Agenda packet — Palo Alto City Council, February 12, 2024 (part 2 of 3)

AMENDMENT NO. 1 TO CONTRACT NO. C20174582B

BETWEEN THE CITY OF PALO ALTO AND
AGREEYA SOLUTIONS, INC.

This Amendment No. 1 (this “Amendment”) to Contract No. C20174582B (the “Contract” as defined below) is entered into as of September 25, 2023, by and between the CITY OF PALO ALTO, a California chartered municipal corporation (“CITY”), and AGREEYA SOLUTIONS, INC., a California Corporation, located at 605 Coolidge Drive, Folsom, CA 9563 0 (“CONSULTANTS”). CITY and CONSULTANT are referred to collectively as the “Parties” in this Amendment.

R E C I T A L S

A. The Contract (as defined below) was entered into by and between the Parties hereto for the provision of engaging a con sultant to provide implementation specialized information technology to enhance the City’s business functionality and overall performance, while maintaining a high degree of customer satisfaction (“Project”) and to engage a consultant to provide support services on an on-call, as needed, time-limited basis in the connection with the Project, as detailed therein.

B. The Parties now wish to amend the Contract in order to increase compensation by One Million Five Hundred Forty Thousand Dollars ($1,540,000) from Two Million Four Hundred Thousand Dollars ($2,400,000.00) to a new not-to-exceed amount of Three Million Nine Hundred Forty Thousand Dollars ($3,940,000) over the term of the contr act across a total of seven (7) consultant agreements ( C20174582H, C2017458B, C20174582C, C2017174582D, C20174582E, C20174582F, and C20174582G).

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 me an Contract No. C20174582B between CONSULTANT and CITY, dated June 22, 2020.

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 4 “NOT TO EXC EED COMPENSATION ” of the Contract is hereb y amended to read as follows:

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“The compensation to be paid to CONSULTANT for performance of the Services described in Exhibit “A” Scope of Services shall not exceed Three Million Nine Hundred Forty Thousand Dollars ($3,940,000). The applicable rate schedule by which CONSULTANT will be paid for Services rendered under this Agreement is set out at Exhibit “C-1”, entitled “HOURLY RATE SCHEDULE”. Any work performed or expenses incurred for which payment would result in a total exceeding the maximum compensation as set forth herein shall be at no cost to the CITY.”

SECTION 3. 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 4. Incorporation of Recitals . The recita ls 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 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

AGREEYA SOLUTIONS, INC.

Officer 1

By:______________________________

Name:___________________________

Title:____________________________

Officer 2

By:______________________________

Name:___________________________

Title:____________________________

DocuSign Envelope ID: 52562AC9-6B43-4AA3-A71A-4461821D88A2 Sanjay Khosla
Managing Partner
Ajay Kaul
Managing Partner
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AMENDMENT NO. 1 TO CONTRACT NO. C20174582C

BETWEEN THE CITY OF PALO ALTO AND
ELEGANT ENTERPRISE-WIDE SOLUTIONS, INC.

This Amendment No. 1 (this “Amendment”) to Contract No. C20174582C (the “Contract” as defined below) is entered into as of September 25, 2023, by and between the CITY OF PALO ALTO, a California chartered municipal corporation (“CITY”), and ELEGANT ENTERPRISE -WIDE SOLUTIONS, INC ., a Virginia Corporation , located at 24035 Whitten Farm Ct , Aldie, VA 201 05 (“CONSULTANTS”). CITY and CONSULTANT are referred to collectively as the “Part ies” in this Amendment.

R E C I T A L S

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 me an Contract No. C20174582C between CONSULTANT and CITY, dated June 22, 2020.

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 4 “NOT TO EXC EED COMPENSATION ” of the Contract is hereb y amended to read as follows:

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SECTION 3. 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 4. Incorporation of Recitals . The recita ls 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 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

ELEGANT ENTERPRISE-WIDE
SOLUTIONS, INC.

Officer 1

By:______________________________

Name:___________________________

Title:____________________________

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Vikas Arora
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AMENDMENT NO. 1 TO CONTRACT NO. C20174582D

BETWEEN THE CITY OF PALO ALTO AND
FORSYS, INC.

This Amendment No. 1 (this “Amendment”) to Contract No. C20174582D (the “Contract” as defined below) is entered into as of September 25, 2023, by and between the CITY OF PALO ALTO, a California chartered municipal corporation (“CITY”), and FORSYS INC., a California Corporation, located at 691 S. Milpitas B lvd., Suite 213, Milpitas, CA 95035 (“CONSULTANTS”). CITY and CONSULTANT are referred to collectively as the “Parties” in this Amendment.

R E C I T A L S

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 me an Contract No. C20174582D between CONSULTANT and CITY, dated June 22, 2020.

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 4 “NOT TO EXC EED COMPENSATION ” of the Contract is hereb y amended to read as follows:

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SECTION 3. 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 4. Incorporation of Recitals . The recita ls 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 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

FORSYS INC.

Officer 1

By:______________________________

Name:___________________________

Title:____________________________

Officer 2

By:______________________________

Name:___________________________

Title:____________________________

DocuSign Envelope ID: 07FD7CC6-9286-45BD-9B34-28D0CBF68F68 Jayaprasad Vejendla
CEO
VP, Strategic Accounts
Ramesh Konda
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AMENDMENT NO. 1 TO CONTRACT NO. C20174582H

BETWEEN THE CITY OF PALO ALTO AND

INSPYR SOLUTIONS, LLC

This Amendment No. 1 (this “Amendment”) to Contract No. C20174582H (the “Contract” as defined below) is entered into as of September 25, 2023, by and between the CITY OF PALO ALTO, a California chartered municipal corporation (“CITY”), and INSYPR SOLUTIONS, LLC, a Delaware Limited Liability Corporation, located at 600 Corporate Drive., Suite 500, Fort Lauderdale, FL 33334 (“CONSULTANTS”). CITY and CONSULTANT are referred to collectively as the “Part ies” in this Amendment.

R E C I T A L S

A. The Contract (as defined below) was entered into by and between the Parties hereto for the provision of engaging a con sultant to provi de implementation specialized information technology to enhance the City’s business functionality and overall performance, while maintaining a high degree of customer satisfaction (“Project”) and to engage a consultant to provide support services on an on-call, as needed, time-limited basis in the connection with the Project, as detailed therein.

B. The CITY and INSYPR SOLUTIONS, LLC entered into the Contract (defined below).

Pursuant to the Novation Agreement (detailed below) executed between INSYPR SOLUTIONS, LLC, and CITY, wherein INSYPR SOLUTIONS, LLC was transferred the obligations of the Contractor under the Contract and INSYPR SOLUTIONS, LLC thereby became the Contractor under the Contract.

C. The Parties now wish to amend the Contract in order to increase compensation by One Million Five Hun dred Forty Thousand Dollars ( $1,540,000) from Two Million Four Hund red Thousand Dollars ($2,400,000.00) to a new not-to-exceed amount of Three Million Nine Hundred Forty Thousand Dollars ($3,940,000) over the term of the contr act across a tota l of seven (7) consultant agreements ( C20174582H, C2017458B, C20174582C, C2017174582D, C20174582E, C20174582F, and C20174582G).

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 Contract No. C21074582H dated June 22, 202 0 as assigned by INSYPR SOL UTIONS, LLC pursuant to the Novation Agreement to Contract No . C21074582H betw een INSYPR SOLUTIONS, LLC, and CITY, wherein INSYPR SOLUTIONS, LLC was transferred the obligations of the Contractor under the Contract INSYPR SOLUTIONS, LLC thereby became the Contractor under the Contract..

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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 4 “NOT TO EXC EED COMPENSATION ” of the Contract is hereb y amended to read as follows:

SECTION 3. 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 4. Incorporation of Recitals . The recita ls set forth above are te rms of thi s Amendment and are fully incorporated herein by this reference.

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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

INSPYR SOLUTIONS LLC

Officer 1

By:______________________________

Name:___________________________

Title:____________________________

Officer 2

By:______________________________

Name:___________________________

Title:____________________________

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Trent Beekman
Scott Forester
CFO
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AMENDMENT NO. 1 TO CONTRACT NO. C20174582E

BETWEEN THE CITY OF PALO ALTO AND
OBJECT TECHNOLOGY SOLUTIONS, INC.

This Amendment No. 1 (this “Amendment”) to Contract No. C20174582E (the “Contract” as defined below) is entered into as of September 25, 2023, by and between the CITY OF PALO ALTO, a California chartered municipal corporation (“CITY”), and OBJECT TECHNOLOGY SOLUTIONS, INC., a Kansas Corporation, located at 6363 College Blvd., S uite 230, Overland Park, Kansas 66211 (“CONSULTANTS”). CITY and CONSULTANT are referred to collectively as the “Part ies” in this Amendment.

R E C I T A L S

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 me an Contract No. C20174582E between CONSULTANT and CITY, dated June 22, 2020.

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 4 “NOT TO EXC EED COMPENSATION ” of the Contract is hereb y amended to read as follows:

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SECTION 3. 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 4. Incorporation of Recitals . The recita ls 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 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

OBJECT TECHNOLOGY SOLUTIONS,
INC.

Officer 1

By:______________________________

Name:___________________________

Title:____________________________

Officer 2

By:______________________________

Name:___________________________

Title:____________________________

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President
VP, Accounting & Finance
Krishna Pal
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AMENDMENT NO. 1 TO CONTRACT NO. C20174582F

BETWEEN THE CITY OF PALO ALTO AND
TECHLINK SYSTEMS, INC.

This Amendment No. 1 (this “Amendment”) to Contract No. C20174582F (the “Contract” as defined below) is entered into as of September 25, 2023, by and between the CITY OF PALO ALTO, a California chartered municipal corporation (“CITY”), and TECHLINK SYSTEMS, INC., a California Corporation, located at 220 Montgomery Street, Suite 1018, San Francisco, CA 94104 (“CONSULTANTS”). CITY and CONSULTANT are referred to collectively as the “Part ies” in this Amendment.

R E C I T A L S
A. The Contract (as defined below) was entered into by and between the Parties hereto for the provision of engaging a con sultant to provide implementation specialized information technology to enhance the City’s business functionality and overall performance, while maintaining a high degree of customer satisfaction (“Project”) and to engage a consultant to provide support services on an on-call, as needed, time-limited basis in the connection with the Project, as detailed therein.

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 Contract No. C20174582F between CONSULTANT and CITY, dated June 22, 2020.

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 4 “NOT TO EXC EED COMPENSATION ” of the Contract is hereb y amended to read as follows:

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SECTION 3. 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 4. Incorporation of Recitals . The recita ls 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 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

TECHLINK SYSTEMS, INC.

Officer 1

By:______________________________

Name:___________________________

Title:____________________________

Officer 2

By:______________________________

Name:___________________________

Title:____________________________

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Jane Kim
CFO
Ronald Alcaraz
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AMENDMENT NO. 1 TO CONTRACT NO. C20174582G

BETWEEN THE CITY OF PALO ALTO AND

ZION CLOUD SOLUTIONS, LLC

This Amendment No. 1 (this “Amendment”) to Contract No. C20174582G (the “Contract” as defined below) is entered into as of September 25, 2023, by and between the CITY OF PALO ALTO, a California chartered municipal corporation (“CITY”), and ZION CLOUD SOLUTIONS, LLC, a Illinois Limited Liability Corporation , located at 2700 Patriot Blvd., S uite 250, Glenview IL 60026 (“CONSULTANTS”). CITY and CONSULTANT are referred to collectively as the “Part ies” in this Amendment.

R E C I T A L S

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 “Cont ract” shall me an Contract No. C20174582G between CONSULTANT and CITY, dated June 22, 2020.

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 4 “NOT TO EXC EED COMPENSATION ” of the Contract is hereb y amended to read as follows:

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SECTION 3. 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 4. Incorporation of Recitals . The recita ls 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 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

ZION CLOUD SOLUTIONS, LLC

Officer 1

By:______________________________

Name:___________________________

Title:____________________________

Officer 2

By:______________________________

Name:___________________________

Title:____________________________

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President
IT Service Delivery Director
Soaham Joshi
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City Council
Staff Report
From: City Manager
Report Type: CONSENT CALENDAR
Lead Department: Utilities
Meeting Date: February 12, 2024
Staff Report: 2311-2253
TITLE
Approval of Contract No. C24188884 With WaterTALENT, LLC for Temporary Consultant Support for Public Works and Utilities Departments in a Not to Exceed Amount of $1,896,000 Over Three Years, With Two One-Year Extension Options; Not to Exceed $830,400 for Year One and Not to Exceed $532,800 per Year for Years Two and Three and Optional Extensions if Authorized; CEQA Status - Not a Project

RECOMMENDATION
Staff recommends the Council (1) approve and authorize the City Manager or designee to execute a contract with WaterTALENT (Contract C24188884) to provide support for key services for Utilities Operations and Public Works Regional Water Quality Control Plant (RWQCP) for an amount not to exceed $1,896,000 over three years; not to exceed amount for year one is $830,400 and not to exceed amount for years two and three is $532,800 per year; and (2) authorize City Manager or designee to approve two optional one-year extensions at an additional not to exceed amount of $532,800 per year.

EXECUTIVE SUMMARY
The Utilities and Public Works Departments have critical operations that require specialized expertise and certifications to perform. There is a limited number of workers in California with the necessary qualifications. WaterTALENT employs a pool of consultants with the requisite certifications who can provide temporary operational support on an on-call basis. Due to existing vacancies and additional attrition anticipated over the next several years, staff is recommending a three-year contract with the option for two one-year extensions. This will provide Utilities and Public Works adequate time for current City employees to gain the necessary certifications and/or to hire additional qualified employees. The contract will be funded by salary savings from vacant staff positions.

BACKGROUND
The Utilities Department and the Public Works Department require temporary consultant support on projects that require specialized expertise and certifications. Existing staff are not Item 9
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qualified or do not have the appropriate certifications to perform these tasks and there are a limited number of qualified candidates outside the City to perform the tasks. Both the Utilities Department and the Public Works Department have an immediate need for support services from qualified consultants in the short term to ensure a reliable level of service is maintained.

These projects require both a high level of experience coupled with State Water Resources Control Board Certifications that take years to obtain, and there is a limited number of candidates that are appropriately certified and qualified to perform the tasks. To illustrate the limited pool of potential candidates, current listings by the State Water Resources Control Board indicate that there are 1,220 Grade 5 Water Distribution Operators and 1,097 Grade 5 Wastewater Treatment Plant Operators licensed at this time in California; a Grade 5 license is required to perform certain necessary high-level tasks. Only 10% of certified operators (i.e., approximately 100) live sufficiently close to Palo Alto where they would not require relocation. Cost of living and commute challenges also add to the difficulty of recruiting. These functions are critical to the operations of essential City services and may only be performed by individuals that hold the required certifications.

WaterTALENT is a firm that offers certified, temporary support services to meet the City’s needs while the City continues the recruitment process. Contractors provided by WaterTALENT are typically highly experienced retirees that have performed similar work for other agencies. This service will allow the City to bridge vacancies with temporary, certified support in critical tasks and maintain operations while continuing recruitment efforts to find permanent candidates.

This temporary support solution will be funded through salary and benefit savings generated by departmental staffing vacancies. As a result, there will be minimal budget impacts.

ANALYSIS
The Departments will use WaterTALENT contractors strictly on an as-needed basis. Once current vacancies are filled, both departments would only need to utilize this contract if additional positions requiring certification were to become open and are not able to be filled in a timely manner. If the City can train and retain staff for these types of critical positions, this contract may not be utilized for the years specified under the contract term. Staff is requesting a three-year term with the option for two one-year extensions for this contract to allow Departments to move proactively to meet critical task support requirements without the time constraints of the City’s procurement and contracting process.

A Request for Proposal (RFP 188884) for temporary certified support was posted on OpenGov Procurement for 22 days; the only bidder was WaterTALENT. WaterTALENT provides staffing services at an hourly rate depending on the task and certifications required. These rates range between $160 and $200 per hour and are inclusive of all costs, with no additional fees or reimbursables. The contract includes an annual rate escalator of $5 per hour beginning on the Item 9
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annual contract renewal date. This staffing is on an on-call basis, and no duration or compensation commitment is required.

Current vacancies and potential upcoming vacancies include:

Utilities Department
Supervisor, Utilities (for Water Transmission Division): This position must hold a Grade 2 Water Treatment Certificate and a Grade 5 Water Distribution Certificate and is responsible for the quality and oversight of the drinking water system for the City of Palo Alto. This includes sampling schedules, water cycling, maintenance of transmission and storage facilities, federal, state, and regional reporting, and regulation compliance. This position also acts as the liaison with the State Drinking Water regulatory agency and develops programs to meet the evolving testing needs for the City. The Contractor will coordinate with field personnel and other City divisions.

Public Works Department
Supervisor, WQC. The person providing this service must hold a Grade 3 State Water Resources Control Board Wastewater Treatment Plant Operator Certificate and is responsible for supervising activities and participating in the monitoring, operating, servicing, troubleshooting, and maintenance of applicable equipment and tools to ensure proper operations, which includes:
analyzing and reviewing work processes; scheduling maintenance; interpreting raw data; monitoring activities for compliance with applicable laws, ordinances, codes, rules, regulations, policies, procedures, and standards; ordering supplies and inventory; and/or, performing other related duties. The Supervisor position monitors compliance with applicable water quality standards while maintaining the City's investment in the plant infrastructure, oversees the City's compliance with OSHA mandates for plant personnel, and conducts plant hazard inspections and job safety analysis.

Assistant Manager, Water Quality Control (WQC) Operations: The person providing this service must hold a Grade 5 State Water Resources Control Board Wastewater Treatment Plant Operator Certificate. The Assistant Manager is responsible for managing section activities within the WQC plant operations division and participates in the monitoring, operating, servicing, troubleshooting, and maintenance of applicable equipment and tools to ensure proper operations, which includes: analyzing and reviewing work processes; scheduling maintenance; interpreting raw data; monitoring activities for compliance with applicable laws, ordinances, codes, rules, regulations, policies, procedures, and standards; ordering supplies and inventory; and/or, performing other related duties. The Assistant Manager also monitors plant effluent quality to ensure compliance with discharge limits and ensures compliance with applicable federal, state, and local laws, rules, regulations, and policies. They must also prepare, review, interpret, and analyze a variety of information, data, and reports; and make recommendations and presentations based on findings.

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Manager, WQC: The person providing this service must hold a Grade 5 State Water Resources Control Board Wastewater Treatment Plant Operator Certificate. This position is responsible for managing the operations and maintenance of the water quality control plant and recycled water plant, including laboratory operations, overseeing the development and administration of policies, procedures, programs, goals, and objectives. This position also participates in annual and long-range planning activities to anticipate and coordinate the need for, or reduction of, future resources and develops and implements quality standards for water quality control operations and maintenance activities. The Manager, WQC also reviews, prepares, and presents reports on division programs and activities; disseminates compliance reports to applicable federal, state, and local regulatory agencies as well as establishes quality standards for operations and maintenance activities to ensure acceptable levels of performance. The Manager WQC oversees facilities to ensure compliance with applicable OSHA and City safety standards and programs and oversees the maintenance and operation of applicable plant facilities.

FISCAL/RESOURCE IMPACT
Funding for the first year of the contract is available in the FY 2024 Utilities and Public Works budgets. The costs for WaterTALENT consultant hours will be funded through salary and benefit savings generated by departmental staffing vacancies. Estimated cost breakdown by department and required certification:

Dept. Certificate Type Hourly Rate
Utilities Grade 5 (Water Distribution Certificate) $190 Public Works Grade 5 (SWRCBWTPOC) $190
Public Works Grade 3 (SWRCBWTPOC) $160
* Note: SWRCBWTPOC is State Water Resources Control Board Wastewater Treatment Plant Operator Certificate. Chart does not reflect an annual $5.00 per hour escalation after year one.

ENVIRONMENTAL REVIEW
Council action on this item is not a project subject to review under the California Environmental Quality Act (CEQA) because the contract with WaterTALENT for consultant support for utility operations is a continuing administrative or maintenance activity under section 15378(b)(2) of the CEQA Guidelines.

ATTACHMENTS
Attachment A: Contract with WaterTALENT
APPROVED BY:

Dean Batchelor, Director Utilities
Staff: Matt Zucca, Assistant Director WGW Utilities
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CITY OF PALO ALTO CONTRACT NO. C24188884

AGREEMENT FOR PROFESSIONAL SERVICES

BETWEEN THE CITY OF PALO ALTO AND WATERTALENT, LLC.

This Agreement for Professional Services (this “Agreement”) is entered into as of the 12th day of February 2024 (the “Effective Date”), by and between the CITY OF PALO ALTO, a California chartered municipal corporation (“CITY”), and WATERTALENT, LLC , a Limited Liability Company, located at 15233 Ventura Blvd., #615, Sherman Oaks, CA 91403 (“CONSULTANT”).

The following recitals are a substantive portion of this Agreement and are fully incorporated herein by this reference:

RECITALS

A. CITY intends to engage temporary consultants to support the Utilities and Public Works Departments ( the “Project”) and desires to engage a consultant to provide staffing services in connection with the Project (the “Services”, as detailed more fully in Exhibit A).

B. CONSULTANT represents that it, its employees and subconsultants, if any, 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, entitled “SCOPE OF SERVICES”.

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

SECTION 1. SCOPE OF SERVICES. CONSULTANT shall perform the Services described in 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.

Optional On-Call Provision (This provision only applies if checked and only applies to on-call agreements.)

CITY may elect to, but is not required to, authorize on- call Services up to the maximum compensation amount set forth in Section 4 (Not to Exceed Compensati on).

CONSULTANT shall provide on- call Services only by advanced, written authorization from CITY as detailed in this Section. On -call Services, if any, s hall be authorized by CITY, as needed, with a Task Order assigned and approved 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 s ervices, schedule of performance and maximum compensation amount, in accordance with the provisions of this Agreement.

Compensation for on-call 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 DocuSign Envelope ID: 5788D7A9-5829-4706-8BBD-07AD95E9C936 Item 9
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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 Task Order shall become part of this Agreement. The cumulative total compensation due to CONSULTANT for all Task Orders issued under this Agreement shall not exceed the amount of compensation set forth in Section 4. CONSULTANT shall only be compensated for on -call Services performed under an authorized Task Order and only up to the maximum compensation amount set forth in Section 4. Performance of and payment for any on-call Services are subject to all requirements and restrictions in this Agreement.

SECTION 2. TERM.

The term of this Agreement shall be from the date of its full execution through February 11, 2027 unless terminated earlier pursuant to Section 19 (Termination) of this Agreement. The CITY shall have the option to renew this Agreement for two additional one-year terms, to be exercised at the CITY’s sole and absolute discretion. City will provide CONSULTANT with written notice of its intent to exercise its option to renew no later than 90 days before the expiration of the prior contract term.

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, entitled “SCHEDULE OF PERFORMANCE”. 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 shall be based on the compensation structure detailed in Exhibit C, entitled “COMPENSATION,” including any reimbursable expenses specified therein, and the maximum total compensation for the first three (3) years shall not exceed One Million Eight Hundred Ninety-Six Thousand Dollars ($1,896,000). T he total compensation for year one (1) shall not exceed Eight Hundred T hirty Thousand Four Hundred Dollars ($830,400). The total compensation for years Two and Three and the two optional one - year extensions shall not exceed Five Hundred Thirty- Two Thousand Eight Hundred Dollars ($532,800) per year. The hourly schedule of rates, if applicable, is set out in Exhibit C-1, entitled “SCHEDULE OF RATES.” Any work performed or expenses incurred for which payment would result in a total exceeding the maximum compensation set forth in this Section 4 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 D ollars ($ ) for the performance of DocuSign Envelope ID: 5788D7A9-5829-4706-8BBD-07AD95E9C936 Item 9
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Additional Services ( as defined below). The total compensation for performance of the Services, Additional Services and any reimbursable expenses specified in Exhibit C, shall not exceed Dollars ($ ) , as detailed in Exhibit C.

“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 S ervices 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.

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 S ervices 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 CITY’s Project Manager at the address specified in Section 13 (Project Management) below. CITY will generally process and pay invoices within thirty (30) days of receipt of an acceptable invoice.

SECTION 6. QUALIFICATIONS/STANDARD OF CARE. All Services shall be performed by CONSULTANT or under CONSULTANT’s supervision. CONSULTANT represents that it , its employees and subcontractors, if any, 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 subcontractors, 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 Services to be furnished by CONSULTANT DocuSign Envelope ID: 5788D7A9-5829-4706-8BBD-07AD95E9C936 Item 9
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under this A greement 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 same or similar circumstances.

SECTION 7. COMPLIANCE WITH LAWS . CONSULTANT shall keep itself info rmed 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 performance of the Services or those engaged to perform Services under this Agreement , as amended from ti me to time . 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 design submittal. If the total estimated construction cost at any submittal exceeds the CITY’s stated construction budget by ten percent (10%) or more , CONSULTANT shall make recommendations to CITY for aligning the P roject 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 S ervices 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 wi ll be responsible for all obligations and payments, whether imposed by federal, state or local law, including, but not limited to, FICA, income tax withholdings, workers’ compensation, unemployment compensation, insurance, and other similar responsibilities re lated to CONSULTANT’s performance of the S ervices, 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 without the prior written approval of the C ity 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 DocuSign Envelope ID: 5788D7A9-5829-4706-8BBD-07AD95E9C936 Item 9
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will apply to, and will bind, the heirs, successors, executors, administrators and assignees of the parties.

SECTION 12. SUBCONTRACTING.

Option A: No Subcontractor: CONSULTANT shall not subcontract any portion of the Services to be performed under this Agreement without the prior written authorization of the City Manager or designee. In the event CONSULTANT does subcontract any portion of the work to be performed under this Agreement, CONSULTANT shall be fully responsible for all acts and omissions of subcontractors.

Option B: Subcontracts Authorized: Notwithstanding Section 11 (Assignment) above, CITY agrees that subcontractors may be used to complete the Services. The subcon tractors authorized by CITY to perform work on this Project are:

CONSULTANT shall be responsible for directing the work of any subcontractors and for any compensation due to subcontractors . CITY assumes no responsibility whatsoever concerning compensation of subcontractors. CONSULTANT shall be fully responsible to CITY for all acts and omissions of subcontractors . CONSULTANT shall change or add subcontractors only with the prior written approval of the City Manager or designee.

SECTION 13. PROJECT MANAGEMENT . CONSULTANT will assign Tyler Reifert, President, Telephone: 424-832- 7217, Email: [email protected] as the CONSULTANT’s Project Manager to have supervisory responsibility for the performance, progress, and execution of the Services and represent CONSULTANT during the day-to-day performance of the Services.

If circumstances cause the substitution of the CONSULTANT’s P roject Manager or any other of CONSULTANT’s key personnel for any reason, the appointment of a substitute Project Manager and the assignment of 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 CONSULTANT 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 Services or a threat to the safety of persons or property.

CITY’s Project Manager is Melissa Smart , Utilities Department, Water Gas Wastewater Operations Division, 250 Hamilton Ave., Palo Alto, CA, 94301, Telephone: 650-496-6940, Email:

[email protected]. 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 1 4. OWNERSHIP OF MATERIALS . A ll work product, including without limitation, all writings, drawings, studies, sketches, photographs, plans, reports, specifications, computations, models, recordings, data, documents, and other materials and copyright interests developed under this Agreement, in any form or media, 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 product pursuant to this Agreement are vested in CITY, and CONSULTANT hereby waives and relinquishes all claims to copyright or other intellectual property rights in favor of CITY. Neither CONSULTANT nor its subcontractors, if any, shall DocuSign Envelope ID: 5788D7A9-5829-4706-8BBD-07AD95E9C936 Item 9
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make any of such work product available to any individual or organization without the prior written approval of the C ity 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 Services.

SECTION 15. AUDITS . CONSULTANT agrees to permit CITY and its authorized representatives to audit, at any reasonable time during the term of this Agreement and for four (4) years from the date of final payment, CONSULTANT’s records pertaining to matters covered by this Agreement, including without limitation records demonstrating compliance with the requirements of Section 10 (Independent Contractor). CONSULTANT further agrees to maintain and retain accurate books and records in accordance with generally accepted accounting principles for at least four (4) years after the expiration or earlier termination of this Agreement or the completion of any audit hereunder, whichever is later.

SECTION 16. INDEMNITY.

16.1. To the fullest extent permitted by law, CONSULTANT shall 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 attorney’s fees, experts fees, court costs and disbursements (“Claims”) resulting from, arising out of or in any manner re lated 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 1 6 shall be construed to require CONSULTANT to indemnify an Indemnified Party from a Claim arising from the active negligence or willful misconduct of an Indemnified Party that is not contributed to by any act of, or by any omission to perform a duty imposed by law or agreement by, CONSULTANT, its officers, employees, agents or contractors under this Agreement.

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. No waiver of a condition or nonperformance of an obligation under this Agreement is effective unless it is in writing in accordance with Section 2 9.4 of this Agreement. No delay or failure to require performance of any provision of this Agreement shall constitute a waiver of that provision as to that or any other instance. Any waiver granted shall apply solely to the specific instance expressly stated. No single or partial exercise of any right or remedy will preclude any other or further exercise of any right or remedy.

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, entitled “INSURANCE REQUIREMENTS”. CONSULTANT and its contractors, if any, shall obtain a policy endorsement naming CITY as an additional insured under any general liability or DocuSign Envelope ID: 5788D7A9-5829-4706-8BBD-07AD95E9C936 Item 9
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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.

18.3. Certificates evidencing such insurance shall be filed with CITY concurrently 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 Manager 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. If CONSULTANT fails to perform any of its material obligations under this Agreement, in addition to all other remedies provided under this Agreement or at law, the City Manager may terminate this Agreement sooner upon written notice of termination. Upon recei pt of any notice of suspension or termination , CONSULTANT will discontinue its performance of the Services on the effective date in the notice of suspension or termination.

19.2. In event of suspension or termination, CONSULTANT wi ll deliver to the City Manager on or before the effective date in the notice of suspension or termination, any and all work product, as detailed in Section 14 (Ownership of Materials), whether or not completed, prepared by CONSULTANT or its contractors, if any, in the performance of this Agreement. Such work product is the property of CITY, as detailed in Section 14 (Ownership of Materials).

19.3. In event of suspension or termination, CONSULTANT will be paid for the Services rendered and work products delivered to CITY in accordance with the Scope of Services up to the effective date in the notice of suspension or termination; provided, however, if this DocuSign Envelope ID: 5788D7A9-5829-4706-8BBD-07AD95E9C936 Item 9
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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 S ervices provided in material conformity with this Agreement as such determination is 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, 17, 19.2, 19.3, 19.4, 20, 25, 27, 28, 29 and 30.

19.4. 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, unless made in accordance with Section 17 (Waivers).

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 P roject Manager at the address of CONSULTANT recited on the first page of this Agreement.

CONSULTANT shall provide written notice to CITY of any change of address.

SECTION 21. CONFLICT OF INTEREST.

21.1. In executing 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 furt her covenants that, in the performance of this Agreement, it will not employ subcontractors or other persons or parties having such an interest.

CONSULTANT certifies that no person who has or will have any financial interest under this Agreement is an off icer 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, as amended from time to time . CONSULTANT agrees to notify CITY if any conflict arises.

21.3. If the CONSULTANT meets the definition of a “Consultant” as defined by the Regulations of the Fair Political Practices Commission, CONSULTANT will file the appropriate financial disclosure documents required by the Palo Alto Municipal Code and the Political Reform Act of 1974, as amended from time to time.

SECTION 22. NONDISCRIMINATION; COMPLIANCE WITH ADA.

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22.1. As set forth in Palo Alto Municipal Code S ection 2.30.510, as amended from time to time, CONSULTANT 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, pregna ncy, 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.

22.2. CONSULTANT understands and agrees that pursuant to the Americans Disabilities Act (“ADA”), programs, services and other activities provided by a public entity to the public, whether directly or through a contractor or subcontractor, are required to be accessible to the disabled public. CONSULTANT will provide the Services specified in this Agreement in a manner that complies with the ADA and any other applicable federal, state and local disability rights laws and regulations, as amended from time to time. CONSULTANT will not discriminate against persons with disabilities in the provision of services, benefits or activities provided under this Agreement.

SECTION 23. ENVIRONMENTALLY PREFERRED PURCHASING AND ZERO WASTE REQUIREMENTS. CONSULTANT shall comply with t he CITY’s Environmentally Preferred Purchasing policies which are available at CITY ’s Purchasing Department , hereby incorporated by reference and as 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 reducing 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 printer 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 Department’s office.
(c) Reusable/returnable pallets shall be taken back by CONSULTANT , at no additional cost to CITY, for reuse or recycling. CONSULTANT 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 ORDINANCE .

CONSULTANT shall comply with all requirements of the Palo Alto Municipal Code Chapter 4.62 (Citywide Minimum Wage), as 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 DocuSign Envelope ID: 5788D7A9-5829-4706-8BBD-07AD95E9C936 Item 9
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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. This Agreement is subject to the fiscal provisions of the Charter of the City of Palo Alto and the Palo Alto Municipal Code, as amended from time to time. 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 S ection shall take precedence in the event of a conflict with any other covenant, term, condition, or provision of this Agreement.

SECTION 2 6. PREVAILING WAGES AND DIR REGISTRATION FOR PUBLIC WORKS CONTRACTS.

26.1. This Project is not subject to prevailing wages and related requirements. CONSULTANT is not required to pay prevailing wages and meet related requirements under the California Labor Code and California Code of Regulations in the performance and implementation of the Project if the contract:
(1) is not a public works contract;
(2) is for a public works construction project of $25,000 or less, per California Labor Code Sections 1782(d)(1), 1725.5(f) and 1773.3(j); or (3) is for a public works alteration, demolition, repair, or maintenance project of $15,000 or less, per California Labor Code Sections 1782(d)(1), 1725.5(f) and 1773.3(j).

SECTION 27. CLAIMS PROCEDURE FOR “9204 PUBLIC WORKS PROJECTS” . For purposes of this Section 27, a “9204 Public Works Project” means the erection, construction, alteration, repair, or improvement of any public structure, building, road, or other public improvement of any kind. ( Cal. Pub. Cont. Code § 9204.) Per California Public Contract Code Section 9204, for Public Works Projects , certain claims procedures shall apply, as set forth in Exhibit F, entitled “Claims for Public Contract Code Section 9204 Public Works Projects”.

This Project is not a 9204 Public Works Project.

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 perform CONSULTANT’s obligations to CITY under this Agreement 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.

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28.2. “Confidential Information” means all data, information (including without limitation “Personal Information” about a California resident as defined in Civil Code S ection 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, directly 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 Inform ation; (iii) is rightfully obtained by CONSULTANT from a third party without breach of any confidentiality 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 requirements 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.

28.6. If selected in Section 30 (Exhibits), this Agreement is also subject to the terms and conditions of the Information Privacy Policy and Cybersecurity Terms and Conditions.

SECTION 29. MISCELLANEOUS PROVISIONS.

29.1. This Agreement will be governed by California law, without regard to its conflict of law provisions.

29.2. 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.

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of legal services provided by attorneys employed by it as well as any attorneys’ fees paid to third parties.

29.4. This Agreement, including all exhibits, constitutes the entire and integrated agreement between the parties with respect to the subject matter of this Agreement, and supersedes all prior agreements, negotiations, representations, statements , and undertakings , either oral or written. This Agreement may be amended only by a written instrument, which is signed by the authorized representatives of the parties and approved as required under Palo Alto Municipal Code, as amended from time to time.

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

29.6. In the event of a conflict between the terms of this Agreement and the exhibits hereto (per Section 30) or CONSULTANT’s proposal (if any), the Agreement shall control. In the event of a conflict between the exhibits hereto and CONSULTANT’s proposal (if any), the exhibits shall control.

29.7. The provisions of all checked boxes in this Agreement shall apply to this Agreement; the provisions of any unchecked boxes shall not apply to this Agreement.

29.8. All section headings contained in this Agreement are for convenience and reference only and are not intended to define or limit the scope of any provision of this Agreement.

29.9. This Agreement may be signed in multiple counterparts, which, when executed by the authorized representatives of the parties, shall together constitute a single binding agreement.

29.10 If CITY, within twelve (12) months after conclusion of a person’s temporary assignment by CONSULTANT at CITY, either directly or indirectly, including through any company or entity within CITY control or a company affiliated with CITY, hires that Temporary Employee of CONSULTANT as an employee, consultant, independent contractor of CITY, or utilizes the Temporary Employee’s services through another temporary or outsourcing service during such Temporary Employee’s employment by CONSULTANT or an affiliate of CONSULTANT, , CITY agrees to pay CONSULTANT a direct hire/conversion fee stipulated by the parties to be set forth in a Fee Schedule to be amended to this agreement or, in the case of a direct placement or temp -to-hire conversion, a fee equal to twenty- five percent (25%) of the employee’s annualized wage or salary offered to Temporary Employee by CITY. If the offer to Temporary Employee is not considered full -time, the conversion fee shall be calculated by the average amount of hours worked on a weekly basis then annualized on a schedule for a 12-month/52-week period.

SECTION 30. EXHIBITS. Each of the following exhibits, if the check box for such exhibit is selected below, is hereby attached and incorporated into this Agreement by reference as though fully set forth herein:

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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

THIS AGREEMENT IS NOT COMPLETE UNLESS ALL SELECTED EXHIBITS ARE ATTACHED.

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CONTRACT NO. C24188884 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

WATERTALENT, LLC.

Officer 1

By:_____________________________

Name:__________________________

Title:___________________________

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EXHIBIT A

SCOPE OF SERVICES

CONSULTANT shall provide temporary consultants on an on-call basis to support the City’s Utilities and Public Works departments. Projects will be performed on a Task Order basis, in accordance with Section 1 (Scope of Services) of this Agreement. Task Order scopes, budgets, and schedules will be negotiated as projects arise per Section 1.

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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 target completing 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.

Milestones
Completion
Number of Days/Weeks (as specified below)
from NTP

1. Kickoff meeting / Client Intake Meeting 1 week from contract signing

2. Search Intake Meeting (per Task
Order)
1 week from City request (accepted Task Order)

3. Candidate Coordination (per
recruitment)
2-6 weeks from Candidate screening

4. Ongoing Check In Meetings / Status
Updates (during active recruitments)
At least twice monthly, or more frequently as
agreed.

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EXHIBIT C

COMPENSATION

CITY agrees to compensate CONSULTANT for the Services performed in accordance with the terms and conditions of this Agreement, including Services, any specified reimbursable expenses, and Additional Services (if any, per Section 4 of the Agreement), based on the hourly rate schedule attached as Exhibit C-1.

The compensation to be paid to CONSULTANT under this Agreement for all S ervices, any specified reimbursable expenses, and Additional Services (if any, per Section 4), shall not exceed the amount(s) stated in Section 4 of this Agreement . CONSULTANT agrees to complete all Services, any specified reimbursable expenses, and Additional Services (if any, per Section 4) , within this/these amount(s). Any work performed or expenses incurred for which payment would result in a total exceeding the maximum amount of compensation set forth in this Agreement shall be at no cost to the CITY.

REIMBURSABLE EXPENSES

CONSULTANT’S ordinary business expenses , such as administrative, overhead, administrative support time /overtime, information systems, software and hardware, photocopying, telecommunications (telephone, internet), in-house printing, insurance and other ordinary business expenses, are included within the scope of payment for Services and are not reimbursable expenses hereunder.

Reimbursable expenses, if any are specified as reimburs able under this section , will be reimbursed at actual cost. The expenses (by type, e.g., travel) for which CONSULTANT will be reimbursed are: NONE up to the not-to-exceed amount of: $0.00.

A. Travel outside the San Francisco Bay A rea, including transportation and meals, if specified as reimbursable, will be reimbursed at actual cost subject to the City of Palo Alto’s policy for reimbursement of travel and meal expenses.

B. Long distance telephone service charges, cellular phone service charges, facsimile transmission and postage charges, if specified as reimbursable, will be reimbursed at actual cost.

All requests for reimbursement of expenses, if any are specified as reimbursable under this section, shall be accompanied by appropriate backup documentation and information.

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EXHIBIT C-1

SCHEDULE OF RATES

CONSULTANT’s schedule of rates is as follows:

Dept. Certificate Type Hourly Rate
Utilities Grade 5 (Water Distribution Certificate) $190 Public Works Grade 5 (SWRCBWTPOC) $190
Public Works Grade 3 (SWRCBWTPOC) $160
Note: SWRCBWTPOC is State Water Resources Control Board Wastewater Treatment Plant Operator Certificate

Annual rate escalations of $5/hr beginning on the date of execution of this contract shall be applied to all tasks for the duration of the term of this contract.

*Should the City have a request for temporary support that is not certified as described in the table above, the City may inquire with waterTALENT directly and a quote shall be provided for the support on a point-of-need basis.

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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

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

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 TO THE FOLLOWING: [email protected]

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,

INSURANCE AS AFFORDED BY THIS POLICY IS PRIMARY AND IS NOT ADDITIONAL TO OR

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

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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 INCREASE 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 EMAIL ADDRESS:

[email protected]

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City Council
Staff Report
From: City Manager
Report Type: ACTION ITEMS
Lead Department: Planning and Development Services
Meeting Date: February 12, 2024
Report #:2402-2574
TITLE
Adopt a Resolution Modifying the City’s Objective Design Standards for SB 9 Projects.

RECOMMENDATION
Staff recommends Council adopt the attached Resolution (Attachment A) modifying the objective design standards for development pursuant to California Senate Bill 9 (SB 9).

EXECUTIVE SUMMARY
This report transmits a resolution that refines the City’s SB 9 objective design standards. The standards were first introduced in late 2021 and quickly prepared in response to changes in state law. Council previously directed staff to include review of the SB 9 regulations in the work plans of the Architectural Review Board (ARB) and Planning and Transportation Commission (PTC) and return with updated standards based on application of the standards to projects. The City’s Architectural Review Board reviewed the standards over several meetings and supports the recommended revisions. Staff also met with local architects to receive input on the subject design standards. The proposed changes reduce the overall number of requirements, due in part to elimination of redundant provisions or overlapping regulations and improve overall clarity for staff and applicants.

BACKGROUND
The Housing Opportunity and More Efficiency (HOME) Act, or SB 9, was enacted by the state legislature and signed into law by Governor Newsom in 2021 and became effective January 1, 2022. This law generally allows single family zoned properties to add an additional dwelling unit that can be combined with a junior and/or accessory dwelling unit (J/ADU), or subdivide an existing single family zoned lot into two lots (also referred to as an urban lot split). This law essentially allows for up to four units on existing single family zoned lots or split across newly created lots.

In late 2021 and early 2022, the City Council enacted interim ordinances (#5538, #5542, and #5546) to amend the zoning code to respond to SB 9, including standards for urban lot splits.

The City Council adopted a set of objective design standards for the ministerial processing of SB Item 10
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9 projects in December 2021. These design standards were modeled after the Single-Family Individual Review (IR) Guidelines focused on privacy, massing and streetscape for two story home developments approved through the City’s discretionary IR application process.1 As ministerial projects, SB 9 projects do not require review by the ARB or PTC; these are processed administratively by PDS staff.

Staff returned to Council to codify the interim ordinance, which is essentially a restatement of the state requirements, in May/June 2023. Council also previously directed staff to return with refined objective design standards and include feedback from the Architectural Review Board (ARB). This effort to update the objective design standards is the focus of the subject report and Council action.

Architectural Review Board
The ARB held three meetings in Spring 2023 to review the objective design standards. The Board’s initial review found that:

• Some of the design standards were overly restrictive
• Multiple standards intersected with other standards creating overlapping regulations • The standards lacked flexibility or design options for certain details, such as window different types of window trims or window configuration • The privacy standards seemed adequate
The ARB asked staff to engage a focus group to provide additional feedback before returning back to the Board with recommended changes.

Staff met with local architects and individuals who had filed or expressed an interest in filing an SB 9 application. Each of these individuals was familiar with the zoning code and the City’s processes. Over the course of several weeks in late Summer and early Fall, the focus group reviewed the objective standards and the ARB’s comments. The summary of the focus group input is described in the November 16, 2023 ARB staff report. The group concurred with the ARB and expressed an interest in simplifying the requirements and making clear which standards were applicable to different project types (two story homes and homes in Eichler tracts).

Toward the end of 2023, staff returned to the ARB, which held three additional meetings reviewing and providing feedback on the subject objective design standards. This effort resulted in changes that reduced the overall number of objective standards from 64 to 19 for all 1 The IR process is a discretionary process, where the Director’s decisions are appealable to City Council; the program is in place for two-story homes and second floor additions. More about the IR process is viewable at this link: https://www.cityofpaloalto.org/Departments/Planning-Development-Services/Current-Planning/Forms- Applications
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projects and an additional 20 that apply to some projects; changes to improve administration, improve clarity and better convey design intent; and allow design flexibility to address a wider range of architectural styles.

A ‘crosswalk’ showing how the existing standards are proposed to be modified is provided in Attachment B.

The ARB unanimously supported improving the objective standards for SB9 projects.

Prior ARB staff reports and video recordings are available online.2

DISCUSSION
SB 9 is one of many state initiatives intended to promote greater housing production. The City’s initial response to SB 9 was to minimally address the requirements of state law and develop standards that reasonably reflected the type of projects being built through the City’s Individual Review (IR) process, including privacy related concerns with increased density in single family zones. The City staff focused its limited time in late 2021 to develop the standards based on the IR program guidelines, with the help of the IR program architect. There was no time to share the standards with the ARB and PTC prior to Council’s urgency ordinance adoption of the standards in 2021. Accordingly, the Council directed staff to bring the standards to the ARB and PTC for review.

The attached resolution updates the initial objective design standards. Through the ARB’s work and engagement with stakeholders, the new standards are easier to apply to projects and are anticipated to result in additional SB 9 applications being filed. To date, the City has received six SB 9 applications and approved one. Staff are still reviewing the other five applications, and regularly have conversations with other prospective applicants.

The City’s adopted Housing Element includes a program to increase the permitted floor area for certain SB 9 units from state-minimum 800 square feet to allow up to 1,200 square feet.

Increasing the size of these units beyond 800 square feet is expected to improve the feasibility of the projects, introduce more two-bedroom homes and potentially create more financially accessible ownership units. With this program, the City projects it would add an additional 40 2 Link to most recent ARB online minutes for the SB 9 project: November 16, 2023:
https://www.cityofpaloalto.org/files/assets/public/v/1/agendas-minutes-reports/agendas-minutes/architectural- review-board/2024/arb-draft-minutes-11-16-23.pdf
Links to the Spring 2023 ARB Staff Reports and minutes for ARB meetings of March 16, April 20, and May 18 are available at this link: https://www.cityofpaloalto.org/City-Hall/Boards-Commissions/Architectural-Review-Board ARB Staff Report, dated November 16, 2023: https://www.cityofpaloalto.org/files/assets/public/v/1/agendas- minutes-reports/agendas-minutes/architectural-review-board/2023/arb-11.16-sb9-standards.pdf ARB Video Recording, from December 7, 2023: https://midpenmedia.org/architectural-review-board-77-1272023/ ARB Video Recording, from December 21: https://midpenmedia.org/architectural-review-board-77-12212023/ Item 10
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units (not including J/ADU units) over the eight year housing cycle. This change is not reflected in the attached resolution and would require a text amendment to the municipal code. This effort to increase SB 9 floor area is expected to be initiated in 2025.

Staff also anticipates additional changes to state law concerning SB 9-related projects. Senate Bill 450 is being considered by the state legislature and may introduce more streamlining initiatives, timelines for review, restrictions on certain development standards or enforcement provisions later this year. Accordingly, staff anticipates revisions to the SB 9 objective design standards or ordinance may be a recurring effort over the next few years, similar to the refinements made to the state J/ADU requirements.

SB9 Objective Design Standards
The SB 9 objective design standards seek to regulate the design of SB 9 projects by maintaining and making objective key elements from the IR Guidelines and Palo Alto Eichler Neighborhood Design Guidelines3. The SB 9 objective design standards address privacy, height, massing, streetscape, and neighborhood context.

In addition to the City’s ministerial SB 9 application review process, the City also allows an applicant to seek modification to the objective design standards by opting into a discretionary individual review process. This existing application processing option is intended to give a property owner the choice to design a project consistent with the City’s objective standards or seek relief through a process that would involve notification to adjacent property owners. This process does not allow for an increase in unit floor area and may result in reasonable conditions being imposed on the project.

FISCAL/RESOURCE IMPACT
The recommendation in this report does not have any significant fiscal impact; all work has been absorbed through existing department budgets and resources.

POLICY IMPLICATIONS
The recommendation in this report improves the application review process by refining the objective design standards to eliminate redundant provisions and improve clarity for SB 9 projects. The changes are informed by the City’s ARB and consultation with individuals seeking to advance such projects. The proposed changes do not weaken or substantially reduce or eliminate standards that promote consistency with the neighborhood character of single family zones or privacy. The City Council and community should anticipate further state law changes related to SB 9 projects. Moreover, the City Council, through its adopted Housing Element, has 3 Link to Eichler Neighborhood Design Guidelines: https://www.cityofpaloalto.org/files/assets/public/v/1/planning- amp-development-services/eichler-neighood-design-guidelines/2018-04-02_palo-alto-eichler-design- guidelines_adopted-design-guidelines.pdf
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signaled its support to expand opportunities for SB 9 production in Palo Alto through a program that will allow for increases in SB 9 unit size.

STAKEHOLDER ENGAGEMENT
As noted, the public had the opportunity to comment on the SB 9 objective design standards during the six ARB meetings. Additionally, a focus group of architects were consulted to solicit feedback on the design standards. Notice of the subject meeting was made available online with the agenda posting at least 10 days in advance of the meeting and posted on the City’s message board on King Plaza.

ENVIRONMENTAL REVIEW
The refinement of the City’s objective design standards for SB 9 projects does not result in any significant impact on the environment in accordance with the California Environmental Quality Act Guidelines Section 15061(b)(3). Moreover, future projects developed under SB9 are ministerial and therefore exempt from environmental review consistent with CEQA Guidelines Section 15268.

ATTACHMENTS
Attachment A: Resolution Adopting Revised SB 9 Objective Design Standards with Exhibit 1 Proposed Revised SB 9 Objective Design Standards (no annotations) Attachment B: SB 9 Objective Design Standards Revision Crosswalk APPROVED BY:

Jonathan Lait, Planning and Development Services Director Item 10
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Resolution No. ____
Resolution of the Council of the City of Palo Alto Amending the Objective Design Standards for SB9 Development

WHEREAS, on December 6, 2021, the City Council adopted Urgency Ordinance no. 5538 , as well as objective design standards to govern development under the Senate Bill 9 (2021) (SB9), and directed staff to include in work plans of the City’s Architectural Review Board (ARB) and Planning and Transportation Commission (PTC) reviews of these standards; and

WHEREAS, on January 24, 2022 and April 11, 2022, the City Council adopted Interim Ordinance nos. 5542 and 5546, respectively, replacing and amending Ordinance no. 5538.

WHEREAS, on February 8, 2023, the Planning and Transportation Commission review ed and recommended adoption of a permanent ordinance governing SB 9 projects; and

WHEREAS, on June 12, 2023, the City Council adopted Ordinance no. 5587 governing SB 9 projects; and

WHEREAS, in March, April, May, and November 2023, the City’s Architectural Review Board provided feedback to staff and Council to amend the SB9 objective development standards, in public hearings allowing for public testimony, and included consideration of focus group input from architects who had experience as applicants for SB9 projects;

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

SECTION 1.

The City Council adopts the attached objective design standards for SB9 development (Exhibit 1), which shall be mandatory for SB9 development unless applicants prefer to apply under the Individual Review program set forth in Palo Alto Municipal Code Sections

18.12.110 and 18.77.075;

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SECTION 2. The Council finds that the revisions to the SB9 project objective design standards will facilitate streamlined review of SB9 projects and are not considered a project under the California Environmental Quality Act because it can be seen with certainty that there is no possibility that the activity in question may have a significant impact on the environment.

INTRODUCED AND PASSED:

AYES:

NOES:

ABSTENTIONS:

ABSENT:

ATTEST: APPROVED:

________________________ ______________________________ City Clerk Mayor

APPROVED AS TO FORM:

________________________ ______________________________ Assistant City Attorney City Manager

_____________________________
Director of Planning and
Development Services

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EXHIBIT 1

SB 9 Objective Design Standards
Revised 1/26/2024

Applicability: All SB 9 Projects must meet all requirements of the Zoning Code, including development standards, and special requirements for Flood Zones, Single-Story Overlays, etc.

They must additionally meet all applicable SB 9 Objective Design Standards (ODS) per PAMC

18.42.180(e)(2)).

Section A: All
The following ODS apply to all proposed new housing units as a part of an SB 9 project. When existing units do not meet the ODS, they shall be treated as existing non-conforming when proposing remodels.

A1: FRONT SETBACK Where the contextual front yard setback does not apply, the front setback shall be no less than the average front setback of the homes on lots to either side of the subject lot, up to a maximum of 25 feet. Otherwise, the zoning minimum front setback or special setback would still apply.

A2: STUCCO TEXTURE: When stucco is used it shall be steel-troweled ‘Smooth’ or ‘Santa Barbara’ texture as described in the Technical Services Information Bureau, Chapter 5 - Plaster Textures & Acrylic Finishes (2011). For additions, stucco plaster texture on the addition shall be allowed to match the stucco texture of the existing house.

A3: CONTEXTUAL PORCH ENTRIES: If porches (i.e., roofed, street-facing porches with posts/ column(s) and more than 3 feet deep), occur on more than half of the houses on the same side of the block, including the subject site, the proposed house(s) with street frontage shall include a street-facing porch no less than 4.5 feet deep and 6 feet wide.

A4: DRIVEWAYS: One curb cut and driveway per street frontage. Shared driveways are encouraged but require an easement to which the City is a third party.

A5: DRIVEWAY WIDTH: 18-foot maximum driveway width (inclusive of uncovered parking) within a front or street side yard setback.

A6: WALKWAY SEPARATION: Walkways shall be separated from driveways by a minimum of 2 feet of landscape planting or shall be a different paving material than the driveway.

A7: PLANTING STRIP: A minimum two-foot wide, landscaped planting strip is required between a driveway and/or uncovered parking space and an existing interior lot line.

A8: DRIVEWAY MATERIALS: Driveway and uncovered parking surfaces that exceed 10 feet in width shall not have asphalt or grey concrete surfaces. They must have a decorative surface to blend with the landscape such as stone pavers, grass pavers, or bricks.

A9: GARAGE LOCATION: Attached garages adjacent to the front setback must be located a minimum of 5 feet behind the forwardmost plane of the front facade or 3 feet behind the forwardmost plane of the street-side façade. The forwardmost façade plane may be a building wall or porch with posts/columns and must be at least 12 feet wide. In mapped Eichler neighborhoods, this standard does not apply.

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A10: GARAGE WIDTH: An attached garage or carport facing the street shall be no more than 30 percent of the total facade width facing that street, except that it may be 12 feet wide in any circumstance.

A11: GARAGE DOOR DESIGN AND MATERIALS: The garage door shall match the material, color, or panel design pattern of the entry door, window fenestration, or exterior cladding material.

A12: GARAGE DOOR SIZE: When visible from the street, the maximum garage door width shall be 16 feet and the maximum garage door height shall be 8 feet. If two single-wide garage doors are used instead of one double-wide door, each door's maximum width shall be 9 feet and maximum height 8 feet.

A13: ROOF DECK NOT PERMITTED: A roof deck (i.e., a deck above the first level of a single- story building or second level of a two-story building) shall not be permitted.

A14: ROOF HEIGHT FOR VARIED ROOF PITCHES: Roof height shall be limited to 27 feet for roofs with pitches 9:12 or greater, 25 feet for roofs with pitches 3:12, up to 9:12, and 22 feet for roofs with pitches less than 3:12, inclusive of parapets on flat roofs. In flood zones, the maximum height is increased by one-half of the increase in elevation required to reach base flood elevations, up to a maximum increase of 30 inches.

A15: GABLE ROOF FORMS: No more than three gable forms on an elevation facing a public street.

A16: BAY WINDOWS: No more than two bay windows on an elevation facing a public street.

A17: STREET-FACING WINDOWS: Each street-facing building elevation shall have at least 20 square feet of glazing in a large window, multi-panel window or glazed door, or bay window form, with minimum dimensions of 3 feet. In an Eichler tract, clerestory windows may have a reduced minimum dimension.

A18: WINDOW TO WALL DETAILING: Window frames shall be recessed at least 2 inches from the exterior wall face or have trim at least 2 inches wide and 0.5 inches thick on all four window sides. Stucco over foam shall not be used as window trim.

A19: WINDOW PATTERNS: Window fenestration with divided lite appearance shall have exterior applied muntin bars (i.e., true or simulated divided lites).

Section B: Two-Story Houses
The following ODS apply to SB 9 projects that include a new or expanded second story.

B1: SECOND FLOOR LOCATION: The second-floor area shall not be permitted within the standard side or rear setbacks of the underlying single-family zoning district.

B2: SECOND FLOOR SIZE: The maximum second-floor area shall not exceed 35 percent of the allowable gross floor area for the lot, or 400 sf, whichever is larger.

B3: CONTEXTUAL FIRST FLOOR EAVE HEIGHT: The height of the first floor's street-facing roof edges (i.e., eaves or parapets) shall not exceed 18 inches above the average height of the first-floor eave or parapet of the homes on the abutting lots at side lot lines as measured at those homes' eaves nearest the subject lot. This first-floor roof edge height limit shall also extend 15 feet back from the building corner. This standard shall be 24 inches within a flood zone if either of the abutting homes’ first-floor levels does not meet current flood zone regulations. This standard applies to the eave side of pitch roof forms and not the rake side such as at a gable.

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B4: CONTEXTUAL SECOND FLOOR EAVE HEIGHT: The height of the upper floor's street-facing roof edge (eave or parapet) shall not exceed 18 inches above either: (a) the average height of the upper floor street-facing eave or roof edge of homes to each side, or (b) in the case of only one home having a second floor, the height of that home's eaves.

B5: GARAGE HEIGHT AND MASS: Maximum height of a roof over an attached garage shall not exceed 15 feet in height as measured from existing grade. The maximum garage wall plate height shall not exceed 10 feet.

B6: SECOND FLOOR BALCONY LIMITATIONS: No more than one second-floor deck/balcony shall be permitted per dwelling and shall: (a) only be permitted on a street-facing facade, (b) be located at least 10 feet from any interior side lot line with a 5.5-foot-tall solid privacy wall or be located at least 30 feet from any interior side lot line, and (c) be limited in size to no more than 40 square feet.

B7: SCREENING LANDSCAPE: For two-story houses, plant screening trees with a species having a typical mature height of at least 25 feet and mature canopy width of 15 feet at a quantity of at least one per 25 linear feet along each interior lot line. Existing trees to be retained that are at least 25 feet tall and 15 feet wide count towards the required planting.

Three closely spaced tall screening shrubs with a mature height of at least 15 feet and a mature width of at least 3 feet may be substituted for one screening tree.

Privacy screening landscape shall be located to align with proposed second-floor windows across the side and rear lot lines and between windows at facing units on a single property.

B8: PLANTING TYPE AND SIZE: When required, screening trees and shrubs shall be specified by botanical name with at least 50 percent of screening trees and shrubs being evergreen.

Screening trees shall be specified and planted at 24-inch box size or larger and 8 feet height or taller. Screening shrubs shall be specified and planted at 15-gallon size or larger and 8 feet or taller.

B9: PLANTING ADJACENT PUE’S: Where an easement such as a PUE exists along an interior lot line, privacy landscaping is required to be planted on the same side of the easement as the building, but not within the easement.

B10: SECOND FLOOR WINDOW PRIVACY: For any window on an upper floor or in a stairway, facing an interior lot line that is located less than 20 feet from a side or rear lot line, one of the following shall be used: (a) permanent obscure glazing to at least 5 feet from the finished floor, or (b) exterior mounted permanent architectural privacy screens that block views more than 70%, or (c) windows with sills above 5 feet from the finished floor level. In a stairway, the finished floor is the height of the landing.

This standard shall also apply to first-floor windows less than 6 feet from a property line where the finished floor height is 2 feet or more above grade.

B11: SECOND FLOOR OPERABLE WINDOWS ALONG SIDE LOT LINES: Operable casement windows on the upper level with a sill height less than 5 feet above the finished floor and within 20 feet of an interior side lot line shall be hinged so the windows open towards the public street. Horizontal sliding windows shall not be permitted facing and within 20 feet of Item 10
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an interior side lot line, unless the windowsill height is at least 5 feet above the finish floor level.

Section C: New or Expanded Second Story Development Next to One-Story House(s) The following Standards apply when an SB 9 project includes a new or expanded second story adjacent to an existing one-story house.

C1: SIDE DAYLIGHT PLANE CLEARANCE: Where a home on an abutting lot across a side lot line is single-story or has a second-floor area no more than 500 square feet, the side daylight plane shall be measured from 8 ft above average grade instead of 10 ft. In the case of an Urban Lot Split, the daylight plane only applies to the original property lines.

In flood zones, the average grade for determining daylight plane is increased by one-half of the increase in elevation required to reach base flood elevations, up to a maximum increase of 30 inches.

C2: SINGLE-STORY BUILDING FORMS: Where a home on an abutting lot across a side lot line is single-story or has a second-floor area no more than 500 square feet, all houses with frontage on the street shall have either: (a) a one-story building form (excluding garages) at least 6 feet forward of the second-floor wall face, and at least 10 feet wide; or (b) a protruding porch or one-story roof overhang at least 6 feet deep, and at least 8 feet wide.

Section D: Flag Lots and Substandard Lots
The following ODS applies only for projects proposed on an existing flag lot or substandard lot. A lot created by an Urban Lot Split is not subject to this.

D1. SECOND FLOOR AREA ON FLAG LOTS AND SUBSTANDARD LOTS: On lots that are flag lots (or similar lots without street frontage) and/or substandard lots prior to an Urban Lot Split, a second floor shall only be allowed to facilitate the minimum 800 sf unit size.

Section E: Eichler Neighborhoods
The following ODS apply only in mapped Eichler Tracts, as listed on the map published in the Eichler Design Guidelines (2018)
E1: EICHLER TRACT GARAGES: In mapped Eichler Tracts, a garage or carport may be located forward of the front facade plane of the house so long as the garage or carport is: (a) no more than 21 feet wide, (b) has a roof pitch of 3:12 (slope of 3 vertical feet for every 12 horizontal feet) or less, and (c) has a maximum height of no more than 12 feet above existing grade.

E2: EICHLER TRACT GARAGES: In mapped Eichler Tracts, the garage may also count as the required 1-story form in ODS A9.

E3: EICHLER TRACT ROOF HEIGHTS: In mapped Eichler Tracts the maximum roof height shall not exceed 22 feet, as measured from existing grade to the roof surface. Properties in flood zones shall be permitted to increase building height by one-half foot for each foot that the base flood elevation exceeds the existing grade.

E4: ROOFLINES IN EICHLER TRACTS: In mapped Eichler Tracts rooflines shall meet the following: (a) roof pitches no more than 3:12, (b) gable, shed, butterfly, or flat roof forms, and (c) 2-foot minimum overhangs at eave and rake sides of roof forms for at least 50 percent of roof edges.

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E5: EXTERIOR MATERIALS IN EICHLER TRACTS: In mapped Eichler Tracts, exterior wall cladding shall be vertical board channel or flush siding, wood tongue, and groove board siding, wood nickel-gap siding, smooth fiber cement panels, or metal panels. Board-form concrete, concrete block, or stucco may be used as a secondary material, but collectively, these materials shall not account for more than 30 percent of all non-glazed wall surfaces.

E6: ENTRIES IN EICHLER TRACTS: In mapped Eichler Tracts, a projecting entry porch shall not be used. A covered trellis used as a colonnade or a side porch that does not project forward of the facade at the entry would not be considered an entry porch.

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Attachment B
SB 9 Objective Design Standards Revision Crosswalk
Table 1: Revised Objective Design Standards
Applicability Current SB 9 Objective Design Standards Proposed SB 9 Objective Design Standards Type of Change All

1.3C: FRONT SETBACK Where the contextual
front yard setback does not apply, the front
setback shall be no less than the average front
setback of the homes on lots to either side of
the subject lot. (Note: In all cases, the
zoning minimum front setback or
special setback would still apply.)
A1: FRONT SETBACK Where the contextual front
yard setback does not apply, the front setback
shall be no less than the average front setback of
the homes on lots to either side of the subject
lot, up to a maximum of 25 feet. Otherwise, the
zoning minimum front setback or
special setback would still apply.

Added that in no circumstance would
this standard create a setback larger
than 25 ft. on a property where the
contextual front yard setback does not
apply
All

4.3C: STUCCO TEXTURE: When stucco is used it
shall be steel-troweled ‘Smooth’ or ‘Santa
Barbara’ texture as described in the Technical
Services Information Bureau, Chapter 5 - Plaster
Textures & Acrylic Finishes (2011). For additions,
stucco texture on the addition shall be
allowed to match the stucco texture of the
existing house.

A2: STUCCO TEXTURE: When stucco is used it
shall be steel-troweled ‘Smooth’ or ‘Santa
Barbara’ texture as described in the Technical
Services Information Bureau, Chapter 5 - Plaster
Textures & Acrylic Finishes (2011). For additions,
stucco texture on the addition shall be
allowed to match the stucco texture of the
existing house.

No change
All

4.4A: CONTEXTUAL PORCH ENTRIES: If
porches (i.e.
roofed, street-facing porches with posts/column
(s) and more than 3 feet deep), occur on at least
50 percent of homes on the block of the subject
lot (counting only homes on the subject lot side
of the street), the proposed house shall include a
street-facing porch no less than 6 feet deep and
8 feet wide.

A3: CONTEXTUAL PORCH ENTRIES: If
porches (i.e., roofed, street-facing porches with
posts/ column(s) and more than 3
feet deep), occur on more than half of the
houses on the same side of the block, including
the subject site, the proposed house(s) with
street frontage shall include a street-facing
porch no less than 4.5 feet deep and 6 feet
wide.

Clarified this only applies to houses
with street frontage. Reduced the
minimum size of porch required.

All

1.1A: DRIVEWAYS: One curb cut and driveway
per street frontage. Shared driveways are
encouraged but require an easement to
which the City is a third party.

A4: DRIVEWAYS: One curb cut and driveway per
street frontage. Shared driveways are
encouraged but require an easement to
which the City is a third party.

No change
All

1.1B: DRIVEWAY WIDTH:
18-foot maximum driveway width (inclusive
of uncovered parking) within a front or street
side yard setback.

A5: DRIVEWAY WIDTH:
18-foot maximum driveway width (inclusive
of uncovered parking) within a front or street
side yard setback.

No change
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1.1D WALKWAY SEPARATION: Walkways shall be
separated from driveways by a minimum of 4
feet of landscape planting or extend
sideways (that is, perpendicular) from driveway
so that no additional parking or paved
turnaround space is created in a front or street
side yard beyond that of the maximum allowed
driveway width.

A6: WALKWAY SEPARATION: Walkways shall be
separated from driveways by a minimum of 2
feet of landscape planting or shall be a different
paving material than the driveway.

Reduces minimum separation to allow
for easier compliance on narrower lots.

All

1.1C. PLANTING STRIP: A minimum
two-foot wide, landscaped planting strip
is required between a driveway and/or
uncovered parking space and an interior lot line.

A7. PLANTING STRIP: A minimum two-foot wide,
landscaped planting strip is required between a
driveway and/or uncovered parking space and
an interior lot line.

No change
All

1.1F: DRIVEWAY MATERIALS: Driveway and
uncovered parking surfaces that exceed 10 feet
in width shall not have asphalt or grey concrete
surfaces. They must have a decorative surface to
blend with the landscape such pavers, brick, or
colored concrete.

A8: DRIVEWAY MATERIALS: Driveway and
uncovered parking surfaces that exceed 10 feet
in width shall not have asphalt or grey concrete
surfaces. They must have a decorative surface to
blend with the landscape such as stone pavers,
grass pavers, or bricks.

Removed colored concrete as an
option.

All

1.2A: GARAGE LOCATION: Attached or detached
garages/carports must be located a minimum of
5 feet behind the forwardmost plane of the front
facade or 3 feet behind the forwardmost plane
of the street-side façade.

The forwardmost façade plane may be a building
wall or porch with posts/columns and must be at
least 12 feet wide.

A9: GARAGE LOCATION: Attached garages
adjacent to the front setback must be located a
minimum of 5 feet behind
the forwardmost plane of the front facade or 3
feet behind the forwardmost plane of
the street-side façade. The forwardmost façade
plane may be a building wall or porch with
posts/columns and must be at least
12 feet wide.

In mapped Eichler neighborhoods, this standard
does not apply.

Simplified text, detached garages are
already required to be back from the
front property line. Clarified that this
standard only applies when the garage
is near a front/street side setback.

All

1.2B: GARAGE WIDTH: An attached or detached
garage/carport facing the street shall be no
more than 30 percent of the total facade width
facing that street, except that it may be 12 feet
wide in any circumstance.

A10: GARAGE WIDTH: An attached garage or
carport facing the street shall be no more than
30 percent of the total facade width facing that
street, except that it may be 12 feet wide in any
circumstance.

No change
All

4.5A: GARAGE DOOR DESIGN AND MATERIALS:

The garage door shall match the material, color,
and panel design pattern of the entry door or
window fenestration.

A11: GARAGE DOOR DESIGN AND MATERIALS:

The garage door shall match the material, color,
or panel design pattern of the entry door,
Added option for garage door to match
exterior cladding material
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window fenestration, or exterior cladding
material.

All

4.5B: GARAGE DOOR SIZE: The maximum garage
door width shall be 16 feet and the maximum
garage door height shall be 8 feet. If two single-
wide garage doors are used instead of one
double-wide door, each door's maximum width
shall be 9 feet and maximum height 8 feet.

A12: GARAGE DOOR SIZE: When visible from the
street, the maximum garage door width shall be
16 feet and the maximum garage door height
shall be 8 feet. If two single-wide garage
doors are used instead of one double-wide door,
each door's maximum width shall be 9 feet and
maximum height 8 feet.

No change
All

5.4B: ROOF DECK NOT PERMITTED: A roof deck
(i.e., a deck above of the first level of a single-
story building or second level of a two-story
building) shall not be permitted.

A13: ROOF DECK NOT PERMITTED: A roof deck
(i.e., a deck above the first level of a single-story
building or second level of a two-story building)
shall not be permitted.

No change
All

2.1B: ROOF HEIGHT FOR VARIED ROOF PITCHES:

Roof height shall be limited to 27 feet for roofs
with pitches 9:12 or greater, 25 feet for roofs
with pitches 3:12, up to 9:12, and 22
feet for roofs with pitches less than 3:12.

Properties in flood zones shall be permitted to
increase building height by one-half foot for
each foot that the base flood elevation exceeds
existing grade.

A14: ROOF HEIGHT FOR VARIED ROOF PITCHES:

Roof height shall be limited to 27 feet for roofs
with pitches 9:12 or greater, 25 feet for roofs
with pitches 3:12, up to 9:12, and 22
feet for roofs with pitches less than 3:12,
inclusive of parapets on flat roofs. In flood zones,
the maximum height is increased by one-half of
the increase in elevation required to reach base
flood elevations, up to a maximum increase of
30 inches.

Text edits to floor zone language to be
consistent with PAMC 18.12
All

3.4A: GABLE ROOF FORMS: No more
than three gable forms on an elevation facing a
public street.

A15: GABLE ROOF FORMS: No more
than three gable forms on an elevation facing a
public street.

No change
All 3.4B: BAY WINDOWS: No more than two bay
windows on an elevation facing a public street.

A16: BAY WINDOWS: No more than two bay
windows on an elevation facing a public street.

No change
All

4.1A: FAÇADE VISUAL FOCAL POINT: Each street
facing building elevation shall have a significant
visual focal point, defined as either: (a) at least
50 square feet of glazing in a large window,
multi-panel window or glazed door, or bay
window form, or (b) a roofed or trellised porch
at least 6 feet deep and 8 feet wide and no more
than 12 feet tall.

A17: STREET-FACING WINDOWS: Each street-
facing building elevation shall have at least 20
square feet of glazing in a large window, multi-
panel window or glazed door, or bay window
form, with minimum dimensions of 3 feet.

In an Eichler tract, clerestory windows may have
a reduced minimum dimension.

Intent clarified to require window(s)
facing the street. Minimum window
sized reduced to allow broader
architectural styles and accommodate
smaller units.

Porch requirements are in ODS A3.

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4.3A: WINDOW TO WALL DETAILING: Window
frames shall be recessed at least 2 inches from
the exterior wall face or have trim at least 3.5
inches wide on all four window sides. Stucco
over foam shall not be used as window trim.

A18: WINDOW TO WALL DETAILING: Window
frames shall be recessed at least 2 inches from
the exterior wall face or have trim at least 2
inches wide and 0.5 inches thick on all four
window sides. Stucco over foam shall not be
used as window trim.

Changed minimum window trim from

3.5 wide to 2 in wide and .5 in thick.

All

4.3B: WINDOW PATTERNS: Window fenestration
with divided lite appearance shall have exterior
applied muntin bars (i.e., true or simulated
divided lites).

A19: WINDOW PATTERNS: Window fenestration
with divided lite appearance shall have exterior
applied muntin bars (i.e., true or simulated
divided lites).

No change
Applicability Current SB 9 Objective Design Standards Proposed SB 9 Objective Design Standards Type of Change Two Story

1.3D: SECOND FLOOR STEPBACKS: Second floor
area shall not be permitted within
the standard side or rear setbacks of the
underlying single family zoning district.

B1: SECOND FLOOR LOCATION: Second floor
area shall not be permitted within
the standard side or rear setbacks of the
underlying single family zoning district.

No change
Two Story

1.3A: SECOND FLOOR SIZE: The maximum floor
area above the first-floor level: (a) shall not
exceed 35 percent of total gross floor area on
the lot except as noted in
subsection (b) or Standard 1.3B. (b) shall not
exceed 30 percent of the total gross floor area
where an abutting lot along a side lot line has a
one-story home or home with no more than 500
square feet of second floor area.

B2: SECOND FLOOR SIZE: The maximum second-
floor area shall not exceed 35 percent of the
allowable gross floor area for the lot, or 400 sf,
whichever is larger.

Simplified text, and provided a
minimum allowable second floor area
to accommodate at least two
bedrooms and bathrooms on the
second floor, for families.

Two Story

2.3A: CONTEXTUAL FIRST FLOOR EAVE HEIGHT:

The height of the first floor's street facing roof
edges (i.e., eaves or parapets) shall not exceed
18 inches above the average height of the first-
floor eave or parapet of the homes on the
abutting lots at side lot lines as measured at
those homes' eaves nearest the subject lot. This
first-floor roof edge height limit shall also extend
15 feet back from the building corner. This
standard shall be 24 inches within a flood zone if
either of the abutting homes’ first-floor level
does not meet current flood zone regulations.

This standard applies to the eave side of pitch
B3: CONTEXTUAL FIRST FLOOR EAVE HEIGHT:

The height of the first floor's street-facing roof
edges (i.e., eaves or parapets) shall not exceed
18 inches above the average height of the first-
floor eave or parapet of the homes on the
abutting lots at side lot lines as measured at
those homes' eaves nearest the subject lot. This
first-floor roof edge height limit shall also extend
15 feet back from the building corner. This
standard shall be 24 inches within a flood zone if
either of the abutting homes’ first-floor levels
does not meet current flood zone regulations.

This standard applies to the eave side of pitch
No change
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roof forms and not the rake side such as at a
gable.
roof forms and not the rake side such as at a
gable.

Two Story

2.3B: CONTEXTUAL SECOND FLOOR EAVE
HEIGHT: The height of the upper floor's street
facing roof edge (eave or parapet) shall not
exceed 18 inches above either: (a) the average
height of the upper floor street facing eave or
roof edge of homes to each side, or (b) in the
case of only one home having a second floor, the
height of that home's eaves.

B4: CONTEXTUAL SECOND FLOOR EAVE HEIGHT:

The height of the upper floor's street-facing roof
edge (eave or parapet) shall not exceed 18
inches above either: (a) the average height of
the upper floor street-facing eave or roof edge
of homes to each side, or (b) in the case of only
one home having a second floor, the height of
that home's eaves.

No change
Two Story

3.1A: GARAGE HEIGHT AND MASS: Maximum
height of a roof over an attached garage shall
not exceed 15 feet in height as measure from
existing grade. The maximum garage wall plate
height shall not exceed 10 feet.

B5: GARAGE HEIGHT AND MASS: Maximum
height of a roof over an attached garage shall
not exceed 15 feet in height as measure from
existing grade. The maximum garage wall plate
height shall not exceed 10 feet.

No change
Two Story

5.4A: SECOND FLOOR BALCONY LIMITATIONS:

No more than one second floor deck/balcony
shall be permitted per dwelling and
shall: (a) only be permitted on a street facing
facade, (b) be located at least 20 feet from any
interior side lot line, and (c) be limited in size to
no more than 40 square feet.

B6: SECOND FLOOR BALCONY LIMITATIONS: No
more than one second-floor deck/balcony shall
be permitted per dwelling and shall: (a) only
be permitted on a street-facing
facade, (b) be located at least 10 feet from any
interior side lot line with a 5.5-foot-tall solid
privacy wall or be located at least 30 feet from
any interior side lot line, and (c) be limited in size
to no more than 40 square feet.

Added privacy wall requirement to
allow balconies 10-30 feet of a side
property line
Two Story

1.4A: SCREENING LANDSCAPE: Plant screening
trees with a species having a typical mature
height of at least 25 feet, and mature canopy
width of 15 feet at a quantity of at least one per
25 linear feet along each interior lot line. Existing
trees to be retained that are at least 25 feet tall
and 15 feet wide may substitute for required
planting on a one-to-one ratio. Three closely
spaced tall screening shrubs with a mature
height of at least 20 feet and mature width of at
least 5 feet may be substituted for one screening
tree.

B7: SCREENING LANDSCAPE: For two-story
houses, plant screening trees with a species
having a typical mature height of at least 25
feet and mature canopy width of 15 feet at a
quantity of at least one per 25 linear feet along
each interior lot line. Existing trees to
be retained that are at least 25 feet tall and 15
feet wide count towards the required planting.

Three closely spaced tall screening shrubs with a
mature height of at least 15 feet and a mature
width of at least 3 feet may be substituted for
one screening tree.

Privacy screening landscape shall be located to
align with proposed second-floor windows
Clarified intent of the standard
regarding spacing and placement of
trees/shrubs. Combined with text from

5.2D
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across the side and rear lot lines and between
windows at facing units on a single property.

Two Story

1.4B: PLANTING TYPE AND SIZE: Screening trees
and shrubs shall be specified by botanical name
with at least 50 percent of screening trees and
shrubs being evergreen. Screening trees shall be
specified and planted at 24-inch box size or
larger and 8 feet height or taller. Screening
shrubs shall be specified and planted at 15-
gallon size or larger and 8 feet or taller.

B8: PLANTING TYPE AND SIZE: When required,
screening trees and shrubs shall be specified by
botanical name with at least 50 percent of
screening trees and shrubs being evergreen.

Screening trees shall be specified and planted at
24-inch box size or larger and 8 feet height or
taller. Screening shrubs shall be specified and
planted at 15-gallon size or larger and 8 feet or
taller.

Clarified text
Two Story

1.4C: PLANTING ADJACENT PUE’S: Where an
easement such as a PUE exist along an interior
lot line, trees are required to be planted on the
same side of the easement as the building, but
not within the easement.

B9: PLANTING ADJACENT PUE’S: Where an
easement such as a PUE exist along an interior
lot line, trees are required to be planted on the
same side of the easement as the building, but
not within the easement.

No change
Two Story

5.2B: SECOND FLOOR WINDOW PRIVACY: For
any window on an upper floor, facing an interior
lot line that is located less than 20 feet from a
side lot line or less than 30 feet from a rear lot
line, one of the following
shall be used: (a) permanent obscure
glazing, or (b) exterior mounted permanent
architectural privacy screens that block views
more than 70%, or (c) windows with sills above
5 feet from the finished floor level.

B10: SECOND FLOOR WINDOW PRIVACY: For any
window on an upper floor or in a stairway, facing
an interior lot line that is located less than 20
feet from a side or rear lot line, one of the
following shall be used: (a) permanent obscure
glazing to at least 5 feet from the finished
floor, or (b) exterior mounted permanent
architectural privacy screens that block views
more than 70%, or (c) windows with sills above 5
feet from the finished floor level. In a stairway,
the finished floor is the height of the landing.

This standard shall also apply to first-floor
windows less than 6 feet from a property line
where the finished floor height is 2 feet or more
above grade.

Simplified distance to 20 ft from any
interior lot line, combined stairway
requirements from 5.2C. Added privacy
requirements for first-floor windows in
specific situations consistent with
PAMC 18.09.

Two Story

5.3B: SECOND FLOOR OPERABLE WINDOWS
ALONG SIDE LOT LINES: Operable casement
windows on the upper level with a sill height less
than 5 feet above the finished floor and within
20 feet of an interior side lot line shall be hinged
so the windows open towards the public street.

Horizontal sliding windows shall not
B11: SECOND FLOOR OPERABLE WINDOWS
ALONG SIDE LOT LINES: Operable casement
windows on the upper level with a sill height less
than 5 feet above the finished floor and within
20 feet of an interior side lot line shall be hinged
so the windows open towards the public street.

Horizontal sliding windows shall not
No change
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be permitted facing and within 20 feet of an
interior side lot line, unless the windowsill height
is at least 5 feet above the finish floor level.
be permitted facing and within 20 feet of an
interior side lot line, unless the windowsill height
is at least 5 feet above the finish floor level.

Applicability Current SB 9 Objective Design Standards Proposed SB 9 Objective Design Standards Type of Change Two Story
Adjacent to
One Story

1.5C: SIDE DAYLIGHT PLANE CLEARANCE: Where
a home on an abutting lot across a side lot line
is single-story or has a second-floor area no
more than 500 square feet, the proposed
structure(s) shall maintain at least 2 feet
clearance from the second-floor roof edge or
wall parapet to the side daylight plane as
measured perpendicularly to the side daylight
plane.

C1: SIDE DAYLIGHT PLANE CLEARANCE: Where a
home on an abutting lot across a side lot line
is single-story or has a second-floor area no
more than 500 square feet, the side daylight
plane shall be measured from 8 ft above average
grade instead of 10 ft. In the case of an Urban
Lot Split, the daylight plane only applies to the
original property lines.

In flood zones, the average grade for
determining daylight plane is increased by one-
half of the increase in elevation required to
reach base flood elevations, up to a maximum
increase of 30 inches.

Simplified how this is measured. Allows
for flood zone height increase
consistent with PAMC 18.12
Two Story
Adjacent to
One Story

2.5A: SINGLE-STORY BUILDING FORMS: At least
one single-story building form (excluding
garages) with dimensions no greater than 16
feet in height, no less than 8 feet in depth, and
no less than 12 feet in width shall be placed on
each street facing building side. Location shall be
either: (a) fully forward of the second floor's
wall face, or (b) partially forward or aligned with
the second floor's wall face if the one-story form
is at a building corner.

C2: SINGLE-STORY BUILDING FORMS: Where a
home on an abutting lot across a side lot line
is single-story or has a second-floor area no
more than 500 square feet, all houses with
frontage on the street shall have either: (a) a
one-story building form (excluding garages) at
least 6 feet forward of the second-floor wall
face, and at least 10 feet wide; or (b) a
protruding porch or one-story roof overhang at
least 6 feet deep, and at least 8 feet wide.

Now only applies when adjacent to a
single-story house. Simplified text,
reduced minimum dimensions.

Existing Flag
and
Substandard
Lots

1.3E. SECOND FLOOR AREA ON FLAG LOTS AND
SUBSTANDARD LOTS: On flag lots (or similar lots
without street frontage) and/or substandard
lots, if the maximum allowed total floor area is
greater than 70 percent of the buildable lot area,
floor area may be placed on a second level. The
maximum second floor area allowed shall be the
area in excess of 70 percent of the buildable lot
area or 300 square feet, whichever is greater.

D1. SECOND FLOOR AREA ON FLAG LOTS AND
SUBSTANDARD LOTS: On lots that are flag lots
(or similar lots without street frontage) and/or
substandard lots prior to an Urban Lot Split, a
second floor shall only be allowed to facilitate
the minimum 800 sf unit size.

No change
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Applicability Current SB 9 Objective Design Standards Proposed SB 9 Objective Design Standards Type of Change Eichler

1.2C: EICHLER TRACT GARAGES: In mapped
Eichler Tracts, a garage or carport may
be located forward of the front facade plane of
the house so long as the garage or carport
is: (a) no more than 21 feet wide, (b) has a roof
pitch of 3:12 (slope of 3 vertical feet for every 12
horizontal feet) or less, and (c) has a maximum
height of no more than 12 feet above existing
grade.

E1: EICHLER TRACT GARAGES: In mapped Eichler
Tracts, a garage or carport may
be located forward of the front facade plane of
the house so long as the garage or carport
is: (a) no more than 21 feet wide, (b) has a roof
pitch of 3:12 (slope of 3 vertical feet for every 12
horizontal feet) or less, and (c) has a maximum
height of no more than 12 feet above existing
grade.

No change
Eichler

2.5B: Within mapped Eichler Tracts, garages may
serve as the form in Standard 2.5A, and no roof
pitch shall exceed 3:12. (See Standard 3.2C).

E2: EICHLER TRACT GARAGES: In mapped Eichler
Tracts, the garage may also count as the
required 1-story form in ODS A9.

Updated references
Eichler

2.1C: EICHLER TRACT ROOF HEIGHTS: In mapped
Eichler Tracts the maximum roof height shall not
exceed 22 feet, as measured from existing grade
to the roof surface for a pitched
roof, or 20 feet for a flat roof surface or parapet.

Properties in flood zones shall be permitted to
increase building height by one-half foot for
each foot that the base flood elevation exceeds
existing grade.

E3: EICHLER TRACT ROOF HEIGHTS: In mapped
Eichler Tracts the maximum roof height shall not
exceed 22 feet, as measured from existing grade
to the roof surface.

Properties in flood zones shall be permitted to
increase building height by one-half foot for
each foot that the base flood elevation exceeds
the existing grade.

Simplified text, more consistent with
A14.

Eichler

3.2C: ROOFLINES IN EICHLER TRACTS: In mapped
Eichler Tracts rooflines shall meet the
following: (a) roof pitches no more than
3:12, (b) gable, shed, butterfly or flat roof forms
(note: hip roofs with flat roofs at
eaves permitted; see Illustration 1D of the IR
guidelines for example),
and (c) 2-foot minimum overhangs at eave and
rake sides of roof forms for at least 50 percent of
roof edges.

E4: ROOFLINES IN EICHLER TRACTS: In mapped
Eichler Tracts rooflines shall meet the
following: (a) roof pitches no more than
3:12, (b) gable, shed, butterfly, or flat roof
forms, and (c) 2-foot minimum overhangs at
eave and rake sides of roof forms for at least 50
percent of roof edges.

Simplified text
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Eichler

4.3D: EXTERIOR MATERIALS IN EICHLER TRACTS:

In mapped Eichler Tracts, exterior wall cladding
shall be vertical board channel or flush siding,
wood tongue and groove board siding, wood
nickel-gap siding, smooth fiber cement panels,
or metal panels. Board-form concrete, concrete
block, or stucco may be used as a secondary
material but collectively these materials shall not
account for more than 30 percent of all non-
glazed wall surfaces.

E5: EXTERIOR MATERIALS IN EICHLER TRACTS: In
mapped Eichler Tracts, exterior wall cladding
shall be vertical board channel or flush siding,
wood tongue, and groove board siding, wood
nickel-gap siding, smooth fiber cement panels,
or metal panels. Board-form concrete, concrete
block, or stucco may be used as a secondary
material, but collectively, these materials shall
not account for more than 30 percent of all non-
glazed wall surfaces.

No change
Eichler

4.4B: ENTRIES IN EICHLER TRACTS: In mapped
Eichler Tracts an entry porch projecting forward
of the front wall of the house shall not be used.

A recessed void at the facade or a courtyard
entry may be used in lieu of a porch. A covered
trellis used as a colonnade or a side porch that
does not project forward of the facade at the
entry would not be considered an entry porch.

E6: ENTRIES IN EICHLER TRACTS: In mapped
Eichler Tracts, a projecting entry porch shall not
be used. A covered trellis used as a colonnade or
a side porch that does not project forward of the
facade at the entry would not be considered an
entry porch.

Simplified text
Table 2: Objective Design Standards Proposed for Deletion Applicability Current SB 9 Objective Design Standards Type of Change Delete

1.2D: DUPLEX PARKING REQUIREMENT: In the case of a duplex, when parking spaces are required, the parking space for each unit shall be a covered parking space.

One covered space is required by PAMC 18.52 for all SB 9 units regardless of configuration, unless exempted from parking requirements by State Law.

Delete

1.3B: EICHLER TRACT SECOND FLOOR SIZE: Where a property is in a mapped Eichler Tract, and not in a single-story overlay zone, the maximum floor area of the second floor shall not exceed 25 percent of the total gross floor area on the lot.

This standard was originally changed to be the same as B2 (35% of the floor area), and then eliminated because it was redundant with B2.

Delete

1.5A: CONTEXTUAL FRONT MASSING STEPBACK: Where a home on an abutting lot across a side lot line is single-story or has a second-floor area less than 500 square feet, a proposed structure shall have a one- story building volume at least 15-foot wide and 15-foot deep at the front side of the house set forward of any second-floor street facing wall plane.

Intent of this standard is now in C2.

Item 10
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Standards Revision Crosswalk

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Delete

1.5B: CONTEXTUAL SIDE MASSING STEPBACK: Where a home on an abutting lot across a side lot line is single-story or has a second-floor area less than 500 square feet, each proposed structure located within 20 feet of the side lot line shall step back the upper floor from the lower floor along that side of the structure at least 7 feet for at least 50 percent of the depth of the structure.

Feedback indicated the Daylight Plane was the preferred way to regulate this.

Delete

1.5D: EICHLER TRACT SIDE DAYLIGHT PLANE CLEARANCE: In mapped Eichler Tracts the clearance from any roof edge to the side daylight plane as measured perpendicularly from the daylight plane shall be at least 4 feet.

Determined 4 feet was overly restrictive, this scenario is now regulated by C1.

Delete

2.1A: UPPER FLOOR FRONT FAÇADE AREA: Where an abutting lot across a side lot line has a single-story home or home with no more than 500 square feet on the second floor, the front facade's visible wall area on the upper floor shall be no greater than 50 percent of the front facade's visible wall area on the first floor. Wall area includes the area defined by porches, windows, and wall surfaces under gables. On corner lots, the front facade shall be the facade at the shorter frontage.

The 2nd floor façade width would be sufficiently regulated by the daylight plane. This was also very difficult to interpret and calculate.

Delete

2.2A: FIRST FLOOR LEVEL: The finished first floor level shall not be more than 18 inches above existing grade. In Eichler Tracts, the finished first floor level shall not be more than 12 inches above existing grade. In a flood zone, the first-floor level may be set at the minimum allowed above grade to meet code requirements. For a lot removed from the flood zone due to on-site grading, the measurement shall be taken from revised grade.

This is sufficiently addressed by the other height restrictions (A13, B3, B4), and was overly strict in flood zones.

Delete

2.2B: FLOOR-TO-FLOOR HEIGHT: The height from the first finished floor to the second finished floor shall not exceed 10'-6”.

Feedback indicated regulating interior height was overly restrictive.

The exterior height limits (A14, B3, B4) are sufficient to not need to regulate interior height.

Delete

2.2C: SECOND FLOOR WALL PLATE HEIGHT: The wall plate height (i.e., interior wall height at exterior wall) on the second floor shall not exceed 9 feet for roofs with pitches 3:12 or lower; 8'-6" for roofs with pitches greater than 3:12 up to 9:12; and 8 feet for roofs with pitches 9:12 or greater.

The exterior height limits are sufficient to not need to regulate interior height.

Delete 2.2D: PARAPET HEIGHT: Parapets shall not exceed 1 foot above the roof surface over second floor roofs.

The overall height limits are sufficient.

Delete 2.6A: ATTIC HEIGHT: Unused attic spaces shall not exceed 5 feet in height.

The Zoning Code FAR and height regulations already discourage this.

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Standards Revision Crosswalk

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Delete

2.6B: EXTERIOR WALL HEIGHT: No exterior wall shall exceed 22 feet in height as measured from existing grade to the eave or parapet.

Portions of walls under rakes such as at gables or shed roof forms may exceed this height.

Feedback indicated the 22ft felt arbitrary, and other standards such as C1, B3, and the daylight plane sufficiently regulate this Delete 3.1B: ENTRY HEIGHT: Exterior entry forms shall not exceed 12 feet in height as measured from existing grade.

The Zoning Code FAR and height regulations already discourage this.

Delete

3.2A: ROOF FORM VARIATION: No more than two types of roof forms shall be used (examples of two forms are hip and gable roofs or shed and flat roofs).

Feedback indicated this was overly restrictive, and did not sufficiently account for entry accents or similar.

Delete 3.2B: ROOF PITCH VARIATION: No more than two roof pitches shall be used (e.g., 4:12 and 12:12; 6:12 and flat).

Feedback indicated this was overly restrictive, and did not sufficiently account for entry accents or similar.

Delete

3.3A: INCOMPLETE ROOF FORMS: Truncated hip and gable roof forms shall not be permitted at second floor roofs on two-story structures or roofs at single story structures. Note: A truncated roof form is where the roof planes do not extend to a ridgeline; rather they terminate with a flat roof or roof well.

Feedback indicated that truncated roof forms can be a useful tool in reducing overall height. Typically, this is not visible from the public right of way. It also unnecessarily restricts historically recognized forms such as Dutch gables.

Delete

3.5A: CONTEXTUAL ROOF PITCH: On properties adjacent to single story homes along either interior side lot line, roof pitches on new two-story buildings shall be 6:12 or lower.

Feedback indicated this was unnecessary considering other eave and roof height restrictions (A14, B3, B4)
Delete

4.2A: WINDOW ALIGNMENT: Windows on two-story wall planes that face a street shall be aligned vertically unless there is a change in exterior materials from the lower floor to the upper floor.

Feedback indicated this was overly restrictive, “aligned vertically” was also unclear to interpret.

Delete

4.2B: FAÇADE ELEMENT SPACING: Focal points such as porches, large/featured windows, and bay windows shall be spaced at least 5 feet horizontally apart from each other when placed on the same level/floor.

Feedback indicated this was overly restrictive, particularly for smaller units. It also had unintended limitations, such as preventing “large windows” from being under a porch.

Delete

5.1A: PRIVACY DIAGRAM: Site Privacy Diagram must show the proposed second-floor plan including windows, major on-site vegetation, and all elements on the neighboring property within 25 feet of the subject property line. For adjacent sites show major vegetation, building footprints, windows (indicate size and location), and patios within 25 feet of the property lines shall be provided in the project plan set.

This is a submittal checklist requirement, not a Design Standard.

Delete

5.2A: BEDROOM WINDOW LOCATION: Organize the second-floor plan so at least one bedroom has its largest/egress window facing the front lot line. On corner lots, at least one bedroom’s largest/egress window shall also face the street side lot line.

The privacy requirements (B10, B11) already encourage this.

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Standards Revision Crosswalk

Item 10: Staff Report
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Delete

5.2C: STAIR WINDOW PRIVACY: Stair windows facing interior side lot lines within 20 feet of the lot line shall have permanent obscure glazing or exterior mounted permanent architectural privacy screens to at least 5 feet above the landing.

Combined into standard B10.

Delete

5.2D: PRIVACY LANDSCAPE: Privacy screening landscape shall be located to align with proposed second floor windows across side and rear lot lines and between windows at facing units on a single property. Privacy screening landscape shall be evergreen and per size and planting standards shown in Standard 1.4.

Combined into standard B7.

Delete

5.3A: SECOND FLOOR WINDOW SIZE ALONG SIDE LOT LINES: Any upper-level window or window grouping located less than 20 feet from a side interior lot line (measured perpendicularly) shall not have more than 30 square feet of glazing.

The privacy requirements (B10, B11) already encourage this, and/or sufficiently mitigate privacy for larger windows.

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City Council
Staff Report
From: City Manager
Report Type: ACTION ITEMS
Lead Department: Administrative Services
Meeting Date: February 12, 2024
Report #:2311-2233
TITLE
Discuss the FY 2024 Mid-Year Budget Review and Approve 1) FY 2024 Budget Amendments in Various Funds, and 2) Amendments to the FY 2024 Table of Organization to add 1.00 Full Time Equivalent (FTE) Position. CEQA Status – Not a Project.

RECOMMENDATION
Staff recommends that the City Council review, discuss, and approve:
1) Amendments to the Fiscal Year 2024 Budget Appropriation for various funds and various capital projects, as identified in Attachment A, Exhibits 1 and 2 (requires a supermajority, 2/3 approval); and
2) Amend the FY 2024 Table of Organization in Attachment B consistent with the budget amendments in Attachment A, adding 1.00 full time position.

EXECUTIVE SUMMARY
This report provides an extensive update on the City’s financial status as of December 31, 2023.

Included in this report are:
1) Recommended budget adjustments to FY 2024 that reflect urgent / high priority fiscal needs, revenue supported program activities, and technical adjustments, 2) Recommended changes in staffing levels in FY 2024 adding 2.00 positions and deleting 1.00 position,
3) Updated information on the City’s financial position and outlook in FY 2024 including positioning for the upcoming FY 2025 budget process, and 4) FY 2024 2nd quarter financial status updates (Attachment C).

The next significant financial planning and budget discussions will be the review of the FY 2025 proposed operating and capital budgets and municipal fee schedule (May 2024 – June 2024) and recommended utility rate updates (March 2024 – June 2024).

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This report addresses the City Council referral adopted with the FY 2024 budget to revisit key Council priority investments, makes recommended funding adjustments based on activities through December 2023, and proposes technical adjustments. If approved, these actions will authorize investments for immediate needs and key priority areas to be addressed in FY 2024 (rather than waiting for the FY 2025 budget process) and position the Council for its FY 2025 budget deliberations in the coming months with the most current financial projections.

The balancing strategy works to continue the practice of funding ongoing activities with ongoing revenue sources to continue use of the uncertainty reserve and excess savings in the Budget Stabilization Reserve to offset projected deficits for the next several years. If this report is approved as recommended, the Uncertainty Reserve will maintain a balance of $9.5 million and the Budget Stabilization will remain at $57.2 million, $3.3 million above the Council- approved 20% level or $53.9 million. These amounts are in line with estimates provided in the FY 2025-2034 Long Range Financial Forecast (LRFF) and this reserve funding will be used in the financial planning for the FY 2025 Proposed Budget and beyond. Staff will continue to monitor these estimates and may bring forward a year-end budget adjustment report in June with any additional refinements to budgeted levels based on the most current information available.

The City Council may amend the annual budget through appropriate motion; Attachment A and B, if approved as recommended, provide the necessary transactional information for official amendment of the annual budget. The budget appropriation actions require a supermajority approval by the City Council (PAMC 2.28.080(c)(1)), or five (5) votes.

BACKGROUND
Staff provides the Mid-Year Budget Review to report the financial status of major funds and the Capital Improvement Program as of the second quarter (Q2) of the current fiscal year and recommends adjustments to the Adopted Budget. This Mid-year Budget Review also recommends funding for priority initiatives in advance of the FY 2025 budget process in alignment with expressed priorities by the City Council during the FY 2024 Adopted Budget process. Additionally, this report aligns estimates for significant changes that have occurred in FY 2024, including projections for major tax revenues.

In the first half of FY 2024, staff brought forward the FY 2023 Annual Comprehensive Financial Report (ACFR) (Staff Report 2311-2230)1 for Council approval and the First Quarter (Q1) FY 2024 Financial Report (Staff Report 2307-1774)2 as an informational report. Staff reported higher annual earnings for general fund revenues in FY 2023 as compared to the budget primarily due to a faster recovery of major tax revenues in the last two quarters of the fiscal year. This recovery trend continued in the first and second quarter of FY 2024, with several major tax 1 January 16, 2024 City Council Meeting: FY 2023 Annual Comprehensive Financial Report https://cityofpaloalto.primegov.com/Portal/Meeting?meetingTemplateId=13566 2 January 22, 2024 City Council Meeting: FY 2024 First Quarter Financial Status Report https://cityofpaloalto.primegov.com/Portal/Meeting?meetingTemplateId=13333 Item 11
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revenue categories tracking to exceed budgeted levels; actual year end results may vary due to continued economic uncertainty. Staff is recommending that the City Council recognize this additional funding as part of this report and anticipates using this additional one-time funding and reserves to support near-term funding priorities and bridge projected shortfalls as part of the FY 2025 budget development. Longer term, staff expects that economic recovery and a more diverse revenue base will help to stabilize the fiscal outlook.

Where possible, budget change recommendations are brought forward for City Council consideration as part of the approval of the Mid-Year Budget Report to consolidate requests and streamline changes to budget appropriations. These adjustments are necessary as revenues and expenditures vary from the original budget plan for many reasons such as changes in economic factors, project estimates and scope, and City Council policy and direction.

The Mid-Year Budget Report reflects adjustments to align with prior City Council approved direction, fund Council priorities deferred from the FY 2024 Adopted Budget, and clean-up actions based on FY 2023 actual experience or current FY 2024 actual activities.

As discussed in the FY 2025-2034 Long Range Financial Forecast (LRFF)3, and consistent with the projections in the FY 2024 Adopted Budget, deficits are reflected in the near term due to ongoing resources added to support priority initiatives and projected economic stagnation.

Ongoing financial stability will require continued prioritization of spending and utilization of one-time surplus funding and the Uncertainty Reserve to address short term deficits in the next few years.

ANALYSIS
This item serves as a continuation of the many touch points as the City balances responding to emergent priorities with following through on established commitments. Findings and recommended adjustments in this report are based on the data available at the time of reporting and reflect preliminary 2nd Quarter financial activity in FY 2024 (Attachment C). Final Q2 data is typically available at the end of March 2024, though material differences are not expected.

The staff report provides discussion of the balancing strategy as well as key highlights from the detailed adjustments. This report is organized as follows:
1) FY 2024 Mid-Year Budget Adjustments (Attachment A)
a. General Fund
i. Mid-Year Budget Review Balancing Strategy Summary
ii. Recommended Amendments to the FY 2024 Adopted Budget iii. Position/Table of Organization Changes Summary (Attachment B) iv. City’s Financial Position in FY 2024 and FY 2025
3 January 22, 2024 City Council Meeting: 2025-2034 Long Range Financial Forecast https://cityofpaloalto.primegov.com/Portal/Meeting?meetingTemplateId=13333 Item 11
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b. Internal Service Funds
c. Special Revenue Funds
d. Enterprise Funds
e. Capital Funds
2) Preliminary General Fund Q2 Financial Status & public safety overtime (Attachments C & D)
3) Timeline and Next Steps
The following is an overview of the status for the General Fund, Enterprise Funds, and other funds including recommended budget adjustments as they pertain to the City’s FY 2024 Operating and Capital Budgets.

1.a. General Fund

1.a.i. Mid-Year Budget Review Balancing Strategy Summary The following table outlines the major drivers of the General Fund mid-year recommended balancing strategy to offset the collective impact of a few key activities:
- Completion of FY 2023 year-end financial transactions which ended with funding of $3.4 million above the 20% Council adopted target level in the Budget Stabilization Reserve as discussed in the FY 2023 Annual Comprehensive Financial Report (ACFR). - Alignment with current FY 2024 estimated major tax revenue projections as discuss in the FY 2025-2034 Long Range Financial Forecast (LRFF).
- Support to continue Council priority investments as referred during the FY 2024 Adopted Budget process and routing operations.

This report continues to work to balance the immediate needs with the mid- and longer-term forecast needs, using one-time funds as a key tool in bridging uneven economic trends. There are potential risks and benefits associated with continuing this balancing strategy that should be considered when looking beyond FY 2024. The risks would further reduce the City’s ability to fund the current level of services over the next several years, while the benefits could offset costs for a longer period or even increase available funding sources. These are discussed further in the Proposed Balancing Solutions section of this report.

Table 1: General Fund Mid-Year Adjustments and Balancing Solutions Summary of General Fund Adjustments
Net $ Impact
(Cost)/Benefit
FY 2024 Council Budget Referral and Priorities Investments Rental Registry Program $(0.2) M
California Avenue Car Free Streets $(0.1) M
Parklet Prototypes $(0.1) M
Fleet Electrification $(0.1) M
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Summary of General Fund Adjustments
Net $ Impact
(Cost)/Benefit
Youth Mental Health $(33,000)
Subtotal FY 2024 Priority Investments: $(0.6) M
Recommended Funding:

Planning and Transportation Services $(0.2) M
Public Safety Services $(0.1) M
Subtotal Recommending Funding: $(0.3) M
Technical Adjustments:

Major Tax Revenues & Investment Earnings
(Property Tax, Sales Tax, Utility Users Tax, Transient Occupancy Tax, Documentary Transfer Tax)
$3.6 M
Utility Equity Transfer FY 2023 True-up $0.3 M
Utility Equity Transfer Case (Net-Neutral Action)
($11.2M for first round of settlement, offset by $11.2M from Reserve) $0.0 M
Supplemental Pension 115 Trust Contribution
($1.7M of the excess FY23 Budget Stabilization Reserve) $(1.7) M
Capital Improvement Funding
($1.7M of the excess FY23 Budget Stabilization Reserve) $(1.7) M
El Camino Real Ballpark/Lot 37 FY 2023 Rent $(0.2) M
Golf Course Services Revenue FY 2023 True-up $(0.1) M
Subtotal Technical Adjustments: $0.2 M
Use of Uncertainty Reserve
(Uncertainty Reserve remains at $9.5M)
$0.6 M
Use of Budget Stabilization Reserve (BSR)
(BSR remains at 21.2% and $3.3 M above the 20.0% target level) $0.1 M
Total Net Impact General Fund Mid-Year Adjustments $0.0 M

1.a.ii. Recommended Amendments to the FY 2024 Adopted Budget This report includes budget adjustments to 1) make key investments in alignment with deferred investments identified by Council through its FY 2024 Budget and priorities, 2) recommended funding for grants, urgent or timely needs, or 3) technical adjustments.

Major changes are recommended as directed by the City Council and/or recommended by staff are below, and all transactions can be found in greater detail in Attachment A. It should be noted that recommended budget adjustments have been prorated for the remainder of the fiscal year where appropriate.

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As part of the FY 2024 budget process, the Finance Committee and City Council referred some priority investments to be reviewed during the FY 2024 Mid-Year Budget Review. This section addresses each of these and the status and investments in alignment with the Council priority objectives:
•Fleet Electrification (PWD): $1,350,000 is requested to allow for nine additional FY 2024 vehicle replacements to be all-electric: 3 Ford F-150s, 2 GMC 6yrd Dump Trucks, 2 Ford Ranger Small Pickup Trucks, and 2 Chevy Blazers. The cost is spread across five funds (General, Electric, Gas, Wastewater Collection, and Water) in the Community Services, Planning and Development Services, and Utilities Departments, with $130,000 in the General Fund. Fleet electrification is ongoing, and staff will return to Council with recommendations for additional replacement of vehicles with electric models as part of the FY 2025 Budget.
•Sea Level Rise (PWD): No additional funding is requested yet. Staff is in the process of evaluating future steps and investments to better inform the request for additional funding in the context of correspondence with the Army Corps of Engineers about the South San Francisco Bay Shoreline Phase II Feasibility Study. Work continues; however, additional funding is likely to be requested as part of the FY 2025 budget process rather than at this time.
•Youth Mental Health (CSD): This brings forward $30,000 in funding to host an event with the goal of nurturing support and sharing knowledge on topics relevant to youth mental health.

In pursuit of this goal, the Community Services Department will actively engage in partnerships with Youth Community Service, Project Safety Net, Allcove, and other partners to identify specific target audiences and refine event formats. Partnership with the Department of Transportation to fund rides through Palo Alto Link ($3,000) for youth attending this event and other locations to access programs and services conducive to enhancing mental health is also included. This is an incremental step and reflects expected activity during the remaining months of FY 2024.
•Eucalyptus Tree Removal (CSD/OES): No additional funding is requested at this time as staff has pursued a grant to support funding for this project to increase wildfire safety. •Unhoused Resident Services (CMO): No additional funding is requested as initially, staff expected to develop a plan for better coordination among homeless individuals and housing/services. However, most services are already managed by the County through the Palo Alto-supported Community Plan to End Homelessness4. To avoid duplication, the focus shifted to strengthening services through improved coordination and launching a pilot outreach worker program. Additionally, staff expects to propose a new Priority Objective 4 https://housingtoolkit.sccgov.org/take-action/santa-clara-county-community-plan-end-homelessness-2020-2025 Item 11
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for 2024 focused on increasing capacity, coordination and effectiveness relating to housing and services for the unhoused in Palo Alto.
•Regulate Short Term Rentals (PDS): No additional funding has been brought forward at this time as staff continues to not have the capacity to take on this objective at this time.

Resources, as discussed later, are added for the establishment of a new Rental Registry Program prioritizing that program and other Council Priorities at this time.

In addition to those items referred for consideration as part of this Mid-Year review, limited investment in Council priorities is recommended including:
•California Avenue Car Free Streets Project Management (CMO): Funding of $85,000 is recommended for provisional staff for the oversight of the California Avenue car free street efforts. Recognizing the critical and focused effort needed to support this area, this resource will provide a more flexible means to engage on this multidisciplinary effort going forward with the City's consultant, Urban Field Studio, stakeholders, and City staff. •Rental Registry Program (PDS): A new Senior Planner position and contractual resources of $228,000 are recommended to be added in alignment with the Council priority objecting and prior council direction to establish a Rental Registry Program. •Parklet Prototypes (PDS): This action appropriates $84,000 for the estimated costs of development of up to three parklet prototype concepts. This uses one of the City's on-call contracts with Urban Planning Partners, Inc. and will include long range planning, application processing, and environmental review services.

Recommended Additional Funding
In limited areas staff recommends appropriation of additional funding to continue operations and support needed investment. Key investments are summarized here by service delivery area:
•Planning and Transportation Services: $214,000 revenue, $461,000 expense For the Office of Transportation, this report recommends the recognition of Measure B grant revenue in the amount of $213,725, along with an increase in contract services by the same amount. Staff will use the grant funding to hire a consultant to manage the Safe Routes to School Program. Palo Alto Transportation Management Authority (PATMA) has requested additional funding of $84,000 to maintain existing service levels, but an increase of $42,000 is recommended to support continued services. Staff expects to reassess funding needs in preparation for FY 2025. Although the current contract amount is $200,000, PATMA has identified that the true cost of current services is $330,000 per year and they have utilized surplus funding received in prior years to cover costs. Those surplus funds have been exhausted. PATMA will need to evaluate staff time and outreach at hotels, restaurants, and shops in the City.

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For the Planning and Development Services Department, this report includes recommendations to delete an Assistant Chief Building Official position and add a Planning Division Manager for the Development Center and planning special projects to better align with the goals and needs of improving the Development Center and planning operations.

Funding totaling $163,000 is also recommended to continue the Department’s cost allocation fee study, update development impact fee calculations, and fund a new electric vehicle for code enforcement staffing.
•Public Safety Services: $65,000 expense
Ongoing funding of $50,000 for the Fire Department will be used for first responder equipment maintenance and training supplies. This funding addresses maintenance and repair costs for personal protective equipment (PPE), equipment tracking software, and supplied air respirator machines. Ongoing funding of $15,000 will be used to cover cost increases for training drill supplies such as lumber as well as increases due to staff turnover and increased training needs.

Technical Adjustments and Previous Council Direction
This report includes actions that are technical in nature and are needed to align budget with current trends, and previous direction approved by the Council. Major changes are recommended as directed by the City Council and/or recommended by staff are below, and all transactions can be found in greater detail in Attachment A. •Major Tax Revenue ($3.3 million additional revenue; ($300,000) expense reduction): Staff evaluated departmental and major tax revenue through Q2 and recommends actions that result in a net $3.6 million increase. As noted in the Q1 Financial Report, major tax revenue categories are trending higher than budgeted in FY 2024, and a $3.3 million increase is recommended to adjust Sales Tax ($1.6 million increase), Utility Users Tax (UUT) ($1.2 million increase), Investment Earnings ($1.1 million increase), and Property Tax ($0.8 million increase), partially offset by Transient Occupancy Tax (TOT) ($1.3 million decrease) and Documentary Transfer Tax (DTT) ($0.1 million decrease) based on trends experienced in the first half of FY 2024. Since a portion of TOT revenue has been dedicated to fund capital improvements, per Council direction, the reduced TOT revenue estimates warrant a reduction in the transfer from the General Fund to the Capital Improvement Fund ($0.3 million decrease).
•Utility Equity Transfer FY 2023 True-up ($293,000 additional revenue): This action increases the equity transfer to the General Fund by $293,000 with additional funding from the Gas Fund ($508,000) partially offset by reduced funding from the Electric Fund ($215,000) in FY Item 11
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2024. This action is in alignment with the FY 2023 Annual Comprehensive Financial Report (ACFR) as of June 30, 2023 (Staff Report 2311-2230)5 .
•Utility Transfer Litigation (Equity Transfer) Reserve (Net Neutral Expense Adjustment): This action implements the first set of refunds issued to class members as a result of the Green v. City of Palo Alto (Santa Clara Superior Court, Case No. 1-16-CV-300760) settlement. Use of $11.2 million for this first refund leave a remaining reserve balance of $6.3 million for planned future settlement payment needs.
•Uncertainty Reserve: Use of $0.6 million from the FY 2024 Adopted Budget level of $10.1 million is half of the $1.0 million set aside as part of the FY 2024 budget process for additional priority investments. $9.5 million remains in the reserve; approximately $6.0 million of the reserve will be necessary to provide one-time funding for the FY 2025 forecasted deficit outlined in the City's 2025-3034 Long Range Financial Forecast. •Supplemental Pension Trust Contribution ($1.7 million expense): This adjustment adds a $1.7 million transfer to the General Benefits Fund for an additional contribution to the City’s Section 115 Pension Trust. This action was approved by the City Council in the FY 2023 Annual Comprehensive Financial Report (ACFR) for BSR exceeding target levels of 18.5%, reflects General Fund contributions only, and is consistent with the City’s Retiree Benefits Funding Policy. Staff will include adjustments for proportional contributions from other (non-General Fund) funds as part of the FY 2024 year-end or FY 2025 proposed process consistent with past practice and policy guidelines.
•Capital Improvement Funding ($1.7 million expense): This adjustment formalizes City Council actions to allocate $1.7 million resulting from FY 2023 year-end excess BSR, bringing the total base General Fund transfer to the Capital Improvement Fund to $12.5 million in FY 2024 and is consistent with the Council policy guiding use of surplus funds. This funding will increase the fund balance in the Capital Improvement Fund for use in the development of the upcoming 2025-2029 five-year Capital Improvement Plan. •El Camino Real Ballpark/Lot 37 FY 2023 Rent ($221,000 expense): This action will allow the payment of the Fiscal Year 2023 rent due to Stanford for the El Camino Real Ballpark, also referred to as Lot 37. The FY 2023 rent was withheld by the City while a minor error on the rental invoice was resolved with Stanford. Agreement was reached in FY 2024; however, the remaining funding in FY 2023 was inadvertently omitted from the reappropriation process to move funds into FY 2024.
•Golf Course Services Revenue FY 2023 True-up ($51,000 expense): This adjustment increases contract expenditure by $51,000 for City Golf Course operations owed to the management company, OB Sports. The terms of agreement include a revenue share equivalent to 20% of 5 January 16, 2024 City Council Meeting: FY 2023 Annual Comprehensive Financial Report https://cityofpaloalto.primegov.com/Portal/Meeting?meetingTemplateId=13566 Item 11
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the calculated FY 2023 difference between Gross Revenue and Target Revenue for that fiscal year.

1.a.iii. Position/Table of Organization Changes Summary Two position actions are recommended in this report, both in the Planning and Development Services Department. They include the addition of 1.00 Senior Planner to facilitate the rental registry program and the addition of 1.00 Planning Division Manager and deletion of 1.00 Assistant Chief Building Official. This will increase full-time staffing levels in the General Fund from the FY 2024 adopted level of 586.06 to 587.06. Although staffing challenges remain citywide, staff is focusing on recruitments of current vacant position and all others new staffing requests will be addressed through the FY 2025 annual budget process. This reflects movement towards the City’s practices prior to the pandemic in alignment with best budgeting practices.

Staff will continue to use appropriate temporary staffing measures, such as overstrength positions overseen by the City Manager, to proactively address time sensitive staffing needs and maintain high quality services for residents.

1.a.iv. City’s Financial Position in FY 2024 and FY 2025 With any forecast and adjustments based on projections, there are inherent risks and benefits.

Staff seeks to position the City in order to provide organizational stability, while acknowledging the service and resource needs, capacity to implement, and project pipeline to continue to reinvest at a pace the organization can support.

Should the Council approve the actions recommended in this report, there will be three (3) reserves in the General Fund with the following status:

1. Reserve: Utility Transfer Litigation (Equity Transfer) $6.3 million, from $17.5 million Planned to be used for the continued compliance with the Green v. City of Palo Alto (Santa Clara Superior Court, Case No. 1-16-CV-300760) settlement

2. Budget Uncertainty Reserve $9.5 million, from $10.1 million Planned to be used for the FY 2025 projected deficit of $6.0 million with remaining funds to be discussed and planned uses identified as part of the FY 2025 budget process. This reserve was established to help the City manage the immediate term recovery and uncertainty, ensuring that the City has a stable financial plan to address current service levels while investing in core priority service areas. As a reminder the City also is facing a forecasted deficit in FY 2026 of $5.4 million too.

3. Budget Stabilization Reserve estimated to be $57.2 million, which is above the adopted 20% level of $53.9 million by $3.3 million.

The City’s Budget Stabilization Reserve (BSR) serves as the primary General Fund reserve and is maintained at a level between 15% and 20% of General Fund operating expenses in Item 11
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any given year. This is both intended for catastrophic events as well as a repository for unspent operating funds at year-end used to fund one-time unexpected needs that arise outside of the regular budget preparation process. Prudent financial management practices dictate that the BSR not be used to fund or solve on-going, recurring financial needs.

Alternatively, Council could amend this and appropriate the excess BSR of $3.3 million to the Uncertainty Reserve. This would consolidate one-time funding to support FY 2025 and immediate outer years and Council priority investments in one location. If this was done, the Uncertainty Reserve would be $12.8 million, of which $6.0 million is planned to resolve the FY 2025 deficit. Remaining funds could be used for the FY 2026 deficit of $5.4 million and/or investing in Council priorities.

Potential risks and benefits associated with this balancing solution that should be considered when looking beyond FY 2024. The risks would further reduce the City’s ability to fund the current level of services over the next several years, while the benefits could offset costs for a longer period of time or even increase available funding sources.

Risks include but are not limited to the unresolved deficit beyond FY 2025 - estimated deficits in FY 2026 and FY 2027 (approximately $8.8 million in total) need to be resolved; labor contracts will be renegotiated around the time of developing the FY 2026 budget; economic recession or more sever stagnation of economic growth would cause increased deficits over the next several years.

Benefits include but are not limited to the reserve levels to bridge FY 2025 services for at least one more year; revenue and expense estimates may materialize additional available funds; the City’s diligence in funding long term liabilities such as pension have the potential to fund annual pension and retiree healthcare costs to provide short-term relief; a more robust economic recovery.

1.b. Internal Service Funds – Mid-Year Budget Adjustments Mid-Year actions recommended in these funds are related to technical adjustments to align the City’s contributions to the 115 Pension Trust Fund with Council policy, increase funding for higher estimated liability costs, and provide funding for the Council priority for electrification of the City’s fleet. See Attachment A, Exhibit 1 for further information regarding the recommended changes in the Internal Service Funds.
•General Benefits Fund: Supplemental Pension Trust Contribution of $5.7 million in additional contributions to the City’s Section 115 Pension Trust consistent with the funding policies outlined in the City’s Retiree Benefits Funding Policy. This brings total principal contributions to $73.3 million ($47.5 million from the General Fund) since inception in 2017.

Included in this adjustment are true-up actions for FY 2023 excess BSR funds of $1.7 million and $1.2 million in FY 2023 year-end pension savings and $2.8 million in non-General Fund funds proportional contributions to “catch-up” to prior year General Fund contributions.

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•General Liabilities Fund: Supplemental insurance funding of $355,000 supports increasing insurance premium costs. Specifically, $196,000 in expense for umbrella excess liability insurance and $159,000 for property loss insurance. This brings FY 2024 funding for umbrella excess liability insurance from $4.2 million to $4.4 million and property loss insurance from $0.8 million to $0.9 million.
•Vehicle Replacement and Maintenance Fund: Fleet Electrification adjustment adds $1.3 million in expense and revenue to allow for 9 additional FY 2024 vehicle replacements to be all-electric: 3 Ford F-150s, 2 GMC 6yrd Dump Trucks, 2 Ford Ranger Small Pickup Trucks, and 2 Chevy Blazers. The cost of $1.3 million is spread across 5 funds (General Fund, Electric Fund, Gas Fund, Wastewater Collection Fund, and Water Fund) in the Community Services, Planning and Development Services, and Utilities Departments, with $130,000 in the General Fund. Fleet electrification is ongoing, and staff will return to Council with recommendations for additional replacement of vehicles with electric models as part of the FY 2025 Budget. A new vehicle to support a new Code Enforcement Supervisor position added in FY 2024 in the amount of $64,000 for a new electric Chevy Blazer supporting daily off-site duties and sustainability goals is also added.

1.c. Special Revenue Funds – Mid-Year Budget Adjustments Mid-Year actions recommended in these funds are related to technical adjustments to align updated revenue projections from the State for Gas Tax funding and align a transfer from the Community Development Block Grant Fund to the Capital Improvement Fund for Sidewalk repair work. See Attachment A, Exhibit 1 for further information regarding the recommended changes in the Special Revenue Funds.
•Gas Tax Fund: The City receives revenues from California’s Highway Users Tax Account (HUTA) and the Road Maintenance and Rehabilitation Account (RMRA SB1). In January, the Department of Finance’s updates for estimated revenues from these accounts indicated that receipts would be lower than what is currently in the City’s budget. To align with the new estimates, gas tax revenues will be reduced by $16,194, and transfers to the Capital Improvement Fund for the Street Maintenance project (PE-86070) will be reduced by the same amount.
•Community Development Block Grant: A technical adjustment is needed to align the FY 2024 Budget with the FY 2023-24 CDBG Action Plan by recognizing a $211,673 transfer from CDBG to the Capital Improvement Fund for the Sidewalk Repairs project (PO-89003).

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1.d. Enterprise Funds – Mid-Year Budget Adjustments
Mid-year actions being recommended in these funds are primarily related to the alignment of the Utilities Department budgets with current market conditions for revenues and expenses related to the purchase of commodities and the operation of utilities. The actions recommended for FY 2024 mid-year will align revenues and expenses for interfund transfers for the Gas and Electric Fund Utilities Equity Transfers; Electric Fund revenue projections and commodity costs; and shared costs for Water, Gas, Wastewater Utility GIS Data project WS- 02014. See Attachment A, Exhibits 1 and 2 for further information regarding the recommended changes in the Enterprise Funds.

Capital Budget – Mid-Year Budget Adjustments
Several Capital Improvement Program projects require adjustments in FY 2024. For a detailed view of all project adjustments by Fund, see Attachment A, Exhibit 2. •All remaining funding in the Automated External Defibrillator Replacement (FD-21000) and Extrication Tool Replacement (FD-22000) projects will be removed because both projects have been completed. The remaining amounts are $38,000 of revenue in FD-21000, and $20,845 of revenue and $79,153 of appropriation in FD-22000. •As approved by the Valley Transportation Agency (VTA), Measure B revenue will be reallocated from the Railroad Grade Separation and Safety Improvements project (PL- 17001) to the Traffic Signal and Intelligent Transportation Systems (PL-05030) and Transportation and Parking Improvements (PL-12000) projects in the amounts of $701,500 and $233,833, respectively.
•Align the Street Maintenance project (PE-86070) with reduced gas tax revenue estimates discussed in the Gas Tax Fund section above with a reduction of $16,194. •Align the Roth Building Rehabilitation project (PF-23001) with County grants awarded for the building’s windows and roof in the amount of $387,590, as well as $200,000 of interest earnings on Transfer Development Rights (TDR) funding reserved for this project in the Capital Improvement Fund.
•$211,673 of appropriation and CDBG grant revenue will be added to the Sidewalk Repairs project (PO-89003) to align the FY 2024 budget with the FY 2023-24 CDBG Annual Action Plan.
•Nine projects require technical adjustments to align FY 2024 budgets with FY 2023 actual financial activity, with no changes to project schedules or scopes. 2) Preliminary Q2 Financial Status & public safety overtime (Attachment C & D) Attachments C and D provide summary information on actual preliminary financial activity through December 2023. These actuals have been factored into the analysis and projections used in the development of this Mid-Year Budget Review. Overall, they remain consistent with Item 11
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trends seen in the first quarter of the fiscal year. Staff will continue to monitor trends and update assumptions as part of the FY 2025 budget process as necessary. 3) Timeline and Next Steps
Staff is actively working on the FY 2025 budget and regular reporting activities over the coming months. Below is a list of expected reports and Council updates planned for the remainder of FY 2024. The Council and Finance Committee will continue to be updated through these planned discussions with adjustments brought forward as necessary. Expected upcoming financial status and budget reporting include:

March/April 2024:
➢Utility Advisory Commission (UAC) and Finance Committee Meetings – Five Year Utility Financial Plans and FY 2025 Rate Recommendations
May 2024:
➢Release of the FY 2025 Proposed Operating and Capital Budgets & Municipal Fee Changes
➢Public Budget Hearings on the Proposed Budgets with Finance Committee, including Utility Rates, Municipal Fees, and the 5-Year Capital Improvement Plan June 2024:
➢FY 2024 Third Quarter (Q3) Fiscal Analysis Report (information) ➢FY 2025 Operating and Capital Budget Adoption
➢FY 2025 Municipal Fee Adoption
➢FY 2025 Utility Rates adoption
In addition, routine information reports including but not limited to utilities risk management, investment reports, contracts and lease reporting will continue.

FISCAL/RESOURCE IMPACT
Approval of the attached transactions is required to amend the FY 2024 budget appropriation.

With the approval of these amendments, the Budget Stabilization Reserve (BSR) would be reduced by $0.1 million and the projected ending balance of the General Fund BSR is anticipated to be $57.2 million, which is $3.3 million above the 20% City Council target level $53.9 million.

As mentioned previously, Council could amend this and appropriate the excess BSR of $3.3 million to the Uncertainty Reserve. This would consolidate one-time funding to support FY 2025 and immediate outer years and Council priority investments in one location. If this was done, the Uncertainty Reserve would be $12.8 million, of which $6.0 million is planned to resolve the Item 11
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FY 2025 deficit. Remaining funds could be used for the FY 2026 deficit of $5.4 million and/or investing in Council priorities.

The projected changes to the fund balance for all other funds including Capital Funds, Enterprise Funds, Internal Services Funds, and Special Revenue Funds, and are outlined in Attachment A and accompanying exhibits and impacts to fund balance by fund are summarized as follows:

Table 2: Resource Impact (Non-General Fund)
Fund Type Fund Amount
Capital Capital Improvement Fund $0.7 M
Enterprise Airport Fund $(36,000)
Electric Fund $24.4 M
Fiber Optics Fund $(38,000)
Gas Fund $(0.1 M)
Refuse Fund $(0.1 M)
Stormwater Management Fund $(0.1 M)
Utility Administration Fund $(0.1 M)
Wastewater Collection Fund $0.2 M
Wastewater Treatment Fund $(0.9 M)
Water Fund $(2.3 M)
Internal Service General Benefits Fund $(4.0 M)
General Liabilities Fund $(0.4 M)
Information Technology Fund $(0.4 M)
Print and Mail Services Fund $(9,000)
Vehicle Replacement Fund $(0.1 M)
Workers’ Compensation Fund $(11,000)
Special Revenue California Avenue Parking Fund $(6,000) Community Development Block Grant Fund $(0.2 M)
Gas Tax Fund $(16,000)
Housing In Lieu Fund $(2,000)
Public Art Fund $(6,000)
Residential Parking Permit Fund $(11,000)
University Avenue Parking Fund ($22,000)

STAKEHOLDER ENGAGEMENT
The Office of Management and Budget has coordinated with all departments city-wide and the City Manager’s Office, as appropriate, to bring forward the changes discussed and recommended in this report.

Item 11
Item 11 Staff Report

Item 11: Staff Report
Pg.
15 Packet Pg. 312 of 428

ENVIRONMENTAL REVIEW
Council action on this item is not a project as defined by the California Environmental Quality Act (CEQA) because the amendments to the FY 2024 Budget Appropriation and FY 2024 Table of Organization are fiscal activities which do not involve any commitment to any specific project which may result in a potentially significant physical impact on the environment. CEQA Guidelines section 15378(b)(4).

ATTACHMENTS
Attachment A, Exhibit 1: FY 2024 Recommended Operating Budget Adjustments Attachment A, Exhibit 2: FY 2024 Recommended Capital Budget Adjustments Attachment B: Amended FY 2024 Table of Organization
Attachment C: Preliminary FY 2024 2nd Quarter Financial Status Attachment D: Public Safety Overtime Analysis
APPROVED BY:

Kiely Nose, Assistant City Manager
Item 11
Item 11 Staff Report

Item 11: Staff Report
Pg.
16 Packet Pg. 313 of 428

Revenues
Department FTE Adjustment Adjustment
GENERAL FUND (102)
Administrative
Services
Technical Adjust: Business Tax Revenue/Business Registry Administration Contract Funding This action increases expenses to support the business tax and registry program administration contract, as scheduled to be presented to the City Council in Staff Report 2401‐2481 on February 5, 2024, and recognizes sufficient Measure K revenue to offset this expense. This contract will provide administration, collection, and enforcement services for the City’s business tax and business registry certificate program. (Ongoing costs: $0) ‐    41,000$                      41,000$
City Manager's
Office
FY 2024 Budget Council Priority: California Avenue Car Free Streets Project Management This action increases the appropriation for salaries and benefits to fund the equivalent of 0.60 Assistant to the City Manager provisional limited term position to support the oversight of the California Avenue car free street efforts. This work is currently being done through consultant services; however, as staff this resource will provide a more flexible means to engage on this multidisciplinary effort going forward with the City's consultant, Urban Field Studio, stakeholders, and City staff. (Ongoing costs: $170,000 FY 2025 only) ‐    ‐$                            85,000$
Community
Services
FY 2024 Budget Council Priority: Fleet Electrification
This action allows for a vehicle in the Community Services Department to be replaced by an all‐electric Ford F‐ 150. As part of the FY 2024 Budget Adoption, select priorities were identified to be revisited at Mid‐Year.  This action reflects a recommended continued transition to electric vehicles to allocate an additional $1.3 million across various funds to allow for additional FY 2024 vehicle replacements to be all‐electric. (Ongoing costs: $0) ‐    ‐$                            80,000$
Community
Services
Technical Adjust: Golf Course Green Fee Contract Services Alignment This action increases expenditures related to City Golf Course operations. Contract expenditures are increased by $51,000 to reflect amounts owed to the service provider, OB Sports, per the compensation terms of the agreement with the City.  The calculated FY 2023 revenue share, or 20% of the difference between Gross Revenue and Target Revenue for that fiscal year is reflected in this true‐up adjustment. (Ongoing costs: $0) ‐    ‐$                            51,000$
Community
Services
Recommended Funding: Charges for Services Revenue/Children and Teen Studio Art Class Funding This action provides $50,000 in contract dollars for the Art Center's Kids and Teens Studio program offset by $50,000 in additional registration revenue. This increase will allow for increased demand for spring classes and summer camps, provide increases in hourly pay for contract instructors, and remain competitive in the marketplace. (Ongoing costs: $0)
‐    50,000$                      50,000$
Community
Services
FY 2024 Budget Council Priority: Youth Mental Health Event Funding This action allows for a Youth Mental Health program to support and plan an event with community partners focused on youth mental health and empowerment. As part of the FY 2024 Budget Adoption, select priorities were identified to be revisited at Mid‐Year. The $0.2 million estimated for these services has been updated due to event dates shifting from FY24 to FY25, and recalculated costs to administer these events. Additional funding ($3,000) is recommended in the Office of Transportation to fund rides through PA Link for youth attending this and other vital locations to access programs and services conducive to enhancing mental health. (Ongoing costs: $100,000)
‐    ‐$                            30,000$
Community
Services
Recommended Funding: Development Impact Fee Conversion
This action increases funding for contractual services to facilitate the conversion of three existing Development Impact Fee Programs. Currently assessed on a per dwelling basis, these fees will be transitioned to a per building square foot basis, in compliance with California State Assembly Bill 602. Additional funding is recommend in the Planning and Development Services Department ($20,000) to fund half of the total contract cost as these fees are maintained jointly by the two departments. (Ongoing costs: $0) ‐    ‐$                            20,000$
CITY OF PALO ALTO
Expenses
ATTACHMENT A, EXHIBIT 1
65,000$                  ‐$                                                  ‐   Recommended Funding: Fire Equipment Maintenance and Training Supplies This action adds $65,000 in ongoing funding for first responder equipment maintenance and training supplies.

This funding addresses maintenance and repair costs for personal protective equipment (PPE), equipment tracking software, and supplied air respirator machines. Additionally, this action adds funding for training drill supplies due to an increase in costs such as lumber as well as an increase in training needs due to staff turnover. (Ongoing costs: $65,000)
Fire
Item 11
Attachment A - FY 2024
Recommended Operating
and Capital Budget
Adjustments

Item 11: Staff Report
Pg.
17 Packet Pg. 314 of 428

Revenues
Department FTE Adjustment Adjustment
GENERAL FUND (102)
CITY OF PALO ALTO
Expenses
ATTACHMENT A, EXHIBIT 1
Non‐
Departmental
Technical Adjust: Projected Tax Revenue/Transfer to the Capital Improvement Fund This action recognizes adjustments to estimates for Sales Tax ($1.6 million increase), Utility Users Tax (UUT) ($1.2 million increase), Investment Earnings ($1.1 million increase), and Property Tax ($0.8 million increase), partially offset by Transient Occupancy Tax (TOT) ($1.3 million decrease) and Documentary Transfer Tax (DTT) ($0.1 million decrease) based on trends experienced in the first half of FY 2024. This adjustment would bring Property Tax revenue to $64.6 million, Sales Tax revenue to $37.7 million, TOT revenue to $25.5 million, UUT revenue to $19.7 million, DTT to $5.8 million, and Investment Earnings to $2.9 million. This action also decreases the transfer to the Capital Infrastructure Reserve by $0.3 million due to the reduced TOT revenue that Council designated to fund Capital Improvements. (Ongoing savings: $0) ‐    3,289,000$                (300,000)$
Non‐
Departmental
Technical Adjust: Business Tax Revenue Alignment/Transfer to the Capital Improvement Fund This is a technical correction to consolidate the recognition and receipt of all Business Tax revenue in the City's General Fund; no new revenue is reflected in this action. Previously the budget reflected tax revenues in association to transportation capital investments in the Capital Improvement Fund ($0.8 million). This action also establishes a transfer to the Capital Improvement Fund to maintain the allocation of the funding in alignment with the Council's adopted Advisory Spending Resolution to fund transportation and grade separation projects. (Ongoing savings: $0)
‐    750,000$                   750,000$
Non‐
Departmental
Technical Adjust: El Camino Real Ballpark/Lot 37 FY 2023 Rent Funding This action increases expenses to allow payment of the Fiscal Year 2023 rent due to Stanford for the El Camino Real Ballpark, also referred to as Lot 37. The FY 2023 rent was withheld by the City while a minor error on the rental invoice was resolved with Stanford. Agreement was reached in FY 2024 and the City is now ready to release the FY 2023 rent payment; however, the remaining funding in FY 2023 was inadvertently omitted from the reappropriation process to move funds into FY 2024. (Ongoing costs: $0) ‐    ‐$                            220,540$
Non‐
Departmental
Technical Adjust: Transfer to the Capital Improvement Fund This action transfers $1.7 million to the Infrastructure Reserve in the Capital Improvement Fund, as approved by the City Council on January 16, 2024 in the FY 2023 Annual Comprehensive Financial Report (ACFR) for BSR exceeding the 20% target level. (Ongoing costs: $0)
‐    ‐$                            1,700,000$
Non‐
Departmental
Technical Adjust: Transfer to the General Benefits Fund for Supplemental Pension Contributions This action transfers $1.7 million to the General Benefits Fund to increase the contribution to the City's Section 115 Pension Trust Fund, as approved by the Council on January 16, 2024 in the FY 2023 Annual Comprehensive Financial Report (ACFR) for BSR exceeding the 20% target level. (Ongoing costs: $0) ‐    ‐$                            1,700,000$
Non‐
Departmental
Technical Adjust: FY 2023 Year‐End Cleanup for the Equity Transfer This action adjusts the equity transfer from the gas and electric funds with an overall increase of $0.3 million to align with FY 2023 year‐end actuals. The gas equity transfer increases by $0.5 million to adjust the FY23 year‐end amount from $6.7 million to $7.2 million per the staff report on April 17, 2023 to Council (CMR 2303‐ 1219). This action also includes a decrease to the electric equity transfer by $0.2 million to adjust the FY23 year‐end amount from $14.5 million to $14.3 million based on a reduced PG&E Return on Equity estimate from 10.25% to 10.00%. (Ongoing savings: $0)
‐    293,000$                   ‐ $
Non‐
Departmental
Technical Adjust: Utility Transfer Settlement Funding (Green v. City of Palo Alto) This action appropriates $11.2 million from the Utility Transfer Legal Cost Reserve to the General Fund for the first set of refunds issued to class members as a result of the Green v. City of Palo Alto (Santa Clara Superior Court, Case No. 1‐16‐CV‐300760) settlement. The reserve will retain a balance of $6.3 million that will be appropriated based on future settlement payment needs. (Ongoing costs: $6.3M) ‐    ‐$                            11,153,960$
Non‐
Departmental
Technical Adjust: Reduce Utility Transfer Legal Cost Reserve This action reduces the Utility Transfer Legal Cost Reserve by $11.2 million to fund the first round of refunds issued to class members as a result of the Green v. City of Palo Alto (Santa Clara Superior Court, Case No. 1‐16‐CV‐300760) settlement. The reserve will retain a balance of $6.3 million that will be appropriated based on future settlement payment terms. (Ongoing savings: $6.3M) ‐    ‐$                            (11,153,960)$
Item 11
Attachment A - FY 2024
Recommended Operating
and Capital Budget
Adjustments

Item 11: Staff Report
Pg.
18 Packet Pg. 315 of 428

Revenues
Department FTE Adjustment Adjustment
GENERAL FUND (102)
CITY OF PALO ALTO
Expenses
ATTACHMENT A, EXHIBIT 1
Non‐
Departmental
Technical Adjust: Uncertainty Reserve
This action reduces the City's FY 2024 Uncertainty Reserve by $0.6 million from it's FY 2024 Adopted Budget level of $10.1 million. The Uncertainty Reserve was set aside as part of the FY 2024 process to proactively reserve funding for FY 2025 forecasted deficit between General Fund revenues and expenses as well as $1.0 million for FY 2024 Mid‐Year additional priority investments for: fleet electrification, sea level rise, youth mental health, eucalyptus tree removal, unhoused services, and regulating short term rentals. This Mid‐Year recommends investments in fleet electrification, youth mental health, a rental registry program, California Avenue car free streets and parklet prototypes. This leaves $9.5 million in unspent reserve funds. Of this $9.5 million, approximately $6.0 million will be necessary to provide one‐time funding for the FY 2025 forecasted deficit outlined in the City's 2025‐3034 Long Range Financial Forecast. (Ongoing savings: $9.5M) ‐ ‐$ (560,000)$
Office of
Transportation
Recommended Funding: Measure B for Safe Routes to School/Revenue from Other Agencies This action recognizes $0.2 million in grant revenue from the Valley Transportation Agency's (VTA) 2016 Measure B Bicycle and Pedestrian Education and Encouragement Funding and increases contract services by the same amount. Staff will use the grant funding to hire a consultant to manage its Safe Routes to School Program. Currently, the City utilizes multiple vendors for services such as bicycle safety classes and bicycle repair. Combining such functions within a single contract will simplify program administration and performance. (Ongoing costs: $0)
‐ 213,725$ 213,725$
Office of
Transportation
Recommended Funding: Palo Alto Transportation Management Authority (PATMA) This action increases the contract with PATMA by $42,000, half of the amount requested. The current annual budget is $200,000, but the true cost of annual services is $330,000. PATMA has been utilizing surplus funding received in prior years to cover costs exceeding the annual budget, but those surplus funds have now been spent, and $84,000 is needed to continue the current service level of an estimated 306 cars taken off the road.

PATMA will need to evaluate staff time and outreach at hotels, restaurants, and shops in the City. Additional ongoing cost increases for PATMA services will be considered during the FY 2025 budget development process. (Ongoing costs: $0)
‐    ‐$                            42,000$
Office of
Transportation
FY 2024 Budget Council Priority: Youth Mental Health Event Funding (PALink) This action funds rides through PA Link for youth attending a city‐hosted youth mental health event and other vital locations to access programs and services conducive to enhancing mental health. As part of the FY 2024 Budget Adoption, select priorities were identified to be revisited at Mid‐Year. Additional funding is recommended in the Community Services Department ($30,000) to host the event. (Ongoing costs: $6,000) ‐    ‐$                            3,000$
Planning and
Development
Recommended Funding: Development Impact Fee Conversion
This action increases funding for contractual services to facilitate the conversion of three existing Development Impact Fee Programs. Currently assessed on a per dwelling basis, these fees will be transitioned to a per building square foot basis, in compliance with California State Assembly Bill 602. Additional funding is recommend in the Community Services Department to fund half of the total contract cost as these fees are maintained jointly by the two departments. (Ongoing costs: $0) ‐    ‐$                            20,000$
Planning and
Development
Recommended Funding: Cost Allocation Fee Study Amendment This action increases funding for an amendment to the cost allocation fee study for Planning and Development services fees. Commenced in 2021, the study faced delays due to shifts in priorities induced by the pandemic.

Additional funding is needed to address escalated costs associated with these delays and to encompass the extended time needed to complete the scope of services. (Ongoing costs: $0) ‐ ‐$ 59,000$
Planning and
Development
FY 2024 Budget Council Priority: Parklet Prototypes
This action appropriates $84,000 for the estimated costs of development of up to three parklet prototype concepts. This uses one of the City's on‐call contracts with Urban Planning Partners, Inc. and will include long range planning, application processing, and environmental review services. (Ongoing costs: $0) ‐ ‐$ 84,000$
Item 11
Attachment A - FY 2024
Recommended Operating
and Capital Budget
Adjustments

Item 11: Staff Report
Pg.
19 Packet Pg. 316 of 428

Revenues
Department FTE Adjustment Adjustment
GENERAL FUND (102)
CITY OF PALO ALTO
Expenses
ATTACHMENT A, EXHIBIT 1
Planning and
Development
FY 2024 Budget Council Priority: Rental Registry Program Administration and Implementation This action adds a 1.00 FTE Senior Planner position and $228,000 in contractual funding for software to establish the rental registry program as adopted and directed by the City Council on November 27, 2023.

These resources reflect first year expenditures after factoring vacancy savings, but the program is expected to be fully funded by collected fees starting in FY 2025. (Ongoing costs: $0)

1.00 ‐ $                            228,000$
Planning and
Development
Technical Adjust: Deposit‐Based Cost Recovery Amendment This action increases revenue and expenses accordingly to support the continuity of services for the deposit‐ based cost recovery program. The Planning and Development Services Department provides a service to expedite entitlement studies through the use and expertise of outside consultants for private development projects. These services are fully cost recoverable and paid for by the planning applicant who directly receives these services. (Ongoing costs: $0)
‐    146,000$                   146,000$
Planning and
Development
Recommended Funding: Development Center and Planning Special Project Staffing This action deletes a 1.00 FTE Assistant Chief Building Official position and adds a 1.00 FTE Planning Division Manager position. The Assistant Chief Building Official was added in FY 2023, to focus on improving the permit process, establish interdepartmental workflows, and problem solve complex policy and operational issues as they arise.  After recruitment challenges and a closer review of duties, it is recommended that this realignment of staffing be made to better align with the goals and needs of improving the Development center and planning operations. Ongoing this will have a net cost of approximately $78,000 as this includes funding reallocation between revenue backed fee activities and General Fund activities as well as increased costs for the Planning Division Manager position. In FY 2024, these costs will be absorbed within existing levels through vacancy savings. (Ongoing costs: $78,000)
‐    ‐$                            ‐ $
Planning and
Development
FY 2024 Budget Process Priority Referal: Fleet Electrification This action allows for two Chevy Blazers in the Planning and Development Services Department used for Building Inspections to be purchased as electric vehicles instead of the gas powered vehicles previously approved as part of the FY 2024 Adopted Budget. This is part of an action that was deferred by Council during FY 2024 Budget Adoption to allocate $1.3 million across various funds to allow for additional FY 2024 vehicle purchases and replacements to be all‐electric. (Ongoing costs: $0) ‐    ‐$                            50,000$
Planning and
Development
Recommended Funding: Code Enforcement Supervisor Vehicle This action allocates $64,000 for a new electric Chevy Blazer for the Code Enforcement Supervisor position added as part of the FY 2024 Adopted Budget. The Department has attempted to use a shared vehicle; however, this position manages the City's more complex enforcement cases and builds relationships with the community and partner departments which supports a dedicated electric vehicle for daily off‐site duties. (Ongoing costs: $0)
‐    ‐$                            64,000$
Fund Balance Adjustment to Fund Balance FY 2023 Year End use of BSR This action reduces the current Budget Stabilization Reserve (BSR) FY 2024 projected level by $3.6 million in alignment with the actions recommended and approved by the City Council in the FY 2023 Year‐End Annual Comprehensive Financial Report (ACFR) and Year End Budget transactions approved by Council on January 16, 2024.  This reflects allocation of funds above the Council goal of 20% of General Fund expenses based on FY 2023 year end actual financial activity. (Ongoing cost: $0) ‐    ‐$                            (3,620,540)$
Fund Balance Adjustment to Fund Balance
This action adjusts the fund balance increases the Budget Stabilization Reserve (BSR) projected for June 30, 2024.  This would bring the BSR to an estimate of $57.2 million, this is above the Council target of 20% by $3.3 million and staff expects to discuss use of these funds as part of the FY 2025 budget process in the coming months. These funds combined with any unspent Uncertainty Reserve funds are expected to be part of the financial planning for FY 2025 and the near term beyond that. ‐    ‐$                            3,561,000$
GENERAL FUND (102) SUBTOTAL 1.00                  4,782,725$                4,782,725$ Item 11
Attachment A - FY 2024
Recommended Operating
and Capital Budget
Adjustments

Item 11: Staff Report
Pg.
20 Packet Pg. 317 of 428

Revenues
Department FTE Adjustment Adjustment
CAPITAL IMPROVEMENT FUNDS
GENERAL FUND CAPITAL IMPROVEMENT FUND (471)
Capital Capital Improvement Project Adjustments
This action reflects the combined impact from adjustments to projects as outlined in Attachment A, Exhibit 2.
‐    (8,253,248)$       (7,556,567)$
Capital Technical Adjust: Transfer from the General Fund (FY 2023 Year‐End Savings) This action transfers $1.7 million from the General Fund to the Infrastructure Reserve in the Capital Improvement Fund, as approved by the City Council on January 16, 2024 in the FY 2023 Annual Comprehensive Financial Report (ACFR) for BSR exceeding the 20% target level. (Ongoing savings: $0)
‐    1,700,000$        ‐ $
Capital Technical Adjust: Transfer from the General Fund (Business Tax Revenue) This action transfers Business Tax revenue recognized in the General Fund to rail grade separation capital projects (PL‐24000 and PL‐24001) in the Capital Improvement Fund in alignment with the Council's adopted Advisory Spending Resolution. (Ongoing savings: $0) ‐    750,000$           ‐ $
Capital Technical Adjust: Business Tax Revenue Category Realignment This action removes Business Tax revenue that had been budgeted as such in rail grade separation capital projects (PL‐24000 and PL‐24001) in the Capital Improvement Fund. That revenue will instead be recognized in the General Fund and, in alignment with the Council's adopted Advisory Spending Resolution, allocated to the Capital Improvement Fund via transfers. (Ongoing costs: $0)
‐    (750,000)$          ‐ $
Capital Technical Adjust: Transfer from General Fund (TOT) This action reduces transfers from the General Fund to the Infrastructure Reserve in the Capital Improvement Fund in alignment with adjustments to estimates for Transient Occupancy Tax (TOT) revenue based on trends experienced in the first half of FY 2024. (Ongoing costs: $0)
‐    (300,000)$          ‐ $
Capital Technical Adjust: Transfer from Community Development Block Grant (CDBG) This action aligns the FY24 Budget with the FY23‐24 CDBG Annual Action Plan by recognizing a transfer from the CDBG Fund to the Capital Improvement Fund for the Sidewalk Repairs project (PO‐89003). (Ongoing costs: $0)
‐    211,673$           211,673$
Fund Balance Adjustment to Fund Balance
This action adjusts the fund balance to offset adjustments recommended in this report. ‐    ‐$                    703,319$
GENERAL FUND CAPITAL IMPROVEMENT FUND (471) SUBTOTAL                   ‐    (6,641,575)$      (6,641,575)$ CITY OF PALO ALTO
Expenses
ATTACHMENT A, EXHIBIT 1
Item 11
Attachment A - FY 2024
Recommended Operating
and Capital Budget
Adjustments

Item 11: Staff Report
Pg.
21 Packet Pg. 318 of 428

Revenues
Department FTE Adjustment Adjustment
ENTERPRISE FUNDS
AIRPORT ENTERPRISE FUND (530)
Public Works Technical Adjust: Other Funds Catch‐Up (115 Pension Trust Fund) This action recognizes a transfer of $2.8 million from various funds to increase the contributions to the City's Section 115 Pension Trust Fund. This represents a proportional contribution from other funds to "catch up" to General Fund contribution levels. (Ongoing costs: $0) ‐    ‐$                    36,112$
Fund Balance Adjustment to Fund Balance
This action adjusts the fund balance to offset adjustments recommended in this report. ‐    ‐$                    (36,112)$
AIRPORT ENTERPRISE FUND (530) SUBTOTAL                  ‐    ‐$                    ‐ $ UTILITIES ADMINISTRATION FUND (521)
Utilities Technical Adjust: Other Funds Catch‐Up (115 Pension Trust Fund) This action recognizes a transfer of $2.8 million from various funds to increase the contributions to the City's Section 115 Pension Trust Fund. This represents a proportional contribution from other funds to "catch up" to General Fund contribution levels. (Ongoing costs: $0) ‐    ‐$                    121,124$
Fund Balance Adjustment to Fund Balance
This action adjusts the fund balance to offset adjustments recommended in this report. ‐    ‐$                    (121,124)$
UTILITIES ADMINISTRATION FUND (521) SUBTOTAL                  ‐    ‐$                    ‐ $ ELECTRIC FUND (513 & 523)
Utilities FY 2024 Budget Council Priority: Fleet Electrification This action allows for two vehicles in the Utilities Department to be replaced by two all‐electric Ford Ranger Small Pickup Trucks. It is part of an action that was deferred by Council during FY 2024 Budget Adoption to allocate $1.3 million across the General, Electric, Gas, Wastewater Collection, and Water Funds to allow for additional FY 2024 vehicle replacements to be all‐electric. (Ongoing costs: $0) ‐    ‐$                    160,000$
Utilities Technical Adjust: Other Funds Catch‐Up (115 Pension Trust Fund) This action recognizes a transfer of $2.8 million from various funds to increase the contributions to the City's Section 115 Pension Trust Fund. This represents a proportional contribution from other funds to "catch up" to General Fund contribution levels. (Ongoing costs: $0) ‐    ‐$                    748,983$
Utilities Technical Adjust: Net Sales Revenue/Electric Commodity Adjustments This one‐time action aligns the Electric commodity purchase and sales budget with a net increase of $25.0 million to the Electric Fund, reflecting the updated forecasts as of November 2023. The reduction of $11.2 million in expenses is attributed to lower power revenue requirements for Base Resource customers, reduced CVPIA Restoration Fund charges, and decreased market purchase costs due to significantly higher hydro output. The $13.8 million increase in revenue is due to surplus sales revenue and improved hydro conditions, enabling the sale of excess renewable energy credits. (Ongoing costs:
$0)
‐    13,818,733$      (11,226,940)$
Utilities Technical Adjust: Year‐end Cleanup Equity Transfer to General Fund This action also includes a decrease to the electric equity transfer by $0.2 million to adjust the FY23 year‐end amount from $14.5 million to $14.3 million based on a reduced PG&E Return on Equity estimate from 10.25% to 10.00%. (Ongoing costs: $0)
‐    ‐$                    (215,000)$
Fund Balance Adjustment to Fund Balance
This action adjusts the fund balance to offset adjustments recommended in this report. ‐    ‐$                    24,351,690$
ELECTRIC FUND (513 & 523) SUBTOTAL                  ‐    13,818,733$      13,818,733$ FIBER OPTICS FUND (533)
Utilities Technical Adjust: Other Funds Catch‐Up (115 Pension Trust Fund) This action recognizes a transfer of $2.8 million from various funds to increase the contributions to the City's Section 115 Pension Trust Fund. This represents a proportional contribution from other funds to "catch up" to General Fund contribution levels. (Ongoing costs: $0) ‐    ‐$                    38,182$
Fund Balance Adjustment to Fund Balance
This action adjusts the fund balance to offset adjustments recommended in this report. ‐    ‐$                    (38,182)$
FIBER OPTICS FUND (533) SUBTOTAL                  ‐    ‐$                    ‐ $ CITY OF PALO ALTO
Expenses
ATTACHMENT A, EXHIBIT 1
Item 11
Attachment A - FY 2024
Recommended Operating
and Capital Budget
Adjustments

Item 11: Staff Report
Pg.
22 Packet Pg. 319 of 428

Revenues
Department FTE Adjustment Adjustment
ENTERPRISE FUNDS
CITY OF PALO ALTO
Expenses
ATTACHMENT A, EXHIBIT 1
GAS FUND (514 & 524)
Utilities FY 2024 Budget Council Priority: Fleet Electrification This action allows for a vehicle in the Utilities Department to be replaced by an all‐electric Ford F‐150. It is part of an action that was deferred by Council during FY 2024 Budget Adoption to allocate $1.3 million across the General, Electric, Gas, Wastewater Collection, and Water Funds to allow for additional FY 2024 vehicle replacements to be all‐electric. (Ongoing costs: $0) ‐    ‐$                    80,000$
Utilities Technical Adjust: Other Funds Catch‐Up (115 Pension Trust Fund) This action recognizes a transfer of $2.8 million from various funds to increase the contributions to the City's Section 115 Pension Trust Fund. This represents a proportional contribution from other funds to "catch up" to General Fund contribution levels. (Ongoing costs: $0) ‐    ‐$                    284,498$
Utilities Technical Adjust: Water, Gas, Wastewater Operating Transfer Technical Clean Up This one‐time action corrects the transfers between the Gas and Water Funds from FY2018 to FY2022 for a shared recurring project, WS‐02014 WGW Utility GIS Data. In 2018, a change in fund transfer methodology to collect the Gas portion of the project changed for more visibility on the fund transfers, and the action to terminate the former method was overlooked. (Ongoing costs: $0) ‐    728,920$           ‐ $
Utilities Technical Adjust: Year‐end Cleanup Equity Transfer to General Fund This mid‐year action increases the gas equity transfer by $0.5 million to adjust the FY23 year end amount from $6.7 million to $7.2 million per the staff report on April 17, 2023 to Council (CMR 2303‐ 1219). (Ongoing costs: $0)
‐    ‐$                    508,000$
Fund Balance Adjustment to Fund Balance
This action adjusts the fund balance to offset adjustments recommended in this report. ‐    ‐$                    (143,578)$
GAS FUND (514 & 524) SUBTOTAL                  ‐    728,920$           728,920$ REFUSE FUND (525)
Public Works Technical Adjust: Other Funds Catch‐Up (115 Pension Trust Fund) This action recognizes a transfer of $2.8 million from various funds to increase the contributions to the City's Section 115 Pension Trust Fund. This represents a proportional contribution from other funds to "catch up" to General Fund contribution levels. (Ongoing costs: $0) ‐    ‐$                    90,253$
Fund Balance Adjustment to Fund Balance
This action adjusts the fund balance to offset adjustments recommended in this report. ‐    ‐$                    (90,253)$
REFUSE FUND (525) SUBTOTAL                  ‐    ‐$                    ‐ $ STORMWATER MANGEMENT FUND (528)
Public Works Technical Adjust: Other Funds Catch‐Up (115 Pension Trust Fund) This action recognizes a transfer of $2.8 million from various funds to increase the contributions to the City's Section 115 Pension Trust Fund. This represents a proportional contribution from other funds to "catch up" to General Fund contribution levels. (Ongoing costs: $0) ‐    ‐$                    85,132$
Fund Balance Adjustment to Fund Balance
This action adjusts the fund balance to offset adjustments recommended in this report. ‐    ‐$                    (85,132)$
STORMWATER MANGEMENT FUND (528) SUBTOTAL                  ‐    ‐$                    ‐ $ Item 11
Attachment A - FY 2024
Recommended Operating
and Capital Budget
Adjustments

Item 11: Staff Report
Pg.
23 Packet Pg. 320 of 428

Revenues
Department FTE Adjustment Adjustment
ENTERPRISE FUNDS
CITY OF PALO ALTO
Expenses
ATTACHMENT A, EXHIBIT 1
WASTEWATER COLLECTION FUND (527)
Utilities FY 2024 Budget Council Priority: Fleet Electrification This action allows for one vehicle in the Utilities Department to be replaced by an all‐electric GMC 6yrd Dump Truck and another vehicle to be replaced by an all‐electric Ford F‐150 Truck. It is part of an action that was deferred by Council during FY24 Budget Adoption to allocate $1.3 million across the General, Electric, Gas, Wastewater Collection, and Water Funds to allow for additional FY 2024 vehicle replacements to be all‐electric. (Ongoing costs: $0)
‐    ‐$                    530,000$
Utilities Technical Adjust: Other Funds Catch‐Up (115 Pension Trust Fund) This action recognizes a transfer of $2.8 million from various funds to increase the contributions to the City's Section 115 Pension Trust Fund. This represents a proportional contribution from other funds to "catch up" to General Fund contribution levels. (Ongoing costs: $0) ‐    ‐$                    142,032$
Utilities Technical Adjust: Water, Gas, Wastewater Operating Transfer Technical Clean Up This one‐time action corrects the transfers between the Wastewater Collection and Water Funds from FY2018 to FY2022 for a shared recurring project, WS‐02014 WGW Utility GIS Data. In 2018, a change in fund transfer methodology to collect the Gas portion of the project changed for more visibility on the fund transfers, and the action to terminate the former method was overlooked. (Ongoing costs: $0) 850,288$
Fund Balance Adjustment to Fund Balance
This action adjusts the fund balance to offset adjustments recommended in this report. ‐    ‐$                    178,256$
WASTEWATER COLLECTION FUND (527) SUBTOTAL                  ‐    850,288$           850,288$ WASTEWATER TREATMENT FUND (526)
Capital Capital Improvement Project Adjustments
This action reflects the combined impact from adjustments to projects as outlined in Attachment A, Exhibit 2.
‐    (3,010,000)$       (2,578,200)$
Public Works Technical Adjust: Other Funds Catch‐Up (115 Pension Trust Fund) This action recognizes a transfer of $2.8 million from various funds to increase the contributions to the City's Section 115 Pension Trust Fund. This represents a proportional contribution from other funds to "catch up" to General Fund contribution levels. (Ongoing costs: $0) ‐    ‐$                        423,325$
Fund Balance Adjustment to Fund Balance
This action adjusts the fund balance to offset adjustments recommended in this report. ‐    ‐$                    (855,125)$
WASTEWATER TREATMENT FUND (526) SUBTOTAL                  ‐    (3,010,000)$      (3,010,000)$ WATER FUND (522)
Utilities FY 2024 Budget Council Priority: Fleet Electrification This action allows for a vehicle in the Utilities Department to be replaced by an all‐electric GMC 6yrd Dump Truck. It is part of an action that was deferred by Council during FY24 Budget Adoption to allocate $1.3 million across the General, Electric, Gas, Wastewater Collection, and Water Funds to allow for additional FY 2024 vehicle replacements to be all‐electric. (Ongoing costs: $0) ‐    ‐$                    450,000$
Utilities Technical Adjust: Other Funds Catch‐Up (115 Pension Trust Fund) This action recognizes a transfer of $2.8 million from various funds to increase the contributions to the City's Section 115 Pension Trust Fund. This represents a proportional contribution from other funds to "catch up" to General Fund contribution levels. (Ongoing costs: $0) ‐    ‐$                    255,461$
Utilities Water, Gas, Wastewater Operating Transfer Technical Clean Up This one‐time action corrects the fund transfers from FY2018 to FY2022 for a shared recurring project, WS‐02014 WGW Utility GIS Data, decreasing the Water Fund by $1,579,209; increasing $850,288 to the Wastewater Fund and $728,920 to the Gas Fund. (Ongoing costs: $0) ‐    ‐$                    1,579,209$
Fund Balance Adjustment to Fund Balance
This action adjusts the fund balance to offset adjustments recommended in this report. ‐    ‐$                    (2,284,670)$
WATER FUND (522) SUBTOTAL ‐$                    ‐ $
Item 11
Attachment A - FY 2024
Recommended Operating
and Capital Budget
Adjustments

Item 11: Staff Report
Pg.
24 Packet Pg. 321 of 428

Revenues
Department FTE Adjustment Adjustment
INTERNAL SERVICE FUNDS
GENERAL BENEFITS FUND (687)
Non‐
Departmental
Technical Adjust: Transfer from the General Fund for Supplemental Pension Contributions This net‐neutral action recognizes a transfer of $1.7 million from the General Fund to increase the contribution to the City's Section 115 Pension Trust Fund, as approved by the City Council in the FY 2023 Annual Comprehensive Financial Report (ACFR). A corresponding adjustment is made to recognize pension expense. This brings total contributions to $73.3 million through FY 2024 ($47.5 million from the General Fund). Staff will include proportional contributions from other funds as part of the FY 2024 year‐end or FY 2025 Proposed Budget process. (Ongoing costs: $0)
‐    1,700,000$        1,700,000$
Non‐
Departmental
Technical Adjust: Other Funds Catch‐Up (115 Pension Trust Fund) This action recognizes a transfer of $2.8 million from various funds to increase the contributions to the City's Section 115 Pension Trust Fund. This represents a proportional contribution from other funds to "catch up" to General Fund contribution levels. (Ongoing costs: $0)
‐    ‐$                    2,776,676$
Non‐
Departmental
Technical Adjust: Supplemental Pension Contributions
This action increases contributions to the City's Section 115 Pension Trust Fund by $1.2 million. These savings represents amounts collected from departments that exceeded annual required payments in the respective fiscal year and remain unspent in the General Benefits Fund. (Ongoing costs: $0)
‐    ‐$                    1,200,000$
Fund Balance Adjustment to Fund Balance
This action adjusts the fund balance to offset adjustments recommended in this report. ‐    ‐$                    (3,976,676)$
GENERAL BENEFITS FUND (687) SUBTOTAL                 ‐    1,700,000$        1,700,000$ GENERAL LIABILITIES INSURANCE FUND (689)
Human
Resources
Technical Adjust: Umbrella Excess Liability Insurance Expense This action increases the estimate for umbrella excess liability insurance to align with higher than anticipated premium costs, from $4.2 million to $4.4 million. (Ongoing costs:
$0)
‐    ‐$                    196,000$
Human
Resources
Technical Adjust: Property Loss Insurance Expense
This action increases the estimate for property loss insurance to align with higher than anticipated premium costs, from $0.8 million to $0.9 million. (Ongoing costs: $0) ‐    ‐$                    159,000$
Fund Balance Adjustment to Fund Balance
This action adjusts the fund balance to offset adjustments recommended in this report. ‐    ‐$                    (355,000)$
GENERAL LIABILITIES INSURANCE FUND (689) SUBTOTAL                 ‐    ‐$                    ‐ $ INFORMATION TECHNOLOGY FUND (682)
Information
Technology
Technical Adjust: Other Funds Catch‐Up (115 Pension Trust Fund) This action recognizes a transfer of $2.8 million from various funds to increase the contributions to the City's Section 115 Pension Trust Fund. This represents a proportional contribution from other funds to "catch up" to General Fund contribution levels. (Ongoing costs: $0)
‐    ‐$                    368,589$
Fund Balance Adjustment to Fund Balance
This action adjusts the fund balance to offset adjustments recommended in this report. ‐    ‐$                    (368,589)$
INFORMATION TECHNOLOGY FUND (682) SUBTOTAL                 ‐    ‐$                    ‐ $ CITY OF PALO ALTO
Expenses
ATTACHMENT A, EXHIBIT 1
Item 11
Attachment A - FY 2024
Recommended Operating
and Capital Budget
Adjustments

Item 11: Staff Report
Pg.
25 Packet Pg. 322 of 428

Revenues
Department FTE Adjustment Adjustment
INTERNAL SERVICE FUNDS
CITY OF PALO ALTO
Expenses
ATTACHMENT A, EXHIBIT 1
PRINT AND MAIL SERVICES FUND (683)
Administrative
Services
Technical Adjust: Other Funds Catch‐Up (115 Pension Trust Fund) This action recognizes a transfer of $2.8 million from various funds to increase the contributions to the City's Section 115 Pension Trust Fund. This represents a proportional contribution from other funds to "catch up" to General Fund contribution levels. (Ongoing costs: $0)
‐    ‐$                    8,906$
Fund Balance Adjustment to Fund Balance
This action adjusts the fund balance to offset adjustments recommended in this report. ‐    ‐$                    (8,906)$
PRINT AND MAIL SERVICES FUND (683) SUBTOTAL                 ‐    ‐$                    ‐ $ VEHICLE REPLACEMENT & MAINTENANCE FUND (681)
Public Works Fleet Electrification
This action, which was deferred by Council during FY24 Budget Adoption, allows for 9 additional FY 2024 vehicle replacements to be all‐electric: 3 Ford F‐150s, 2 GMC 6yrd Dump Trucks, 2 Ford Ranger Small Pickup Trucks, and 2 Chevy Blazers. The cost of $1.3 million is spread across 5 funds (General Fund, Electric Fund, Gas Fund, Wastewater Collection Fund, and Water Fund) in the Community Services, Planning and Development Services, and Utilities Departments, with $130,000 in the General Fund. (Ongoing costs: $0) ‐    1,350,000$        1,350,000$
Public Works Technical Adjust: Other Funds Catch‐Up (115 Pension Trust Fund) This action recognizes a transfer of $2.8 million from various funds to increase the contributions to the City's Section 115 Pension Trust Fund. This represents a proportional contribution from other funds to "catch up" to General Fund contribution levels. (Ongoing costs: $0)
‐    ‐$                    114,486$
Planning and
Development
Recommended Funding: Code Enforcement Supervisor Vehicle This action allocates $64,000 for a new electric Chevy Blazer for the Code Enforcement Supervisor position added as part of the FY 2024 Adopted Budget. The Department has attempted to use a shared vehicle; however, this position manages the City's more complex enforcement cases and builds relationships with the community and partner departments which supports a dedicated electric vehicle for daily off‐site duties. (Ongoing costs: $0) ‐    64,000$              64,000$
Fund Balance Adjustment to Fund Balance
This action adjusts the fund balance to offset adjustments recommended in this report. ‐    ‐$                    (114,486)$
VEHICLE REPLACEMENT & MAINTENANCE FUND (681) SUBTOTAL                 ‐    1,414,000$        1,414,000$ WORKERS' COMPENSATION FUND (688)
Non‐
Departmental
Technical Adjust: Other Funds Catch‐Up (115 Pension Trust Fund) This action recognizes a transfer of $2.8 million from various funds to increase the contributions to the City's Section 115 Pension Trust Fund. This represents a proportional contribution from other funds to "catch up" to General Fund contribution levels. (Ongoing costs: $0)
‐    ‐$                    11,246$
Fund Balance Adjustment to Fund Balance
This action adjusts the fund balance to offset adjustments recommended in this report. ‐    ‐$                    (11,246)$
WORKERS' COMPENSATION FUND (688) SUBTOTAL ‐$                    ‐ $ Item 11
Attachment A - FY 2024
Recommended Operating
and Capital Budget
Adjustments

Item 11: Staff Report
Pg.
26 Packet Pg. 323 of 428

Revenues
Department FTE Adjustment Adjustment
SPECIAL REVENUE FUNDS
PUBLIC ART FUND (207)
Community
Services
Technical Adjust: Other Funds Catch‐Up (115 Pension Trust Fund) This action recognizes a transfer of $2.8 million from various funds to increase the contributions to the City's Section 115 Pension Trust Fund. This represents a proportional contribution from other funds to "catch up" to General Fund contribution levels. (Ongoing costs: $0) ‐    ‐$                    6,411$
Fund Balance Adjustment to Fund Balance
This action adjusts the fund balance to offset adjustments recommended in this report. ‐    ‐$                    (6,411)$
PUBLIC ART FUND (207) SUBTOTAL                        ‐    ‐$                    ‐ $ GAS TAX FUND (231)
Public Works Technical Adjust: Gas Tax Revenues/Transfers to the Capital Improvement Fund for Streets Improvement Project (PE‐86070)
This action reduces Fund 231 Gas Tax revenue by $16,194, and reduces the transfer to the Capital Improvement Fund by $16,194 for the Streets Improvement project (PE‐86070). This is based on the State's updated January HUTA and SB1 gas tax revenue estimates. (Ongoing costs: $0) ‐    (16,194)$            (16,194)$
Fund Balance Adjustment to Fund Balance
This action adjusts the fund balance to offset adjustments recommended in this report. ‐    ‐$                    ‐ $
GAS TAX FUND (231) SUBTOTAL                        ‐    (16,194)$            (16,194)$ COMMUNITY DEVELOPMENT BLOCK GRANT (CDBG) FUND (232)
Planning and
Development
Technical Adjust: Transfer to Capital Improvement Fund
This action aligns the FY24 Budget with the FY23‐24 CDBG Annual Action Plan by recognizing a transfer from CDBG to the Capital Improvement Fund for the Sidewalk Repairs project (PO‐89003). ‐    ‐$                    211,673$
Planning and
Development
Technical Adjust: Other Funds Catch‐Up (115 Pension Trust Fund) This action recognizes a transfer of $2.8 million from various funds to increase the contributions to the City's Section 115 Pension Trust Fund. This represents a proportional contribution from other funds to "catch up" to General Fund contribution levels. (Ongoing costs: $0) ‐    ‐$                    660$
Fund Balance Adjustment to Fund Balance
This action adjusts the fund balance to offset adjustments recommended in this report. ‐    ‐$                    (212,333)$
COMMUNITY DEVELOPMENT BLOCK GRANT (CDBG) FUND (232) SUBTOTAL                        ‐    ‐$                    ‐ $ CITY OF PALO ALTO
RECOMMENDED AMENDMENTS TO THE CITY MANAGER'S FY 2024 BUDGET Expenses
ATTACHMENT A, EXHIBIT 1
Item 11
Attachment A - FY 2024
Recommended Operating
and Capital Budget
Adjustments

Item 11: Staff Report
Pg.
27 Packet Pg. 324 of 428

Revenues
Department FTE Adjustment Adjustment
SPECIAL REVENUE FUNDS
CITY OF PALO ALTO
RECOMMENDED AMENDMENTS TO THE CITY MANAGER'S FY 2024 BUDGET Expenses
ATTACHMENT A, EXHIBIT 1
HOUSING IN‐LIEU/RESIDENTIAL (233)
Planning and
Development
Technical Adjust: Other Funds Catch‐Up (115 Pension Trust Fund) This action recognizes a transfer of $2.8 million from various funds to increase the contributions to the City's Section 115 Pension Trust Fund. This represents a proportional contribution from other funds to "catch up" to General Fund contribution levels. (Ongoing costs: $0) ‐    ‐$                    990$
Fund Balance Adjustment to Fund Balance
This action adjusts the fund balance to offset adjustments recommended in this report. ‐    ‐$                    (990)$
HOUSING IN‐LIEU/RESIDENTIAL (233) SUBTOTAL                        ‐    ‐$                    ‐ $ HOUSING IN‐LIEU/COMMERCIAL (234)
Planning and
Development
Technical Adjust: Other Funds Catch‐Up (115 Pension Trust Fund) This action recognizes a transfer of $2.8 million from various funds to increase the contributions to the City's Section 115 Pension Trust Fund. This represents a proportional contribution from other funds to "catch up" to General Fund contribution levels. (Ongoing costs: $0) ‐    ‐$                    990$
Fund Balance Adjustment to Fund Balance
This action adjusts the fund balance to offset adjustments recommended in this report. ‐    ‐$                    (990)$
HOUSING IN‐LIEU/COMMERCIAL (234) SUBTOTAL                        ‐    ‐$                    ‐ $ UNIVERSITY AVENUE FUND (236)
Office of
Transportation
Technical Adjust: Other Funds Catch‐Up (115 Pension Trust Fund) This action recognizes a transfer of $2.8 million from various funds to increase the contributions to the City's Section 115 Pension Trust Fund. This represents a proportional contribution from other funds to "catch up" to General Fund contribution levels. (Ongoing costs: $0) ‐    ‐$                    1,976$
Administrative
Services
Technical Adjust: Other Funds Catch‐Up (115 Pension Trust Fund) This action recognizes a transfer of $2.8 million from various funds to increase the contributions to the City's Section 115 Pension Trust Fund. This represents a proportional contribution from other funds to "catch up" to General Fund contribution levels. (Ongoing costs: $0) ‐    ‐$                    5,073$
Public Works Technical Adjust: Other Funds Catch‐Up (115 Pension Trust Fund) This action recognizes a transfer of $2.8 million from various funds to increase the contributions to the City's Section 115 Pension Trust Fund. This represents a proportional contribution from other funds to "catch up" to General Fund contribution levels. (Ongoing costs: $0) ‐    ‐$                    14,955$
Fund Balance Adjustment to Fund Balance
This action adjusts the fund balance to offset adjustments recommended in this report. ‐    ‐$                    (22,004)$
UNIVERSITY AVENUE FUND (236) SUBTOTAL                        ‐    ‐$                    ‐ $ Item 11
Attachment A - FY 2024
Recommended Operating
and Capital Budget
Adjustments

Item 11: Staff Report
Pg.
28 Packet Pg. 325 of 428

Revenues
Department FTE Adjustment Adjustment
SPECIAL REVENUE FUNDS
CITY OF PALO ALTO
RECOMMENDED AMENDMENTS TO THE CITY MANAGER'S FY 2024 BUDGET Expenses
ATTACHMENT A, EXHIBIT 1
CALIFORNIA AVENUE FUND (237)
Office of
Transportation
Technical Adjust: Other Funds Catch‐Up (115 Pension Trust Fund) This action recognizes a transfer of $2.8 million from various funds to increase the contributions to the City's Section 115 Pension Trust Fund. This represents a proportional contribution from other funds to "catch up" to General Fund contribution levels. (Ongoing costs: $0) ‐    ‐$                    1,976$
Administrative
Services
Technical Adjust: Other Funds Catch‐Up (115 Pension Trust Fund) This action recognizes a transfer of $2.8 million from various funds to increase the contributions to the City's Section 115 Pension Trust Fund. This represents a proportional contribution from other funds to "catch up" to General Fund contribution levels. (Ongoing costs: $0) ‐    ‐$                    2,177$
Public Works Technical Adjust: Other Funds Catch‐Up (115 Pension Trust Fund) This action recognizes a transfer of $2.8 million from various funds to increase the contributions to the City's Section 115 Pension Trust Fund. This represents a proportional contribution from other funds to "catch up" to General Fund contribution levels. (Ongoing costs: $0) ‐    ‐$                    1,750$
Fund Balance Adjustment to Fund Balance
This action adjusts the fund balance to offset adjustments recommended in this report. ‐    ‐$                    (5,903)$
CALIFORNIA AVENUE FUND (237) SUBTOTAL                        ‐    ‐$                    ‐ $ RESIDENTIAL PARKING PERMIT FUND (239)
Office of
Transportation
Technical Adjust: Other Funds Catch‐Up (115 Pension Trust Fund) This action recognizes a transfer of $2.8 million from various funds to increase the contributions to the City's Section 115 Pension Trust Fund. This represents a proportional contribution from other funds to "catch up" to General Fund contribution levels. (Ongoing costs: $0) ‐    ‐$                    11,392$
Fund Balance Adjustment to Fund Balance
This action adjusts the fund balance to offset adjustments recommended in this report. ‐    ‐$                    (11,392)$
RESIDENTIAL PARKING PERMIT FUND (239) SUBTOTAL                        ‐    ‐$                    ‐ $ Item 11
Attachment A - FY 2024
Recommended Operating
and Capital Budget
Adjustments

Item 11: Staff Report
Pg.
29 Packet Pg. 326 of 428

Project
Number Title Revenue Expense Comments
PF‐93009 Americans With Disabilities Act
Compliance
$ ‐
$ (332,551) This action is a technical correction to align FY 2024 budgets with FY 2023 actual financial
activity. There is no change to the project
schedule or scope.

FD‐21000 Automated External Defibrillator
Replacement
$ (38,000) $ ‐ This action removes all remaining funding because the project has been completed.

FD‐22000 Extrication Tool Replacement $ (20,845) $ (79,513) This action removes all remaining funding because the project has been completed.

PE‐18004 Fire Station 4 $ (5,200,000) $ ‐ This action removes revenue budgeted in FY 2024 because it was received in FY 2023 and
reserved in the fund balance.

PE‐11011 Highway 101 Pestrian/Bicycle Overpass $ ‐ $ (87,105) This action is a technical correction to align FY 2024 budgets with FY 2023 actual financial
activity. There is no change to the project
schedule or scope.

PE‐12011 Newell Rd/SFC Bridge Replacement $ (3,365,799) $ (3,365,799) This action is a technical correction to align FY 2024 budgets with FY 2023 actual financial
activity. There is no change to the project
schedule or scope.

PL‐17001 Railroad Grade Separation and Safety
Improvements
$ (935,333) $ (3,995,937) The expense action is a technical correction to align FY 2024 budgets with FY 2023 actual
financial activity, with no change to the project
schedule or scope; the revenue action
reallocates Measure B revenue to PL‐05030 and
PL‐12000 as approved by VTA.

PF‐23001 Roth Building Rehabilitation $ 387,590 $ 587,590 This action adds County grant revenue ($0.4 million) for work on the Roth Building's windows
and roof. Interest earnings on Transfer
Development Rights funding ($0.2 million)
reserved for this project is also appropriated.

PO‐11000 Sign Reflectivity Upgrade $ ‐ $ (110,000) This action is a technical correction to align FY 2024 budgets with FY 2023 actual financial
activity. There is no change to the project
schedule or scope.

PE‐86070 Street Maintenance $ (16,194) $ (16,194) This action aligns the FY 2024 budget with the State's updated January HUTA & SB1 Gas Tax
revenue estimates.

PL‐05030 Traffic Signal and Intelligent
Transportation Systems
$ 701,500 $ (157,058) The expense action is a technical correction to align FY 2024 budgets with FY 2023 actual
financial activity, with no change to the project
schedule or scope; the revenue action adds
Measure B revenue reallocated from PL‐17001
as approved by VTA.

PL‐12000 Transportation and Parking Improvements $ 233,833 $ ‐ This action adds Measure B revenue reallocated from PL‐17001 as approved by VTA.

Total $ (8,253,248) $ (7,556,567)
WQ‐19003 Advanced Water Purification Facility $ (500,000) $ ‐ This action is a technical correction to align FY 2024 budgets with FY 2023 actual financial
activity. There is no change to the project
schedule or scope.

WQ‐14002 Laboratory & Environmental Svcs Bldg $ (2,510,000) $ (2,578,200) This action is a technical correction to align FY 2024 budgets with FY 2023 actual financial
activity. There is no change to the project
schedule or scope.

Total $ (3,010,000) $ (2,578,200)
TOTAL CIP ADJUSTMENTS $ (11,263,248) $ (10,134,767) CITY OF PALO ALTO
WASTEWATER TREATMENT FUND
ATTACHMENT A, EXHIBIT 2
CAPITAL IMPROVEMENT FUND
Item 11
Attachment A - FY 2024
Recommended Operating
and Capital Budget
Adjustments

Item 11: Staff Report
Pg.
30 Packet Pg. 327 of 428

TABLE OF ORGANIZATION
Table of Organization
Table of Organization
FY 2021
Actuals
FY 2022
Actuals
FY 2023
Adopted
Budget
FY 2024
Adjusted
Budget***
FY 2024
Change
FTE
FY 2024
Change %
General Fund
Administrative Services
Account Specialist 4.63 4.13 4.13 4.13 — —%
Account Specialist-Lead 3.45 3.45 3.45 3.45 — —%
Accountant 3.00 2.00 2.00 2.00 — —%
Administrative Assistant 1.00 1.00 1.00 1.00 — —%
Administrative Associate II 1.00 0.50 0.50 1.00 0.50 100.0% Administrative Associate III 1.00 1.00 1.00 1.00 — —%
Assistant Director Administrative Services 1.65 1.65 1.65 1.65 — —% Buyer 1.00 2.00 2.00 2.00 — —%
Chief Procurement Officer 1.00 1.00 1.00 1.00 — —%
Contracts Administrator 2.70 1.70 2.70 3.70 1.00 37.0%
Director Administrative Services/CFO 0.80 0.80 0.80 0.80 — —% Director Office of Management and Budget 1.00 1.00 1.00 1.00 — —% Management Analyst 2.00 2.00 2.00 2.00 — —%
Manager Budget 2.00 2.00 2.00 2.00 — —%
Manager Real Property 1.00 1.00 1.00 1.00 — —%
Manager Revenue Collections 0.62 0.62 0.62 0.62 — —%
Manager Treasury, Debt & Investments 0.60 0.60 0.60 0.60 — —% Manager, Finance 1.00 1.00 1.00 1.00 — —%
Payroll Analyst 2.00 2.00 2.00 2.00 — —%
Performance Auditor II 1.00 — — — — —%
Senior Accountant 3.00 3.00 3.00 3.00 — —%
Senior Buyer 1.00 1.00 1.00 1.00 — —%
Senior Management Analyst 2.30 2.30 2.30 2.30 — —%
Storekeeper 1.00 1.00 2.00 2.00 — —%
1 ATTACHMENT B
Item 11
Attachment B - Amended
FY 2024 Table of
Organization

Item 11: Staff Report
Pg.
31 Packet Pg. 328 of 428

TABLE OF ORGANIZATION
Storekeeper-Lead 0.20 0.20 0.20 0.20 — —%
Warehouse Supervisor 0.20 0.20 0.20 0.20 — —%
Total Administrative Services 40.15 37.15 39.15 40.65 1.50 3.8% City Attorney
Assistant City Attorney 3.00 3.00 4.00 4.00 — —%
Chief Assistant City Attorney 1.00 1.00 1.00 1.00 — —%
City Attorney 1.00 1.00 1.00 1.00 — —%
Claims Investigator 1.00 1.00 1.00 1.00 — —%
Deputy City Attorney 1.00 1.00 — 0.50 0.50 —%
Legal Fellow 1.00 1.00 1.00 1.00 — —%
Secretary to City Attorney 1.00 1.00 1.00 1.00 — —%
Senior Management Analyst 1.00 1.00 1.00 1.00 — —%
Total City Attorney 10.00 10.00 10.00 10.50 0.50 5.0%
City Auditor
City Auditor 1.00 — — — — —%
Senior Performance Auditor 2.00 — — — — —%
Total City Auditor 3.00 — — — — —%
City Clerk
Administrative Associate III 2.00 2.00 2.00 2.00 — —%
Assistant City Clerk 1.00 1.00 1.00 2.00 1.00 100.0%
City Clerk 1.00 1.00 1.00 1.00 — —%
Deputy City Clerk 1.00 1.00 1.00 — (1.00) (100.0)%
Total City Clerk 5.00 5.00 5.00 5.00 — —%
City Manager
Administrative Assistant 2.00 2.00 2.00 3.00 1.00 50.0% Assistant City Manager 1.00 1.00 1.00 1.00 — —%
Table of Organization
FY 2021
Actuals
FY 2022
Actuals
FY 2023
Adopted
Budget
FY 2024
Adjusted
Budget***
FY 2024
Change
FTE
FY 2024
Change %
2 ATTACHMENT B
Item 11
Attachment B - Amended
FY 2024 Table of
Organization

Item 11: Staff Report
Pg.
32 Packet Pg. 329 of 428

TABLE OF ORGANIZATION
Assistant to the City Manager 2.00 1.00 3.00 3.00 — —%
Chief Communications Officer 1.00 1.00 1.00 1.00 — —%
City Manager 1.00 1.00 1.00 1.00 — —%
Deputy City Manager 1.00 1.00 1.00 1.00 — —%
Executive Assistant to the City Manager 1.00 1.00 1.00 1.00 — —% Manager Communications 1.00 1.00 1.00 1.00 — —%
Senior Management Analyst — — 1.00 1.00 — —%
Total City Manager 10.00 9.00 12.00 13.00 1.00 8.3%
Community Services
Administrative Assistant 1.00 1.00 1.00 1.00 — —%
Administrative Associate III 1.00 — — — — —%
Assistant Director Community Services 2.00 1.00 1.00 2.00 1.00 100.0% Building Serviceperson 1.00 1.00 1.00 2.00 1.00 100.0%
Building Serviceperson-Lead 0.60 0.60 0.60 2.00 1.40 233.3% Coordinator Recreation Programs 4.00 4.00 4.00 5.75 1.75 43.8% Director Community Services 1.00 1.00 1.00 1.00 — —%
Division Manager Open Space, Parks & Golf* — — — 1.00 1.00 —% Heavy Equipment Operator 0.07 — — — — —%
Inspector, Field Services 2.00 2.00 2.00 2.00 — —%
Junior Museum & Zoo Educator* 3.60 3.25 4.10 4.85 0.75 18.3% Management Analyst 1.00 1.00 1.00 1.00 — —%
Management Assistant 1.00 1.00 1.00 1.00 — —%
Manager Community Services 5.00 5.00 5.00 5.00 — —%
Manager Community Services Senior Program 4.00 4.00 4.00 4.00 — —% Manager Human Services 1.00 1.00 1.00 1.00 — —%
Park Maintenance Person 6.00 6.00 6.00 6.00 — —%
Table of Organization
FY 2021
Actuals
FY 2022
Actuals
FY 2023
Adopted
Budget
FY 2024
Adjusted
Budget***
FY 2024
Change
FTE
FY 2024
Change %
3 ATTACHMENT B
Item 11
Attachment B - Amended
FY 2024 Table of
Organization

Item 11: Staff Report
Pg.
33 Packet Pg. 330 of 428

TABLE OF ORGANIZATION
Park Maintenance-Lead 1.00 1.00 1.00 1.00 — —%
Park Ranger 5.00 5.00 6.00 6.00 — —%
Parks/Golf Crew-Lead 2.00 2.00 2.00 2.00 — —%
Producer Arts/Science Program 12.00 11.00 12.25 9.50 (2.75) (24.4)% Program Assistant I 7.00 3.00 3.00 3.75 0.75 25.0%
Program Assistant II 4.00 4.00 4.00 4.00 — —%
Project Manager 0.10 0.10 0.10 0.10 — —%
Senior Management Analyst 1.00 1.00 1.00 1.00 — —%
Sprinkler System Representative 4.00 4.00 4.00 4.00 — —% Superintendent Community Services 2.00 2.00 2.00 2.00 — —% Superintendent Recreation 1.00 — — — — —%
Theater Specialist 2.00 2.00 2.00 5.00 3.00 150.0%
WGW Heavy Equipment Operator — 0.07 0.07 0.07 — —%
Total Community Services 75.37 67.02 70.12 78.02 7.90 11.3% Fire
40-Hour Captain — — 0.20 0.20 — —%
40-Hour Training Battalion Chief 1.00 1.00 1.00 1.00 — —% 40-Hour Training Captain 1.00 1.00 1.00 1.00 — —%
Administrative Assistant 1.00 1.00 1.00 1.00 — —%
Administrative Associate II 2.20 2.20 2.20 2.20 — —%
Administrative Associate III — — 0.20 0.20 — —%
Battalion Chief 3.00 3.00 3.00 3.00 — —%
Business Analyst 0.80 0.80 0.80 0.80 — —%
Deputy Chief/Fire Marshal 0.05 0.05 — — — —%
Deputy Director Technical Services Division 0.20 — 0.20 0.20 — —% Deputy Fire Chief 2.00 1.00 2.00 2.00 — —%
Table of Organization
FY 2021
Actuals
FY 2022
Actuals
FY 2023
Adopted
Budget
FY 2024
Adjusted
Budget***
FY 2024
Change
FTE
FY 2024
Change %
4 ATTACHMENT B
Item 11
Attachment B - Amended
FY 2024 Table of
Organization

Item 11: Staff Report
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TABLE OF ORGANIZATION
Emergency Medical Service Director 1.00 1.00 1.00 1.00 — —% Emergency Medical Services Data Specialist 1.00 1.00 1.00 1.00 — —% Fire Apparatus Operator 26.00 26.00 26.00 26.00 — —%
Fire Captain 21.00 20.00 20.00 20.00 — —%
Fire Chief 1.00 1.00 1.00 1.00 — —%
Fire Fighter 34.00 29.00 34.00 34.00 — —%
Fire Fighter Trainee — — 3.00 3.00 — —%
Fire Inspector 0.80 0.40 0.40 2.40 2.00 500.0%
Fire Marshal — — 0.05 0.05 — —%
Geographic Information System Specialist 0.50 0.50 0.50 0.50 — —% Hazardous Materials Inspector 0.30 0.30 0.70 0.70 — —%
Senior Management Analyst 1.00 1.00 1.00 1.00 — —%
Total Fire 97.85 90.25 100.25 102.25 2.00 2.0%
Human Resources
Administrative Assistant — — — 0.75 0.75 —%
Assistant Director Human Resources 1.00 1.00 1.00 1.00 — —% Director Human Resources/CPO 1.00 1.00 1.00 1.00 — —%
Human Resources Representative 3.00 2.00 2.00 4.00 2.00 100.0% Human Resources Technician 4.00 3.00 4.00 2.00 (2.00) (50.0)% Manager Employee Benefits 1.00 1.00 1.00 1.00 — —%
Manager Employee Relations 1.00 1.00 1.00 1.00 — —%
Senior Human Resources Administrator 3.00 3.00 3.00 4.00 1.00 33.3% Senior Management Analyst 2.00 2.00 2.00 2.00 — —%
Total Human Resources 16.00 14.00 15.00 16.75 1.75 11.7% Library
Administrative Assistant — — — 1.00 1.00 —%
Table of Organization
FY 2021
Actuals
FY 2022
Actuals
FY 2023
Adopted
Budget
FY 2024
Adjusted
Budget***
FY 2024
Change
FTE
FY 2024
Change %
5 ATTACHMENT B
Item 11
Attachment B - Amended
FY 2024 Table of
Organization

Item 11: Staff Report
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TABLE OF ORGANIZATION
Administrative Associate III 1.00 — 1.00 — (1.00) (100.0)% Assistant Director Library Services 1.00 — 1.00 — (1.00) (100.0)% Business Analyst 1.00 1.00 1.00 — (1.00) (100.0)%
Coordinator Library Programs 1.00 1.00 2.00 5.00 3.00 150.0% Director Libraries 1.00 1.00 1.00 1.00 — —%
Division Head Library Services 1.00 1.00 1.00 2.00 1.00 100.0% Librarian 6.00 6.00 7.00 4.00 (3.00) (42.9)%
Library Associate 7.00 6.00 6.00 10.00 4.00 66.7%
Library Specialist 11.50 10.50 12.50 8.00 (4.50) (36.0)% Management Analyst 1.00 1.00 1.00 1.00 — —%
Manager Library Services 3.00 3.00 3.00 3.00 — —%
Senior Business Analyst — — — 1.00 1.00 —%
Senior Librarian 8.00 6.00 6.00 8.00 2.00 33.3%
Supervising Librarian 4.00 4.00 4.00 5.00 1.00 25.0%
Total Library 46.50 40.50 46.50 49.00 2.50 5.4%
Office of Emergency Services
Director Office of Emergency Services 1.00 1.00 1.00 1.00 — —% Office of Emergency Services Coordinator 1.00 1.00 1.00 2.00 1.00 100.0% Program Assistant II 1.00 — — — — —%
Total Office of Emergency Services 3.00 2.00 2.00 3.00 1.00 50.0% Office of Transportation
Administrative Assistant 0.50 0.60 0.60 0.60 — —%
Associate Engineer 0.30 0.35 0.35 0.35 — —%
Associate Planner 0.45 0.40 0.40 0.40 — —%
Chief Transportation Official 0.70 0.70 0.70 0.70 — —%
Coordinator Transportation Systems
Management

1.25 0.65 0.65 0.65 — —%
Table of Organization
FY 2021
Actuals
FY 2022
Actuals
FY 2023
Adopted
Budget
FY 2024
Adjusted
Budget***
FY 2024
Change
FTE
FY 2024
Change %
6 ATTACHMENT B
Item 11
Attachment B - Amended
FY 2024 Table of
Organization

Item 11: Staff Report
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TABLE OF ORGANIZATION
Management Analyst* 0.50 0.50 0.50 — (0.50) (100.0)%
Parking Operations-Lead — 0.05 0.05 0.05 — —%
Project Engineer 0.45 0.25 0.25 0.25 — —%
Senior Engineer 0.20 0.20 0.55 0.55 — —%
Senior Management Analyst* — — — 0.50 0.50 —%
Senior Planner 0.50 0.15 0.15 1.40 1.25 833.3%
Traffic Engineering-Lead 0.35 0.35 — — — —%
Transportation Planning Manager 1.15 1.00 1.00 1.00 — —% Total Office of Transportation 6.35 5.20 5.20 6.45 1.25 24.0% Planning and Development Services
40-Hour Captain — — 0.80 0.80 — —%
Administrative Assistant 1.00 1.00 1.00 1.00 — —%
Administrative Associate I 1.00 1.00 1.00 — (1.00) (100.0)% Administrative Associate II* 2.80 2.80 2.80 0.80 (2.00) (71.4)% Administrative Associate III* 4.00 3.00 4.80 7.80 3.00 62.5% Assistant Chief Building Official*** 1.00 1.00 2.00 1.00 (1.00) (50.0)% Assistant Director PCE 1.00 1.00 1.00 1.00 — —%
Associate Engineer 0.20 — — 0.50 0.50 —%
Associate Planner 3.00 3.25 1.25 1.25 — —%
Building Inspector Specialist 6.00 6.00 8.00 — (8.00) (100.0)% Building/Planning Technician 3.00 2.00 2.50 2.50 — —%
Chief Building Official 1.00 1.00 1.00 1.00 — —%
Chief Planning Official 1.00 1.00 1.00 1.00 — —%
Code Enforcement Officer 2.00 — 1.00 1.00 — —%
Code Enforcement-Lead 1.00 1.00 1.00 1.00 — —%
Deputy Chief/Fire Marshal 0.80 0.80 — — — —%
Table of Organization
FY 2021
Actuals
FY 2022
Actuals
FY 2023
Adopted
Budget
FY 2024
Adjusted
Budget***
FY 2024
Change
FTE
FY 2024
Change %
7 ATTACHMENT B
Item 11
Attachment B - Amended
FY 2024 Table of
Organization

Item 11: Staff Report
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TABLE OF ORGANIZATION
Development Project Coordinator II 2.00 2.00 2.00 2.00 — —% Development Project Coordinator III 3.00 3.00 3.00 3.00 — —% Director Planning/Community Environment 1.00 1.00 1.00 1.00 — —% Division Manager Planning*** — — — 1.00 — —%
Engineer 0.52 0.52 0.52 0.52 — —%
Engineering Technician III 1.50 1.50 1.50 1.00 (0.50) (33.3)% Fire Inspector 3.20 1.60 1.60 1.60 — —%
Fire Marshal — — 0.80 0.80 — —%
Hazardous Materials Inspector 1.60 1.60 3.20 3.20 — —%
Industrial Waste Investigator 0.35 0.35 0.35 0.35 — —%
Inspector, Field Services 0.68 0.68 0.68 0.68 — —%
Landscape Architect Park Planner 0.50 0.50 0.50 0.50 — —% Manager Planning 4.00 4.00 4.00 4.00 — —%
Planner 4.00 4.00 5.00 5.00 — —%
Plans Check Engineer — — 1.00 1.00 — —%
Principal Planner 2.00 1.00 2.00 2.00 — —%
Program Assistant I 1.00 — — — — —%
Project Engineer 0.10 — — — — —%
Project Manager — — 0.50 0.50 — —%
Senior Building Inspector** — — — 8.00 8.00 —%
Senior Business Analyst 1.00 1.00 1.00 1.00 — —%
Senior Engineer 0.40 0.40 0.45 0.45 — —%
Senior Management Analyst 2.00 2.00 2.00 2.00 — —%
Senior Plan Check Engineer** — — — 2.00 2.00 —%
Senior Planner*,*** 3.60 3.65 4.65 8.65 4.00 86.0%
Supervisor Inspection and Surveying 0.25 0.25 0.25 0.25 — —% Supervisor of Code Enforcement** — — — 1.00 1.00 —%
Table of Organization
FY 2021
Actuals
FY 2022
Actuals
FY 2023
Adopted
Budget
FY 2024
Adjusted
Budget***
FY 2024
Change
FTE
FY 2024
Change %
8 ATTACHMENT B
Item 11
Attachment B - Amended
FY 2024 Table of
Organization

Item 11: Staff Report
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TABLE OF ORGANIZATION
Traffic Engineering-Lead 0.10 0.05 — — — —%
Transportation Planning Manager — 0.05 0.05 0.05 — —%
Total Planning and Development Services 61.60 54.00 65.20 72.20 7.00 10.7% Police
Administrative Assistant 1.00 1.00 1.00 1.00 — —%
Administrative Associate II 3.00 2.00 2.00 3.00 1.00 50.0% Animal Control Officer 3.00 2.00 2.00 2.00 — —%
Animal Control Officer-Lead 1.00 1.00 1.00 1.00 — —%
Assistant Police Chief 1.00 1.00 1.00 1.00 — —%
Business Analyst 1.20 1.20 2.20 2.20 — —%
Code Enforcement Officer 1.00 1.00 1.00 1.00 — —%
Communications Manager 1.00 — — — — —%
Communications Technician 1.00 — — — — —%
Community Service Officer 7.50 5.63 5.63 5.63 — —%
Court Liaison Officer* 1.00 1.00 1.00 2.00 1.00 100.0%
Crime Analyst 1.00 1.00 1.00 1.00 — —%
Deputy Director Technical Services Division 0.80 — 0.80 0.80 — —% Geographic Information System Specialist 0.50 0.50 0.50 0.50 — —% Police Agent 19.00 19.00 19.00 19.00 — —%
Police Captain 2.00 2.00 2.00 2.00 — —%
Police Chief 1.00 1.00 1.00 1.00 — —%
Police Lieutenant 5.00 4.00 4.00 4.00 — —%
Police Officer 50.00 39.00 43.00 45.00 2.00 4.7%
Police Records Specialist II 6.00 6.00 6.00 6.00 — —%
Police Records Specialist-Lead 1.00 1.00 1.00 1.00 — —% Police Sergeant 14.00 14.00 14.00 14.00 — —%
Table of Organization
FY 2021
Actuals
FY 2022
Actuals
FY 2023
Adopted
Budget
FY 2024
Adjusted
Budget***
FY 2024
Change
FTE
FY 2024
Change %
9 ATTACHMENT B
Item 11
Attachment B - Amended
FY 2024 Table of
Organization

Item 11: Staff Report
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TABLE OF ORGANIZATION
Program Assistant II 1.00 1.00 1.00 1.00 — —%
Property Evidence Technician 2.00 2.00 2.00 2.00 — —%
Public Safety Communications Manager 1.00 — 1.00 1.00 — —% Public Safety Dispatcher 16.00 12.00 14.00 16.00 2.00 14.3% Public Safety Dispatcher-Lead 4.00 4.00 4.00 4.00 — —%
Public Safety Program Manager 2.00 1.00 1.00 1.00 — —%
Senior Management Analyst 1.00 1.00 1.00 1.00 — —%
Total Police 149.00 124.33 133.13 139.13 6.00 4.5%
Public Works
Administrative Assistant 1.00 0.50 0.50 0.50 — —%
Administrative Associate I 0.10 — — — — —%
Administrative Associate II 2.65 2.65 2.65 2.65 — —%
Administrative Associate III 0.01 — — — — —%
Assistant Director Public Works 0.73 0.73 0.73 0.73 — —% Associate Engineer — — — 0.45 0.45 —%
Building Serviceperson-Lead 1.00 1.00 1.00 1.00 — —%
Building/Planning Technician — — 0.50 0.50 — —%
Cement Finisher 2.00 2.00 2.00 2.00 — —%
Cement Finisher-Lead 0.26 0.26 0.26 0.26 — —%
Coordinator Public Works Projects 1.50 1.50 1.50 1.50 — —% Director Public Works/City Engineer 1.00 1.00 1.00 1.00 — —% Electrician 0.80 0.80 0.80 0.80 — —%
Engineer 0.48 0.48 0.48 0.48 — —%
Engineering Technician III 1.75 1.75 1.75 1.80 0.05 2.9% Environmental Specialist — — 0.33 0.33 — —%
Equipment Operator 2.46 2.46 2.46 2.46 — —%
Table of Organization
FY 2021
Actuals
FY 2022
Actuals
FY 2023
Adopted
Budget
FY 2024
Adjusted
Budget***
FY 2024
Change
FTE
FY 2024
Change %
10 ATTACHMENT B
Item 11
Attachment B - Amended
FY 2024 Table of
Organization

Item 11: Staff Report
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TABLE OF ORGANIZATION
Facilities Carpenter 1.00 1.00 1.00 1.00 — —%
Facilities Maintenance-Lead 1.85 1.85 1.85 1.85 — —%
Facilities Painter 1.75 1.75 1.75 1.75 — —%
Facilities Technician 4.05 4.05 4.05 5.05 1.00 24.7%
Heavy Equipment Operator 2.33 2.10 2.10 2.10 — —%
Heavy Equipment Operator-Lead 0.85 0.85 0.85 0.85 — —%
Inspector, Field Services 0.11 0.11 0.11 0.11 — —%
Landscape Architect Park Planner 0.60 0.60 0.60 0.60 — —% Management Analyst 1.45 1.45 0.70 0.70 — —%
Manager Environmental Control Program — — 0.33 0.33 — —% Manager Facilities 0.90 0.90 0.90 0.90 — —%
Manager Maintenance Operations 1.20 1.20 1.20 1.20 — —% Manager Urban Forestry 1.00 1.00 1.00 1.00 — —%
Manager Watershed Protection 0.05 0.05 0.05 0.05 — —%
Project Manager 2.65 2.00 2.50 2.85 0.35 14.0%
Senior Engineer 0.60 0.60 0.60 0.60 — —%
Senior Management Analyst 1.11 1.11 1.11 1.11 — —%
Supervisor Inspection and Surveying 0.10 0.10 0.10 0.10 — —% Surveyor, Public Works 0.33 0.33 0.33 0.33 — —%
Traffic Controller Maintainer I 1.94 1.94 1.94 1.94 — —% Traffic Controller Maintainer II 2.00 1.00 1.00 1.00 — —% Tree Maintenance Person 1.00 1.00 1.00 1.00 — —%
Tree Trim/Line Clear 7.00 7.00 7.00 7.00 — —%
Tree Trim/Line Clear-Lead 1.00 1.00 1.00 1.00 — —%
WGW Heavy Equipment Operator — 0.23 0.23 0.23 — —%
Total Public Works 50.61 48.35 49.26 51.11 1.85 3.8%
Total General Fund 574.43 506.80 552.81 587.06 34.25 6.2% Table of Organization
FY 2021
Actuals
FY 2022
Actuals
FY 2023
Adopted
Budget
FY 2024
Adjusted
Budget***
FY 2024
Change
FTE
FY 2024
Change %
11 ATTACHMENT B
Item 11
Attachment B - Amended
FY 2024 Table of
Organization

Item 11: Staff Report
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TABLE OF ORGANIZATION
Enterprise Fund
Public Works
Account Specialist 0.30 — — — — —%
Accountant 0.40 0.70 0.70 0.70 — —%
Administrative Associate I 0.10 — 1.00 1.00 — —%
Administrative Associate II 2.15 2.15 2.15 2.15 — —%
Administrative Associate III 0.10 0.20 0.20 0.20 — —%
Airport Specialist II — — — 2.50 2.50 —%
Assistant Director Public Works 1.30 1.30 1.30 1.30 — —% Assistant Manager WQCP 2.00 2.00 2.00 2.00 — —%
Associate Engineer 3.00 3.00 3.00 3.05 0.05 1.7%
Chemist 3.00 2.00 2.00 3.00 1.00 50.0%
Deputy Chief/Fire Marshal 0.07 0.07 — — — —%
Electrician 3.00 3.00 3.00 3.00 — —%
Electrician-Lead 2.00 2.00 2.00 2.00 — —%
Engineer 0.90 0.90 0.90 1.90 1.00 111.1%
Engineering Technician III 0.25 0.25 0.25 0.20 (0.05) (20.0)% Environmental Specialist 2.00 2.00 2.33 2.33 — —%
Equipment Operator 0.54 0.54 0.54 0.54 — —%
Facilities Maintenance Lead 1.00 1.00 1.00 1.00 — —%
Facilities Technician 1.50 1.50 2.50 — (2.50) (100.0)%
Fire Marshal — — 0.07 0.07 — —%
Hazardous Materials Inspector 0.04 0.04 0.04 0.04 — —%
Heavy Equipment Operator 0.90 0.90 0.90 0.90 — —%
Heavy Equipment Operator-Lead 1.15 1.15 1.15 1.15 — —%
Industrial Waste Inspector 3.00 3.00 3.00 3.00 — —%
Table of Organization
FY 2021
Actuals
FY 2022
Actuals
FY 2023
Adopted
Budget
FY 2024
Adjusted
Budget***
FY 2024
Change
FTE
FY 2024
Change %
12 ATTACHMENT B
Item 11
Attachment B - Amended
FY 2024 Table of
Organization

Item 11: Staff Report
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TABLE OF ORGANIZATION
Industrial Waste Investigator 1.15 1.15 1.15 1.15 — —%
Laboratory Technician WQC 3.00 3.00 3.00 3.00 — —%
Landfill Technician 1.00 1.00 1.00 2.00 1.00 100.0%
Management Analyst 2.30 2.30 2.30 2.30 — —%
Manager Airport 1.00 1.00 1.00 1.00 — —%
Manager Environmental Control Program 5.00 5.00 5.33 5.33 — —% Manager Laboratory Services 1.00 1.00 1.00 1.00 — —%
Manager Maintenance Operations 1.96 1.96 1.96 1.96 — —% Manager Solid Waste 1.00 1.00 1.00 1.00 — —%
Manager Water Quality Control Plant 1.00 1.00 1.00 1.00 — —% Manager Watershed Protection 0.95 0.95 0.95 0.95 — —%
Plant Mechanic 7.00 7.00 7.00 7.00 — —%
Program Assistant I 1.00 1.00 1.00 1.00 — —%
Program Assistant II 2.00 2.00 2.00 2.00 — —%
Project Engineer 1.83 1.83 1.83 2.83 1.00 54.6%
Project Manager 1.35 1.35 1.35 1.35 — —%
Senior Accountant 0.30 0.30 0.30 0.30 — —%
Senior Buyer 1.00 1.00 1.00 1.00 — —%
Senior Chemist 1.00 2.00 2.00 2.00 — —%
Senior Engineer 3.76 3.76 3.76 3.76 — —%
Senior Industrial Waste Investigator 1.00 1.00 1.00 1.00 — —% Senior Management Analyst 0.21 0.21 0.21 0.21 — —%
Senior Mechanic 1.00 1.00 1.00 1.00 — —%
Senior Operator WQC 6.00 6.00 6.00 6.00 — —%
Senior Technologist 1.00 1.00 1.00 1.00 — —%
Storekeeper 1.00 1.00 1.00 1.00 — —%
Street Maintenance Assistant 1.00 1.00 1.00 — (1.00) (100.0)% Table of Organization
FY 2021
Actuals
FY 2022
Actuals
FY 2023
Adopted
Budget
FY 2024
Adjusted
Budget***
FY 2024
Change
FTE
FY 2024
Change %
13 ATTACHMENT B
Item 11
Attachment B - Amended
FY 2024 Table of
Organization

Item 11: Staff Report
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TABLE OF ORGANIZATION
Street Sweeper Operator 1.63 1.63 1.63 1.63 — —%
Supervisor WQCP Operations 3.00 3.00 3.00 3.00 — —%
Surveyor, Public Works 0.12 0.12 0.12 0.12 — —%
Technologist 1.00 1.00 1.00 1.00 — —%
Traffic Controller Maintainer I 0.06 0.06 0.06 0.06 — —% WQC Plant Operator II 16.00 16.00 16.00 16.00 — —%
Zero Waste Coordinator 1.00 1.00 1.00 1.00 — —%
Total Public Works 101.32 101.32 103.98 106.98 3.00 2.9% Utilities
Account Specialist 1.70 1.00 1.00 1.00 — —%
Accountant 0.60 1.30 1.30 1.30 — —%
Administrative Assistant 1.00 1.00 1.00 1.00 — —%
Administrative Associate II 6.00 6.00 6.00 6.00 — —%
Assistant City Attorney — — 1.00 2.00 1.00 100.0%
Assistant Director Administrative Services 0.25 0.25 0.25 0.25 — —% Assistant Director Sustainability and Climate
Action
— — — 1.00 1.00 —%
Assistant Director Utilities Customer Support
Services

1.00 1.00 1.00 2.00 1.00 100.0%
Assistant Director Utilities Engineering 1.00 1.00 1.00 1.00 — —% Assistant Director Utilities Operations 1.00 1.00 1.00 1.00 — —% Assistant Director Utilities/Resource
Management

1.00 1.00 1.00 1.00 — —%
Associate Sustainability Program Administrator — — 1.00 1.00 — —% Business Analyst 6.00 6.00 6.00 6.00 — —%
Cathodic Protection Technician Assistant 1.00 1.00 1.00 1.00 — —% Cathodic Technician 1.00 1.00 1.00 1.00 — —%
Cement Finisher 2.00 2.00 2.00 2.00 — —%
Table of Organization
FY 2021
Actuals
FY 2022
Actuals
FY 2023
Adopted
Budget
FY 2024
Adjusted
Budget***
FY 2024
Change
FTE
FY 2024
Change %
14 ATTACHMENT B
Item 11
Attachment B - Amended
FY 2024 Table of
Organization

Item 11: Staff Report
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TABLE OF ORGANIZATION
Contracts Administrator 0.70 0.70 0.70 0.70 — —%
Coordinator Utilities Projects 6.00 6.00 8.00 8.00 — —% Customer Service Representative 7.00 7.00 7.00 7.00 — —% Customer Service Specialist 2.00 2.00 2.00 2.00 — —%
Customer Service Specialist-Lead 2.00 2.00 2.00 2.00 — —% Deputy Chief/Fire Marshal 0.08 0.08 — — — —%
Deputy City Attorney 1.00 1.00 — 0.50 0.50 —%
Director Administrative Services/CFO 0.20 0.20 0.20 0.20 — —% Electric Heavy Equipment Operator 2.00 2.00 1.00 1.00 — —% Electric Project Engineer 4.00 4.00 8.00 8.00 — —%
Electric Underground Inspector 2.00 2.00 2.00 2.00 — —% Electric Underground Inspector-Lead 1.00 1.00 1.00 1.00 — —% Electrical Equipment Technician 1.00 1.00 1.00 1.00 — —% Electrician Assistant I 3.00 3.00 3.00 3.00 — —%
Engineer 4.00 4.00 4.00 5.00 1.00 25.0
Engineering Manager - Electric 1.00 1.00 1.00 1.00 — —% Engineering Manager - WGW 1.00 1.00 1.00 1.00 — —%
Engineering Technician III 3.00 3.00 3.00 3.00 — —%
Environmental Specialist — — 0.34 0.34 — —%
Equipment Operator — — 1.00 1.00 — —%
Fire Marshal — — 0.08 0.08 — —%
Gas and Water Meter Measurement and
Control Technician

4.00 4.00 4.00 4.00 — —%
Gas and Water Meter Measurement and
Control Technician - Lead

1.00 1.00 1.00 1.00 — —%
Hazardous Materials Inspector 0.06 0.06 0.06 0.06 — —%
Heavy Equipment Operator - Install/Repair 4.00 4.00 4.00 4.00 — —% Human Resources Representative — 1.00 1.00 1.00 — —%
Table of Organization
FY 2021
Actuals
FY 2022
Actuals
FY 2023
Adopted
Budget
FY 2024
Adjusted
Budget***
FY 2024
Change
FTE
FY 2024
Change %
15 ATTACHMENT B
Item 11
Attachment B - Amended
FY 2024 Table of
Organization

Item 11: Staff Report
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TABLE OF ORGANIZATION
Industrial Waste Investigator 0.50 0.50 0.50 0.50 — —%
Inspector, Field Services 5.00 — — — — —%
Inspector, WGW Utilities Field Svc — 5.00 5.00 5.00 — —% Lineperson/Cable Specialist 10.00 10.00 10.00 10.00 — —% Lineperson/Cable Specialist-Lead 4.00 4.00 4.00 4.00 — —% Maintenance Mechanic-Welding 2.00 2.00 2.00 2.00 — —%
Management Analyst — — 1.00 1.00 — —%
Manager Communications 1.00 1.00 1.00 1.00 — —%
Manager Customer Service 1.00 1.00 1.00 1.00 — —%
Manager Electric Operations 1.00 1.00 1.00 1.00 — —%
Manager Environmental Control Program — — 0.34 0.34 — —% Manager Information Technology — — — 1.00 1.00 —%
Manager Treasury, Debt & Investments 0.40 0.40 0.40 0.40 — —% Manager Utilities Compliance 1.00 1.00 1.00 1.00 — —%
Manager Utilities Credit & Collection 1.00 1.00 1.00 1.00 — —% Manager Utilities Operations WGW 1.00 1.00 1.00 1.00 — —% Manager Utilities Program Services 1.00 1.00 2.00 2.00 — —% Manager Utilities Strategic Business 1.00 1.00 1.00 1.00 — —% Manager Utilities Telecommunications 1.00 1.00 1.00 3.00 2.00 200.0% Meter Reader 6.00 6.00 6.00 5.00 (1.00) (16.7)%
Meter Reader-Lead 1.00 1.00 1.00 1.00 — —%
Metering Technician 3.00 3.00 2.00 2.00 — —%
Metering Technician-Lead 1.00 1.00 1.00 1.00 — —%
Offset Equipment Operator 0.48 0.48 0.48 0.48 — —%
Overhead Underground Troubleman 2.00 2.00 2.00 2.00 — —% Power Engineer 1.00 1.00 — — — —%
Principal Business Analyst 1.00 1.00 1.00 1.00 — —%
Table of Organization
FY 2021
Actuals
FY 2022
Actuals
FY 2023
Adopted
Budget
FY 2024
Adjusted
Budget***
FY 2024
Change
FTE
FY 2024
Change %
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TABLE OF ORGANIZATION
Principal Utilities Program Manager — — 1.00 — (1.00) (100.0)% Program Assistant I 1.50 1.50 1.50 2.00 0.50 33.3%
Program Assistant II 1.00 1.00 — — — —%
Project Engineer 5.00 5.00 5.00 5.00 — —%
Project Manager 0.75 0.75 0.75 0.75 — —%
Resource Planner 5.00 5.00 5.00 5.00 — —%
Restoration Lead 1.00 1.00 1.00 1.00 — —%
SCADA Technologist 2.00 2.00 — — — —%
Senior Accountant 0.70 0.70 0.70 0.70 — —%
Senior Business Analyst 3.00 3.00 3.00 3.00 — —%
Senior Electrical Engineer 4.00 5.00 5.00 5.00 — —%
Senior Engineer 5.00 5.00 6.00 5.00 (1.00) (16.7)%
Senior Management Analyst 0.70 0.70 0.70 0.70 — —%
Senior Marketing Analyst — — — 1.00 1.00 —%
Senior Mechanic 1.00 1.00 1.00 1.00 — —%
Senior Performance Auditor 1.00 — — — — —%
Senior Resource Planner 6.50 6.50 7.00 7.00 — —%
Senior Utilities Field Service Representative 1.00 1.00 1.00 1.00 — —% Senior Utilities System Operator** — — — 1.00 1.00 —%
Senior Water Systems Operator 2.00 2.00 2.00 2.00 — —%
Storekeeper 1.00 1.00 1.00 1.00 — —%
Storekeeper-Lead 0.80 0.80 0.80 0.80 — —%
Street Light, Traffic Signal & Fiber Technician 5.00 5.00 4.00 4.00 — —% Street Light, Traffic Signal & Fiber-Lead 2.00 2.00 2.00 2.00 — —% Substation Electrician 6.00 6.00 6.00 6.00 — —%
Substation Electrician-Lead 2.00 2.00 2.00 2.00 — —%
Supervising Electric Project Engineer 1.00 — — — — —%
Table of Organization
FY 2021
Actuals
FY 2022
Actuals
FY 2023
Adopted
Budget
FY 2024
Adjusted
Budget***
FY 2024
Change
FTE
FY 2024
Change %
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TABLE OF ORGANIZATION
Sustainability Programs Administrator — 4.00 5.00 5.00 — —% Tree Maintenance Person 1.00 1.00 1.00 1.00 — —%
Utilities Chief Operating Officer 1.00 1.00 1.00 1.00 — —% Utilities Compliance Technician 3.00 3.00 3.00 3.00 — —% Utilities Compliance Technician-Lead 1.00 1.00 1.00 1.00 — —% Utilities Credit/Collection Specialist 2.00 2.00 2.00 2.00 — —% Utilities Director 1.00 1.00 1.00 1.00 — —%
Utilities Engineer Estimator 5.00 5.00 5.00 5.00 — —%
Utilities Field Services Representative 5.00 5.00 5.00 5.00 — —% Utilities Install Repair-Lead-Welding Certified 2.00 2.00 3.00 3.00 — —% Utilities Install Repair-Welding Certified 3.00 3.00 3.00 3.00 — —% Utilities Install/Repair 10.00 10.00 10.00 10.00 — —%
Utilities Install/Repair Assistant 1.00 1.00 1.00 1.00 — —% Utilities Install/Repair-Lead 5.00 5.00 4.00 4.00 — —%
Utilities Key Account Representative 3.00 3.00 3.00 3.00 — —% Utilities Locator 3.00 3.00 3.00 3.00 — —%
Utilities Marketing Program Administrator 4.00 — — — — —% Utilities Safety Officer 1.00 1.00 1.00 1.00 — —%
Utilities Supervisor 12.00 12.00 12.00 12.00 — —%
Utilities System Analyst — — 2.00 2.00 — —%
Utilities System Operator 5.00 5.00 6.00 5.00 (1.00) (16.7)% Utility Engineering Estimator - Lead 1.00 1.00 1.00 1.00 — —% Warehouse Supervisor 0.80 0.80 0.80 0.80 — —%
Water System Operator II 4.00 4.00 4.00 4.00 — —%
WGW Heavy Equipment Operator 4.70 4.70 4.70 4.70 — —%
Total Utilities 257.42 257.42 267.60 273.60 6.00 2.2%
Total Enterprise Fund 358.74 358.74 371.58 380.58 9.00 2.4% Table of Organization
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Actuals
FY 2022
Actuals
FY 2023
Adopted
Budget
FY 2024
Adjusted
Budget***
FY 2024
Change
FTE
FY 2024
Change %
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TABLE OF ORGANIZATION
Other Funds
Capital Project Fund
Administrative Assistant 0.15 0.65 0.65 0.65 — —%
Administrative Associate I 0.80 — — — — —%
Administrative Associate III 0.89 0.80 0.80 0.80 — —%
Assistant Director Public Works 0.72 0.72 0.72 0.72 — —% Associate Engineer 2.50 1.65 1.65 1.65 — —%
Associate Planner 0.30 0.35 0.35 0.35 — —%
Building Serviceperson 1.00 1.00 1.00 — (1.00) (100.0)% Building Serviceperson-Lead 1.40 1.40 1.40 — (1.40) (100.0)% Cement Finisher-Lead 0.74 0.74 0.74 0.74 — —%
Chief Transportation Official 0.30 0.30 0.30 0.30 — —%
Contracts Administrator 0.60 0.60 0.60 0.60 — —%
Coordinator Public Works Projects 1.30 1.30 1.30 1.30 — —% Coordinator Transportation Systems
Management

0.75 1.35 1.35 1.35 — —%
Engineer 3.10 2.10 3.10 3.10 — —%
Engineering Technician III 0.50 0.50 0.50 0.50 — —%
Facilities Technician 1.50 1.50 1.50 1.50 — —%
Inspector, Field Services 1.21 1.21 1.21 1.21 — —%
Landscape Architect Park Planner 0.90 0.90 0.90 0.90 — —% Management Analyst* 0.95 0.95 0.95 0.80 (0.15) (15.8)%
Manager Facilities 0.10 0.10 0.10 0.10 — —%
Manager Maintenance Operations 0.65 0.65 0.65 0.65 — —% Parking Operations-Lead 0.40 0.30 0.30 0.30 — —%
Project Engineer 7.62 7.92 7.92 7.92 — —%
Project Manager 1.15 0.80 0.80 1.45 0.65 81.3%
Table of Organization
FY 2021
Actuals
FY 2022
Actuals
FY 2023
Adopted
Budget
FY 2024
Adjusted
Budget***
FY 2024
Change
FTE
FY 2024
Change %
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TABLE OF ORGANIZATION
Senior Engineer 4.04 4.04 4.64 4.64 — —%
Senior Management Analyst* 0.60 0.60 0.60 0.75 0.15 25.0% Senior Planner 0.50 0.80 0.80 1.55 0.75 93.8%
Supervisor Inspection and Surveying 0.65 0.65 0.65 0.65 — —% Surveyor, Public Works 0.55 0.55 0.55 0.55 — —%
Traffic Engineering-Lead 0.55 0.60 — — — —%
Transportation Planning Manager 0.35 0.45 0.45 0.45 — —% Total Capital Project Fund 36.77 35.48 36.48 35.48 (1.00) (2.7)% General Liabilities Insurance Program Fund
Senior Management Analyst — — — 1.00 1.00 —%
Total General Liabilities Insurance Program
Fund
— — — 1.00 1.00 —%
Printing and Mailing Services
Manager Revenue Collections 0.10 0.10 0.10 0.10 — —%
Offset Equipment Operator 1.52 1.52 1.52 1.52 — —%
Total Printing and Mailing Services 1.62 1.62 1.62 1.62 — —% Special Revenue Funds
Account Specialist 1.87 1.37 1.37 1.37 — —%
Account Specialist-Lead 0.55 0.55 0.55 0.55 — —%
Administrative Assistant 0.35 0.25 0.25 0.25 — —%
Administrative Associate II 0.20 0.20 0.20 0.20 — —%
Associate Planner 0.25 — — — — —%
Community Service Officer 0.50 0.37 0.37 0.37 — —%
Coordinator Public Works Projects 0.20 0.20 0.20 0.20 — —% Electrician 0.20 0.20 0.20 0.20 — —%
Facilities Maintenance-Lead 0.15 0.15 0.15 0.15 — —%
Table of Organization
FY 2021
Actuals
FY 2022
Actuals
FY 2023
Adopted
Budget
FY 2024
Adjusted
Budget***
FY 2024
Change
FTE
FY 2024
Change %
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TABLE OF ORGANIZATION
Facilities Painter 0.25 0.25 0.25 0.25 — —%
Facilities Technician 0.45 0.45 0.45 0.45 — —%
Management Analyst* 0.35 0.35 0.35 — (0.35) (100.0)%
Manager Community Services Senior Program 1.00 1.00 1.00 1.00 — —% Manager Maintenance Operations 0.19 0.19 0.19 0.19 — —% Manager Revenue Collections 0.28 0.28 0.28 0.28 — —%
Parking Operations-Lead 0.60 0.65 0.65 0.65 — —%
Senior Management Analyst* — — — 0.35 0.35 —%
Senior Planner 0.40 0.40 0.40 0.40 — —%
Street Maintenance Assistant 2.00 2.00 2.00 2.00 — —%
Street Sweeper Operator 0.37 0.37 0.37 0.37 — —%
Transportation Planning Manager 0.50 0.50 0.50 0.50 — —% Total Special Revenue Funds 10.66 9.73 9.73 9.73 — —%
Technology Fund
Administrative Assistant 1.00 1.00 1.00 1.00 — —%
Assistant Director Administrative Services 0.10 0.10 0.10 0.10 — —% Business Analyst 1.00 1.00 1.00 1.00 — —%
Desktop Technician 6.00 6.00 6.00 6.00 — —%
Director Information Technology/CIO 1.00 1.00 1.00 1.00 — —% Management Analyst — — — 1.00 1.00 —%
Manager Information Technology 3.00 3.00 3.00 3.00 — —% Manager Information Technology Security 1.00 — — — — —% Principal Business Analyst 1.00 — — — — —%
Senior Business Analyst 2.00 2.00 2.00 2.00 — —%
Senior Management Analyst 1.00 1.00 1.00 1.00 — —%
Senior Technologist* 18.00 14.00 16.00 17.00 1.00 6.3%
Table of Organization
FY 2021
Actuals
FY 2022
Actuals
FY 2023
Adopted
Budget
FY 2024
Adjusted
Budget***
FY 2024
Change
FTE
FY 2024
Change %
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TABLE OF ORGANIZATION
*The FY 2023 Adopted Budget does not include City Council actions to amend staffing levels approved in the FY 2023 Mid-Year Budget Review (CMR 2212-0515). These positions appear as a base adjustment in the FY 2024 Adopted Budget. **The FY 2024 Budget includes new job classifications that require completion of appropriate review and potential discussions with bargaining groups. Proposals in this budget include estimated funding levels for financial planning purposes only and do not reflect the final terms of the proposed classifications. ***Adjustments recommended in the FY 2024 Midyear Budget Review (2311-2233).

Technologist 1.00 — — — — —%
Total Technology Fund 36.10 29.10 31.10 33.10 2.00 6.4% Vehicle Replacement and Maintenance Fund
Assistant Director Public Works 0.25 0.25 0.25 0.25 — —% Assistant Fleet Manager 1.00 1.00 1.00 1.00 — —%
Equipment Maintenance Service Person 2.00 1.00 1.00 2.00 1.00 100.0% Fleet Services Coordinator 1.00 1.00 1.00 2.00 1.00 100.0% Management Analyst 0.20 0.20 0.20 0.20 — —%
Management Assistant 1.00 1.00 1.00 1.00 — —%
Manager Fleet 1.00 1.00 1.00 1.00 — —%
Motor Equipment Mechanic II 6.00 5.00 5.00 5.00 — —%
Motor Equipment Mechanic-Lead 2.00 2.00 2.00 1.00 (1.00) (50.0)% Project Manager 1.00 1.00 1.00 1.00 — —%
Senior Management Analyst 0.08 0.08 0.08 0.08 — —%
Total Vehicle Replacement and
Maintenance Fund

15.53 13.53 13.53 14.53 1.00 7.4%
Workers' Compensation Program Fund
Senior Human Resources Administrator 1.00 1.00 1.00 1.00 — —% Total Workers’ Compensation Program
Fund

1.00 1.00 1.00 1.00 — —%
Total Other Funds 101.68 90.46 93.46 96.46 3.00 3.2%
Total Citywide Positions 1,034.85 956.00 1,017.85 1,064.10 46.25 4.5% Table of Organization
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Actuals
FY 2022
Actuals
FY 2023
Adopted
Budget
FY 2024
Adjusted
Budget***
FY 2024
Change
FTE
FY 2024
Change %
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Attachment C
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Preliminary FY 2024 2nd Quarter Financial Status
General Fund
Overall, the General Fund is tracking closely to adopted estimated revenues and at or below adopted expenses. Actual total revenue increased slightly compared to the same period in fiscal year 2023. Though data continues to be uncertain as 2nd Quarter data will not be finalized until March 2024, staff believe recommended adjustments are measured and align more closely with the current financial outlook.

Revenues
The FY 2024 Adopted revenue budget totals $237.1 million (excluding Operating Transfers‐in), of which $93.3 million or 38.4% of the budget, has been collected as of the end of the 2nd quarter. Overall, tax revenue estimates in the FY 2024 Adopted budget are $ 10 million higher than the FY 2023 Adjusted revenue, from approximately $141 million to $151 million.

Adjustments to align revenue with estimates included in the FY 2025‐2034 Long Range Financial Forecast are recommended in this Mid‐Year Budget Report, including adjustments for Sales Tax ($1.6 million increase), Utility Users Tax (UUT) ($1.2 million increase), Investment Earnings ($1.1 million increase), and Property Tax ($0.8 million increase), partially offset by Transient Occupancy Tax (TOT) ($1.3 million decrease) and Documentary Transfer Tax (DTT) ($0.1 million decrease) based on trends experienced in the first half of FY 2024.

Table 2 below outlines General Fund revenue performance, as of the end of the 2 nd quarter,
compared to the adjusted budget. The adjusted budget does not assume staff’s recommended adjustments presented in this Mid‐Year report.

Table 2

Revenues Inc / (Dec) % change FY 2024 % FY 2023 %

Property Tax $929 4.8% $63,785 32.0% $59,770 32.6%
Sales Tax 1,041 8.9% 36,272 35.1% 32,580 35.8% Charges for Services (792) ‐ 5.2% 35,131 40.7% 30,786 49.1% Transient Occupancy Tax 670 6.8% 26,834 39.1% 18,199 53.9% Utility User Tax 539 6.7% 18,457 46.3% 15,579 51.4% Permits and Licenses 2,087 66.9% 10,256 50.8% 9,794 31.9% Documentary Transfer Tax 327 13.3% 5,920 47.1% 7,217 34.1% Business Tax ‐ ‐ ‐ 1,660 0.0% ‐ 0.0% All Other Revenue Sources (2,267) ‐ 10.7% 44,856 42.2% 41,851 50.7%

Total Revenue 2,534           2.8% $243,171 38.4% $215,776 42.1% General Fund Revenue
FY 2024 2nd Quarter  YTD
(000's)
2nd Quarter Actuals Adjusted Budget
FY 2024 FY 2023
$20,428 $19,499
12,715       11,674
14,313       15,105
10,479       9,809
8,550         8,011
$93,421 $90,887
5,208         3,121
2,791         2,464
18,937       21,204
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Property Tax
The FY 2024 Adopted Budget is $63.8 million, a $0.7 million or 1.1% increase from the FY 2023 actual receipts of $63.1 million. Transfer of ownership has been a significant driver of growth; however, this growth is expected to moderate due to economic slowdown and higher mortgage interest rates. For example, the median sales price for a single‐family residential home in the 1st quarter declined by 3% compared to the previous quarter. Staff recommends a modest $0.8 million increase in this Mid‐Year report.

As of the end of FY 2023, the reserve for Excess Education Revenue Augmentation Fund (ERAF), representing the at‐risk amount related to the State Controller’s Office auditing finding on Marin County, totaled $4.1 million. As of December 2023, the State Controller’s Office has issued a negative audit finding against Marin County. The state’s assertion is former Redevelopment Agency funds, which are now part of the regular property taxes, should be excluded from the excess ERAF calculation. Marin County is challenging this finding and in late‐ December 2023, the County of Santa Clara filed a lawsuit against the State Controller’s Office on this. The estimate is, if this audit finding is sustained, 22% of excess ERAF is at risk for fiscal years 2021, 2022, 2023 and 2024. If the finding holds, the County of Santa Clara, as well as other Excess ERAF counties, could face similar audit findings likely starting in FY 2025. This reserve is consistent with prior year methodology of assumptions for this challenge.

Sales Tax
The FY 2024 Adopted Budget is $36.3 million, a slight decrease of 1.6% compared to the actual Sales Tax receipts of $36.9 million in FY Sale Tax for the first four months of FY 2024 is 8.9% higher than the same period of the prior year. During this period, inflation is still elevated but declining and consumer spending has remained steady. The expectation is that consumer spending growth will slow down but remain strong, so Sales Tax is anticipated to generate more than the conservatively budgeted amount in FY 2024. Staff recommends increasing the budget by $1.6 million in this report.

Transient Occupancy Tax (TOT)
The FY 2024 Adopted Budget assumed an estimate of $26.8 million, a 5.1% increase from FY 2023 actual receipts of $25.5 million and slightly lower than the pre‐pandemic actuals of $25.7 million in FY 2019. TOT economic performance for the first five months of FY 2024 is 5.9% higher than the same period of the prior year. Table 2 shows a 6.8% increase in TOT; however, the primary driver of this increase is payment timing difference and does not reflect economic performance. For the 2nd quarter, the average occupancy rate is 69.3% (prior year it was 73.2%) and the average room rate is $246 (prior year it was $266). TOT revenue remained stagnant in the 1st quarter, then experienced double digit growth in the first two months of the 2nd quarter.

Staff continues to monitor trends and conservatively estimates that TOT levels will remain flat compared to FY 2023 actuals. Staff recommends a $1.3 million decrease to TOT revenue and a corresponding reduction of $0.3 million to the transfer to the Capital Fund for funding allocated for capital improvements.

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Utility User Tax (UUT)
The FY 2024 Adopted Budget assumed an estimate of $18.5 million, slightly lower than the $18.8 million FY 2023 actual receipts. Actual UUT receipts in FY 2023 were above year end estimated levels, due to commodity price increases which resulted in higher UUT revenue. As a result, this trend continues in FY 2024 as 2nd quarter UUT revenue totals $8.6 million, or 46.3% of the FY 2024 adjusted budget. Staff recommends increasing the budget by $1.2 million in this report as a result of higher utility revenues.

Permits and Licenses
The FY 2024 Adopted Budget assumed an estimate of $10.7 million, slightly higher than the $9.8 million FY 2023 Adjusted Budget. Cash receipts as of 2nd quarter total $5.2 million, or 50.8% of the FY 2024 adjusted budget and is $2.1 million, or 66.9%, higher compared to FY 2022 2nd quarter revenue. The increased revenue levels for FY 2024 is driven by new construction and permit activity.

Documentary Transfer Tax
The FY 2024 Adopted Budget is $5.9 million, an assumed decline of 18% from the FY 2023 Adjusted budgeted of $7.2 million. Cash receipts as of 2nd quarter total $2.8 million, or 47.1% of the FY 2024 adjusted budget and is $0.3 million, or 13.3% higher compared to FY 2023 2nd quarter revenue due to the higher total property sales value. This revenue source is highly unpredictable, as it is dependent on the value of properties being sold. Staff continues to monitor these receipts closely due to significant fluctuations that can occur anytime depending on the real estate sales activity. The budgeted amount of $5.9 million is 2.9% higher than the actual receipts of the prior year and expected to be realized. Staff recommends decreasing the budget by $0.1 million in this report.

Business Tax
The FY 2024 Adopted Budget includes $2.4 million for Business Tax revenue across all funds and as of the 2nd quarter, revenue collected totals $0.5 million. The first due date for the tax is January 1st for the 2023 calendar year, with February 1st being the date that penalties and interest will begin. In January 2024, an additional $0.5 million was collected. Staff will continue to monitor collections and expect to begin compliance and enforcement activities in February 2024, before assessment and collection of the first quarter of calendar year 2024 begins. A small increase of $41,000 in business tax revenue is recommended in this report to align with increased contractual administration costs for business tax and business registry.

A technical correction is also recommended in this report to consolidate all business tax revenue in the General Fund. As part of the FY 2024 Adopted Budget $0.8 million in business tax revenue was budgeted in the Capital Improvement Fund to support transportation capital projects. This report will move the budget for this $0.8 million to the General Fund and establish a transfer of $0.8 million to the Capital Improvement program to maintain the Item 11
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allocation of the funding in alignment with the Council's adopted Advisory Spending Resolution to fund transportation and grade separation projects.

Charges for Services & Permits and Licenses
The FY 2024 Adopted Budget assumed an estimate of $34.6 million in Charges for Services, a $4.0 million, or 13.1% increase, compared to the FY 2023 Adjusted Budget. The FY 2024 Adopted Budget assumed an estimate of $10.7 million in permit and license revenue, a $0.9 million or 9.2% increase compared to the FY 2023 Adjusted Budget. Together, these revenue categories make up nearly half of all non‐tax revenues. In total, $42.5 million was received during FY 2023, above the revised budget estimates by $2.0 million. These revenue categories consist of charges to Stanford for fire services and paramedic services, fees related to the City’s golf course, arts and science classes, plan check fees, Building Permits, Fire Permits, and miscellaneous health and safety‐related licenses. Several minor adjustments to revenue in Charges for Service are recommended in this report and discussed below; however, overall revenues in these categories are in line with activity levels anticipated thus far.

 Community Services (CSD): The demand for CSD programming remains at elevated levels. Total departmental revenue through the end of the second quarter is approximately $6.1 million or 47% of the FY 2024 total budgeted revenue. At this same time last year, CSD’s total revenue was tracking at 46% of FY 2023 budgeted revenue levels through the second quarter. CSD is recommending adjustments to an Art Center program with high demand. Due to the popularity of art classes, the Kids and Teens Studio Program has requested $50,000 in additional contract dollars to help meet demand with an offset of $50,000 of increased revenue from class fees to remain cost‐ neutral.

 Golf Course: Golf revenue continues to perform well in the first and second quarters of FY 2024 and slightly higher by 2% from this time last year. This could be attributed to better weather than FY23, which experienced several weeks of heavy rains which deterred play both at the course and the driving range. Revenue guidance is recommended to remain at its current budgeted level due to the unpredictability of winter storms in the coming months. The proposed FY 2025 budget will reassess golf revenue and expenditures based on additional information from third‐quarter results. In addition, the division is working on a feasibility study of adding a second story to the driving range with additional potential revenue as an element of the study. Projections will be included as a part of future revenue estimates if that potential project moves forward.

 Junior Museum & Zoo (JMZ): Through the first two quarters of FY 2024, revenue is roughly at 40% of budgeted levels (approximately $0.7 million in actual revenue vs. $1.6 million in budgeted revenue). Memberships remain the best‐performing revenue Item 11
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category (41% of FY 2024 target), while facilities rentals are the lowest performing (5% of FY 24 target), reflecting similar trends as the prior year.

Staff is working with a consultant on a comprehensive operational analysis of the Palo Alto Junior Museum and Zoo. The consultant is preparing a business plan to inform ongoing operational and budgetary decisions. The study will examine financial, operational, and programmatic status and make recommendations for future operations to include ticket and membership prices, and how pricing will impact consumer demand. Once the study is completed, staff will review the results and present recommendations for financial and operational efficiencies to Council. In addition, Staff is currently working with purchasing for a new reservation and ticketing platform for the JMZ. Staff expects to implement the new system in 2024.

 Development Services: Preliminary FY 2024 Development Services revenue is up 3.1% compared to last year and is currently at 43.8% of the FY 2024 revenue target. This is mainly driven by increased single family residential permit activity. Department‐ managed expenses are currently under or on pace to meet the budget. The table below articulates Development Services revenues from January 2021 through December 2023.

Table 3: Development Services Revenue – 2021 through 2023

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Expenditures
Overall General Fund expenses are currently expected to remain within the FY 2024 Adjusted budget levels of $284.3 million (not including transfers to infrastructure or other funds).

General Fund expenses (excluding operating transfers) for second quarter are 17.4% higher than the prior year and are tracking at 39.0% of the Adjusted Budget (excluding encumbrances); this trend is consistent with prior year expenditure levels.

Table 4

Salaries and Benefits
As a service driven organization, the largest expenses are salaries and benefits. Preliminary salary and benefits expenditures through December 2023 are approximately $81.7 million, or 49% of the $166.9 million FY 2024 Adopted Budget, compared to $71.3 million in the same period in the prior year. The City continues to maintain vacancies of approximately 74 positions; though this changes frequently, this reflects approximately a 13% vacancy rate.

Vacancy levels impact service capacity; however, departments use vacancy savings to mitigate these impacts through other staffing strategies such as filling staffing gaps by contracting for professional services, hiring ahead to allow overlap and smooth transitions, piloting new technologies to increase efficiency in the absence of staff, and supporting a summer internship program.

Expenditures FY 2024 FY 2023 Inc/(Dec) % change FY 2024 % FY 2023 % Police 26,032 $ 23,934$ 2,098$ 8.8% 52,241$ 49.8% 47,723$ 50.2% Fire 23,925 20,420 3,505 17.2% 47,464 50.4% 41,479 49.2% Community Services 17,976 13,379 4,597 34.4% 40,356 44.5% 34,690 38.6% Public Works 9,761 9,264 497 5.4% 25,763 37.9% 22,764 40.7% Planning and Development Services 10,938 8,916 2,022 22.7% 33,049 33.1% 26,426 33.7% Library 5,289 4,272 1,017 23.8% 12,599 42.0% 10,524 40.6% Administrative Services 4,971 4,705 266 5.7% 11,250 44.2% 10,107 46.6% All Other Departments 12,022 9,609 2,413 25.1% 61,530 19.5% 54,672 17.6%

Total Expenditures 110,914 $ 94,499$ 16,415$ 17.4% 284,252$ 39.0% 248,385$ 38.0% General Fund Expenditures
FY 2024 2nd Quarter YTD
(000's)
2nd Quarter Actuals Adjusted Budget
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Attachment C
Attachment C – Page 7 of 7
Public Safety Overtime
Table 5

As shown in Table 5 above, Police Department overtime is trending higher compared to FY 2023 due to a number of factors including backfilling shifts due to vacancies; benefited leave or industrial injuries; and five recruits in training, either in house or at the police academy. As of the end of the 2nd quarter, 12% of positions are vacant, another 7% of staff are unavailable to work due to benefited leave or industrial injury, and 5% of filled positions have new staff in training (in‐house or at the police academy). The Department is anticipating overtime to continue trending over FY 2024 budget levels, with a leveling off if the hiring cycle continues to stay ahead of departures. See Attachment D For more information on vacancy and overtime staffing.

Fire Department overtime expenses are tracking higher compared to FY 2023 due to backfilling entry level firefighters while completing the Joint Fire Academy and continued vacancies. In the spring of 2023, the Department hired a total of 13 entry level firefighters which accounts for 16% of all on‐shift personnel positions. Although the positions are filled, those 13 recruits must complete a 6‐month academy before being able to work on shift. In August 2023, the 13 entry level firefighters graduated from the academy and are now working on shift.

The Department continues to struggle to fill vacancies; as of writing of this report, the Department is still carrying 13 vacancies among the International Association of Fire Fighters (IAFF) ranks. The overtime hours will remain high as backfill is required to maintain daily operations with a high vacancy rate.

Police and Fire
Salaries and Overtime Expense
FY 2024 2nd Quarter YTD
(000's)
FY 2024 FY 2023 % change FY 2024 % FY 2023 %
Inc (Dec)
Police ‐ Salaries 9,110 $ 8,659$ 5.2% 21,577$ 42% 19,186$ 45.1% Police ‐ Overtime 1,687 1,509 11.8% 1,029 164% 973 155.1% Total Police 10,797 10,168 6.2% 22,606 48% 20,159 50.4% Fire ‐ Salaries 8,413 7,450 12.9% 18,417 46% 15,291 48.7% Fire ‐ Overtime 2,050 1,799 13.9% 2,146 95% 3,801 47.3% Total Fire 10,462 9,249 13.1% 20,564 51% 19,092 48.4% Total Public Safety
Salaries & Overtime 21,259$ 19,418$ 9.5% 43,169$ 49% 39,251$ 49.5% 2nd Quarter YTD Actuals Adjusted Budget
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Attachment D
2022 2023 2024 Q2

POLICE DEPARTMENT
Overtime Expense
Adopted Budget (A) $944,186 $972,512 $1,028,988
Modified Budget (B) 1,244,186 972,512 1,028,988 Net Overtime Cost - see below 781,344 1,107,518 1,149,083 Variance to Budget 462,842 (135,006) (120,096) Overtime Net Cost
Actual Expense $2,319,043 $2,940,019 $1,686,904
Less Reimbursements
Other Program Reimbursements - 878 California OES/FEMA (Strike Teams) - - Stanford Communications 107,684 124,868 50,526 Utilities Communications Reimbursement 56,004 64,599 28,472 Local Agencies (C) 5,456 4,949 3,711 Police Service Fees 120,411 100,413 41,534 Total Reimbursements 289,556 295,707 124,243 Less Department Vacancies (A) 1,248,143 1,536,794 413,578 Net Overtime Cost $781,344 $1,107,518 $1,149,083
Department Vacancies (number of days) 3,903 4,876 1,259 Workers' Compensation Cases 11 N/A* N/A* Department Disabilities (number of days) 1,221 739 177

FIRE DEPARTMENT
Overtime Expense
Adopted Budget (D) $1,931,121 $2,124,054 $2,146,234
Modified Budget (E) 2,703,621 3,801,054 2,146,234 Net Overtime Cost - see below 4,073,011 1,740,750 1,334,108 Variance to Budget (1,369,390) 2,060,304 812,127 Overtime Net Cost
Actual Expense $4,684,796 $3,589,198 $2,049,596
Less Reimbursements
California OES/FEMA (Strike Teams) - 341,629 - Total Reimbursements - 341,629 - Less Department Vacancies (D) 611,784 1,506,819 715,488 Net Overtime Cost $4,073,011 $1,740,750 $1,334,108
Department Vacancies (number of days) 1,717 4,105 1,289 Workers' Compensation Cases 35 N/A* N/A* Department Disabilities (number of days) 947 484 167 NOTES:
(A) The FY 2024 Police Department budget was increased by 1.0 Court Liaison Officer, 1.0 Administrative Associate, 2.0 Public Safety Dispatchers, and 2.0 Police Officers.
(B) Police Department adopted budget has not been adjusted in FY 2024. (C) Includes Animal Control Services contract with Los Altos and Los Altos Hills. (D) The FY 2024 Fire Department budget was increased by 2.0 Fire Inspectors. (E) The Fire Department adopted budget has not been adjusted in FY 2024. * Data is not available at time of report release, will update for FY 2024 third quarter financial report.

Overtime Analysis for Fiscal Years 2022 through 2024
Public Safety Departments
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City Council
Staff Report
From: City Manager
Report Type: ACTION ITEMS
Lead Department: Human Resources
Meeting Date: February 12, 2024
Report #:2401-2521
TITLE
Adoption of a Resolution Certifying the Need for an Exception to the California Public Employees Retirement System (CalPERS) 180-day Waiting Period to Hire Matthew Raschke as a Retired Annuitant Extra Help Senior Engineer. CEQA status - Not a Project

RECOMMENDATION
Staff recommends that the City Council adopt a resolution certifying the need for an exception to the 180-day waiting period, set forth by CalPERS, to hire Matthew Raschke as a Retired Annuitant Extra Help Senior Engineer.

BACKGROUND
The Public Employees’ Pension Reform Act of 2013 (PEPRA) generally requires retired annuitants to be separated from employment for at least 180 days before returning to work for an employer in the same retirement system from which they receive a pension.1 An exception to this requirement may be made when the employer’s governing body certifies the nature of the employment and that the appointment is necessary to fill a critically needed position before 180 days have passed.2 The exception allows an employer to hire a retired annuitant to perform work of limited duration, such as to eliminate a backlog, work on limited term special projects, and perform work that is in excess of what regular staff can reasonably perform. PEPRA states that this appointment must be approved by the employer’s governing body in a public meeting as an action item. To secure a 180-day wait period exception, the employer must submit the approved resolution to CalPERS before the first day of re-employment.

ANALYSIS
The Public Works Department has been managing the design and construction of the Public Safety Building as part of the 2014 Council Infrastructure Plan.3 The Public Safety Building’s 1 Government Code section 7522.56 (f).
2 Government Code section 7522.56 (f)(1).
3 https://www.cityofpaloalto.org/Departments/Public-Works/Engineering-Services/Engineering-Projects/Public- Safety-Building-Project
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construction is approximately 90% complete, but there are still many important tasks left to do, including commissioning, move-in, and fit-up of all the technical equipment and furniture. The senior engineer serving as project manager manages most of this work, which is conducted by and through contractors. The project manager also performs special coordination with the prime contractor.

Matthew Raschke served as the project manager for the Public Safety Building for over nine years. He gained detailed knowledge of the building’s design and has built positive working relationships with the Public Safety Building’s project design team and construction teams.

The Public Works Department requires the skills and experience of Matthew Raschke to complete special project work related to the Public Safety Building. Due to Raschke’s specialized knowledge of the Public Safety Building construction project, employing Matthew Raschke as a retired annuitant is the most effective option for completing construction-related work at this critical point.

Matthew Raschke has extensive knowledge of the Public Safety Building’s construction activities to date and will be highly advantageous to participate in processing construction change order requests and other tasks as part of the project close-out. If City Council adopts the recommended resolution, Matthew Raschke can be rehired in March 2024. The Public Safety Building construction project is set to be completed later this spring. However, close-out of the project may take an additional six to nine months. Staff expects to need Matthew Raschke to work part-time through the close-out of the project.

FISCAL/RESOURCE IMPACT
The cost of this retired annuitant hourly position will be funded by vacancy savings from vacant positions, including the employee’s previous full-time position, that are budgeted in the Capital Fund to work on capital projects such as the Public Safety Building Project (PE-15001). The Public Works Department will ensure vacancy savings are available in the Capital Fund to fund the cost of the hourly position for six to nine months while the Public Safety Building Project is completed.

STAKEHOLDER ENGAGEMENT
Staff in Human Resources and the Public Works Departments coordinated on the resolution to re-hire a highly knowledgeable retiree annuitant in compliance with CalPERS Public Employment Retirement Law. The employment agreement between Matthew Raschke and the City of Palo Alto is attached herein.

ENVIRONMENTAL REVIEW
Council approval of the resolution is exempt from California Environmental Quality Act (CEQA) because it can be seen with certainty that approving the resolution will not result in any environmental impacts.

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ATTACHMENTS
Attachment A: Resolution No. 10147: A Resolution of the City Council for the City of Palo Alto Approving an Exception to the California Public Employees Retirement System 180-day Waiting Period to Hire Retired Annuitant Matthew Raschke
Attachment B: Employment Agreement – Raschke 2024
APPROVED BY: Sandra Blanch, Human Resources Director
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*NOT YET APPROVED*
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Resolution No. 10147
A Resolution of the City Council for the City of Palo Alto Approving an Exception to the California Public Employees Retirement System 180- day Waiting Period to Hire Retired Annuitant Matthew Raschke

R E C I T A L S
A. In compliance with Government (Gov.) Code section 7522.56 of the Public Employees’ Retirement Law, the City of Palo Alto must provide CalPERS this certification resolution when hiring a retiree before 180 days has passed since their retirement date; and B. Matthew Raschke (CalPERS ID 3118008844) retired from City of Palo Alto in the position of Senior Engineer, effective January 13, 2024; and C. Gov. Code section 7522.56 requires that post-retirement employment commence no earlier than 180 days after the retirement date, which is July 12, 2024 without this certification resolution; and
D. Gov. Code section 7522.56 provides that this exception to the 180-day wait period shall not apply if the retiree accepts any retirement-related incentive; and E. The City Council of the City of Palo Alto, the City of Palo Alto and Matthew Raschke certify that Matthew Raschke has not and will not receive a Golden Handshake or any other retirement-related incentive; and
F. The City Council hereby appoints Matthew Raschke as an extra help retired annuitant to perform the duties of the Retired Annuitant Extra Help Senior Engineer for the City of Palo Alto under Gov. Code section 21224, effective March 25, 2024, or upon approval from CalPERS to hire, whichever is later; and
G. The entire employment agreement, contract or appointment document between Matthew Raschke and the City of Palo Alto has been reviewed by this body and is attached herein; and
H. No matters, issues, terms or conditions related to this employment and appointment have been or will be placed on a consent calendar; and I. The employment shall be limited to 960 hours per fiscal year for all CalPERS employers; and
J. The compensation paid to retirees cannot be less than the minimum nor exceed the maximum monthly base salary paid to other employees performing comparable duties, divided by 173.333 to equal the hourly rate; and
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*NOT YET APPROVED*
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K. The maximum base salary for this position is $107.20 per hour, and the minimum base salary for this position is $71.47 per hour; and L. The hourly rate paid to Mattew Raschke will be $107.20; and M. Matthew Raschke has not and will not receive any other benefit, incentive, compensation in lieu of benefit or other form of compensation in addition to this hourly pay rate; and
The Council of the City of Palo Alto RESOLVES as follows:

Section 1. The City Council hereby certifies the nature of the appointment of Matthew Raschke as described herein and detailed in the attached employment agreement document and that this appointment is necessary to fill the critically needed position of Senior Engineer for the City of Palo Alto by March 25, 2024 because of the critical need to complete the Public Safety Building project, a long-term, complex project that requires special expertise and experience to complete.

INTRODUCED AND PASSED:

AYES:

NOES:

ABSENT:

ABSTENTIONS:

ATTEST:
___________________________ ______________________________ City Clerk Mayor
APPROVED AS TO FORM: APPROVED:
___________________________ ______________________________ City Attorney City Manager
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7 EMPLOYMENT AGREEMENT

BETWEEN CITY OF PALO ALTO
AND
Matthew Raschke
THIS AGREEMENT is between the City of Palo Alto, a municipal corporation and chartered city ("City") and Matthew Raschke (“Raschke”) . It is effective on the latest date next to the signatures on the last page.

This Agreement is entered into on the basis of the following facts:

A. City, acting by and through its City Council, wishes to employ Raschke as a Retired Annuitant, subject to the terms and conditions set forth in this Agreement, Resolution Number 10147 the Palo Alto Municipal Code and the Charter of the City of Palo Alto (the "Charter").

B. Under the Public Employees’ Retirement Law and the California Public Employees’ Pension Reform Act of 2013, the City Council may appoint a CalPERS retiree to a Retired Annuitant position without reinstatement from retirement within 180 days of retirement if such appointment is necessary because the retired person has specialized skills needed in performing work of limited duration. The City requires the additional services of a retired annuitant to complete a special project and to perform work in excess of what regular staff are reasonably able to do.

C. Notwithstanding any provision of the City of Palo Alto Merit System Rules and Regulations, the Retired Annuitant serves on an at-will basis, with no expectation of continued employment, and with no right to pre-or post- separation due process or appeal.

D. Raschke desires to be employed by the City as a Retired Annuitant Extra Help Senior Engineer, subject to the terms and conditions in this Agreement, the Palo Alto Municipal Code, the Charter, the Palo Alto Merit System Rules and Regulations, and all other applicable laws, resolutions, and policies.

E. The City and Raschke wish to establish specific terms and conditions relating to compensation and benefits and related matters.

BASED UPON THE FOREGOING, THE CITY AND RASCHKE AGREE AS FOLLOWS:

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7 1.Employment. The City appoints Raschke as a Retired Annuitant for a term not to exceed 24 months to begin on March 25, 2024, or upon CalPERS approval, whichever is later. Except as otherwise provided herein, Raschke’s employment with the City shall be governed by the City Council adopted Compensation Plan for Limited Hourly Employees, as it currently exists and may be changed from time to time.

2.Duties of the Retired Annuitant. Raschke will perform the duties established for the Retired Annuitant Extra Help Senior Engineer by direction given by the Public Works Director, and as otherwise provided by law, resolution, or regulation. Raschke agrees to comply with all federal, state and local laws, ordinances, rules and regulations applicable to or associated with these duties.

2.1.No Conflict. Raschke will not engage in any employment, activity, consulting service, or other enterprise, for compensation or otherwise, which is actually or potentially in conflict with or which interferes with the performance of their duties. Raschke acknowledges that they are subject to the various conflict of interest requirements found in the California Government Code and state and local policies and regulations.

2.2.Permission Required for Outside Activities. Raschke will not engage in any employment, activity, consulting service, or other enterprise, for compensation or not, without written permission of the City Council.

3.Salary. While performing the duties of Retired Annuitant, Raschke will receive a base salary within the range for Senior Engineers provided in the City Council-approved Compensation Plan for Management and Professional Personnel and Council Appointees, as it currently exists and may be changed from time to time. Raschke will receive an hourly base rate of one hundred seven dollars and twenty cents ($107.20) per hour, beginning on March 25, 2024, or upon CalPERS approval, whichever is later. This amount is subject to authorized or required deductions and withholding, prorated, and paid on the City's regular paydays. Raschke is a non-exempt employee under applicable wage and hour law.

4.Benefits and Allowances. Pursuant to California Government Code Section 21224, Raschke shall not receive any benefit, incentive, compensation in lieu of benefits, or other form of compensation in addition to the hourly pay rate.

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7 5.Duration of Employment. Raschke understands and agrees that he has no constitutionally protected property or other interest in his employment as a Retired Annuitant.

Raschke waives any and all rights, if any, under the Merit System Rules and Regulations, including without limitation, the right to pre-or post-disciplinary due process. Raschke understands and agrees that he works at the will and pleasure of the City and that he may be terminated or asked to resign at any time, with or without cause. Raschke may terminate this agreement (terminating all employment) upon 30 days written notice.

6. Miscellaneous.

6.1.Notices. Notices given under this Agreement shall be in writing and shall be either: a) served personally; or b) sent by facsimile (provided a hard copy is mailed within one (1) business day); or c) delivered by first-class United States mail, certified, with postage prepaid and a return receipt requested; or d) sent by Federal Express, or some equivalent private mail delivery service. Notices shall be deemed received at the earlier of actual receipt or three (3) days following deposit in the United States mail, postage prepaid. Notices shall be directed to the addresses shown below, provided that a party may change such party's address for notice by giving written notice to the other party in accordance with this subsection.

CITY: Attn: Human Resources
250 Hamilton Avenue, Palo Alto CA 94301
Phone (650) 329-2376
RASCHKE: Matthew Raschke
250 Hamilton Avenue, Palo Alto CA 94301
Phone (650) 329-2100

6.2.Entire Agreement/ Amendment. This Agreement constitutes the entire understanding and agreement between the parties as to those matters contained in it, and supersedes any and all prior or contemporaneous agreements, representations and understandings of the parties. This Agreement may be amended at any time by mutual agreement of the parties, but any such amendment must be in writing, dated, and signed by the parties and attached herto.

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7 6.3.Applicable Law and Venue. This Agreement shall be interpreted according to the laws of the State of California. Venue of any action regarding this Agreement shall be in the proper court in Santa Clara County.

6.4.Severability. In the event any portion of this Agreement is declared void, such portion shall be severed from this Agreement and the remaining provisions shall remain in effect, unless the result of such severance would be to substantially alter this Agreement or the obligations of the parties, in which case this Agreement shall be immediately terminated.

6.5.Waiver. Any failure of a party to insist upon strict compliance with any term, undertaking, or condition of this Agreement shall not be deemed to be a waiver of such term, undertaking, or condition. To be effective, a waiver must be in writing, signed and dated by the parties.

6.6.Representation by Counsel. Raschke and the City acknowledge that they each did, or had the opportunity to, consult with legal counsel of their respective choices with respect to the matters that are the subject of this Agreement prior to executing it.

6.7.Section Headings. The headings on each of the sections and subsections of this Agreement are for the convenience of the parties only and do not limit or expand the contents of any such section or subsection.

Raschke, Matthew Mayor
Approved as to Form:

City Attorney’s Office
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City Council
Staff Report
From: City Manager
Report Type: INFORMATION REPORTS
Lead Department: Utilities
Meeting Date: February 12, 2024
Staff Report:2312-2320
TITLE
Informational Update: Recently Promulgated and Pending Federal Regulations Governing Lead in Drinking Water

RECOMMENDATION
Receive informational update from the Utilities Department.

EXECUTIVE SUMMARY
This informational update to City Council is to provide information regarding recently promulgated and pending federal regulations governing lead in drinking water and the City’s implementation and ongoing compliance efforts. These regulations require the City to verify prior to October 16, 2024 that no public or private lead service lines exist in the City‘s water system. As of January 8, 2024, Palo Alto is approximately 53% complete with its inventory of the service lines and currently anticipates completing the service line inventory prior to the October 16, 2024 deadline. To date, no lead service lines have been identified.

Proposed federal regulations will require CPAU to sample an annual total of 20% of the public and private elementary schools (K-5 th grades) per year, conduct sampling at secondary schools (6th-12th grades) on request for one testing cycle (i.e., 5 years), and conduct sampling on request of all schools’ facilities thereafter. The school sampling will start in 2027 if the draft regulations are promulgated as currently written.

BACKGROUND
Lead is a metallic element that has historically been used in items such as plumbing (e.g., piping, solder, fixtures) paints, cable coverings, bullets, radiation shielding material, and as a gasoline additive. Lead is a widespread contaminant in the human environment and occurs in drinking water principally as a consequence of leaching from plumbing containing lead.

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Health Effects of Lead Exposure
According to the United States Environmental Protection Agency 1 (USEPA), lead is harmful to human health and there is no safe blood lead level for children. In the human body, lead can substitute for calcium, which is a mineral that strengthens the bones. Lead is carried in the bloodstream and can harm the nervous system and brain. What is not excreted is absorbed into the bones, where it can accumulate. Young children are especially susceptible to lead exposure, because of their frequent hand-to-mouth activity, and their metabolism - their bodies absorb metals at a higher rate than the average adult.

The California Safe Drinking Water Act of 1996 (Health and Safety Code Section 116365) requires the Office of Environmental Health Hazard Assessment (OEHHA) to perform risk assessments and adopt public health goals (PHGs) for contaminants in drinking water based exclusively on public health considerations. A PHG of 0.2 micrograms per liter (µg/L) for lead in drinking water has been established on the basis of studies relating neurobehavioral deficits to elevated lead concentrations in the blood. However, PHGs are not enforceable drinking water standards, which also typically account for technical feasibility and cost of implementation in their establishment.

Sources of Lead in Drinking Water
Lead is rarely present in the source water for drinking water supplies (i.e., untreated water from streams, rivers, lakes, or underground aquifers that is used to supply private wells and public drinking water). Lead has not been detected historically in water provided by the San Francisco Public Utilities Commission (SFPUC) or in samples collected by the City of Palo Alto Utilities Department (CPAU) at concentrations greater than allowable pursuant to federal and state regulations.

Most lead in drinking water results from corrosion of older plumbing materials containing lead.

Corrosion can release lead from pipes, solder, fixtures, and other plumbing materials that the water contacts as it moves through plumbing to the tap. The use of lead pipes was banned in the 1980s, yet the USEPA estimates there are over 9 million lead service lines delivering water in neighborhoods across America.

The extent to which corrosion of plumbing materials occurs can affect the amount of lead that is present in the drinking water. Interior lead solder (commonly used until 1988) and lead pipe, leaded brass fittings, valves, and various drinking water outlets (e.g., water fountains and faucets) that contain lead materials are the primary contributors. The occurrence and rate of corrosion depend on the nature of the source water, the corrosion control practices at the water system, and the age of the plumbing materials in the building. Older brass plumbing components can also contain a large percentage of lead, but the amount of lead in new brass drinking water fixtures is regulated at both the state and federal level to help protect drinking water quality. 1 United States Environmental Protection Agency https://www.epa.gov/ground-water-and-drinking-water/basic- information-about-lead-drinking-water#health
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Regulatory Background
The USEPA recently proposed the Lead and Copper Rule Improvements (LCRI) to reduce exposure to lead through drinking water nationwide. The proposal regulation builds on the 2021 Lead and Copper Rule Revisions (LCRR) to the 1991 Lead and Copper Rule (LCR), which are summarized further below.

Federal Lead and Copper Rule
In 1991, the USEPA published final regulatory revisions to the National Primary Drinking Water Regulation (NPDWR) for lead and copper under the authority of the Safe Drinking Water Act (SDWA). This regulation is known as the Lead and Copper Rule (Title 40 Code of Federal Regulations Part 141). Since 1991 the LCR has undergone various revisions. In 2007, EPA revised the LCR to enhance implementation in the areas of monitoring, treatment, customer awareness, lead service line replacement, and enhanced public education requirements.

Federal Lead and Copper Rule Revisions
During January 2021, the USEPA published the Lead and Copper Rule Revisions (LCRR) to the National Primary Drinking Water Regulations and Implementation; (40 CFR Parts 141 and 142).

The LCRR improved the reliability of lead tap sampling results, strengthened corrosion control treatment requirements, expanded consumer awareness, and improved risk communication.

Pursuant to the LCRR, all water systems must develop and submit by October 16, 20242 an initial service line inventory of the entire system, including both the publicly and privately owned portions of the water service line up to the building penetration. The current service line inventory results are required to be made available to the public and are posted on the City’s website. If the City identifies any private lead service lines, it must inform the resident within 30- days of completing the inventory and annually thereafter. Palo Alto previously inventoried all City-owned water piping (i.e., the water mains and service lines up to the water meter). Palo Alto does not have any known lead service lines in its system, but inventory of the private service lines has not been performed previously.

While the State of California has previously required lead sampling at public schools, the LCRR requires for the first time in federal regulations that community water systems (e.g., City of Palo Alto) conduct lead-in-drinking-water testing and public education in public and private schools and childcare facilities, unless the facility was either built or had replaced all plumbing after January 1, 2014. The LCRR requires community water systems to sample 20% of elementary schools and 20% of childcare facilities per year and conduct sampling at secondary schools on request for one testing cycle (i.e., 5 years) and conduct sampling on request of all schools and childcare facilities thereafter. In California, the testing of childcare facilities will be implemented separately by the Department of Social Services and sampling childcare facilities will not be the responsibility of the community water system. Therefore, even though the LCRR requires 2 The original deadline established in the LCRR was January 16, 2024 (86 FR 4198) but was extended to October 16, 2024 in 86 FR 31939. The delay in the effective date is consistent with presidential directives issued on January 20, 2021, to the heads of federal agencies to review certain regulations, including the LCRR.

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community water systems to perform the sampling, the state will address childcare facilities separately and will only require the City to sample public and private schools where it serves water prior to October 16, 2029.3
Proposed Federal Lead and Copper Rule Improvements
On December 6, 2023, the USEPA announced the proposed LCRI (88 FR 84878) with the following principal modifications to the current regulations.
Achieving 100% Lead Pipe Replacement within 10 years. The proposed LCRI would require the majority of water systems to replace lead services lines within 10 years. Locating Legacy Lead Pipes. Under the proposed LCRI, all water systems would be required to regularly update their inventories, create a service line replacement plan, and identify the materials of all service lines of unknown material. Improving Tap Sampling. The proposed LCRI would make changes to drinking water sampling requirements, informed by best practices, and would require collection of the first liter and fifth liter samples at sites with lead service lines and use the higher of the two values when determining compliance with the rule.
Lowering the Lead Action Level. USEPA is proposing to lower the lead action level from 15 µg/L to 10 µg/L. When a water system’s lead sampling exceeds the action level, the system would be required to inform the public and take action to reduce lead exposure while concurrently working to replace all lead pipes.
Strengthening Protections to Reduce Exposure. Water systems with multiple lead action level exceedances would be required to conduct additional outreach to customers and make filters available to all consumers. The filters must be certified to reduce lead.

Notably however, the proposed LCRI delayed the compliance timeframe for school sampling that was originally established in the LCRR. Under the proposed LCRI, the 5-year school sampling schedule starts three years after the date of publication of the final LCRI, which is anticipated in late summer of 2024.

State of California Regulations
Senate Bill No. 1398 (2015-2016), Public Water Systems: lead user service lines, added California Health and Safety Code (HSC) section 116885 and was subsequently amended by Senate Bill No. 427 (2017-2018). HSC Section 116885 requires all community water systems to compile an inventory of known partial or total lead user service lines by July 1, 2018. California Code of Regulations, Title 22, Section 64551.60 defines “User service line," as “the pipe, tubing, and fittings connecting a water main to an individual water meter or service connection,” but does not include the service line from the meter to individual homes. Therefore, the inventory collected under California law only contained information on the City-owned pipe and water service lines between the main and the meter. The LCRR requires the inventory from the water 3 The proposed LCRI proposes to extend the LCRR deadline by three years. The final compliance date will be dependent on the date the final LCRI is promulgated.

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main to the building penetration, including any privately owned service lines. While the City can rely on previously information collected to comply with the requirements of the LCRR, the previously collected information is insufficient for full compliance and the City still needs to inspect all user service lines between the meter and the house penetration.

Previous School Sampling Initiatives
To further safeguard water quality in California’s K-12 public schools, the California legislature in 2017 added Health and Safety Code section 116277, which required community water systems to test lead levels, by July 1, 2019, in drinking water at all California public, K-12 school sites that were constructed before January 1, 2010. Sampling of private schools was not required by the state law, but the LCRR requires sampling of both public and private schools.

The City conducted sampling of public school sites and reported the results as required by HSC section 116277. Of the 90 samples collected, the concentration of lead in water samples collected by the City from public schools were all less than the action level of 15 µg/L and less than the LCRI-proposed action level of 10 µg/L in all but two samples. The school where the elevated lead concentrations were identified promptly implemented corrective actions to mitigate potential exposure to lead in water from the two locations where the lead concentration exceeded the action level.

Historical LCR Sampling and Analytical Results
The lead action level is a measure of the effectiveness of the corrosion control treatment in water systems and is not a standard for establishing a safe level of lead in drinking water. To check if corrosion control is working, the USEPA requires water systems to test for lead at the tap in certain homes, including those with lead service lines. Systems compare sample results from homes to EPA’s action level of 15 µg/L. If 10 percent of the samples from the homes contain lead at concentrations greater than the action level, then the system must perform actions such as public education and lead service line replacement.

During the previous two rounds of sampling under the LCR that the City performed during 2020 and 2023, a total of 38 homes were sampled each event (i.e., 76 total samples) and none of the samples collected contained lead at concentrations exceeding the action level of 15 µg/L or the LCRI-proposed action level of 10 µg/L. During the 2020 sampling event, there were no detections of lead greater than the laboratory reporting limit of 5 µg/L. During the 2023 sampling event, there were two detections of lead at concentrations of 5.53 µg/L and of 9.74 µg/L. All participating residents were informed of their individual sampling results as part of the program.

ANALYSIS
As of January 8, 2024, Palo Alto has completed inventory of approximately 11,087 of the 20,908 water services (i.e., approximately 53% complete) and currently anticipates completing the service line inventory prior to the October 16, 2024 deadline. Results of the inventory will be posted on the City’s website and made publicly available as required by the LCRR. To date, no private lead service lines have been identified.

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Based on information from the California Department of Education and City records, there are 46 schools to be included in the LCRR sampling program as shown by school type in the table below.

School Type Private Public Totals
Kindergartens 3 3
K-12 3 1 4
Elementary School 16 13 29
Intermediate/Middle
Schools 1 3 4
High Schools 4 2 6
Totals 27 19 46

Pending adoption of the final LCRI, CPAU will be required to sample an annual total of 20% of the public and private elementary schools (K-5th grades) per year and conduct sampling at secondary schools (6th-12th grades) on request for one testing cycle (i.e., 5 years) and conduct sampling on request of all schools’ facilities thereafter. The sampling is anticipated to start in 2027, i.e., three years after the anticipated promulgation of the final LCRI.

FISCAL/RESOURCE IMPACT
Funding is available in the FY 2024 Water Fund budget. Compliance with the federal LCRR regulations is a significant expense for CPAU in terms of allocated resources (internal staffing and hourly contractors). The estimated cost of the new LCRI program is $1.8 million in allocated labor and overhead costs based on the number of personnel assigned to assess every private service line in the City. In order to meet the compliance deadline of October 2024, CPAU had to reallocate staff performing maintenance work and hire additional hourly contractors to complete the sampling. Costs for future sampling of schools will be estimated after the final LCRI is promulgated. Funding for subsequent years of the program will be subject to approval through the annual budget development process.

STAKEHOLDER ENGAGEMENT
During 2024, the City will be developing informational outreach for Palo Alto Unified School District (PAUSD) and all other Palo Alto schools that will be distributed after the final LCRI is promulgated (anticipated in late summer of 2024). The informational outreach will inform the schools of the final regulations and associated sampling timelines so the schools can plan and prepare appropriately.

ENVIRONMENTAL REVIEW
This informational update is not a project under the California Environmental Quality Act.

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ATTACHMENTS
None.

APPROVED BY:

Dean Batchelor, Director of Utilities
Staff: Matt Zucca, Assistant Director of Water Gas Wastewater Item 13
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City Council
Staff Report
From: City Manager
Report Type: INFORMATION REPORT
Lead Department: Administrative Services
Meeting Date: February 12, 2024
Report #:2311-2232
TITLE
Investment Activity Report for the Second Quarter, Fiscal Year 2024

RECOMMENDATION
This is an informational report and no City Council action is required.

EXECUTIVE SUMMARY
The City’s Investment Policyi (Policy) requires that staff report to Council quarterly on the City’s portfolio composition and performance compared to the Council-adopted Policy; discuss overall compliance with the City’s Investment Policy; and provide recommendations, if any, for Policy changes. In addition, staff provides a detailed list of all securities and reports on the City’s ability to meet expenditure requirements over the next six months. This report is to inform Council of the City’s investment portfolio performance as of the second quarter ending December 31, 2023 and to disclose staff’s cash flow projections for the next six months. Staff expect that the City will have sufficient funds or liquidity to meet expenditure requirements for the next six months. The portfolio details, activities, and performance are discussed below, and additional information is provided in the attachments. During the second quarter there was no variance from the Investment Policy.

ANALYSIS
The City’s investment portfolio is summarized in Graph 1 and detailed in the Investments by Fund Report (Attachment B). The Investments by Fund Report groups the portfolio’s securities by investment type and includes details of the investment issuer, date of maturity, current market value, the book and face (par) value, and the weighted average maturity of each type of investment and of the entire portfolio.

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Due to rounding, the above graph's percentage total is greater than 100 percent.

The par value of the City’s portfolio is $616.7 million; in comparison, last quarter it was $575.6 million. The $41.1 million portfolio growth since the last quarter results from timing of cash flows from the prepayment of the City’s Fiscal Year 2024 Unfunded Accrued Liability (UAL) pension cost for active employees to the Public Employers’ Retirement System (PERS) totaling $41.6 million, additional major revenue receipt due to seasonality timing, and one less pay period costs in the second quarter compared to the first quarter. By prepaying PERS instead of making payments with each payroll period, the City expects savings of $1.4 million in PERS payments; however, this savings will be partially offset by the loss of approximately $759 thousand in interest income in the City’s portfolio. The net citywide savings of prepaying the UAL cost is $641 thousand. The saving is a consequence of PERS’ potential ability to earn interest earlier and at a higher rate than the City’s portfolio could realize. Without this prepayment, an additional $9.9 million in UAL payment would have been made in the second quarter; this payment was made in first quarter’s prepayment. As far as additional major revenue receipt due to seasonality timing, property taxes and related receipts don’t begin until the second quarter and major revenues such as sales, transient occupancy and utility user’s taxes are historically lower in the first quarter. For example, second quarter property related (taxes and assessments) receipts were $18.4 million.

The portfolio consists of $71.9 million in liquid accounts and $544.8 million in various investment types as detailed in the following Table 1. The Investment Policy requires that at least $50 million be maintained in securities maturing in less than two years. The portfolio includes $173.1 million in investments maturing in less than two years, comprising 28.1% of the City’s investment portfolio. In addition, the Investment Policy allows up to 30% of the portfolio to be invested in securities with maturities beyond five years; actual at the end of the second quarter is 24.9% of the portfolio.

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The current market value of the portfolio is 93.6% of the book value. The market value of securities fluctuates, depending on how interest rates perform. When interest rates decrease, the market value of the securities in the City’s portfolio will likely increase; likewise, when interest rates increase, the market value of the securities will likely decrease. Understanding and showing market values is not only a reporting requirement, but essential to knowing the principal risks in actively buying and selling securities. It is important to note, however, that the City’s practice is to buy and hold investments to maturity, therefore changes in market price do not affect the City’s investment principal. The market valuation is provided by U.S. Bank, which is the City’s safekeeping agent. The average life to maturity of the investment portfolio is 3.13 years compared to 3.52 years last quarter.

The Investment Policy states “Should the ratio of the market value of the portfolio to the book value of the portfolio fall below 95%, the Administrative Services Department will report this to the City Council within a reasonable time frame and evaluate whether there is any risk of holding any of the securities to maturity.” In the prior six quarters the market value fell below 95%; ranging from 89% to 94% during these periods. The market rate this second quarter is 93.6% of book value. Interest rates on new investments have fluctuated so the expectation is the market value of the portfolio is expected to stay in the current range in the coming quarters. To minimize risk of loss for investment principal due to lower market values, the City’s investment practice is to buy and hold investments to maturity; in the instances where there is a need to sell securities for contingency cash flow planning, the City’s practice is to sell securities that are above the market value.

Investments Made During the Second Quarter
During the second quarter, $14.3 million of securities with an average yield of 3.8% matured.

During the same period, per the following Table 2, securities totaling $7.4 million with an average yield of 5.3% were purchased. As expected, as interest rates rose on new investments, the City’s portfolio’s average yield has begun to gradually rise. In the prior two fiscal years or during the height of the COVID-19 economic closures, the portfolio’s interest rate had steadily declined. The Table 1: Up to 1 Year 1 to 2 Years 2 to 3 Years 3 to 5 Years Over 5 Years Portfolio Total * % of Portfolio U.S. Treasury 2.5$ 1.5$ 3.0$ -$ -$ 7.0$ 1.1%U.S. Agency Bonds 17.3 54.9 19.2 15.1 92.4 198.9 32.3%U.S. Municipal/ State Bonds 17.6 29.4 58.8 55.8 59.3 220.9 35.8%Negotiable Certificates of Deposits (NCD) 14.6 11.2 5.0 11.7 1.7 44.2 7.2%U.S. Corporate Bonds 4.3 11.8 4.7 8.5 - 29.3 4.8%Supranational Organizations Bonds - 8.0 26.0 10.5 - 44.5 7.2%Liquid Accounts (LAIF & Fidelity) 71.9 - - - - 71.9 11.7% Grand Total 128.2$ 116.8$ 116.7$ 101.6$ 153.4$ 616.7$ 100%% of Portfolio 20.8% 18.9% 18.9% 16.5% 24.9% 100.0%* $100.3 million or 15.9% are in investments that support Environmental, Social, and Governace (ESG) Activities(aka "Green", local banks, and Supranational Bonds) Investment Type
FY 2024 Q2 Maturities - Par Value (millions)
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City’s short-term money market and pool account increased by $48.1 million compared to the first quarter of Fiscal Year 2024. Staff continually monitors the City’s short-term cash flow needs and adjusts liquid funds to meet them.

Availability of Funds for the Next Six Months
Normally, the flow of revenues from the City’s utility billings and General Fund sources is enough to provide funds for ongoing expenditures in those respective funds. Projections indicate that for the City’s cashflow, an overall growth in the portfolio of $17.2 million is expected over the coming six months due to routine business activities. This reflects expected receipts of $370.0 million and expenditures of $352.8 million over the next six months.

As of December 31, 2023, the City had $71.9 million deposited in the Local Agency Investment Fund (LAIF) and a money market account that could be withdrawn on a daily basis. In addition, investments totaling $25.3 million will mature between January 31, 2024 and June 30, 2024.

Based on the above, staff expect that the City will have sufficient funds or liquidity to meet expenditure requirements for the next six months.

Compliance with City Investment Policy
During the second quarter, staff complied with all aspects of the Investment Policy. Attachment C lists the major restrictions in the City’s Investment Policy compared with the portfolio’s actual performance.

Investment Yields
Interest income on an accrual basis, for the General Fund, for the second quarter was $3.5 million; compared to the prior year’s second quarter of $2.2 million or $1.3 million higher than the prior year’s quarter due to higher yield investment environment and higher General Fund cash balance. As of December 31, 2023, the yield to maturity of the City’s portfolio was 2.39%; in the prior quarter it was 2.20%. In the second quarter, LAIF’s average yield was 3.81% while the average yield on the two-year and five-year Treasury bonds was approximately 4.80% and Table 2:

Up to 1 Year 1 to 2 Years 2 to 3 Years 3 to 5 Years Over 5 Years Portfolio Total * % of Purchase U.S. Treasury -$ -$ -$ -$ -$ -$ 0.0%U.S. Agency Bonds - - - - - - 0.0%U.S. Municipal/ State Bonds - - - - 4.4 4.4 68.8%Negotiable Certificates of Deposits (NCD) 0.2 - - 0.8 - 1.0 15.6%U.S. Corporate Bonds - - - - - - 0.0%Supranational Organizations Bonds - - - 1.0 - 1.0 15.6% Grand Total 0.2$ -$ -$ 1.8$ 4.4$ 6.4$ 100%% of Purchase 3.1% 0.0% 0.0% 28.1% 68.8% 100.0%* $2.9 million or 45.3% are in investments that support Environmental, Social, and Governace (ESG) Activities(aka "Green", local banks, and Supranational Bonds) Investment Type
FY 2024 Q2 Security Purchases - Par Value (millions)
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4.42%, respectively. In comparison, in the prior quarter LAIF had 3.42% yield and the two-year and five-year Treasury bonds yields were higher at 4.92% and lower at 4.31%.

Historically, the City’s portfolio yield has outperformed the two-year and five-year Treasury bond rates and did so again several years ago; this is an expected occurrence during economic downturns. However, during economic recovery periods, interest rates rise, and the City’s portfolio yield is expected to be lower, which is the current financial environment. As the City’s laddered portfolio investments mature in the next year or two, funds will continue to be reinvested and trends will follow the economic patterns. Graph 2 shows the City’s yields and interest earnings for the past 21+ years.

City’s portfolio duration is 3.13 years.

Yield Trends
The Federal Open Market Committee (FOMC), since March 2020, has raised the federal funds rate 11 times totaling 5.25% with the first occurring on March 16, 2022. Prior to this the rate was near zero. This was to mitigate the persistent elevated inflation rate from the peak of 9.1% in June to 3.4% in December 2023, slightly higher than the prior month with a 2% target.

With the FOMC not raising the rate in the last three meetings, the expectation is they are done with further rate increases. The FOMC states “Recent indicators suggest that growth of economic activity has slowed from its strong pace in the third quarter. Job gains have moderated since earlier in the year but remain strong, and the unemployment rate has remained low. Inflation has eased over the past year but remains elevated.” They continue to hold that the U.S. banking system is sound and resilient, tighter credit conditions are likely to weigh on economic activity, hiring, and inflation risks. The expectation is inflation will decline Item 14
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further and interest rates, which have begun to decline, will be lower.

The following tables show the U.S. inflation and unemployment rates and the U.S. Gross Domestic Product (GDP) past and recent trends.

Graph 3: U.S. Inflation Rate
The annual inflation rate in the United States went up to 3.4% in December 2023 from a five- month low of 3.1% in November. Energy, used cars and trucks prices went down while prices increased on food, shelter, new vehicles, apparel, medical care commodities, and transportation services.

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Graph 4: U.S. Unemployment Rate
The unemployment rate in the United States held at 3.7% in December 2023, unchanged from the previous month. There was a slowdown in new entries into the labor force.

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Graph 5: U.S. Gross Domestic Product (GDP) Annual Growth Rate The Gross Domestic Product (GDP) in the United States expanded an annualized 3.3% in the fourth (calendar) quarter of 2023, down from 4.9 percent in the previous quarter.

Funds Held by the City or Managed Under Contract
Attachment A is a consolidated report of all City investment funds, including those not held directly in the investment portfolio. These include cash in the City’s regular bank account with US Bank and Wells Fargo. A description of the City’s banking relationships can be found in City Council Staff Report ID # 7858 ii and ID # 11402iii. The bond proceeds, reserves, and debt service payments being held by the City’s fiscal agents are subject to the requirements of the underlying debt indenture. The trustees for the bond funds are U.S. Bank and California Asset Management Program (CAMP). Bond funds with U.S. Bank are invested in federal agency and money market mutual funds that consist exclusively of U.S. Treasury securities. Bond funds in CAMP are invested in banker’s acceptance notes, certificates of deposit, commercial paper, federal agency securities, and repurchase agreements. The most recent data on funds held by the fiscal agent is as of December 31, 2023.

In January 2017, the City established a Section 115 Irrevocable Trust (Public Agencies Post- Employment Benefits Trust) administered by Public Agency Retirement Services (PARS). This fund is governed by the City’s Retiree Benefit Policy as opposed to the Investment Policy; however, it is discussed in this report to present the full picture of the City’s investments. It is the City’s intent to prefund pension costs and began to address the Net Pension Liabilities (NPL) as calculated by Governmental Accounting Standards Board Pronouncement No. 68 (GASB 68). The Section 115 Trust offered by PARS has five portfolios from which to choose in making investments of City funds. In February 2023, the City Council revised the City’s portfolio selection from “Moderately Conservative” to “Moderate”, shifting from the second most conservative to third.

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ID # 7553 iv. Through December 31, 2023, principal investment contributions of $57.7 million made over time since May 2017, has increased to $65.3 million or by $7.6 million and the net return for one and five years has been 13.5% and 5.4% respectively. Since inception, $8.2 million net earnings have been realized with $0.61 million in administrative expenses.

FISCAL/RESOURCE IMPACT
This is an information report.

STAKEHOLDER ENGAGEMENT
Staff works internally and with external parties (U.S. Bank’s custodial, U.S. Bank’s bonds, Wells Fargo and U.S. Bank’s banking, California Asset Management Program (CAMP), and Public Agency Retirement Services (PARS)) statements to prepare this report.

ENVIRONMENTAL REVIEW
This Council informational report is not a project under California Environmental Quality Act (CEQA) as defined in CEQA Guidelines, section 15378, because it has no potential for resulting in either a direct or reasonably foreseeable indirect physical change in the environment.

ATTACHMENTS
Attachment A: Consolidated Report of Cash Management
Attachment B: Investment Portfolio
Attachment C: Investment Policy Compliance
APPROVED BY:

Kiely Nose, Assistant City Manager
i City of Palo Alto website, Administrative Services Department, Money Management & Treasury: Microsoft Word - Proposed City of Palo Alto Investment Policy - Fiscal Year 2023-24.doc ii City Council, April 11, 2017, under “Additional Information”, CMR 7858:
https://www.cityofpaloalto.org/files/assets/public/agendas-minutes-reports/reports/city-manager-reports- cmrs/year-archive/2017/7858.pdf
iii City Council, September 21, 2020 Item #2, CMR 11402:
https://www.cityofpaloalto.org/files/assets/public/agendas-minutes-reports/reports/city-manager-reports- cmrs/year-archive/2020-2/id-11402.pdf
iv City Council, January 23, 2017 Item #5, CMR 7553:
https://www.cityofpaloalto.org/files/assets/public/agendas-minutes-reports/reports/city-manager-reports- cmrs/year-archive/2017/7553.pdf
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Book Value Market Value
City Investment Portfolio (see Attachment B) 615,665,374$ 576,479,077 $ Other Funds Held by the City
Cash with Wells Fargo Bank 219,407 219,407 (includes general and imprest accounts)
Cash with US Bank 2,664,502 2,664,502 Total - Other Funds Held By City 2,883,909 2,883,909 Funds Under Management of Third Party Trustees *
Debt Service Proceeds
US Bank Trust Services **
1999 Utility Revenue Bonds
Debt Service Fund 25 25
2009 Water Revenue Bonds (Build America Bonds)
Debt Service and Reserve Funds 2,365,717 2,365,717 2010 & 2013 General Obligation (Library) Bond
Debt Service and Escrow Funds 1 1 2011 Utility Revenue Refunding Bonds
Debt Service and Reserve Funds 642,328 642,328 2018 Capital Improvement (Golf Course & 2002B COP Refinance) (Taxable- Green Bond) Certificates of Participation
Debt Service and Cost of Issuance Funds 776 776 2019 California Avenue Parking Garage Certificates of Participation (Tax-Exempt and Taxable Bonds)
Construction and Cost of Issuance Funds 3,270 3,270 2021 Public Safety Building Certificates of Participation Construction Debt Svc, Capitalized Interest, and Cost of Issuan 3,544,742 3,544,742 2022A & B General Obligation (Library) Bond
Cost of Issuance Funds 4,344 4,344 California Asset Management Program (CAMP) ***
2012 University Ave. Parking Refunding Bonds
Reserve Fund 2,900,351 2,900,351
Public Agencies Post-Employment Benefits Trust ****
Public Agency Retirement Services (PARS) 65,253,044 65,253,044 Total Under Trustee Management 74,714,598 74,714,598 GRAND TOTAL 693,263,881 $ 654,077,584 $
* These funds are subject to the requirements of the underlying debt indenture. ** U.S. Bank investments are in money market mutual funds that exclusively invest in U.S. Treasury securities. *** CAMP investments are in money market mutual fund which invest in bankers acceptance, certificate of deposit, commercial paper, federal agency securities, and repurchase agreements. **** PARS investments are in moderately conservative index plus funds Attachment A
Second Quarter, Fiscal Year 2022-23
(Unaudited)
Consolidated Report of Cash Management
City of Palo Alto Cash and Investments
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Attachment B
City of Palo Alto
Administration Svcs. Dept.
250 Hamilton Ave., 4th Floor
Palo Alto, CA 94301
City of Palo Alto
Fund ALL - Portfolio Listings
Investments by Fund
December 31, 2023
(650)329-2362
Purchase Current
Rate
Maturity Days To
Date Maturity
YTM
360
YTM
365Market ValueCUSIP Investment # Issuer Date Book Value Par Value LAIF & Fidelity Cash Accounts
SYS158
SYS159
158
159
Fidelity Investments 07/01/2020
07/01/2020
28,139,807.13
43,766,202.15
28,139,807.13
43,766,202.15
28,139,807.13
43,483,609.52

5.240

3.960

5.168

3.905

5.240

3.960
1 1Local Agency Investment Fund
Subtotal and Average 71,906,009.28 71,906,009.28 71,623,416.65 4.400 4.461 1 Negotiable Certificates of Deposits
00453NAA9
011852AK6
01882MAB8
022663BS6
034577AN6
00224TAL0
04288LAA6
029733BX9
052392CC9
02589AEG3
06654HAA6
065847EH4
07181JAU8
07371AYT4
88241THJ2
156634AY3
066519QC6
09549TAB1
05600XBX7
05580AXU3
064236BQ4
05572YGM8
06654BFE6
06063HQL0
108622NQ0
2831 NCD
2850 NCD
2781 NCD
2867 NCD
2298 NCD
2806 NCD
2801 NCD
1805 NCD
2732 NCD
2729 NCD
2453 NCD
2455 NCD
2730 NCD
2668 NCD
2346 NCD
2074 NCD
2474 NCD
2755 NCD
2480 NCD
2448 NCD
2899 NCD
2876 NCD
2908 NCD
2898 NCD
2900 NCD
Achieve Federal Credit Union
Alaska USA Federal CU
Alliant Credit Union
02/17/2023
03/22/2023
12/30/2022
04/14/2023
03/20/2020
01/27/2023
01/20/2023
05/30/2017
11/28/2022
11/16/2022
11/27/2020
11/23/2020
11/22/2022
03/02/2022
06/02/2020
08/30/2019
01/22/2021
12/19/2022
01/27/2021
11/20/2020
05/24/2023
04/26/2023
05/24/2023
05/15/2023
05/26/2023
249,000.00
249,000.00
249,000.00
249,000.00
249,000.00
249,000.00
249,000.00
245,000.00
249,000.00
249,000.00
248,762.52
250,932.47
249,000.00
248,764.00
249,000.00
245,000.00
248,743.64
249,000.00
248,612.64
249,000.00
249,000.00
249,000.00
249,000.00
249,000.00
249,000.00
249,000.00
249,000.00
249,000.00
249,000.00
249,000.00
249,000.00
249,000.00
245,000.00
249,000.00
249,000.00
249,000.00
249,000.00
249,000.00
249,000.00
249,000.00
245,000.00
249,000.00
249,000.00
249,000.00
249,000.00
249,000.00
249,000.00
249,000.00
249,000.00
249,000.00
248,270.43
251,178.75
251,285.82
249,004.98
237,264.63
247,874.52
248,905.38
242,150.65
250,053.27
251,340.60
229,194.54
234,311.49
249,751.98
228,644.25
235,093.35
239,551.20
228,387.78
248,678.79
212,240.13
229,754.79
249,405.87
249,059.76
249,042.33
248,751.00
249,052.29

4.650

4.850

4.950

5.000

1.100

4.700

5.100

2.300

5.050

5.000

0.450

1.050

5.000

2.050

1.000

1.700

0.550

4.700

1.000

0.500

5.000

4.950

5.200

5.050

5.000

4.589

4.789

4.884

4.937

1.085

4.641

5.030

2.270

4.984

4.931

0.493

0.542

4.940

2.053

0.986

1.678

0.592

4.633

1.019

0.493

4.937

4.886

5.132

4.980

4.937

4.653 02/17/2026

4.855 03/22/2028

4.952 12/30/2027

5.005 04/14/2028

1.100 03/20/2025

4.705 01/27/2025

5.100 01/21/2025

2.301 05/30/2024

5.053 11/27/2026

5.000 11/16/2027

0.500 11/28/2025

0.549 07/28/2025

5.009 11/23/2026

2.081 02/24/2027

1.000 06/13/2025

1.701 08/30/2024

0.600 01/22/2026

4.697 03/19/2024

1.034 10/27/2028

0.500 11/20/2025

5.006 05/24/2028

4.953 04/26/2027

5.203 05/27/2025

5.050 11/15/2024

5.006 05/26/2028
778
1,542
1,459
1,565
444
Amalgamated Fin Corp Bank
Aneca Federal Credit Union
A+ Federal Creit Union
Arsenal Credit Union
American State Bank OSCE
Austin Telco Fed. Credit Union
American Express Centurion Bk
Banner Capital Bank
Bank of Wisconsin Dells
Baxter Credit Union
392
386
150
1,061
1,415
697
574
1,057
1,150
529
Beal Bank - Plano, TX
Texas Exchange Bank
Century Next Bank 242
BankUnited NA 752
Blue Foundry Bank 78
BMO Harris Bank 1,761
689BMW Bank of North America
Bank of Old Monroe 1,605
1,211
512
BOKF NA Bank
Bankwell Bank
Bank of Baroda 319
Bridgewater Bank Bloom MN 1,607
Portfolio CPA
AP
Run Date: 01/21/2024 - 18:49 FI (PRF_FI) 7.3.11
Report Ver. 7.3.11
Item 14
Attachment B - Investment Portfolio

Item 14: Staff Report
Pg.
11 Packet Pg. 384 of 428

Fund ALL - Portfolio Listings
Investments by Fund
December 31, 2023

Page 2 ends

Palo Alto City CouncilFebruary 12, 2024

Palo Alto City Council
February 12, 2024