-field recording upgrades, two-way radios, firearm cases/locks for new employees , updated firearm optics and lighting, range equipment, and ballistic shields. Due to constrained funding, the city is behind on equipment rep lacement, and these grant funds will provide for new equipment that would otherwise continue aging.

Resource Impact
The Department has received funds each year under this program since its inception. Annual allocations have averaged approximately $100,0 00 over the last few years. The City received the official notice from the California Department of Finance in September 20 21 that the City's COPS allocation for Fiscal Year 2022 is $103,648. No further action is required, beyond Council’s approval, to receive the funds. Revenues of $103,648 are recommended to be recognized in the City's Supplemental Law Enforcement Services Fund (SLESF).

A total of $10 3,648 of expenditures a re anticipated as described previously in the memorandum, which will be funded by the COPS grant funding appropriated in Fiscal Year 2022 ($103,648). There will be no impact to the General Fund as ongoing maintenance costs , if any, for the items purchased by the SLESF will be absorbed in the Department 's existing non -salary budget, otherwise the activities will stop when the SLESF funds are spent in full.

Policy Implications
Expenditures of funds associated with COPS funds are consistent with City policy.

Environmental Assessment
Acceptance of COPS funding and the proposed expenditures for public safety equipment are not projects subject to CEQA review.
6 Packet Pg. 64

City of Palo Alto (ID # 14256)
City Council Staff Report

Meeting Date: 5/23/2022 Report Type: Consent Calendar

City of Palo Alto Page 1

Title: Adoption of a Resolution Certifying Compliance with the California Surplus Land Act as Required by MTC's One Bay Area Grant (OBAG) Grant Programs
From: City Manager
Lead Department: Transportation Department

Recommendation
Staff recommends that the City Council adopt a r esolution (Attachment A) as required by the Metropolitan Transportation Commission (MTC) to certify compliance with Assembly Bill 2135 (Surplus Land Act) . MTC requires adoption in order to apply for One Bay Area Grant (OBAG) Programs grant funding.

Background
The MTC is the metropolitan planning organization for the nine -county San Francisco Bay Area region, which includes Santa Clara County. The MTC administers the federally funded One Bay Area Grant (OBAG) Program s with funds fro m the regional Surface Transportation Block Grant (STP) and Congestion Mitigation and Air Quality Improvement (CMAQ) programs.

On January 26, 2022, the MTC adopted Resolution No. 4505 , the OBAG Cycle 3 (OBAG 3) framework. The Program emphasizes regional plan implementation, bicycle/ pedestrian safety and mobility, connections to transit, climate resilience, and projects that advance equitable mobility. Funds are competitively disbursed for complete streets and sustainable streets improvements, streetscape enhancements, safe routes to school projects, priority development and conservation areas, local street and road maintenance, and transportation planning.

Discussion
In order to be eligible for OBAG 3 funds, MTC requires that local jurisdictions, including charter cities, certify compliance with the California Surplus Lands Act (AB 2135). The current text of the Surplus Land Act is linked here, and project eligibility and requirements are included in MTC Resolution No. 4 505. In general, the Surplus Land Act regulates how local agencies, including the City, dispose of surplus real property. The goal of the Act is to prioritize affordable housing as a use for land that is no longer needed by a local agency.

The City of Palo Alto applies for OBAG funding when available and if the proposed city projects 7 Packet Pg. 65

City of Palo Alto Page 2

are competitive. As a condition to receive competitively awarded funds, MTC requires that local jurisdictions certify alignment with local and state housing and complete streets requirements by adopting a resolution of compliance (see Attachment A) . Adoption of this resolution will support the City’s efforts to obtain this and future Federal Grant funds through MTC.

Timeline
Each Bay Area jurisdiction must adopt a Surplus Land Act resolution before MTC will award funds under the OBAG 3 program. Staff intend to apply to the OBAG 3 program in June of this year for the construction phase of the South Palo Alto Bikeways project.

Resource Impact
Adopting this resolution has no immediate effect on City resources ; however, it does require the City to prioritize affordable housing if it considers the disposition of surplus property which may imact the value.

Policy Implications
The attached resolution is consistent with the following Comprehensive Plan policies:

Transportation Element Policy T -1.25: Pursue transportation funding opportunities for ongoing transportation improvements that will help mitigate the impacts of future development and protect residents’ quality of life. When other sources are unavailable, continue to fund improvements, operations and maintenance through the general fund.

Housing Element Policy H2.2 : Continue to support the redevelopment of suitable lands for mixed uses containing housing to encourage compact, infill development. Optimize the use of existing urban services, and support transit use.

Housing Element Policy H3.1: Encourage, foster, and preserve diverse housing opportunities for very low-, low-, and moderate income households.

Environmental Review
The action being considered does not constitute a “project” within the meaning of the California Environmental Quality Act (“CEQA”) pursuant to CEQA Guidelines section 15378(b)(5) in that it is a governmenta l organizational or administrative activity that will not result in direct or indirect changes in the environment.

Attachments:
• Attachment7.a: Attachment A - Resolution Making Required Findings per MTC/OBAG Program Requirements Related to the Surplus Land Act 7 Packet Pg. 66
*NOT YET APPROVED*

254_20220511_ts24 1
Resolution No.___

Resolution of the Council of the City of Palo Alto Making Required Findings as Required by the Metropolitan Transportation Commission and Its OBAG Program Requirements

R E C I T A L S

A. The San Francisco region has the highest housing costs in the United States; and

B. The Bay Area produced less than 30% of the need for low- and moderate-income housing units from 2007-2014; and

C. There are limited funding sources available to secure land for the construction of low- and moderate-income housing; and

D. Public lands can play a critical role in increasing the supply of land for affordable housing; and

E. The Metropolitan Transportation Commission adopted Resolution No. 4202, outlining the programming policy and project selection criteria for the One Bay Area Grant Program (OBAG), including certain requirements to access these funds;

NOW THEREFORE THE CITY COUNCIL OF THE CITY OF PALO ALTO RESOLVES AS FOLLOWS:

SECTION 1
. The City of Palo Alto agrees to comply with the terms of Surplus Land Act - Assembly Bill 2135 (California Government Code § 54220, et seq .), as exists now or may be amended in the future.

//

//

//

//

//

//

//

7.a
Packet Pg. 67
*NOT YET APPROVED*

254_20220511_ts24 2
SECTION 2. This Resolution shall become effective immediately upon adoption.

INTRODUCED:

PASSED:

AYES:

NOES:

ABSENT:

ABSTENTIONS:

ATTEST:

__________________________ _____________________________ City Clerk Mayor

APPROVED AS TO FORM: APPROVED:

__________________________ _____________________________ Assistant City Attorney City Manager

_____________________________
Chief Transportation Official

7.a
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City of Palo Alto (ID # 14281)
City Council Staff Report

Report Type: Consent Calendar Meeting Date: 5/23/2022

City of Palo Alto Page 1
Summary Title: 525 E. Charleston Funding Commitment
Title: Authorize the City Manager to Commit Two Million Dollars ($2,000,000) from the City's Affordable Housing Funds for the Affordable Housing Project at 525 E. Charleston Avenue.

From: City Manager
Lead Department: Planning and Development Services

Recommendation
Staff recommends that City Council take the following actions to authorize and commit funding for a future loan to Eden Housing for the development of an affordable housing project located at 525 E. Charleston Road:

1. Approve a commitment of $2,000,000 from City Housing funds.

2. Designate the 525 E. Charleston Road project as an identified qualifying and a pre- approved Local Housing Trust Fund (LHTF) project, and

3. If the City is awarded a 2022 LHTF program grant in August 2022, increase the total commitment to $3,000,000 by using $1,500,000 of City Residential Housing Fund to 525 E. Charleston to use as local matching funds along with $1,500,000 from the awarded LHTF grant.

Executive Summary:

Staff is requesting that the Council commit funding for a future loan and the associated budget amendment for the entitled affordable residential development located at 525 E. Charleston Road. The City is partnering with Eden Housing, the developer, and the County of Santa Clara in the development of a 50 -unit residential development. As discussed in this report, some of these housing units will be primarily for persons with developmental disabilities. The County of Santa Clara owns the project site.

In a se parate but related action, s taff is also asking Council to authorize the City to submit a 2022 State HCD Local Housing Trust Fund (LHTF) program grant application, discussed as CMR 8 Packet Pg. 69

City of Palo Alto Page 2
ID #14300 on this same meeting agenda . The LHTF program grant is competitiv e and , if awarded, provides a dollar -for-dollar match to local financial contributions to LHTF qualifying affordable housing projects . Staff has included additional recommended Council actions in this report if the LTHF application is awarded, to meet LHTF requirements.

The overall cost of the project is estimated to be almost $45 million. The County has dedicated $8 million and the developer is applying for tax credits to fund the majority of the project.

Background
On September 27, 2021, the City Counc il held a Study Session to discuss the details of the proposed project to redevelop the site at 525 E. Charleston Road (i.e. Mitchell Park Place). Eden Housing, the project developer, propose d to build a four-story mixed -use project with non- profit office uses and 50 affordable rental apartments . In addition, in discussing the project details, the study session included a n anticipated request for a City contribution of $2 million in support of the project. This report is a follow -up to the discussion to com mit the $2 million in City funds.

A minimum of 15% of the units will be accessible for the mobility impaired and 10% of the units will have communication features for the visually and/or auditory impaired. Half of the units (25 units) will have a leasing preference for adults with intellectual or developmental disabilities.

The total project cost is estimated to be approximately $ 45,000,000, which includes $8,000,000 in funds from the County of Santa Clara.

DISCUSSION
The project has already received its land use entitlements. Eden Housing followed a supportive housing expedited permit process as allowed by the Supportive Housing Act (AB 2162). The law requires local entities to streamline the approval of housing projects containing a minimum amount of S upportive Housing by providing a ministerial approval process, removing the requirement for CEQA analysis , and removing the requirement for Conditional Use Authorization or other similar discretionary entitlements . The project was approved on March 8, 2022.

Project Description
Eden Housing proposes to develop the Mitchell Park Place project on a 0.78-acre site (APN 132- 06-039). Eden Housing will construct 50 affordable housing units in one four -story building including 2,750 sq. ft. of non-profit commercial space . The proposed unit mix is 37 studios, eight one-bedroom units, and five two-bedroom units. One two -bedroom unit will be reserved for an on -site manager. As a special needs housing project located near frequent transit, no 8 Packet Pg. 70

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residential parking spaces are required by the City. However, 19 parking spaces will be provided for the commercial space (11 spaces are required by the City), including three parking spaces with electric vehicle charging infrastructure. Bicycle parking will be provided on site wit h 50 long-term spaces and seven (7) short-term spaces for a total of 57 bicycle parking spaces.

Supportive service areas include a community lounge with kitchen, support and meeting space, Eden offices, library and tech lounge, and respite rooms.

Eden Housing will construct the improvements and enter into a ground lease of the property.

The site is currently improved with a 4,000 square foot, one -story commercial building constructed in 1981 with associated parking areas. The site is covered in impervio us surfaces and contains no exposed soil except for small landscaped areas. The site is zoned PF – Public Facilities and the Comprehensive Plan Land Use designation is MISP – Major Institution / Special Facility.

Rents and Occupancy of the Apartments
The maximum rent for each household will be 30% of a household’s income. The project will have units dedicated for a range of incomes from 30% Area Median Income ( AMI) to 60% AMI.

Below, Table 1 summarizes the type of unit, affordability level, unit mix, and for reference the 2021 CTCAC monthly rent limit for the unit. Please note that the unit affordability mix assumes the CTCAC income and rent limits and is subject to change.

Table 1: Unit Types, Unit Mixes, and Range of Proposed Rents PROPOSED AFFORDABILITY MIX* Units 2021 CTCAC Rent
Extremely Low Income Units @ 30% AMI- studio 13 $870
Extremely Low Income Units @ 30% AMI- 1 bed 1 $932
Extremely Low Income Units @ 30% AMI- 2 bed 1 $1,119
Very Low Income Units @ 50% AMI- studio 13 $1,450
Very Low Income Units @ 50% AMI- 1 bed 4 $1,553
Very Low Income Units @ 50% AMI- 2 bed 1 $1,865
Low Income Units @ 60% AMI- studio 11 $1,740
Low Income Units @ 60% AMI- 1 bed 3 $1,864
Low Income Units @ 60% AMI- 2 bed 2 $2,238
Manager's Unit (2 BR) 1 NA
Total 50

The overall development cost for the project is estimated to be approximately $45 million. The breakdown of the development budget is listed below in Table 2.

Table 2: Development Budget
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Total Land & Improvements $146,177
Total Construction $33,342,708
Total Design & Consulting $2,171,550
Total Indirect Costs $6,030,343
Total Finance & Carry Costs $2,983,196
Total TCAC/Syndication $224,000
Total $44,897,974

Funding sources will include the County, the City of Palo Alto, and tax credits . Please note that the staff also recommends providing approximately $218,669 as a predevelopment loan from the CDBG program in addition to committing the requested funds outlined in the staff recommended Council actions. The CDBG amount is still an estima te since the City has not received its 2022 -2023 entitlement amount from HUD. The CDBG amount would be incorporated into the City’s loan agreement. The Council will consider the recommended CDBG allocations separately at its June 20, 2022 meeting.

Table 3: Proposed Project Sources
Permanent Funding Sources
City of Palo Alto $2,000,000*
City of Palo Alto CDBG $218,669
CA HCD LHTF $1,000,000
County of Santa Clara $8,000,000
Low-Income Housing (LIH) Tax Credit-LP Capital Contribution $27,878,205 Permanent Financing $2,280,000
Permanent Financing - leveraging PBVs $3,521,000
GP Equity $100
Total $44,897,974
*To be adjusted if the City is awarded LHTF program grant funds.

There are sufficient resources in the Affordable Housing Fund s (Fund 233 and Fund 234) to support the actions . If the loan and corresponding budget amendment is approved by City Council, staff will execute the budget amendment to allocate the specified funds from the Residential Housing Fund (Fund 233) and Commercial Housin g fund (Fund 234) to assist with the development of the project. If the City’s LHTF program grant application is successful, staff will adjust the allocations as per the recommended Council actions.

The development cost for each unit is almost $897,000 p er unit . As an example of how the City’s financial contribution would assist the project, the City providing $2 million toward the project is equivalent to providing $ 44,373 per unit in exchange for 49 deed restricted units of 8 Packet Pg. 72

City of Palo Alto Page 5
affordable housing.

City Affordable Housing Fund Guidelines
This is a proposed new construction of an affordable housing project serving households earning up to 60% AMI. This is consistent with the City’s Affordable Housing Guidelines.

While the terms of this specific loan will be finalized at a later date, per the Affordable Housing Funding Guidelines, the typical loan terms are a 3% interest rate, deferred, residual receipts, and a 55-year term loan. The loan may be forgiven at Council’s discretion at the end of the loan.

Local Housing Trust Fund (LHTF) Program
The LHTF program is a State Housing and Community Development (HCD) funding program. The LHTF program serves as a funding source to already established or new affordable housing trust funds managed by local jurisdictions or other eligible applicants. The effect of the LHTF program is that the funds awarded amplify existing local affordable housing trust fund balances, as discussed in CMR ID #14300.

The deadline to apply for a 2022 LHTF program grant is May 25, 2022. The Cit y has sufficient balances in the Housing Funds that can be used as local matching funds in the City’s LHTF program grant application. 525 E. Charleston meets the affordability targeting proposed for the City’s LHTF program grant application. The LHTF application is competitive so a Council approval on local funding for 525 E. Charleston would increase the competitiveness of the City’s LHTF program grant application. Awarded applications are expected to be announced in August 2022. Staff will coordinate with Eden Housing regarding the dispersal of the funds.

Given the need to make a financial commitment to 525 E. Charleston at this time without knowing if the City will be awarded a LHTF program grant, staff proposes two financial assistance pathways for 525 E. Charleston:

1. Commit a total of $2M for permanent financing loan for 525 E. Charleston, or

2. If the City’s LHTF program grant application is successful, commit $1.5M from Fund 233 for 525 E. Charleston. This $1.5M in Fund 233 would then be used as local mat ching funds in combination with a LHTF grant disbursement of $1.5M, to increase total financial support to 525 E. Charleston to $3M.

The second financial pathway is necessary to outline, as the City’s LHTF application needs to show documentation of any Cit y pre-approval of any LHTF awarded funds to 525 E. Charleston and the source of local matching funds.
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Staff will return to Council to amend the budget to reflect the final funding commitments depending if the LHTF application is awarded.

Policy Implications
The City has affordable housing funds available to contribute to a future project. The staff recommended Council actions in this report would set aside funds for the project at 525 E.

Charleston Rd. The funds would be distributed in coordination with Eden Housing.

Resource Impact
Currently the re is sufficient uncommitted balance in the respective housing funds to support either pathway recommended in this report. The recommendation in this report would commit either $2 million or $1.5 million in housing depending on the succuss of the LHTF application.

Staff will return to Council to amend the budget to reflect the final funding commitments.

Timeline
This funding commitment from the City is needed for developer’s tax credit application submittal in July 2022. It is expected that additional funding partners will be identified this year.

Once established, further development of the financing plan is anticipated.

Environmental Review
The commitment of funds does not qualify as a project in accordance o f the California Environmental Quality Act (CEQA). In addition, the land use entitlements have already been granted under an expedited project review process under the Supportive Housing Act (AB 2162), which establishes ministerial procedures for the revie w and approval of the project .

Therefore, the project is exempt from CEQA pursuant to Guideline Section 15268. 8 Packet Pg. 74

City of Palo Alto (ID # 14300)
City Council Staff Report

Report Type: Consent Calendar Meeting Date: 5/23/2022

City of Palo Alto Page 1
Summary Title: Local Housing Trust Fund (LHTF) Program Grant Application Title: Adoption of a Resolution Authorizing a City Grant Application for the State Local Housing Trust Fund Program, Designation of Affordable Housing Funds as Local Matching Funds, C ommitment to Targeting the Grant and Local Matching Funds, Approval of Grant Specific Underwriting and Other Financial Standards, and Authorization of City Manager or Designee to Manage the Grant
From: City Manager
Lead Department: Planning and Development Services

Recommendation
Staff recommends that City Council take the following actions in support of the City applying for a State of California Department of Housing and Community Development (HCD) 2022 Local Housing Trust Fund (LHTF) program grant:

1. Adopt the resolution (Attachment A) authorizing submittal of a LHTF program grant application and associated commitments,

2. Designate $2,000,000 of the Residential Housing Fund (Fund 233) as local matching funding for the LHTF program grant, if awarded, and allow this funding to remain in Fund 233 until committed to a LHTF qualifying project,

3. Designate $400,000 of the Residential Impact Fee Fund (Fund 293) as local matching funding for the LHTF program grant, if awarded, and allow this funding to remain in Fund 293 until committed to a LHTF qualifying project,

4. Designate $1,000,000 of the Commercial Housing Fund (Fund 234) as local matching funding for the LHTF program grant, if awarded, and allow this funding to remain in Fund 234 until committed to a LHTF qualifying project,

5. Revert any designation of funds if the LHTF grant is not awarded,

6. Commit to targeting LHTF grant funds and associated dollar-for-dollar local matching funds as described in Table 2 of this report for the development of new affordable 9 Packet Pg. 75

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multi-family rental housing units in Palo Alto , making the City’s application more competitive,

7. Approve the LHTF-specific underwriting guidelines and other financing standards (Attachment B) for use in preparation of LHTF-related City finance documents with authorization for the City Manager or designee to administratively review and approve any HCD-requested adjustments, and

8. Authorize the City Manager or their designee from the Planning and Development Services Department to manage the LHTF grant, including submission of the grant application, annual reports, and filing requests to HCD for disbursement of funds.

Executive Summary
This report discusses the City’s proposed 2022 Local Housing Trust Fund (LHTF) program grant application. Receipt of a LHTF progr am grant award from the state would support Palo Alto’s efforts to provide financial assistance to local affordable housing projects, as any awarded grant funds could be used to match Palo Alto’s local contributions from the City’s Affordable Housing Fund. LHTF awarded grant funds would result in more available financial assistance to current and future affordable housing projects. The LHTF program grant application window is between April 26 and May 25, 2022. Staff needs specific authorization from Council to submit an application, as outlined in the staff recommendations and as explained in this report.

Background
The State of California Department of Housing and Community Development Department (HCD) issued a Notice of Funding Availability (NOFA) on Ap ril 5, 2022 for approximately $57 million in funding for LHTF program grants.1,2 Funding is provided by the Veterans and Affordable Housing Bond Act of 2018 (Proposition 1). Funding provides matching grants to local housing trust funds established by cities and counties, Native American Tribes and incorporated 501(c)(3) nonprofit organizations. Fifteen percent of the funds are reserved for local or regional housing trust funds meeting the definition of “New Local Housing Trust Fund.”

The LHTF program serv es as a funding source to already established or new affordable housing trust funds managed by local jurisdictions or other eligible applicants. The effect of the LHTF program is that the funds awarded amplify existing local affordable housing trust fund balances.

As an example of program -level support, if a local jurisdiction commits $2M in funding in general at qualifying affordability levels, any awarded LHTF grant could match that $2M to be later distributed to future -identified affordable housing projects. While the minimum application request can be $1M, an applicant having an existing local housing trust fund can

1 State of California Housing and Community Development Department (HCD) 2022 Local Housing Trust Fund Program Notice of Funding Availability: https://www.hcd.ca.gov/docs/grants-and-funding/lhtf-2022-nofa.pdf 2 State of California Housing and Community Development Department (HCD) Local Housing Trust Fund Program Final 2020 Guidelines: https://www.hcd.ca.gov/grants-funding/active-funding/lhtf/docs/2020-final-guidelines.pdf 9 Packet Pg. 76

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apply for up to $5M in one year. However, that application amount must be supported by a corresponding local match of $5M, documented either through existing trust fund balances and/or legally binding commitments to deposit dollars in the trust fund by a date certain and prior to disbursement of grant funds.

Use of LHTF Grant
Funding is required to be used to provide construction loans and/or permanent financing loans to pay for the construction or rehabilitation of affordable rental housing projects, emergency shelters, permanent supportive housing, transitional housing and affordable homebuyer/ homeowner projects. Funding may also be used to assist income-eligible first-time homebuyers to purchase homes and to rehabilitate houses owned by income -eligible occupants, as well as to construct, convert, reconstruct, rehabilitate and/or repair Accessory Dwelling Units (ADUs) or Junior Accessory Dwelling Units (JADUs).

LHTF Application Scoring
LHTF program grant applications are highly competitive, g iven the limited amount of overall LHTF funding from the state. To illustrate, applications are scored upon such factors as:
• Non-Residential Matching F unds - the diversity of funding streams going into the local housing trust fund, with higher scores going to funds having public contributions from General Funds, public land donations, and funding not associated with residential in-lieu fees or residential local impact fees,
• Deeper Income Targeting - the targeting of deep er levels of affordability beyond minimum program requirements , with higher scores going to projects focused housing units at 30% of the area median income (AMI),
• Readiness - local jurisdiction levels of effort to support affordable housing , with higher scores going to jurisdictions with more pipeline projects, and • Performance - local jurisdiction pre-existing funding commitments , with higher scores going to jurisdictions that have alrea dy committed at least 40% of any local matching funds.

Discussion
The City of Palo Alto established its first version of its affordable housing trust fund in the 1970s by requiring affordable housing mitigation payments on large industrial and commercial projects under its environmental review authority under the California Environmental Quality Act (CEQA). Over time, the City evolved the affordable housing trust fund to what it is today, referred to as the Affordable Housing Fund.3

3 City of Palo Alto Affordable Housing Fund Guidelines Approved by the City Council on August 17, 2015 by Resolution No.9539: https://www.cityofpaloalto.org/files/assets/public/planning-amp-development- services/housing-element/0131472-housing-fund-guidelines-august-2015.pdf 9 Packet Pg. 77

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Local Matching Fund Sources and Affordability Targeting Staff identified that the Residential Housing Fund (Residential Housing Fund 233 and Residential Impact Fee Fund 293) and the Commercial Housing Fund (Fund 234) as the best sources of dollar-for-dollar local matching fun ds for the LHTF program grant application (Table 1).4 These local matching funds are already on deposit, which means that the City already meets the requirement that local matching funds be available prior to the disbursement of LHTF funds.

Staff recommends that City Council designate a combined $3. 4M of funding for the following LHTF program eligible activity:
• deferred payment permanent financing loans at simple interest rates of no higher than three percent per annum for the development of LHTF program qualifying new affordable multi-family residential rental housing projects.

To have a more competitive LHTF program grant application, staff recommends Council target LHTF grant and local matching funds toward production of rental housing units at deep affordability levels (Table 2):
• A maximum of 70% of funds targeting housing units for residents with incomes at or below 60% of area median income (AMI) and
• A minimum of 30 % of funds targeting housing units for residents with incomes at or below 30% AMI.

These new housing units would be income and rent restricted for not less than 55 years, which is consistent with existing City policy. This proposed affordability targeting is outlined in Attachment A, which is a necessary component to the City’s LHTF program grant application. As LHTF funds must be used dollar -for-dollar with local matching funds, Council would retain review of how LHTF funds and City local matching funds would be spent, including on any LHTF qualifying project such as 525 E. Charleston, as discussed in CMR ID # 14281.

Table 1: Affordable Housing Fund Balances Qualifying as LHTF Local Matching Funds

Undesignated
Balance
(as of April 12,
2022)
Proposed
LHTF
Program
Grant Local
Matching
Funds*
Potential

HCD LHTF
Program Grant
Match**

Remainder
Undesignated
Balance

Residential Housing Fund

Residential Housing Fund Up to

4 The CDBG Housing Fund, the HOME Fund, and the BMR Emergency Fund do not currently qualify as local matching funds.
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(Fund 233)

$2,731,838*** $2,000,000 $2,000,000 $731,838
Residential Impact Fee
Fund (Fund 293)

$451,376***

$400,000
Up to
$400,000

$51,376
Commercial Housing Fund

Commercial Housing Fund
(Fund 234)

$2,451,109***

$1,000,000
Up to
$1,000,000

$1,451,109
* While it is possible to propose including more of the existing balances in each fund into the City’s LHTF program grant application, staff recommends leaving some balance as undesignated in the event that Council would like to support an affordable housing project that comes in at an affordability level different than those targeted.

** The amounts listed under Potential HCD LHTF Program Grant Match ar e the amounts by which the City’s existing Affordable Housing Fund could be matched through LHTF funding.

*** Balances in each fund can be used as local matching funds in the City’s LHTF program grant application. These amounts reflect the undesignated balances in each fund before any Council action on 525 E. Charleston discussed in CMR ID # 14281. 525 E. Charleston meets the affordability targeting proposed for the City’s LHTF program grant application, so any Council action on 525 E.

Charleston would not negatively affect the City’s application . Instead, Council making a funding commitment to 525 E. Charleston would greatly increase the potential success of the City’s LHTF program grant application.

Given the need to make a financial commitment to 525 E. Charleston at this time without knowing if the City will be awarded a LHTF program grant, staff proposes two financial assistance pathways for 525 E. Charleston in CMR ID # 14281:
1) Commit a total of $2M for permanent financing loan for 525 E. Charleston, or 2) If the City’s LHTF program grant application is successful, commit $1.5M from Fund 233 for 525 E. Charleston. This $1.5M in Fund 233 would then be used as local matching funds in combination with a LHTF grant disbursement of $1.5M, to increase total fin ancial support to 525 E. Charleston to $3M.

The second financial pathway is necessary to outline, as the City’s LHTF application needs to show documentation of any City pre -approval of any LHTF awarded funds to 525 E. Charleston and the source of local matching funds.

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Table 2: LHTF Minimum Targeted Affordability Level Requirements and Staff Proposed Competitive Targeted Affordability Levels

LHTF Program Grant
Minimum Targeted
Affordability Level
Requirements

Staff Proposed
LHTF Program Grant
Competitive Targeted
Affordability Levels

Moderate Income (MOD)
<120% of the Area Median Income
(AMI)

Required
Maximum of 20% of funds

Proposed
0% of funds

Low Income (LI)
50% to 80% of the Area Median
Income (AMI)
Remainder % of funds not
expended on Moderate
Income or Extremely Low
Income

Proposed
maximum of 70% of funds
targeting housing units for
residents with incomes
at or below 60% of AMI

Very Low Income (VLI)
30% to 50% of the Area Median
Income (AMI)

Extremely Low Income (ELI)
15% to 30% of the Area Median
Income

Required
Minimum of 30% of funds

Proposed
minimum of 30% of funds
targeting housing units for
residents with incomes
at or below 30% AMI

Additional LHTF Program Grant Requirements
The LHTF program grant application requires the City to clarify if LHTF grant funds would cover administrative services. Consistent with the management of the City’s overall Affordable Housing Fund, grant funds would not be used to cover administrative services ; existing staff administrative dut ies for the Affordable Housing Fund can absorb the LHTF administrative duties.

The LHTF program grant requires all local matching funds to be disbursed with specific loan guidelines and underwriting, administration, reporting, and other financial standar ds. Staff prepared LHTF program -specific Loan Guidelines and Underwriting Standards and Procedures (Attachment B) to support those already in the City of Palo Alto Affordable Housing Fund 9 Packet Pg. 80

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Guidelines.5 The City Attorney’s Office, Administrative Services Dep artment, and Planning and Development Services Department have all reviewed these guidelines and standards and have determined that City administration and financial documents can comply. Submittal of these guidelines and standards is a required component of the LHTF program grant application, though HCD reserves that they might request clarification or elaboration as part of the application review process. In this case, staff included a request in the staff recommendation for Council to approve authority f or the City Manager or designee to administratively review and approve any updates to the LHTF-specific standards in Attachment B.

All LHTF program grant applicants must have an adopted Housing Element found by HCD to be in compliance with state Housing Element law by the time awards are announced in August 2022. Applicants must have also submitted their Annual Progress Report on the Housing Element for the 2021 Calendar Year by the application deadline of May 25, 2022 . The City already complies with these requirements.

Policy Implications
The City’s adopted Housing Element Program H3.1.11 states that Housing Funds shall provide a strong preference for affordable housing that serve the Extremely Low Income (ELI) level and the Very Low Income (VLI) level. Staff proposes that Council target any awarded LHTF grant funds and associated dollar-for-dollar local matching funds toward development of new multi - family rental housing units in Palo Alto at the levels of affordability as described in Table 2.

Applying for the LHTF program grant assists the City in targeting these more costly to create housing units. In addition, Housing Work Plan task 4.2 selects project for funding that maximize the use of the City’s funds for development of new affordable units. Appl ication to the LHTF program is consistent with this task.

Resource Impact
The resource impact of the recommendations in this report is the opportunity to substantially increase funding available to support the development of affordable housing in the City of Palo Alto. There is no additional expense associated with filing a LHTF program grant application ; any award of LHTF program grant funds would supplement existing balances in the City’s existing Affordable Housing Fund with a dollar -for-dollar match. T he LHTF program grant does not influence in-lieu or development impact fees collected in association with entitlements.

Staff time necessary to administer the existing Affordable Housing Fund program is budgeted in the General Fund and sufficient staffing resources are available in the FY 2022 Adopted Operating Budget and FY 2023 Proposed Operating Budget to support the LHTF grant application and administration, should the grant be awarded . Staff will need to provide

5 City of Palo Alto Affordable Housing Fund Guidelines Approved by the City Council on August 17, 2015 by Resolution No.9539: https://www.cityofpaloalto.org/files/assets/public/planning -amp-development- services/housing-element/0131472-housing-fund-guidelines-august-2015.pdf 9 Packet Pg. 81

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documentation of ongoing revenues into the City’s Affordable Housing Fund as part of the LHTF program grant application, but this information does not restrict future fund balances; it only shows that the City’s Affordable Housing Fund operation is consistently sustained. Should the grant be awarded, staff will return to the City Council to amend the budget by recognizing and appropriating the revenue and corresponding expense prior to the dispersal of funding to corresponding projects.

Timeline
Council action on all the staff recommendations is needed at the May 24, 2022 Council meeting for the City Manager to be authorized to submit a LHTF program grant application by the deadline of May 25, 2022. Award announcements are anticipated in August 2022. If awarded, the City would need to enter into a Standard Agreement with HCD and execute within 30 days.

If awarded, the City would also need to submit disbursement requests to HCD for LHTF program qualifying projects that were approved by City Council for funding commitments from the Affordable Housing Fund.

Environmental Review
Submission of a LHTF program grant is not considered a project under the California Environmental Quality Act.

Attachments:

Attachment9.a: Attachment A: Local Housing Trust Fund (LHTF) Program Grant Application Resolution (PDF)
Attachment9.b: Attachment B: LHTF-Specific Loan Guidelines and Underwriting Standards and Procedures (DOCX)
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*NOT YET APPROVED*
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Resolution No. ____
Resolution of the Council of the City of Palo Alto Authorizing Application for and Receipt of 2022 California Department of Housing and Community Development Local Housing Trust Funds

R E C I T A L S

A majority of the council members of the City of Palo Alto (“Applicant”) hereby consents to, adopts and ratifies the following resolution:

A. WHEREAS, the Department is authorized to provide up to $57 million under the Local Housing Trust Fund (“LHTF”) Program from the Veterans and Affordable Housing Bond Act of 2018 (Proposition 1) (as described in Health and Safety Code section 50842.2 et seq. (Chapter 365, Statutes of 2017 (SB 3)) (“Program”).

B. WHEREAS the State of California (the “State”), Department of Housing and Community Development (“Department”) issued a Notice of Funding Availability (“NOFA”) dated 4/5/2022 under the LHTF Program;

C. WHEREAS Applicant is an eligible Local or Regional Housing Trust Fund applying to the Program to administer one or more eligible activities using Program Funds.

D. WHEREAS the Department may approve funding allocations for the LHTF Program, subject to the te rms and conditions of H&S Code Section 50842.2, the LHTF Program Guidelines, NOFA, Program requirements, the Standard Agreement and other related contracts between the Department and LHTF award recipients;

NOW, THEREFORE, the Council of the City of Palo Alto RESOLVES as follows:

SECTION 1
. If Applicant receives an award of LHTF funds from the Department pursuant to the above referenced LHTF NOFA, it represents and certifies that it will use all such funds on Eligible Projects in a manner consistent and in compliance with all applicable state and federal statutes, rules, regulations, and laws, including, without limitation, all rules and laws regarding the LHTF Program, as well as any and all contracts Applicant may have with the Department (“Eligible Project”).

SECTION 2
. NOW, THEREFORE, IT IS RESOLVED: That the City of Palo Alto is hereby authorized to act as the manager in connection with the Department's funds to Eligible Projects pursuant to the above described Notice of Funding Availability in an amount not to exceed $3.4 million (the "LHTF Award"). NOTE: Dollar amount must include amount used for administrative costs, pursuant to Section 105(b) of the Guidelines.

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SECTION 3. Applicant hereby agrees to match on a dollar for dollar basis the L HTF Award pursuant to Guidelines Section 104. Applicant hereby agrees to utilize matching finds on a dollar- for-dollar basis for the same Eligible Project for which Program Funds are used, as required by HSC Section 50843.5(c).

SECTION 4
. Pursuant to Attachment 1 and the Applicant’s certification in this resolution, the LHTF funds will be expended only for Eligible Projects and consistent with all program requirements.

SECTION 5
. Nonprofit Housing Trust Funds and Native American Tribe Housing Trust Funds agree to use Program Funds only for Eligible Projects located in cities and counties that submitted an adopted Housing Element that was found by the Department to be in compliance and that have submitted their Housing Element Annual Progress Report (APR) for the current year or prior year by the application due date.

SECTION 6
. Applicant shall be subject to the terms and conditions as specified in the Standard Agreement, H&S Section 50842.2 and LHTF Program Guidelines

SECTION 7
. The City’s Director of Planning and Development Services is/are authorized to execute the LHTF Program Application, the LHTF Standard Agreement and any subsequent amendments or modifications thereto, as well as any other documents which are related to the Program or the LHTF Award to Applicant, as the Department may deem appropriate.

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SECTION 8. The Council finds that th e adoption of this resolution does not meet the definition of a project under Public Resources Code Section 21065, thus, no environmental assessment under the California Environmental Quality Act is required.

INTRODUCED AND PASSED:

AYES:

NOES:

ABSENT:

ABSTENTIONS:

ATTEST:

__________________________ _____________________________ City Clerk Mayor

APPROVED AS TO FORM: APPROVED:

__________________________ _____________________________ Assistant City Attorney City Manager

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ATTACHMENT 1
The Applicant hereby agrees to match on a dollar for dollar basis the LHTF Award pursuant to Guidelines Section 104. Applicant hereby agrees to utilize matching finds on a dollar-for-dollar basis for the same Eligible Project for which Program Funds are used, as required by HSC Section 50843.5(c).

All (100%) of the City Council designated local matching funds from the Affordable Housing Fund and LHTF program grant funds shall be used for only one LHTF eligible activity: deferred payment permanent financing loans at simple interest rates of no higher than three percent per annum for the development of LHTF program qualifying new affordable multi-family residential rental housing projects that produce housing units at the following affordability levels: A maximum of 70% of funds targeting housing units for residents with incomes at or below 60% of area median income (AMI) and a minimum of 30% of funds targeting housing units for residents with incomes at or below 30% AMI. These housing units would be income and rent restricted for not less than 55 years. LHTF program grant funds would not be used to cover administrative services.

All local matching funds and LHTF program grant funds would be delivered and used within the City of Palo Alto.

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ATTACHMENT B

*NOT YET APPROVED*

City of Palo Alto
Local Housing Trust Fund Program
Loan Guidelines and Underwriting Standards and Procedures

May 23, 2022

Local Housing Trust Fund Underwriting, Administration, and Reporting Requirements:

Per Section G of the California Department of Housing and Community Development 2022 Local Housing Trust Fund NOFA, the City acknowledges that it must comply with the underwriting and loan requirements of Guidelines, Section 107, the administrative requirements of Sections 108 and 109 (b), and the reporting requirements of Section 112 of the Local Housing Trust Fund Program Final 2020 Guidelines.

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City of Palo Alto Local Housing Trust Fund (LHTF) Program Loan Guidelines and Underwriting Standards and Procedures *NOT YET APPROVED*

Transaction Underwriting Guidelines

Multifamily Rental Housing Transaction Underwriting
Guidelines (“Underwriting Guidelines”)
Part I: Applicant Thresholds
Developer
Qualification/
Disqualification
An applicant seeking a Fund subsidy must meet the following qualifications listed below. If the developer entity is a joint venture, the leading developer must meet the required qualifications listed below. If the developers equally share the partnership interest, both developers must qualify.

1. A developer must have experiences within the last five years in developing and owning affordable housing projects that are similar in size, scale, tenure, type, target population and complexity (both from a physical and financial standpoint) to the one being proposed.

2. A developer will be required to disclose whether it, any of its principals, or any affiliated entity, has been an adverse party in litigation involving any county, city, redevelopment agency or other public entity within the past ten years.

3. A developer will be required to disclose all judgments and outstanding claims against it, its principals or any affiliated entity, involving, but not limited to, defaults on financial obligations, construction safety, landlord/tenant disputes, or negligence.

4. A developer will be required to disclose that it, any of its principals, or any affiliated entity, has filed for bankruptcy at any time within the past ten years.

5. A developer must demonstrate its experiences in gaining support from respective communities for its affordable housing projects.

6. Applications are not accepted from entities that have been notified that they are not in compliance with their current obligations on any loans issued by the City of Palo Alto or the Fund. Noncompliance, at the discretion of the Fund, may consist of any monetary or non-monetary provisions, such as failure to submit required financial statements in a timely manner, failure to comply with the requirements of the regulatory agreement, including but not limited to resident service and property management obligations, and failure to correct in a timely manner any building deficiency noted by any government agency.

7. The entities comprising the applicant must not have received negative points from the California Tax Credit Allocation Committee (CTCAC) or the California Debt Limit Allocation Committee (CDLAC) within the past year.

8. If the applicant is seeking 9% tax credits, the applicant entity must meet the standard for maximum general partner experience points under California Qualified Allocation Plan.

9. The applicant is willing to designate a principal available through the entire course of development and construction of the project if the developer track record relies on that principal.

10. The Fund reserves the right to deny funding assistance to any applicant on the basis of the information provided by said disclosures.

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City of Palo Alto Local Housing Trust Fund (LHTF) Program Loan Guidelines and Underwriting Standards and Procedures *NOT YET APPROVED*

Part II: Eligibility

Eligible Projects Eligible projects are new affordable multi-family rental developments including, mixed income developments and mixed-use projects that target the following affordability levels:
• A maximum of 70% of funds targeting housing units for residents with incomes at or below 60% of area median income (AMI) and
• A minimum of 30% of funds targeting housing units for residents with incomes at or below 30% AMI.

These housing units would be income and rent restricted for not less than 55 years.

Ineligible Projects The Fund will not provide funds for applicants proposing housing types that are in violation of Federal or State fair housing laws.

Eligible Applicants Applications are accepted from non-profit and for-profit housing corporations, joint ventures, limited liability companies, partnerships, and local governmental entities that have met the Applicant Thresholds. All applicants seeking a Fund loan must include a nonprofit managing general partner.

Eligible Uses of Funds
To provide take-out financing at construction loan closing for normal and customary pre- development and acquisition related expenses, and to fund normal and customary construction expenses. The Fund will determine, in its sole discretion, costs deemed excessive or unreasonable, or uses deemed ineligible.

Project contingencies must be included at the following minimum levels: new construction hard costs of 5% to 10%; soft costs of 3% to 5%.

Ineligible Uses of Funds Costs associated with construction items or materials of a luxury nature; developer/sponsor administrative costs (other than included in the developer fee.

Eligible Households Households must have incomes at or below 60% of area median income and may include households with special needs. The Fund uses the income limits set by the US Department of Housing and Urban Development (HUD) and the California Tax Credit Allocation Committee (CTCAC) to define extremely low, very low, low, and moderate income households. These income limits are used for most federal, state and local housing programs. They are also used for targeting affordable housing units in local housing elements.

Part III: Project Priorities and Location and Design Guidelines

Project Priorities Specific project targets and criteria may be adopted by the Fund periodically in response to evolving housing challenges and needs that are identified and adopted by the governing body of the Fund. Currently, the funding focus is:
• A maximum of 70% of funds targeting housing units for residents with incomes at or below 60% of area median income (AMI) and
• A minimum of 30% of funds targeting housing units for residents with incomes at or below 30% AMI.

9.b
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City of Palo Alto Local Housing Trust Fund (LHTF) Program Loan Guidelines and Underwriting Standards and Procedures *NOT YET APPROVED*

Projects will be evaluated with respect to criteria that are consistent with Fund goals and policies. In addition, projects that provide the following will be viewed favorably and when compared against other projects:

1. Projects that provide the greatest benefit per dollar of funds spent.

2. Rental projects that have other funding sources identified and committed.

3. Rental projects which benefit the highest percentage of extremely low, very low, and low income persons, provide the lowest rents, or will maintain longer periods of affordability.

4. Rental projects that use program funds as a match or leveraging tool to stimulate the use of conventional and below-market resources, including tax credits, state and federal funding programs, and/or other funding sources.

Design Guidelines

1. Site and building design. With the exception of projects eligible for ministerial approval or a streamlined entitlement process, all projects will be subject to the City’s architectural review process outlined in the Municipal Code.

Livability Standards The Fund’s provision of affordable housing financing is a long-term investment.

Underwriting includes assuring that each development will be well-designed and well- constructed to provide decent, safe affordable housing over the long term for a population that does not have a wide range of housing choices.

The quality and marketability of any housing unit is affected by its size and the livability of the space including the space's ability to accommodate the potential number of occupants and the necessary furniture. A larger unit does not guarantee the successful accommodation of a particular furniture layout over a more efficiently laid out smaller one.

Leasehold Security In any Project where the Sponsor proposes to control the Project land through a long-term ground lease, either:
(1) the Regulatory Agreement and other Program documents shall be recorded against both the Sponsor’s interest in the Project and the fee interest in the land, and the lease shall have a term remaining at the time of recordation at least equal to the term of the Program loan or grant; or
(2) if the Regulatory agreement and other Program documents are not recorded against the Project’s fee interest, the ground lease shall be subject to the Department’s approval, must not be subject to any other mortgages, regulatory agreements, use restrictions, or equivalent instruments on the fee interest, and shall contain, or be amended to contain, provisions which:
(A) establish a remaining term of at least ninety (90) years from the date the Department documents are recorded, provided that the Department may accept a lesser term, not less than 65 years, when the lessor is a public agency;
(B) ensure the validity of the lien of the Program loan and/or grant documents on the lease; (C) ensure that the lease permits the Project to satisfy all Program requirements and permit the Department to enforce the provisions of the Program loan and/or grant without restriction;

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City of Palo Alto Local Housing Trust Fund (LHTF) Program Loan Guidelines and Underwriting Standards and Procedures *NOT YET APPROVED*

(D) expressly consent to the lessee’s assignment of the lease to the Department without further consent of the lessor, and permit the Department, after acquisition of the leasehold property, to transfer or assign the lease to a third party without consent of the lessor. (E) provide that the lessor does not have the right to terminate the lease or accelerate the rent upon lessee’s breach without first giving the lessee and the Department reasonable notice and opportunity to cure within a reasonable period; (F) provide that no termination, modification, or amendment to any terms of the lease shall be effective without the written consent of the Department, and any attempt to take such actions would be void without the Department’s consent; (G) require that, in the event of destruction of any improvements on the land, neither the lessor nor the lessee shall terminate the lease if and so long as the lessee or Department pursues reconstruction of the improvements with reasonable diligence; (H) provide that the Department shall not have any liability for the performance of any of the obligations of lessee under the lease until the Department has acquired the leasehold interest, and then only in accordance with the terms of the lease and only with respect to obligations that accrue during the Department’s ownership of the leasehold interest; (I) provide that neither the lessor nor the lessee, in the event of bankruptcy by either, will take the benefit of any provisions in the United States Bankruptcy Code that would cause the termination of the lease or otherwise render it unenforceable in accordance with its terms; (J) provide that the leasehold interest will not merge into the fee in the event that the lessee acquires the reversionary interest in the Project; and
(K) provide that acquisition of the leasehold property by the Department will not result in a termination of the leasehold; and upon such event, obligate the lessor to enter into a new lease having a term at least as long as the term remaining on the lease prior to acquisition by the Department and on substantially the same terms and conditions.

Parking In addition to providing the number of parking spaces required for the project by the Municipal Code, special consideration should be given to security issues and safety elements for parking, including, but not limited to, pedestrian entrance and exits, lighting, open stairwells with clear visibility on each floor landing, and other design elements to ensure the tenant’s/public’s safety and well-being.

Accessibility
requirements
The Fund expects the developer to be familiar with and comply with accessibility provisions of state and federal law. Information on federal requirements may be obtained from the U.

S. Department of Housing and Urban Development and on state requirements may be obtained from the State of California Building Standards Commission.

Part IV: Development Team
A. Development Team Underwriting and Qualifications

Developer Experience Applicants must meet Applicant Thresholds. In addition, when applicable, applicant team shall have a demonstrated successful track record in providing social services to the targeted population, and adequate capacity to provide social services, or shall contract with a service provider who does. This track record should be evidenced by documentation on project staffing levels, annual social service budget, sources of funds, types of services provided and contracts/agreements with third party service providers at existing projects.

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Staffing and workload
levels
Pipeline, Staffing and Workload Levels

1. Applicant shall identify proposed project manager committed to the project.

2. Applicant shall identify current project pipeline including type of project, location, number of units and status.

3. Applicant shall identify the number of project managers on staff and the average number of current projects per project manager. Applicant shall also describe the how project management is structured within their organization.

Funding Ability/
Financial Strength

1. The borrower’s capacity and financial strength are very important considerations when evaluating whether an affordable housing project will be successful. The Fund reviews the borrower’s financial statements and/or tax filings for at least the past three years plus the current year to date to evaluate whether there is sufficient income, equity and cash flow to undertake, carry out and successfully complete the proposed project. Co-borrowers and guarantors will be considered in this evaluation.

2. Developer may be asked to demonstrate that it has met the financial guarantee requirements of any lenders and investors as may be required for the project to obtain the anticipated funding.

B. Other Development Team Members

General Contractor It is recommended that the applicant involve the proposed GC as early as possible during the project design stage. The Fund’s expectation is that the selected GC has relevant experience working on housing of a similar design to the project being proposed, and it is highly desirable that the developer have previous experience working with the proposed GC. Experience in projects with similar funding source types, such as Federal, state or local assistance is desirable, but not mandatory.

Architect The project architect must have design experience with at least three recent and similar projects as the proposed project. The architect must show experience in similar construction types and similar project complexities as the proposed project. Experience in projects with similar funding source types is desirable, but not mandatory.

Property Manager The sponsor will include the property management company on the development team during the project design phase. The qualification of the firm should be submitted with the Pre-Application.

The Fund reserves the right to approve or disapprove the property management company, management plan, and lease agreement as part of the Pre-Application and/or Full Application process and upon any subsequent change, and annually monitors all projects for occupancy, affordability, management, and social service requirements.

Subject to investor and senior lender approval, the Fund reserves the right to require the management company be changed if the Fund determines the management company is not following policies and procedures specified in the approved management plan, lease agreement, or regulatory documents.

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Financial
Advisor/Consultants
Financial consulting fees must not exceed $150,000 and should be dependent upon the size and complexity of the project. Specific consulting services include: preparation of tax credit applications; preparation of Fund applications and other public agency applications; preparation of Affordable Housing Program (AHP) applications and applications for conventional financing, as well as provision of general development services such as the selection and coordination of the development team; loan documentation; and, processing local approvals and entitlements. Fees required for construction management are not included in this category.

Part V: Project Underwriting Guidelines
A. Fund Debt – Terms and Conditions

1. Loan Terms
a. Method of
Financial
Assistance

Permanent Loans
b. Loan Sizing 1. The loan amount shall not exceed the difference between total development cost and the maximum potential equity and debt raised from private and public sources other than the Fund. Fund staff shall determine the financial gap based on review of the application.

2. In order to serve the widest array of projects in the City and to be as efficient as possible in providing affordable housing units, and to also protect investors and users from unnecessary risk, the Fund will generally limit the size of its loans based on maximum loan amounts per unit and/or per bedroom.

The maximum amount could be determined through an economic analysis of the project to ascertain the necessary funding required to achieve housing affordability. Comparable projects will be used as one indicator, along with consideration of the unit size, number of bedrooms, affordability level, length of affordability, availability of other subsidies, and local or regional project costs.
c. Interest Rate 3.0% simple interest when developer has ability to repay Fund loan.

0% if proposed use/operation has no income source for repayment; special needs developments may be offered the possibility of debt forgiveness tied to years of service provision. For example, a project with 20-year restrictions could be offered 5% debt forgiveness per year for each year of meeting the project’s housing and service obligations.

d. Loan Term 55 years from conversion of permanent financing; this loan term will run in the range of 55 to approximately 57 years.

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e. Loan Repayment Determined on a project-by-project basis. Standard recommendation:

Years 1-30: Fund/Developer 50/50 split of residual receipts; will be extended to 40 years if term debt is 40 years. Years 31-55: Fund/Developer 50/50 split of residual receipts
Balance due at Year 56

Fund portion of residual receipts may be shared with other public agencies in proportion to the respective loan amounts committed by each public agency. h. Draw Requests Provided on a monthly basis or as needed. i. Performance
Bonds

Performance bonds may be required at the Fund’s discretion. j. Reporting Developer to provide Fund with copies of monthly construction inspection reports and draw reports provided to construction lender(s).
k. Cost Savings
To the extent that there are Excess Sources (as hereafter defined), the applicant (and at this future point in time will then be the “Borrower”) shall make a special payment to the Fund within thirty (30) days of receipt by the Borrower of either (i) the approved final cost certification relating to the development, and (ii) the final equity payment from the Borrower’s limited partner, whichever is later to occur. The amount of the special payment shall be the lesser of (x) the outstanding principal balance of the Fund loan, plus accrued interest, and (y) Excess Sources. For the purposes of these Underwriting Guidelines, “Excess Sources” shall be defined as the amount by which the funding sources actually available to Borrower for acquisition and new construction and/or rehabilitation of the development exceed the actual aggregate cost for the acquisition and new construction and/or rehabilitation of the development, as such sources are determined by the final cost certification. Such payment shall be applied first to accrued interest, and then to outstanding principal.

For projects using both State and City funding, the Excess Sources would be shared between City on a pro rata basis.

3. Affordable Housing Provisions
a. Term of Deed
Restrictions

The Fund places a strong priority on financing projects that provide permanently affordable housing units. Consideration will be given to units with affordability restrictions that expire at some future date, but they should remain affordable for the longest possible time, and at a minimum for a term of 55 years.

b. Eligible
Households See Eligibility section.

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B. Private Permanent Financing – Terms and Conditions

1. Debt Service
Coverage Ratio
Minimum
4% LIHTC: 1.15
9% LIHTC: 1.15
Maximum: 1.2

2. Loan to Value Maximum 90% LTV. 80% LTV or less preferred. Subject to industry standards.

3. Loan Term 30-40 years
(Shorter loan terms may apply subject to constraints imposed by State and Federal financing sources.)

4. Interest Rate 4% LIHTC: 100-300 basis points below
conventional industry lending rates 9%
LIHTC: Conventional industry lending
rates
The interest rate on the hard debt must be competitive with the prevailing market interest rate for similar financing structures with similar risk characteristics.

C. Cash Flow Projections (including Annual Reserves, Services and Fees)

1. Positive Cash Flow The Project must demonstrate a positive cash flow for 15 years, using income and expenses increase rate assumptions specified in California Code of Regulations, Title 4, Section 10327.

The City may consider special circumstances in which the project is unable to show a 15-year positive cash flow.

2. Income
a. Rent Inflation
Factor

2.5% annually (adjusted to industry standard annually). b. Other Income -
Description and
Justification
The applicant should show the details of any miscellaneous income expected to be generated from the project. This income could include laundry machine income, storage, or other non- housing related income sources.
c. Other Income
Inflation Factor
Not to exceed rent inflation factor and justification of inflation factor to be provided. d. Lease-up Income Lease-up income is defined as cash flow from the project operations prior to the conversion of the primary construction loan to a permanent loan. Lease-up income should not be shown as a source of funds for budgeting purposes; however, borrower must submit details of lease-up income amounts prior to conversion to permanent loan.

3. Expenses
a. Operating
Expenses Operating expenses must meet the minimum standards set by CTCAC, and must not exceed the industry standards.
b. Vacancy Rates 5% unless subject to other minimum standards set such as CTCAC. c. Operating Expense
Inflation Factor

3.5% annually: The proforma operating expenses (excluding property taxes and replacement reserves) should not be inflated by less than one percent (1%) higher than the proforma revenues.

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d. Replacement
Reserves
Minimum replacement reserves should be consistent with California Tax Credit Allocation Committee (CTCAC), California Debt Limit Allocation Committee (CDLAC), California Department of Housing and Community Development (HCD), and/or California Housing Finance Agency (CalHFA) requirements, as appropriate. In the absence of senior lender requirements, the Fund will require replacement reserves consistent with CTCAC standards.

The Fund will require an annual audited financial statement including the balance, deposits, and withdrawals from the replacement reserve account. If the senior lender and/or tax credit investor does not require approval of withdrawals, the Fund shall reserve the right to approve.

Limited partners cannot take reserve accounts upon exit.

For new construction or conversion Projects, the initial amount of annual deposits to the replacement reserve account shall be equal to at least the lesser of 0.6% of estimated construction costs associated with structures in the Project, excluding construction contingency and general contractor profit, overhead and general requirements, or $500 per unit. However, the Department may approve a different amount based on the results of a third-party reserve analysis, which it may require, or other reliable indicators of the need for replacement reserve funds over the initial 20 years of operation, or, in the case of transactions involving restructuring of existing Department loans, 20 years of operations after the restructuring.

Applicants must provide evidence that the replacement reserves levels are appropriate to the development project. City of Palo Alto has particular concerns that the levels of replacement reserves for small new construction projects be adequate to make future capital repairs, and may require higher than usual reserves levels for small new construction projects (i.e., projects under 20 units).

e. Operating
Reserves
Minimum operating reserves should be consistent with CTCAC, CDLAC, HCD, and/or CalHFA requirements, as appropriate. In the absence of senior lender requirements, the Fund will require operating reserves consistent with CTCAC standards.

The Fund may require an annual audited financial statement including the balance, deposits, and withdrawals from the operating reserve account. If the senior lender and/or tax credit investor does not require approval of withdrawals, The Fund shall reserve the right to approve.

For projects with project-based assistance and/or other operating subsidies that are renewable or terminate prior to the end of the Fund loan, reserves in excess of the CTCAC requirements may be required.

Limited partners cannot take reserve accounts upon exit. f. Private Construction
and Term Lender
Fees
Total lender costs should be in the range of 1% to 3% of the loan amount for 9% LIHTC projects, and 4% to 8% for 4% LIHTC projects.

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g. Property Tax
Increases
2% annually (except for tax-exempt organizations). Payment In-Lieu of Taxes (PILOT) fee to be considered on a case-by-case basis.

Developers/owners of projects with units restricted to households at 80% of area median income or less shall attempt to qualify for the property tax welfare exemption from the California Board of Equalization. In such cases, a nonprofit general partner of a limited partnership submits a certification that the limited partnership agreement provides sufficient management authority and duties to qualify the nonprofit general partner as managing general partner. If an exemption is not contemplated, the Fund may request that the borrower consider submitting an application in order to make the project feasible. h. Limited Partner
Asset
Management
Fee
Paid during years 1-15 from project cash flow after debt service prior to payment of a deferred developer fee or distribution of residual receipts. Potential range at Year 1:
$5,000 - $7,500 or industry standard. May escalate annually at the minimum of CPI or

3.5%.
i. General Partner
Asset
Management
Fee
Paid during years 1-55 from project cash flow after debt service and payment of deferred developer fee before distribution of residual receipts. Potential range at Year 1: $30,000- $35,000 May escalate annually at the minimum of CPI or 3.5%. j. Incentive
Management Fee
Incentive management fees may be permitted on a case-by-case basis.

4. Developer Compensation from Cash Flow
a. Deferred
Developer
Fee
Second draw on cash flow. Subject to repayment with interest within 15 years from date in service.
b. Other Developer
Compensation Any other proposed developer compensation shall be evaluated on a case-by-case basis.

5. Social and
Supportive Services
Budget

Evaluated on a case-by-case basis. Budgets are to be accompanied by detailed explanations of costs.

D. Developer Compensation and Requirements
Maximum Developer
fees
Maximum developer fee should be consistent with California Tax Credit Allocation Committee (CTCAC), California Debt Limit Allocation Committee (CDLAC), California Department of Housing and Community Development (HCD), and/or California Housing Finance Agency (CalHFA) requirements, as appropriate
Deferred Developer
Fee

Deferred developer fee should be consistent with California Tax Credit Allocation Committee (CTCAC), California Debt Limit Allocation Committee (CDLAC), California Department of Housing and Community Development (HCD), and/or California Housing Finance Agency (CalHFA) requirements, as appropriate.

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E. Other Financing Sources – Terms and Conditions
Maximum Leverage
Required
It is expected that the applicant will leverage all available outside funding sources to the greatest extent possible to minimize the Fund’s gap funding. During the earliest stages of the project development, the applicant is strongly encouraged to explore as many outside funding sources as possible. The applicant should provide to the Fund evidence of their activities in soliciting proposals from the various funding sources and/or detailed information supporting their funding assumptions.

F. Tax Credit Equity Commitment
Applicants are encouraged to actively solicit bids from prospective tax credit equity investors.

G. Exceptions to Guidelines
Exceptions to the Fund’s underwriting policies will be granted in situations if staff concludes a waiver is appropriate and approves the request. Requests for exceptions must be submitted by the applicant in writing. It shall be at staff’s sole discretion to determine the appropriateness of the request.

H. Commercial Space Underwriting Guidelines
To be determined on a case-by-case basis and subject to industry standards.

Part VI: Third Party Reports
Appraisals
All appraisers must be state-certified MAI appraisers who do not have an identity of interest with any member of the development team or sponsor. Appraisals must be prepared no earlier than six months prior to the date of the land or building’s purchase contract, or if land or buildings have not been purchased, no earlier than six months prior to the Fund application date. Appraisals prepared for the project’s lender(s) may be accepted with Fund’s approval. Appraisals are to be submitted as soon as possible, but no later than two months before the projected closing date of the Fund loan and/or the construction loan. Appraisals for rehabilitation projects must include “as-is” and “post rehabilitation” values. Appraisals for new construction must include a land valuation and completed value. The property value shall be based on an appraisal that takes restricted rents and the value of below-market financing and tax credits into consideration, as applicable.

The appraisal must be commissioned by the senior lender or by the Fund, funded through project costs, and performed by a reputable agency that is acceptable to the Fund. The appraisal must address unit type demand at the submarket level (or other geographic area if deemed more appropriate), and must provide unit comparables of other restricted affordable apartments. The valuation methodology should assess:

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• Value of unimproved land
• Value as-improved without rent restrictions
• Value as-improved with restricted rents
• Value of below-market financing
• Value of tax credits
• Value of commercial space, if any.

The Fund should be consulted in determining the scope of appraisal to ensure it meets the County’s underwriting needs. As Palo Alto’s real estate market can change rapidly, an update for appraisals less than six months old may be appropriate for purposes of accurate valuation.

For leasehold properties, appraisals should define market value and estimate the property’s below-market value. The appraisal valuation, whether for fee simple or leasehold properties, should support the amount of the first-priority loans as well as the Fund’s loan amount.

Market Study Market studies must be consistent with CDLAC and/or CTCAC requirements. For projects not using those resources, the market study must include three rent comparables for each unit type from similar properties within a one-mile radius of the project, or, if not available within a one-mile radius, the three comparables closest to the project, subject to Fund approval.

Rehabilitation
Assessment
A capital or physical needs assessment of the property must be submitted that details the conditions and remaining useful life of the building’s major components, including but not limited to electrical, plumbing, HVAC, foundation, and roofing. The scope of rehabilitation work identified in the application should match the findings of the physical needs assessment.

The physical needs assessment must be prepared by the project architect or a qualified independent third party, neither of whom has an identity of interest with any member of the development team or sponsor. The needs assessment must be performed no earlier than 120 days prior to the application.

The physical needs assessment shall include a 15-year reserve study, which indicates the expected dates and costs of future replacements of all major building components that are not being replaced immediately. The assessment shall also include a schedule of reserve contributions needed to fund those replacements.

Phase I or Phase II
Environmental
Assessments
Every application must include a Phase I Environmental Assessment which must follow the standards outlined in the American Standards of Testing and Materials (ASTM) standards (E 1527-05) to discover the potential presence of onsite and neighboring property contamination, (including but not limited to lead-based paint, asbestos, and methane) and will have been completed within the last six months. If a project’s Phase I Environmental Assessment indicates the need for further assessment, a Phase II report must be submitted. The applicant must include a cost estimate for any required remediation.

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Lead-based
paint/Asbestos
All rehabilitation projects and new construction projects, which involve demolition of existing structures in advance of the rehabilitation or new construction, must submit an asbestos assessment and lead-based paint report completed within the past twelve months. For new construction projects where there is complete demolition of all existing structures, the applicant may submit a letter in lieu of a lead test report indicating that he/she will assume the presence of lead and follow the appropriate (federal, state, and local) lead hazard abatement protocols. For occupied sites, assessment must include minimally-invasive sampling and readily- accessible surfaces. Testing for asbestos shall be subject to AQMD standards. As it relates to lead-based paint, testing and compliance shall be consistent with those standards outlined in HUD’s “Guidelines for the Evaluation and Control of Lead-Based Paint Hazards in Housing” (June 1995), including chapter 7- Lead-Based Paint Inspection (1997 Revision), which are the industry standard. If the assessment determines that lead is present, (except for new construction with complete existing structure demolition as indicated above), a Lead Abatement Plan must be submitted with application.

Soils Report All new construction projects must submit a soils report completed within the last twenty- four months for the purpose of evaluating the geo-technical engineering characteristics of the on-site subsurface soils relative to the anticipated development. The report shall include the description of the field exploration and laboratory tests performed; evaluation of soil liquefaction potential; conclusions and recommendation relating to construction of the proposed residential development based upon the analyses of data from exploration and testing programs; and knowledge of the general and site-specific characteristics of the subsurface soils. Reports for sites occupied by structures must include subsurface investigations that are conducted in compliance with, and subject to, the City of Palo Alto’s Planning and Development Services Building standards.

Pest Report All applications for rehabilitation projects must submit a pest report completed within the previous 6 months. If the report shows repairs necessary, these costs must be included in the construction budget and scope, and a clear pest report will be required at the conclusion of construction. The pest report must be prepared by a company licensed by the State of California Pest Control Board.

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City of Palo Alto (ID # 14337)
City Council Staff Report

Meeting Date: 5/23/2022 Report Type: Consent Calendar

City of Palo Alto Page 1

Title: Approval of Amendment Number 2 to Contract Number C17164727 with Professional Account Management, LLC. for Parking Citation Processing and Collections to Extend the Term and Increase the Amount by $70,000, for a new Not -To-Exceed Total of $720,000
From: City Manager
Lead Department: Police

Recommendation
Staff recommends that Council approve and authorize the City Manager or their designee to execute Contract Amendment No. 2 (Attachment A) with Professional Account Management LLC for an extended te rm of one year (April 30, 2022 to April 30, 2023 ), and increase compensation by $70,000 for a total not-to-exceed amount of $720,000 over six years.

Background
Management for public parking is been performed by both Office of Transportation (OOT) an d Police, depending on scope of enforcement. Currently Police is managing timed enforcement in the commercial cores , utilizing Community Services Officers (CSOs) . OOT manages all other aspects of public parking including parking garages and Resident Parking Programs ( RPP) with enforcement utilizing contractors.

Aspects of managing the timed parking program by the Police Department include enforcement of timed parking regulations, enforcement of other vehicle related requirements such as license plate place ment or disability identification (placards) , and in rare cases, enforcing no -parking tow-away zones . The Police Department staff provide the enforcement while engaging a contractor to provide “back-office” services such as maintaining database records of violations, vehicle owners, payment transactions, or a record of contesting, along with collection of overdue payments. More recently, service providers were only considered if they could provide a portal to make citation payments on-line, supplementing mail-in to a vendor serviced lockbox and in-person option at Revenue Collections.

The Palo Alto Police Department initiated the current contract, C17164727, December 5, 2016 with a five -year term at a total cost of $650,000 (Staff Report # 7179). The current vendor , Professional Account Management LLC, was selected after conducting a formal request for proposal seeking professional services for parking citation processing and collections for timed 10 Packet Pg. 101

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parking enforcement by the Police Department CSOs.

At the end of the original term, Amendment No. 1 was executed to extend the term of the contract for an additional 6 months . There was n o change to the established not -to-exceed limit of $650,000 and no change f or billing rates by vendor ; this was authorized by the Chief Procurement Officer in accordance with the City municipal code. No increase in contract amount nor funding was required as enforcement services were suspended for a period during shelter-in-place beginning March 2020.

Discussion
An extension for services is recommended with Professional Account Management LLC, through May 30, 202 3, at the same terms as previously agreed to in 2016 with an updated not -to- exceed limit of $720,000. Services to be provided include:

1. Accepting citations from City-owned parking enforcement hardware and software

2. Recording citation data in a vendor-maintained database

3. Receiving payments for citations online or by mail to lockbox

4. Collecting unpaid parking citations

The extension is recommended to ensure services are maintained while allowing for city staff to coordinate the management of public parking among stakeholders adapting to the evolving environment during this transition period. In January 2022, significant chan ges to parking permit program fees both in the downtown cores and the RPP programs were implemented. In March and April, many companies implemented hybrid work schedules . S taff is monitoring how changes such as these are impacting parking demand and the programmatic changes necessary to ensure sustainability of parking programs in the future. A s such, staff recommends maintaining services until 2023 to focus on this effort in the near term. After this extension, staff expect to re-evaluate the market space for these services.

If not approved, the parking enforcement in timed zones enforced by City employees will need to be suspended without the infrastructure to process and collect the parking citations in place.

Resource Impact
Timed parking enforceme nt is a net -zero cost to the city in that the revenue received from enforcement offsets the cost of enforcement (staff, supplies and equipment, and overhead).

Approximately 97% of the revenue and expense is recognized in the General Fund; the remainder is accounted for in the Parking Fund (overseen by OOT) as a small percentage of the Police parking operations supports RPP. While the cost of the contracted back -end services referred to above is expected not to exceed $130,000 annually, the annual expense du ring shelter-in-place and the gradual re -opening was much less as the costs are tied to volume of activity. Not all of the anticipated expense were realized over the initial five -year term. Funds needed for Amendment No. 2 are available in FY 2022 Adopted Operating Budget and are 10 Packet Pg. 102

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accounted for in the FY 2023 Proposed Operating Budget through the duration of the extension. No further funding is requested at this time.

Stakeholder Engagement
Office of Transportation was consulted as it oversees some aspects of parking management in conjunction with the Police Department.

Environmental Review
The recommendation in this report does not constitute a project requiring review under the California Environmental Quality Act (CEQA).

Attachments:
• Attachment10.a: Attachment A: Professional Account Management, LLC.; Contract, C17164727, Amendment #2
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AMENDMENT NO. TWO TO CONTRACT NO. C17164727

BETWEEN THE CITY OF PALO ALTO AND

PROFESSIONAL ACCOUNT MANAGEMENT, LLC

This Amendment No. Two (this “Amendment”) to Contract No. C17164727 (the “Contract”) entered into as of April 29, 2022 by and between the CITY OF PALO ALTO, a California chartered municipal corporation (“CITY”), and PROFESSIONAL ACCOUNT MANAGEMENT, LLC, a Wisconsin limited liability company, located at 633 W. Wisconsin Avenue, Suite 1600, Milwaukee, WI 53203 ("CONSULTANT").CITY and CONSULTANT are referred to collectively as the “Parties” in this Amendment.

R E C I T A L S

A. Th e Contract was entered into by and between the Parties hereto for the provision of parking citation processing and collection services, as detailed therein.

B. T he Parties now wish to amend the Contract in order to increase compensation by Seventy Thousand Dollars ($70,000) from Six Hundred Fifty Thousand Dollars ($650,000) to a new total not-to-exceed amount of Seven Hundred Twenty Thousand Dol lars ($720,000) with no increased in rates; to extend the term for one additional year, from April 30, 2022 through April 29, 2023.

NOW, THEREFORE, in consideration of the covenants, terms, conditions, and provisions of this Amendment, the Parties agree:

SECTION 1. De finitions. The following definitions shall apply to this Amendment:

a. Contract. The term “Con tract” s hall mean C ontract No. C17164727 between CONSULTANT and CITY, dated December 5, 2016.

b. Other Terms. Capitalized terms used and not defined in this Amendment shall have the meanings assigned to such terms in the Contract.

SECTION 2. Se
ction 2, TERM, of the Contract is hereby amended to read as follows:

“The term of this Agreement shall be from the date of its full execution through April 29, 2023, unless terminated earlier pursuant to Section 19 of this Agreement.”

SECTION 3. Section 4 “COMPENSATION FOR ORIGINAL TERM” of the Contract is hereby amended to read as follows:

“The
compensation to be paid to CONSULTANT for performance of the Services described in Exhibit “A” (“Basic Services”), and reimbursable expenses, for a total not to DocuSign Envelope ID: 6036C3E8-3A03-4E6A-BAB8-6EC18F12F111

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exceed amount of Seven Hundred Twenty Thousand Dollars ($720,000). CONSULTANT agrees to complete all Basic Services, including reimbursable expenses, within this amount with no changes to Exhibit C-1, Schedule of Rates.”

SECTION 4. Legal Effect. Except as modified by this Amendment, all other provisions of the Contract, including any exhibits thereto, shall remain in full force and effect.

SECTION 5. Inc
orporation of Rec itals. The recita ls set forth above are terms of t his Amendment and are fully incorporated herein by this reference.

(SIGN
ATURE BLOCK FOLLOWS ON THE NEXT PAGE.)
DocuSign Envelope ID: 6036C3E8-3A03-4E6A-BAB8-6EC18F12F111

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SIGNATURES OF THE PARTIES

IN WITNESS WHEREOF, the Parties have by their duly authorized representatives executed this Amendment effective as of the date first above written.

CITY OF PALO ALTO

_____________________________
City Manager:

APPROVED AS TO FORM:

_____________________________
City Attorney or designee

PROFESSIONAL ACCOUNT
MANAGEMENT, LLC.

By:______________________________

Name:___________________________

Title:____________________________

DocuSign Envelope ID: 6036C3E8-3A03-4E6A-BAB8-6EC18F12F111 Tim Wendler
President and CEO

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City of Palo Alto (ID # 14341)
City Council Staff Report

Meeting Date: 5/23/2022 Report Type: Consent Calendar

City of Palo Alto Page 1

Title: Approval of Amendment #4 to Contract C18171057 with AECOM and Extend the Term to April 2024 and Increase the Not -to-Exceed Compensation by $722,170 for Additional Studies of Railroad Grade Separation Alternatives for a Total Not -to-Exceed of $3,596, 828
From: City Manager
Lead Department: Transportation Department

Recommendation
Staff recommends that the City Council approve and authorize the City Manager to execute Amendment No. 4 (attached) to Contract C18171057 with AECOM for the Railroad Grade Separation and Safety Improvements Capital Improvement Project (PL -17001), to increase compensation by $722,170 for a total not -to-exceed amount of $3,596,828 and extend the term to April 2024 . This amendment includes optional additional services for evaluat ing four- track alternatives that can be authorized by the City Manager in consultation with the Rail Committee.

Executive Summary
On February 14, 2022, the City Council referred Amendment #4 of the AECOM Contract (CMR 13761) to Rail Committee for review before City Council approval. The Rail Committee met on April 20, 2022, and after discussion, the Rail Committee recommended unanimously for Council to authorize and approve Amendment #4 of the AECOM Contract. The Amendment’s schedule of performance has been updated since February to reflect the May approval date of this Amendment.

Background and Discussion
After receiving the final report from the Expanded Community Advisory Panel (XCAP) on April 26, 2021 (CMR 12185), staff presented a detailed review of Meadow Drive and Charleston Road crossing alternatives on August 23, 2021 (CMR 13435). At this meeting, staff provided details on additional studies that may be performed to provide further information in narrowing the alternatives for selection of preferred alternatives at these crossings.

Following the discussion about Charleston Road and Meadow Drive crossing, staff presented details on Churchill Avenue crossing alternatives for grade separation on November 1, 2021 (CMR 13543) . This discussion was continued on November 29, 2021 (CMR 13746). Similar to 11 Packet Pg. 107

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other crossings, staff presented information on additional studies that may be performed to provide further information in narrowing the alternatives for the selection of preferred alternatives at Churchill Avenue Crossings.

Based on the Council discussions and directions at these meetings, staff requested AECOM Consultants to provide a proposal for the additional services on a time and material basis, including support from sub-consultants.

On February 14, 2022, the City Council discussed and referred Amendment #4 of the AECOM Contract (CMR 13761) to the Rail Committee for review before City Council approval. The Rail Committee met on April 20, 2022, and after discussion recommended unanimously for the Council to authorize and approve Amendment #4 of the AECOM Contract.

Timeline & Workplan
The work will be performed in the following anticipated timeline:
• Engage with Rail Committee for dis cussion with Caltrain and impacts of Caltrain’s decisions on alternatives in consideration; June through August 2022 • Check-in with Rail Committee in reviewing the technical information and refined designs available from the Consultant; Sept/October 2022
• Provide an update on the additional studies from the geotechnical information prepared by the Consultant; November/December 2022
• Seek input from various stakeholders for refinement of partial underpass alternative at Churchill Avenue, and underpass alternati ves at Meadow Drive and Charleston Road Crossings; including review of Rail Committee; through November 2022 • Rail Committee to review the refined alternatives in consideration and make recommendations to City Council; December 2022 -January 2023 • City Counc il review of the alternatives in consideration based on Rail Committee recommendations; February-March 2023
• Consultant to prepare Final Draft Project Study Report (PSR); April /May 2023 followed by completion of the final report.

The five-year contract term with AECOM ends on April 22, 2023. However, the City continues to need services of a consultant to perform additional studies for work related to the Grade Separation Project as directed by the City Council. Therefore, staff is recommending Council authorize the contract extension by the period of one-year to April 22, 2024 with this amendment.

Resource Impact
At the request of the City , based on the past practice with previous amendments to this contract, the Consultant provided the proposal for this work on a time and material basis.

Following negotiations between the City and the Consultant, the amendment to the contract is proposed in the amount of $722,170. This amount includes the additional services for the 11 Packet Pg. 108

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optional task in the amount of $104,12 6 that can be authorized by the City Manager and was directed to be included in this contract by the Rail Committee.

Funding required for Contract Amendment #4 is available in the FY 2022 Adopted Capital Budget Railroad Grade Separation and Safety Impro vement Project, PL -17001. The existing AECOM Contract including Amendments 1 -3 totals $2,874,658. Based on the amount proposed in Contract Amendment #4 of $722,170, the total contract amount for the AECOM Contract would increase to $3,596,828. There is ade quate funding available in this project to fund this contract amendment.

Stakeholder Engagement
From June 2019 through February 2021, the XCAP conducted regular meetings for the review of various alternatives in consideration at the Churchill Avenue, Mea dow Drive, and Charleston Road crossings along the Caltrain corridor. Staff , in coordination with AECOM Consultants , provided continuous support to the XCAP and conducted other community engagement activities. In addition to XCAP, and to further engage the community, the City hosted a Virtual Town Hall from August 19, 2020 to September 14, 2020 gaining over 1,000 unique visitors to the online platform. This virtual platform was designed to inform the community an d seek feedback on the proposed alternatives for the grade at the three separation grade crossing locations.

A summary report of the virtual Town Hall was provided as an Informational Report to the City Council on November 30, 2020 ( CMR 11759). Earlier in 2020, before the pandemic began, the City also hosted two well -attended Rail Town Hal l meetings and smaller neighborhood -specific open house meetings to gain community input on the rail alternatives and answer community questions. Staff also developed and released online surveys, and used social media, the City’s website, and electronic ne wsletters to inform, answer questions, and gain feedback from the community on this important City priority.

The scheduled Council Meetings on the ongoing discussion for grade separation alternatives for Meadow Drive, Charleston Road, and Churchill Avenue crossings discussions also provided the community with the opportunit y to provide their comments to the City. In 2021, these meetings were held on March 23, April 26, August 23, November 1, and November 29.

Community members also attended the Rail Committee on April 20 and provided additional comments.

In addition, outreach to PAUSD, Stanford, PABAC, and similar entities are included in the scope of this amendment for further refinement of the project alternatives. The Rail Committee and future City Council Meetings for the project will also provide opportunities for additional community feedback.

Environmental Review
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The recommendation in this report does not constitute a project in accordance with the California Environmental Quality Act and is therefore not subject to environmental review.

Attachments:
• Attachment11.a: C18171057 Amend No4 final
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AMENDMENT NO. 4 TO CONTRACT NO. C18171057

BETWEEN THE CITY OF PALO ALTO AND
AECOM TECHNICAL SERVICES, INC.

This Amendment No. 4 (this “Amendment”) to Contract No. C 18171057 (the “Contract” as defined below) is entered into as of May 16, 2022, by and between the CITY OF PALO ALTO, a California chartered municipal corporation ( “CITY”), and AECOM TECHINICAL SERVICES, INC. , a California corporation , located at 300 Lakeside Drive, Suite 400, Oakland, CA 94612 (“CONSULTANT”). CITY and CONSULT ANT are referred to collectively as the “Parties” in this Amendment.

R E C I T A L S

A. T he Contract (as defined below) was entered by and between the Parties hereto to provide program management, enhanced community engagement services, grade separation planning and alternatives analysis, and technical assistance on rail engineering and design. (“Project”) and desires to engage a consultant to provide Services in connection with the Project (“Services”), as detailed therein.

B. T he Parties now wish to amend the Professional Service Agreement Contract in order to increase the total compensation by $722,170.00 from $2,874,658.00 to $3,596,828.00 for Services and Additional services not included in the previous scope of work and extend the term by one year to April 22, 2024.

NOW, THEREFORE, in consideration of the covenants, terms, conditions, and provisions of this Amendment, the Parties agree:

SECTION 1. Definitions.

The following definitions shall apply to this Amendment:

a. Contract. The term “Contract” shall mean C ontract No. C18171057 between CONSULTANT and CITY, dated April 23, 2018.

Amendment No. 1, dated June 24, 2019
Amendment No. 2, dated June 23, 2020
Amendment No. 3, dated April 23, 2021

b. Other Terms. Capitalized terms used and not defined in this Amendment shall have the meanings assigned to such terms in the Contract.

SECTION 2.

Section 2. “TERM” of the Contract is hereby amended to read as follows:

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“SECTION 2. TERM. The term of this Agreement shall be from the date of its full execution through April 22, 2024, unless terminated earlier pursuant to Section 19 of this Agreement.

SECTION 3. S ection 4 . “NOT TO EXCEED COMPENSATION” of the Contract is hereb y amended to read as follows:

“S
ECTION 4. NOT TO EXCEED COMPENSATION. The compensation to be paid to CONSULTANT for performance of the Services described in Exhibit “A” as amended by Exhibits “A-1”, “A-2” ,and “A-3” (referred to collectively as Exhibit “A” or the “Basic Services”), and reimbursable expenses, shall not exceed Three Million Five Hundred Ninety-Six Thousand Eight Hundred Twenty-Eight Dollars ($3,596,828.00). CONSULTANT agrees to complete all Basic Services, including reimbursable expenses, within this amount. In the event Additional Services are authorized, the total compensation for Basic Services, Additional Services, and reimbursable expenses shall not exceed Three Million Five Hundred Ninety-Six Thousand Eight Hundred Twenty-Eight Dollars ($3,596,828.00). The applicable rates and schedule of payment are set out at Exhibit “C-4”, entitled “HOURLY RATE SCHEDULE,” which is attached to and made a part of this Agreement. Any work performed or expenses incurred for which payment would result in a total exceeding the maximum amount of compensation set forth herein shall be at no cost to the CITY. Additional Services, if any, shall be authorized in accordance with and subject to the provisions of Exhibit “C”. CONSULTANT shall not receive any compensation for Additional Services performed without the prior written authorization of CITY. Additional Services shall mean any work that is determined by CITY to be necessary for the proper completion of the Project, but which is not included within the Scope of Services described at Exhibit “A”.”

SECTION 4. E
xhibit “A-4” to this Amendment (attached hereto and incorporated herein)shall amend, but not replace, Exhibit “A” attached to the original Contract, Exhibit “A-1” attached to Amendment No. 1, Exhibit “A-2” attached to Amendment No. 2, and Exhibit “A-3” attached to Amendment 3 to the Contract. References to “Exhibit A” in the Contract shall mean Exhibits “A”, “A-1”, “A-2”, “A-3”and “A-4” read together. To the extent the provisions of Exhibit “A-4” directly conflict with original Exhibit “A”, Exhibit “A-1”, or Exhibit “A-2”, or Exhibit “A-3”, the provisions of Exhibit “A-4” will control.

SECTION 5. T
he following exhibits to the Contract are hereby amended or added to read as set forth in the attachments to this Amendment, which are incorporated in full by this reference:

a. Ex
hibit “A-4” entitled “AMENDMENT NO. 4, SCOPE OF SERVICES, ADDED b. Exhibit “B-1” entitled “SCHEDULE OF PERFORMANCE”, ADDED c. Exhibit “B-2” entitled “RAILROAD GRADE SEPARATION PROGRAM”, ADDED d. Exhibit “C” entitled “COMPENSATION”, AMENDED, REPLACES PREVIOUS e. Exhibit “C -4” entitled “HOURLY RATE SCHEDULE ”, AMENDED, REPLACES

PREVIOUS
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SECTION 6. Leg
al Effect. Except as modified by this Amendment, all other provisions of the Contract, including any exhibits thereto, shall remain in full force and effect.

SECTION 7. Inc orporation of Recitals . The recitals set forth above are terms of this Amendment and are fully incorporated herein by this reference.

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SIGNATURES OF THE PARTIES

IN WITNESS WHEREOF, the P arties have by their duly authorized representatives executed this Amendment effective as of the date first above written.

CITY OF PALO ALTO

____________________________
City Manager

APPROVED AS TO FORM:

____________________________
City Attorney or designee
CONSULTANT:

AECOM TECHINICAL SERVICES, INC.

By:_____________________________

Name:____Millette Litzinger_________

Title:____Associate Vice President___

By:______________________________

Name:____Allison Hall______________

Title:____CFO Americas_____________

Attachments:

EXHIBIT “A-4”: AMENDMENT NO. 4, SCOPE OF SERVICES, ADDED EXHIBIT “B-1”: SCHEDULE OF PERFORMANCE, ADDED
EXHIBIT “B-2”: RAILROAD GRADE SEPARATION PROGRAM, ADDED EXHIBIT “C”: COMPENSATION, AMENDED, REPLACES PREVIOUS
EXHIBIT “C-4”: HOURLY RATE SCHEDULE, AMENDED, REPLACES PREVIOUS

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EXHIBIT A-4

SCOPE OF SERVICES,
AMENDMENT NO. 4
(ADDED)

This Exhibit “A-4” Additional Scope of Services amends Exhibit “A” Scope of Services, as previously amended by Exhibit “A-1”, Exhibit “A-2” and Exhibit “A-3” should be read together therewith. To the extent the provisions of Exhibit “A-4” directly conflict with original Exhibit “A”, Exhibit “A-1”, or Exhibit “A-2”, or Exhibit “A-3” the provisions of Exhibit “A-4” will control.

AMENDMENT NO. 4:

CONSULTANT will provide services in the project development for conducting additional studies, outreach, and support to City staff at meetings with Rail Committee and the City Council not included in the original scope of work Exhibit A, amended by Exhibit “A-1”, Exhibit “A-2” and Exhibit “A-3”.

This Exhibit “A-4” describes the services that are in addition to Exhibit “A”, Exhibit “A-1”, Ex
hibit “A-2” an
d Exhibit “A-3”.

SCOP

E OF WORK

CON
SULTANT will continue to manage the Project, which will include required technical analyses of alternatives and a community and stakeholder engagement process to identify and develop locally- pref
erred alternatives for modifications to the existing at-grad e
crossings in Palo Alto at Churchill Avenue, Meadow Drive, and Charleston Road.

CONSULTANT will coordinate and manage the project in conjunction with CITY’s staff.

The ta
sks anticipated in this supplemental scope of services with descriptions of supplemental services for each task and associated deliverables are shown below.

Task 1: Project
Management Task 4:

Community Engagement
Task 6: Identify Recommended Alternatives
Task 1. Project Management

1.1 Project Management and Administration
For the additional 16 months to the project (January 2022-April 2023) , the CONSULTANT will continue to provide project management for each task for the duration of the Project.

Management activities will consist of administration, coordination, and quality control, as follows:

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a. Prepare a scope, budget, and updated project schedule. b. Continue to supervise, coordinate, and monitor activities and product development for conformance with the scope of services and CITY standards. c. Prepare sixteen (16) additional monthly invoices and progress reports.

1.2 Performance and Quality Monitoring
CONSULTANT will continue to use a project specific Quality Assurance Plan for technical reviews and detailed checking for work products including the work produced by CONSULTANT’s subconsultants. The CONSULTANT will continue to make sure that all work performed on the project is checked and that all deliverables undergo a quality review before submittal to the CITY.

1.3 Monthly Invoicing, Progress Reports and Schedule
CONSULTANT will prepare and update the project schedule based on the supplemental work and it will be submitted to CITY staff for review and approval.

Task 1 Supplemental Deliverables:
a. Updated baseline project schedule
b. Monthly update of progress against baseline schedule c. Sixteen (16) additional monthly invoices with progress reports Task 4. Community Engagement

4.1 Supplemental Meetings
CONSULTANT will support the City staff with meetings not included in the original scope of work. The additional services will include the preparation and attendance of up to six meetings (3 stakeholders x 2 meetings with each), as directed by the City. Approximate dates are shown in the schedule and stakeholders are assumed to be Stanford, PAUSD and PABAC.

4.2 Presentation to Rail Committee #1
CONSULTANT will prepare a summary of comments from the initial set of stakeholder meetings and develop a PowerPoint presentation to present to the Rail Committee.

Task 4 Deliverables
a. Stakeholder meeting summaries
b. Presentation materials for one Rail Committee meeting

Task 6. Identify Recommended Alternatives

6.1 Refine Meadow and Charleston (MC) Underpasses and Churchill (CH) Partial Underpass Alternatives

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6.1.1 Refine Alternatives
CO
NSULTANT will refine the three underpass alternatives (at Churchill, Meadow and Charleston) to address input received to date, and feedback received from the stakeholders described in Task 4. Only input recommended by the City and the Rail Committee will be incorporated into the refinement of the alternatives. Some input received to date includes the size of the Charleston roundabout, improvements to bike/pedestrian connections and reduction of right-of-way
impacts. The following materials will be updated:

6.1.2 Update Exhibits
Update plan, profile and typical section for each of the three alternatives (Initial and Final)

6.1.3 Update Renderings
Up
date 3D CAD model and still image renderings to include refinements not previously captured such as U-tur
n at Alma Plaza (Initial and Final)

6.1.4 Update Cost Estimates
Update quantities and cost estimate for each alternative. These tasks will be completed only after the final refinements are made.

6.1.5 Update Misc. Items (Fact Sheets, Matrix, VR Room) Update evaluation matrix, FACT Sheets, website materials and VR room materials/exhibits based on the refinements. These tasks will be completed only after the final refinements are made.

6.1.6 Presentation to Rail Committee #2
CONSULTANT will prepare a summary of comments from the second set of stakeholder meetings. Based on comments from the stakeholders and Rail Committee, CONSULTANT will make a final update to the exhibits and renderings for the underpass alternatives. and develop a PowerPoint presentation to present to the Rail Committee.

6.2 Preliminary Geotechnical Study

6.2.1 Data Collection and Review – Groundwater and Geotechnical CONSULTANT will collect available soil profile and groundwater data from adjacent projects.

This could include data from Santa Clara Water District channel projects, local bridges (Caltrain, City or Caltrans), and/or other sources (e.g. local development projects).

6.2.2 Field and Laboratory Studies
Following review of available subsurface information, CONSULTANT will conduct a limited geotechnical field exploration program consisting of one boring and one seismic cone penetration test (CPT) near each of the three rail crossings for preliminary site characterization; this information would be used to update design assumptions made during the current planning-le
vel phase. At least one porewater pressure dissipation test to estimate groundwater depth would be attempted in the CPT at each location if granular deposits are encountered.

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The
borings would be drilled to a depth of 80 feet and the CPTs would be advanced to a depth of 100 feet or practical refusal, whichever is shallower. An AECOM field engineer or geologist will log the borings during drilling and supervise the field activities. Soil samples will be obtained at 5-foo
t depth intervals or changes in stratigraphy to a depth of about 50 feet; the sampling interval might be increased to 7- to 10-foot b elow a depth of 50 feet. Samples will be
collected with a modified California sampler or Standard Penetration Test split-sp oon sampler.

All borings and CPTs will be backfilled in accordance with Valley Water requirements. Cold patch asphalt or rapid set concrete would be used at the surface to complete exploration backfill in paved areas. Soil cuttings would be spread on the ground in unpaved areas along the south side of Alma Street (i.e. drumming or offsite disposal will not be required). We assume the soil and groundwater are non-haza
rdous and Level D personal protective equipment will
be adequate.

Prio
r to mobilizing equipment, we will mark the proposed locations of the borings and CPTs and coordinate utility clearances with Underground Service Alert. We also will retain a private utility locator to clear the boring and CPT locations on the sites. Exploration locations will be tape measured in the field from existing features.

Access for site exploration is limited by the existing tracks, overhead lines, and fencing, as well as the likely presence of numerous underground utilities often found along rail lines. For this reason, site exploration for the three crossings will most likely need to be performed in City streets with approved lane closure (including City or County encroachment permit to be provided at no cost to CONSULTANT) and traffic control; night work is anticipated to minimize impacts to the public.

Lab
oratory tests will be made to evaluate the engineering properties of the materials encountered. These tests are likely to include moisture content, total and dry unit weight, Plasticity Index, grain size distribution and soil corrosivity. Consolidation and triaxial strength testing might also be performed if weak or compressible fine-grai ned soils are encountered
in the borings.

6.2.3 Construction Methodology Evaluation
Based on field exploration and laboratory test program results, CONSULTANT will evaluate the feasibility of the proposed trenching (overhead), underpass, and jacked box alternatives as they relate to the subsurface soil and groundwater conditions anticipated at each site.

6.2.4 Technical Memorandum – Draft and Final
CO
NSULTANT will prepare a draft memorandum summarizing the findings of the data review and site- sp
ecific field and laboratory testing programs; it will include CPT records and boring logs in gINT format. The memorandum will provide recommendations for further geotechnical exploration needed for detailed design and will include discussion of feasible foundation and retaining wall types, the need for tiebacks anchors, control of groundwater and construction considerations associated with the proposed alternatives as they relate to the anticipated geotechnical conditions. The memorandum will be finalized following receipt of comments from the CITY.

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CONSULTANT will prepare presentation materials for a Rail Committee meeting to present the results of the geotechnical study described above and the cost estimate Peer Review described in Task 6.3.

Fo
llowing this meeting, CONSULTANT will support the City staff at a City Council meeting to discuss the Rail Committee’s recommendations and answer technical questions as-nee ded.

6.3 Cost Estimate Peer Review
CONSULTANT will conduct a Peer Review of the cost estimate and design assumptions for the trench alternative. The Peer Review will be conducted by an independent consultant with experience and expertise in trench design and construction. The Peer Review will be summarized in a memorandum and will evaluate overall costs as well as unit costs.

6.4 Additional Technical Support
CONSULTANT will provide additional technical support to City staff for additional meetings with the Rail Committee and the City Council and/or additional engineering services by advanced request and written authorization from the City’s Project Manager. The CONSULTANT at the City’s request shall submit a detailed written proposal including a description of the scope of services, schedule, level of effort and CONSULTANT’s maximum compensation for the services based on rates set forth in the contract. The additional services shall be negotiated and agreed to in writing by the City’s Project Manager prior to commencement of the services. Payment for additional services is subject to all requirements and restrictions in this Agreement. Additional Services could also include additional meetings and/or additional studies/renderings at City’s request. A budgetary allowance has been included in the fee estimate for this task.

6.5 Caltrain Coordination on 4-Trac k Policy (Optional) JP
B has adopted the moderate-gr
owth improvement program as outlined in the Business
Plan (https://caltrain2040.org/). However, JPB also indicated that the high-gr owth
improvement program should not be precluded. Palo Alto has been identified in the Business Plan as a location for the high- gr
owth improvements, including 4-trac
ks. To date,
alternatives developed for the Rail Program have only been evaluated for 2-trac ks.

6.5.1 Gather Data from Caltrain
CO
NSULTANT along with City staff will meet with Caltrain to gather more information about what the limits of the 4-tr
ack alignment would be and what the typical section would be along the limits and at the stations.

6.5.2 Evaluate Alternatives
CO
NSULTANT to conduct a high-lev
el analysis of the impacts of 4-trac
ks for each alternative
still under consideration (MC Hybrid, MC Trench, MC Underpass, CH Underpass, and CH Closure) by overlaying Caltrain’s 4-trac
k geometry over the proposed 2-tr
ack. The analysis will
identify a list of significant impacts for each alternative and determine if the alternatives are still feasible with 4-trac
ks or does not preclude 4-trac
ks in the future. This task assumes no
animations or photo simulations, or updates to existing exhibits.

6.5.3 Meet with Caltrain
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alternatives and gather additional feedback on the feasibility and impacts of each. It is assumed there will be two meetings.

6.5.4 Prepare Memorandum Report
CON
SULTANT will prepare a draft and final memorandum report that documents the evaluation of the 4-tra
ck alignment and feedback received from Caltrain. CONSULTANT will incorporate one set of consolidated comments from the City and Caltrain on the draft technical memorandum.

6.5.5 Presentation to Rail Committee and City Council
CONSULTANT will prepare presentation materials to present to Rail Committee and City Council. Based on comments from Rail Committee and City Council, update exhibits and return to Rail Committee to present revised exhibits.

Task 6 Deliverables
a. Updated plans, exhibits and renderings for two underpass alternatives (Meadow and Charleston) and one partial underpass alternative (Churchill) – Draft and Final
b. Geotechnical Memorandum – Draft and Final
c. Memorandum to summarize independent review of cost estimate and assumptions – Draft and Final
d. Presentation materials for three Rail Committee meetings and one City Council meeting
e. Memorandum report for 4-Tr ack evaluation and presentation materials for one Rail Committee meeting and one City Council meeting (OPTIONAL – Task 6.5)
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EXHIBIT “B”
SCHEDULE OF PERFORMANCE, AMENDMENT NO.4
(AMENDED, REPLACES PREVIOUS)

CONSULTANT shall perform the Services so as to complete each task within the number of days/weeks specified on Attachment “B” Schedule of Performance. Attachment “B” reflects the currently anticipated schedule.’ CONSULTANT will regularly update the schedule in consultation with CITY’s Project Manager.

The time to complete each task may be increased or decreased by mutual written agreement of the project managers for CONSULTANT and CITY so long as all work is completed within the term of the Agreement.

(See following pages for Schedule included in Amendment No. 2 and Schedule for Amendment 4)

AMENDMENT NO.
3:

The dates of up to four meetings in additional services are to be determined.

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Connecting Palo Alto Railroad Grade Separation Program - Project Schedule (Amendment #4) ID Task
Mode
1 2

3 4
5 6
7 8
Task Name

NTP from City
Task 4. Community Engagement

4.1 Supplemental Outreach

4.1.1 Supplemental Meetings
1st Meeting w/ Stanford
1st Meeting w/ PAUSD
1st Meeting w/ PABAC
2nd Meeting w/ Stanford
Duration

0 days

90 days

90 days
90 days
0 days
0 days
0 days
0 days
Start

Tue 5/17/22

Mon 6/13/22

Mon 6/13/22
Mon 6/13/22
Mon 6/13/22
Mon 6/20/22
Mon 6/27/22
Mon 10/3/22
Finish

Tue 5/17/22

Mon 10/17/22

Mon 10/17/22
Mon 10/17/22
Mon 6/13/22
Mon 6/20/22
Mon 6/27/22
Mon 10/3/22

Nov Dec

2022
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
5/17

6/13
6/20
6/27
10/3

2023
Jan Feb Mar Apr May Jun Jul Aug
9 2nd Meeting w/ PAUSD
10 2nd Meeting w/ PABAC
0 days
0 days
Mon 10/10/22 Mon 10/10/22
Mon 10/17/22 Mon 10/17/22
10/10
10/17
11 4.2 Presentation to Rail Committee #1
12 Task 6. Identify Recommended Alternatives
13 6.1 Refine Meadow, Charleston and Churchill Underpass Alternatives 14 6.1.1 Refine Underpass Alternatives
15 Initial Revisions (Exhibits and Renderings)
16 Final Revisions (Exhibits and Renderings)
17 Finalize Cost Estimate, Fact Sheets, Evaluation Matrix and Website Materials 18 6.1.2 Presentation to Rail Committee #2 (Present Refinements of the Alternatives) 19 6.2 Preliminary Geotechnical Study
20 6.2.1 Data Collection and Review
21 6.2.2 Field and Laboratory Studies
22 6.2.3 Construction Methodology Evaluation
23 6.2.4 Geotechnical Memorandum
24 Draft Memo
25 City and Rail Committee Review
26 Final Geotechnical Memo
0 days
300 days

175 days
175 days
10 wks
10 wks
12 wks
0 days
200 days
4 wks
16 wks
4 wks
90 days
8 wks
4 wks
6 wks
Mon 7/18/22
Tue 4/19/22

Tue 7/19/22
Tue 7/19/22
Tue 7/19/22
Tue 11/8/22
Tue 12/27/22
Mon 11/7/22
Tue 5/17/22
Tue 5/17/22
Tue 6/14/22
Tue 10/4/22
Tue 10/4/22
Tue 10/4/22
Tue 11/29/22
Tue 12/27/22
Mon 7/18/22
Mon 6/12/23

Mon 3/20/23
Mon 3/20/23
Mon 9/26/22
Mon 1/16/23
Mon 3/20/23
Mon 11/7/22
Mon 2/20/23
Mon 6/13/22
Mon 10/3/22
Mon 10/31/22
Mon 2/6/23
Mon 11/28/22
Mon 12/26/22
Mon 2/6/23
7/18

11/7
27 6.2.5 Presentation to Rail Committee #3 and City Council Meeting 28 Presentation to Rail Committee #3 (Present Geotechnical Findings and Cost Estimate Peer Review) 50 days
0 days
Mon 12/12/22 Mon 2/20/23
Mon 12/12/22 Mon 12/12/22

12/12
29 City Council Meeting (Discuss Rail Committee's Recommendations) 30 6.3 Cost Estimate Peer Review (Trench Alternative)
31 Draft Memo
32 City and AECOM Review
33 Final Cost Estimate Memo
34 6.4 Additional Technical Support
35 To Be Determined by City Project Manager
36 6.5 Caltrain Coordination on 4-Track Policy (Optional) 37 6.5.1 Gather Data from Caltrain
38 6.5.2 Evaluate Alternatives
39 6.5.3 Meet with Caltrain
40 6.5.4 Four Track Memorandum
41 Draft Memo
42 City & Caltrain Review
43 Final 4-Track Evaluation Memo
44 6.5.5 Presentation to Rail Committee and City Council 45 Rail Committee Meeting
46 Update Exhibits
47 City Council Meeting
48 Project Report
49 Draft Project Report
50 City Review
51 Draft Final Project Report
52 Final City Review
53 Final Project Report
0 days
120 days
12 wks
6 wks
6 wks
300 days
60 wks
230 days
8 wks
8 wks
0 days
70 days
6 wks
4 wks
4 wks
50 days
0 days
8 wks
0 days
140 days

16 wks
2 wks
6 wks
2 wks
2 wks
Mon 2/20/23
Tue 8/9/22
Tue 8/9/22
Tue 11/1/22
Tue 12/13/22
Tue 4/19/22
Tue 4/19/22
Tue 5/17/22
Tue 5/17/22
Tue 7/12/22
Mon 9/19/22
Tue 9/20/22
Tue 9/20/22
Tue 11/1/22
Tue 11/29/22
Mon 1/23/23
Mon 1/23/23
Tue 1/24/23
Mon 4/3/23
Tue 12/27/22
Tue 12/27/22
Tue 4/18/23
Tue 5/2/23
Tue 6/13/23
Tue 6/27/23
Mon 2/20/23
Mon 1/23/23
Mon 10/31/22
Mon 12/12/22
Mon 1/23/23
Mon 6/12/23
Mon 6/12/23
Mon 4/3/23
Mon 7/11/22
Mon 9/5/22
Mon 9/19/22
Mon 12/26/22
Mon 10/31/22
Mon 11/28/22
Mon 12/26/22
Mon 4/3/23
Mon 1/23/23
Mon 3/20/23
Mon 4/3/23
Mon 7/10/23
Mon 4/17/23
Mon 5/1/23
Mon 6/12/23
Mon 6/26/23
Mon 7/10/23

9/19

1/23
2/20

4/3
Project: Palo Alto RR GSP Date: Fri 4/29/22
DocuSign Envelope ID: 2F9F8991-B99A-4B80-AB23-7D5B3C0CC45D

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EXHIBIT “B-1” - RAILROAD GRADE SEPARATION PROGRAM

Classification ==>

EXHIBIT “B-1”: RAILROAD GRADE SEPARATION PROGRAM SUBS

ODCs

Total
AECOM
Hours

TOTAL
$

Principal in
Charge

Lead Project
Professional-
Track/Sys

Sr Project
Manager

Lead
Project
Engr-Civil

Project
Engr - Civil
/ Struct
Lead
Project
Engr-
Structure /
Geotech

Lead
Geotech
Eng

Sr Geotech
Eng

Lead Project
Engr - Cost
Estimating

Sr
Illustrator

Staff Engr

Sr
Illustrator

CADD
Technician

Project
Assistant

Admin

Independent
Peer Review

2022 Hourly Billing Rate ==>

1.03 Staff

$358.07

E. Mercurio

$287.38

J. Maher

$308.27

M. Litzinger

$245.91

P. DeStefano

$170.59

M. Gogosanu

$276.96

S. Brokken

$306.43

TBD

$186.52

TBD

$266.46

TBD

$186.52

TBD

$127.90

TBD

$159.88

TBD

$119.91

TBD

$102.99

D. Vazquez

$94.91

M. Walden

1.00 1.00

1.0 Project Management

1.1 Project Management and Administration 8

16 8

32 $9,764

1.2 Performance and Quality Monitoring 40 40 20

20 40

160 $41,319

1.3 Monthly Invoicing, Progress Reports and Schedule (16)

16 8

24 $6,900

Subtotal Hours 48 40 52 16 0 20 0 0 0 0 0 0 0 0 40

216

Subtotal Cost $17,187 $11,495 $16,030 $3,935 $0 $5,539 $0 $0 $0 $0 $0 $0 $0 $0 $3,797 $0 $0

$57,982

4.0 Community Engagement
4,1 Supplemental Outreach 10

20 20 20

70 $18,076

4.2 Presentation to Rail Committee (1) 10

20 20

10 60 $15,863

Subtotal Hours 20 0 40 40 20 0 0 0 0 0 0 0 10 0 0

130

Subtotal Cost $7,161 $0 $12,331 $9,837 $3,412 $0 $0 $0 $0 $0 $0 $0 $1,199 $0 $0 $0 $0

$33,939

6.0 Identify Recommended Alternatives

6.1 Refine Underpass Alternatives

6.1.1 Refine Alternatives 6

18 60 180

264 $53,158

6.1.2 Update Exhibits

6 12 36

180

234 $33,964

6.1.3 Update Renderings 2

2 8 16

120

148 $25,214

6.1.4 Update Cost Estimates 2

2 8 24

36 72 $11,998

6.1.5 Update Misc Items (Fact Sheets, Matrix, VR Room)

24 24 24

24 24

120 $25,708

6.1.6 Presentation to Rail Committee (1) 10

20 20

10 60 $15,863

Subtotal Hours 20 0 72 132 280 0 0 0 0 24 216 144 10 0 0 0

898

Subtotal Cost $7,161 $0 $22,195 $32,461 $47,764 $0 $0 $0 $0 $4,477 $27,626 $23,022 $1,199 $0 $0 $0 $0

$165,905

6.2 Preliminary Geotechnical Study

6.2.1 Data Collection and Review - Groundwater and Geotechnical 2 2 20 30 54 $13,057

6.2.2 Field and Laboratory Studies 2

2 50 140

$85,250 194 $128,017
DocuSign Envelope ID: 2F9F8991-B99A-4B80-AB23-7D5B3C0CC45D

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Classification ==>
EXHIBIT “B-1”: RAILROAD GRADE SEPARATION PROGRAM SUBS

ODCs

Total
AECOM
Hours

TOTAL
$

Principal in
Charge

Lead Project
Professional-
Track/Sys

Sr Project
Manager

Lead
Project
Engr-Civil

Project
Engr - Civil
/ Struct
Lead
Project
Engr-
Structure /
Geotech

Lead
Geotech
Eng

Sr Geotech
Eng

Lead Project
Engr - Cost
Estimating

Sr
Illustrator

Staff Engr

Sr
Illustrator

CADD
Technician

Project
Assistant

Admin

Independent
Peer Review

2022 Hourly Billing Rate
==>

$358.07

$287.38

$308.27

$245.91

$170.59

$276.96

$306.43

$186.52

$266.46

$186.52

$127.90

$159.88

$119.91

$102.99

$94.91

1.00 1.00

80 $19,878 6.2.3 Construction Methodology Evaluation 5 5 5 5 20 20 10 10

6.2.4 Technical Memorandum - Draft and Final 2

2 15 15

15 49 $10,151

6.2.5 Presentation to Rail Committee and City Council (2) 20

40 40

20 120 $31,727

Subtotal Hours 31 5 51 45 20 20 95 195 0 0 0 0 20 0 15

497

Subtotal Cost $11,100 $1,437 $15,722 $11,066 $3,412 $5,539 $29,111 $36,372 $0 $0 $0 $0 $2,398 $0 $1,424 $0 $85,250

$202,830

6.3 Cost Estimate Peer Review

6.3 Cost Estimate Peer Review 2

8 8 8

8 $100,000

34 $107,338

Subtotal Hours 2 0 8 8 8 0 0 0 0 0 0 0 0 8 0

34 Subtotal Cost $716 $0 $2,466 $1,967 $1,365 $0 $0 $0 $0 $0 $0 $0 $0 $824 $0 $100,000 $0

$107,338

6.4 Additional Technical Support

6.4 Additional Technical Support 30

60 70

30 190 $50,049

Subtotal Hours 30 0 60 70 0 0 0 0 0 0 0 0 30 0 0

190

Subtotal Cost $10,742 $0 $18,496 $17,214 $0 $0 $0 $0 $0 $0 $0 $0 $3,597 $0 $0 $0 $0

$50,049
TOTAL Hrs (without optional task 6.5) 151 45 283 311 328 40 95 195 0 24 216 144 70 8 55 1,775 TOTAL Cost (without optional Task 6.5) $54,068 $12,932 $87,239 $76,479 $55,952 $11,078 $29,111 $36,372 $0 $4,477 $27,626 $23,022 $8,393 $824 $5,220 $100,000 $85,250 $618,044

6.5 Caltrain Coordination on 4-Track Policy (Optional)

6.5.1 Gather Data from Caltrain

16 20 8

12 20

76 $16,229

6.54.2 Evaluate Alternatives

40 20 70 100 20

20 270 $62,801

6.5.3 Meet with Caltrain 4 8 16 28 $7,833

6.5.4 Prepare Technical Memorandum 2

12 30 8 8

4 8

72 $17,263
Subtotal Hours 6 56 60 124 108 28 0 0 24 0 0 0 12 28 0 446 Subtotal Cost $2,148 $16,093 $18,496 $30,493 $18,423 $7,755 $0 $0 $6,395 $0 $0 $0 $1,439 $2,884 $0 $0 $0 $104,126 TOTAL Hrs (with optional task 6.5) 157 101 343 435 436 68 95 195 24 24 216 144 82 36 55 2,221 TOTAL Cost (with optional Task 6.5) $56,217 $29,025 $105,735 $106,973 $74,376 $18,833 $29,111 $36,372 $6,395 $4,477 $27,626 $23,022 $9,832 $3,708 $5,220 $100,000 $85,250 $722,170 TOTAL (with OPTIONAL Task 6.5) $722,170
DocuSign Envelope ID: 2F9F8991-B99A-4B80-AB23-7D5B3C0CC45D

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City of Palo Alto Contract No. C18171057
Form Vers.: Aug. 5, 2019 Amendment No. 3

EXHIBIT “C” COMPENSATION
AMENDMENT NO.4
(AMENDED, REPLACES PREVIOUS)
CITY agrees to compensate CONSULTANT for professional services performed in accordance with the terms and conditions of this Agreement, and as set forth in the budget schedule below. Compensation shall be calculated based on the hourly rate schedule attached as Exhibit “C-1” up to the not to exceed budget amount for each task set forth below.

CONSULTANT shall perform the tasks and categories of work as outlined and budgeted below. CITY’s Project Manager may approve in writing the transfer of budget amounts between any of the tasks or categories listed below provided the total compensation for Basic Services, including reimbursable expenses, and the total compensation for Additional Services do not exceed the amounts set forth in Section 4 of this Agreement.

TASK ORIGINAL

CONTRACT
NOT TO
EXCEED
AMOUNT

NOT TO EXCEED
AMOUNT

ADDED OR
(SUBTRACTED)
BY

AMENDMENT
NO 1
NOT TO
EXCEED
AMOUNT

ADDED BY

AMENDMENT
NO 2
NOT TO
EXCEED
AMOUNT

ADDED BY

AMENDME
NT NO 3
NOT TO
EXCEED
AMOUNT

ADDED BY

AMENDMENT
NO. 4
Task 1 Project Management $225,184.00 $136,825 $48,827 $0 $57,982

Task 2 Data Collection & Review $121,117.20 $12,360 $0 $0 $0

Task 3 Convene Technical Advisory $51,873.60 ($39,806) $0 $0 $0 Committee Meetings

Task 4 Community Engagement $285,885.60 $470,050 $79,626 $0 $33,939

Task 5 Identify Alternative Analysis $177,420.00 $0 $0 $0 $0

Task 6 Identify Recommended

$312,523.20 $387,406 $178,419 $0 $526,122

Task 7 Assist with CAHSR

$32,424.00 $0 $0 $0 $0
Analysis Phase

Task 8 Financing Plan $28,032.00 $59,290 $0 $0 $0

Reimbursables and Other

$44,200.00 $0 $3,000 $0 $0

Additional Services 0 $180,000 $0 $80,000 $104,126

TOTAL

$1,278,660.0 $1,206,126 $309,872 $80,000 $722,120
DocuSign Envelope ID: 2F9F8991-B99A-4B80-AB23-7D5B3C0CC45D

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City of Palo Alto
Form Vers.: Aug. 5, 2019

TOTAL BASIC SERVICES (AMENDMENT NO. 4) $ 618,044.00
TOTAL BASIC SERVICES (AMENDMENT NO. 2) $ 306,872.00
TOTAL BASIC SERVICES (AMENDMENT NO. 1) $1,026,126.00

TOTAL BASIC SERVICES (ORIGINAL CONTRACT)

$1,234,460.00

Reimbursable Expenses $47,200.00
Additional Services (AMENDMENT 1)
Additional Services (AMENDMENT NO. 3)
$180,000.00
$80,000.00

Additional Services (AMENDMENT NO. 4)

$104,126.00

Maximum Total Compensation

$3,596,828.00

REIMBURSABLE EXPENSES
The administrative, overhead, secretarial time or secretarial overtime, word processing, photocopying, in-house printing, insurance and other ordinary business expenses are included within the scope of payment for services and are not reimbursable expenses.

CITY shall reimburse CONSULTANT for the following reimbursable expenses at cost.

Expenses for which CONSULTANT shall be reimbursed are:

A. Travel outside the San Francisco Bay area, including transportation and meals, will be reimbursed at actual cost subject to the City of Palo Alto’s policy for reimbursement of travel and meal expenses for City of Palo Alto employees.

B. Long distance telephone service charges, cellular phone service charges, facsimile transmission and postage charges are reimbursable at actual cost.

All requests for payment of expenses shall be accompanied by appropriate backup information. Any expense anticipated to be more than $2,500.00 shall be approved in advance by the CITY’s project manager.

DocuSign Envelope ID: 2F9F8991-B99A-4B80-AB23-7D5B3C0CC45D

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City of Palo Alto
Form Vers.: Aug. 5, 2019

EXHIBIT “C-4”

HOURLY RATE SCHEDULE
AMENDMENT NO. 4,
(AMENDED, REPLACES PREVIOUS):

DocuSign Envelope ID: 2F9F8991-B99A-4B80-AB23-7D5B3C0CC45D

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City of Palo Alto
Form Vers.: Aug. 5, 2019