Agenda packet — Palo Alto City Council, February 10, 2025

CITY COUNCIL and
PUBLIC IMPROVEMENT CORPORATION
Special Meeting
Monday, February 10, 2025
Council Chambers & Hybrid
5:30 PM
Palo Alto City Council meetings will be held as “hybrid” meetings with the option to attend by teleconference or in person. Information on how the public may observe and participate in the meeting is located at the end of the agenda. The meeting will be broadcast on Cable TV Channel 26, live on YouTube https://www.youtube.com/c/cityofpaloalto, and streamed to Midpen Media Center https://midpenmedia.org.

VIRTUAL PARTICIPATION CLICK HERE TO JOIN (https://cityofpaloalto.zoom.us/j/362027238) Meeting ID: 362 027 238 Phone:1(669)900‐6833
PUBLIC COMMENTS
General Public Comment for items not on the agenda will be accepted in person for up to three minutes or an amount of time determined by the Chair. General public comment will be heard for 30 minutes. Additional public comments, if any, will be heard at the end of the agenda.

Public comments for agendized items will be accepted both in person and via Zoom for up to three minutes or an amount of time determined by the Chair. Requests to speak will be taken until 5 minutes after the staff’s presentation or as determined by the Chair. Written public comments can be submitted in advance to [email protected] and will be provided to the Council and available for inspection on the City’s website. Please clearly indicate which agenda item you are referencing in your subject line.

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

Signs and symbolic materials less than 2 feet by 3 feet are permitted provided that: (1) sticks, posts, poles or similar/other type of handle objects are strictly prohibited; (2) the items do not create a facility, fire, or safety hazard; and (3) persons with such items remain seated when displaying them and must not raise the items above shoulder level, obstruct the view or passage of other attendees, or otherwise disturb the business of the meeting.

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

CALL TO ORDER
SPECIAL ORDERS OF THE DAY (5:30 ‐ 5:50 PM)

1. Santa Clara County 2024 Synopsys Championship Science Fair STEM Winners from Palo Alto

2. Appointment of Candidates to the Planning and Transportation Commission 1 February 10, 2025
Materials submitted after distribution of the agenda packet are available for public inspection at www.CityofPaloAlto.org/agendas.

CALL TO ORDER
SPECIAL ORDERS OF THE DAY (5:30 ‐ 5:50 PM)

1. Santa Clara County 2024 Synopsys Championship Science Fair STEM Winners from Palo Alto

2. Appointment of Candidates to the Planning and Transportation Commission AGENDA CHANGES, ADDITIONS AND DELETIONS
PUBLIC COMMENT (5:50 ‐ 6:20 PM)
Members of the public may speak in‐person ONLY to any item NOT on the agenda. 1‐3 minutes depending on number of speakers. Public Comment is limited to 30 minutes. Additional public comments, if any, will be heard at the end of the agenda.

COUNCIL MEMBER QUESTIONS, COMMENTS, ANNOUNCEMENTS (6:20 ‐ 6:25 PM) Members of the public may not speak to the item(s).

STUDY SESSION (6:25 ‐ 7:55 PM)

3. Housing and Homelessness in Palo Alto: Review of current efforts including the 2024 Gap Analysis Report, Update on Enforcement Work, Overview of Engagement Framework to Develop an Implementation Plan, and Discussion of Other Potential Next Steps CONSENT CALENDAR (7:55 ‐ 8:00 PM)
Items will be voted in one motion unless removed from the calendar by three Council Members.

4. Approval of Minutes from January 21, 2025 and January 25, 2025 Meetings

5. Approval of Contract Amendment Number 2 to Contract Number S24189598 with Good City Company in the Amount of $24,930 for a Stream Corridor Protection Ordinance Update; CEQA Status: Exempt Pursuant to CEQA Guidelines 15061(b)(3).

6. Approval of Contract Amendment Number Three to Contract Number C21177024 With Veolia Sustainable Buildings USA West, Inc. to Extend the Contract Time Through August 14, 2026 With No Change in the Amount Not‐to‐Exceed of $1,985,000 for the Commercial & Industrial Energy Efficiency Program. CEQA ‐ Not a Project

7. Approval of Amendment Number Three (3) to Contract Number C19174648 with WaterSmart Software, Inc. (dba WaterSmart) for the WaterSmart Utilities Customer Portal, to Extend the Contract Term for 18 Months, for the Total Not‐to‐Exceed Amount of $537,763 Over the Seven‐Year Term; CEQA status –Exempt under CEQA Guidelines Section 15308.

8. Adoption of a Resolution Authorizing the City Manager to Approve the Verified Emission Reduction (VER) Master Agreements with AQC Environmental Brokerage Services, Inc. and SCB Brokers, LLC and Authorizing the City Manager to Purchase VERs from AQC Environmental Brokerage Services, Inc. and SCB Brokers, LLC Under Specified Terms and CdiiDiCldY2025Thh2034IliSbjLiii
2 February 10, 2025
Materials submitted after distribution of the agenda packet are available for public inspection at www.CityofPaloAlto.org/agendas.
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& Industrial Energy Efficiency Program. CEQA ‐ Not a Project

8. Adoption of a Resolution Authorizing the City Manager to Approve the Verified Emission Reduction (VER) Master Agreements with AQC Environmental Brokerage Services, Inc. and SCB Brokers, LLC and Authorizing the City Manager to Purchase VERs from AQC Environmental Brokerage Services, Inc. and SCB Brokers, LLC Under Specified Terms and Conditions During Calendar Years 2025 Through 2034, Inclusive, Subject to Limitations; CEQA Status: Not a Project, CEQA Guidelines 15378(b)(5)

9. Approval of Professional Services Contract Number C25189597 with Rutherford & Chekene in an Amount Not to Exceed $207,812 for Development of a Seismic Hazard Identification and Mitigation Program for a Period of Three Years. CEQA Status: Exempt under CEQA Guidelines 15262.

10. Approval of Two Professional Service Agreements: Contract No. C25190944A with 4Leaf, Inc. and Contract No. C25190944B with Park Engineering, Inc in the Aggregate Amount Not‐to‐Exceed $3.75 Million for a Period of Five Years for On‐Call Field Inspections and Construction Management Services to Support Utilities Water, Gas, and Wastewater Capital Improvement Projects; CEQA Status: Not a project.

11. Adoption of a Resolution Amending the Conflict of Interest Code for Designated City Officers and Employees as Required by the Political Reform Act and Regulations of the Fair Political Practices Commission and Repealing Resolution Number 9937. CEQA Status ‐‐ Not a Project

12. SECOND READING: Ordinance of the Council of the City of Palo Alto Amending Various Chapters of Title 18 (Zoning) of the Palo Alto Municipal Code to Implement the 2023‐ 2031 Housing Element (FIRST READING: January 21, 2025 PASSED 7‐0) CITY MANAGER COMMENTS (8:00 ‐ 8:15 PM)
RECESS CITY COUNCIL MEETING AND CONVENE PUBLIC IMPROVEMENT CORPORATION

MEETING
ACTION ITEMS (Item 13: 8:15 ‐ 8:30 PM)
Include: Report of Committees/Commissions, Ordinances and Resolutions, Public Hearings, Report of Officials, Unfinished Business and Council Matters.

13. Approval of the FY 2024 Public Improvement Corporation’s Annual Financial Report; CEQA Status: Not a Project
BREAK (15 MINUTES)
RECONVENE CITY COUNCIL MEETING
ACTION ITEMS (Item 14: 8:45 ‐ 9:00 PM, Item 15: 9:00 ‐ 10:30 PM) Include: Report of Committees/Commissions, Ordinances and Resolutions, Public Hearings, Report of Officials, Unfinished Business and Council Matters.
14PUBLICHEARING:ObjectionstoWeedAbatementatAffectedPropertiesandApproval 3 February 10, 2025
Materials submitted after distribution of the agenda packet are available for public inspection at www.CityofPaloAlto.org/agendas.

13. Approval of the FY 2024 Public Improvement Corporations Annual Financial Report; CEQA Status: Not a Project
BREAK (15 MINUTES)
RECONVENE CITY COUNCIL MEETING
ACTION ITEMS (Item 14: 8:45 ‐ 9:00 PM, Item 15: 9:00 ‐ 10:30 PM) Include: Report of Committees/Commissions, Ordinances and Resolutions, Public Hearings, Report of Officials, Unfinished Business and Council Matters.

14. PUBLIC HEARING: Objections to Weed Abatement at Affected Properties and Approval of Affected Property List for Commencing Weed Abatement in 2025; CEQA status ‐ exempt

15. PUBLIC HEARING / QUASI‐JUDICIAL. 3265 El Camino Real [24PLN‐00012]: Approval of an Ordinance Rezoning the Subject Parcel From Commercial Services (CS) to Planned Community Zoning (PC) and Adoption of a Record of Land Use Action to Construct a 100% Affordable, Five‐Story, 55 Unit Residential Rental Project. Environmental Assessment: Initial Study/15183 Streamlined CEQA Review.

ADJOURNMENT
INFORMATION REPORTS
Information reports are provided for informational purposes only to the Council and the public but are not listed for action during this meeting’s agenda.

16. Semi‐Annual Report of Contracts Awarded by the City Manager, Procurement Officer or Other Designated Employees for the period of July 1, 2024 through December 31,2024 ;CEQA Status‐ Not a Project.

17. Palo Alto Local Hazard Mitigation Plan Annual Update for Calendar Year 2024; CEQA Status: Not a Project

18. Information Item: Summary of Fiscal Year 2023‐2024 Community Development Block Grant (CDBG) Program Accomplishments — Review of the CDBG Consolidated Annual Performance and Evaluation Report (CAPER). CEQA Status — Not a Project.

19. Key Findings of the 2024 Human Services Needs Assessment; CEQA Status ‐ Not a Project
OTHER INFORMATION
Standing Committee Meetings this week
Policy & Services Committee February 11, 2025
Public Comment Letters
Schedule of Meetings
PUBLIC COMMENT INSTRUCTIONS
4 February 10, 2025
Materials submitted after distribution of the agenda packet are available for public inspection at www.CityofPaloAlto.org/agendas.

Standing Committee Meetings this week
Policy & Services Committee February 11, 2025
Public Comment Letters
Schedule of Meetings
PUBLIC COMMENT INSTRUCTIONS
Members of the Public may provide public comments to teleconference meetings via email, teleconference, or by phone.

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

2. For in person public comments please complete a speaker request card located on the table at the entrance to the Council Chambers and deliver it to the Clerk prior to discussion of the item.

3. Spoken public comments for agendized items using a computer or smart phone will be accepted through the teleconference meeting. To address the Council, click on the link below to access a Zoom‐based meeting. Please read the following instructions carefully.

You may download the Zoom client or connect to the meeting in‐ browser. If using your browser, make sure you are using a current, up‐to‐date browser: Chrome 30 , Firefox 27 , Microsoft Edge 12 , Safari 7 . Certain functionality may be disabled in older browsers including Internet Explorer. Or download the Zoom application onto your smart phone from the Apple App Store or Google Play Store and enter in the Meeting ID below.

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

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

When called, please limit your remarks to the time limit allotted. A timer will be shown on the computer to help keep track of your comments.

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

CLICK HERE TO JOIN Meeting ID: 362‐027‐238 Phone: 1‐669‐900‐6833 Americans with Disability Act (ADA) It is the policy of the City of Palo Alto to offer its public programs, services and meetings in a manner that is readily accessible to all. Persons with disabilities who require materials in an appropriate alternative format or who require auxiliary aids to access City meetings, programs, or services may contact the City’s ADA Coordinator at (650) 329‐2550 (voice) or by emailing [email protected]. Requests for assistance or accommodations must be submitted at least 24 hours in advance of the meeting, program, or service.

Schedule of Meetings
PUBLIC COMMENT INSTRUCTIONS
Members of the Public may provide public comments to teleconference meetings via email, teleconference, or by phone.

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

2. For in person public comments please complete a speaker request card located on the table at the entrance to the Council Chambers and deliver it to the Clerk prior to discussion of the item.

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

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

When called, please limit your remarks to the time limit allotted. A timer will be shown on the computer to help keep track of your comments.

California Government Code §84308, commonly referred to as the "Levine Act," prohibits an elected official of a local government agency from participating in a proceeding involving a license, permit, or other entitlement for use if the official received a campaign contribution exceeding $500 from a party or participant, including their agents, to the proceeding within the last 12 months. A “license, permit, or other entitlement for use” includes most land use and planning approvals and the approval of contracts that are not subject to lowest responsible bid procedures and have a value over $50,000. A “party” is a person who files an application for, or is the subject of, a proceeding involving a license, permit, or other entitlement for use. A “participant” is a person who actively supports or opposes a particular decision in a proceeding involving a license, permit, or other entitlement for use, and has a financial interest in the decision. The Levine Act incorporates the definition of “financial interest” in the Political Reform Act, which encompasses interests in business entities, real property, sources of income, sourcesofgifts,andpersonalfinancesthatmaybeaffectedbytheCouncil’sactions.Ifyou 6 February 10, 2025
Materials submitted after distribution of the agenda packet are available for public inspection at www.CityofPaloAlto.org/agendas.
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disabilities who require materials in an appropriate alternative format or who require auxiliary aids to access City meetings, programs, or services may contact the City’s ADA Coordinator at (650) 329‐2550 (voice) or by emailing [email protected]. Requests for assistance or accommodations must be submitted at least 24 hours in advance of the meeting, program, or service.

California Government Code §84308, commonly referred to as the "Levine Act," prohibits an elected official of a local government agency from participating in a proceeding involving a license, permit, or other entitlement for use if the official received a campaign contribution exceeding $500 from a party or participant, including their agents, to the proceeding within the last 12 months. A “license, permit, or other entitlement for use” includes most land use and planning approvals and the approval of contracts that are not subject to lowest responsible bid procedures and have a value over $50,000. A “party” is a person who files an application for, or is the subject of, a proceeding involving a license, permit, or other entitlement for use. A “participant” is a person who actively supports or opposes a particular decision in a proceeding involving a license, permit, or other entitlement for use, and has a financial interest in the decision. The Levine Act incorporates the definition of “financial interest” in the Political Reform Act, which encompasses interests in business entities, real property, sources of income, sources of gifts, and personal finances that may be affected by the Council’s actions. If you qualify as a “party” or “participant” to a proceeding, and you have made a campaign contribution to a Council Member exceeding $500 made within the last 12 months, you must disclose the campaign contribution before making your comments. 7 February 10, 2025
Materials submitted after distribution of the agenda packet are available for public inspection at www.CityofPaloAlto.org/agendas.

City Council
Staff Report
Report Type: SPECIAL ORDERS OF THE DAY
Lead Department: City Clerk
Meeting Date: February 10, 2025
Report #:2412-3857
TITLE
Santa Clara County 2024 Synopsys Championship Science Fair STEM Winners from Palo Alto

BACKGROUND
The Santa Clara Valley Science and Engineering Fair Association is asking the Mayor and City Council to recognize the 2024 Synopsys Championship Science Fair STEM Winners from Palo Alto. The 2024 awardees are:
• Avery Amsili
• Ivy Ruth Alcheck
• Aditya Banwasi
• Maya Caren
• Edward Chen
• Connor Chin
• Jacob Chiu
• Arlo Cohen
• Adrina Esmaeilpour
• Carina Gross
• Ethan Kou
• Lauren Jungmin Lee
• Charlene Yifan Li
• Atharv Mahajan
• Maya Mazin
• Adrit Rao
• Claire Rao
• Eden Alivia Ross
• Hongyi Shi
• Stella Su
• Lucas Wu
• Vince Wu
• Danielle Zomet

ATTACHMENTS
Attachment A: Certificates of Recognition
APPROVED BY:

Mahealani Ah Yun, City Clerk
ITEM 1 Item 1 Page 1 Packet Page 8 of 582
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Staff Report
From: City Clerk
Report Type: SPECIAL ORDERS OF THE DAY
Meeting Date: February 10, 2025
Report #:2411-3834
TITLE
Appointment of Candidates to the Planning and Transportation Commission

RECOMMENDATION
Staff recommends City Council vote to appoint one candidate to fill the partial term expiring on March 31, 2026, and two candidates to fill the full terms expiring on March 31, 2029, to the Planning and Transportation Commission (PTC).

A majority vote (4 yes’s) is required to appoint a candidate.

BACKGROUND
Then-PTC Commissioners Keith Reckdahl and George Lu were sworn in as City Councilmembers on January 6, 2025, thereby vacating their PTC seats. Keith Reckdahl was in PTC Seat 4, whose term expires 3/31/26. Staff recruited for 1 partial term to fill this vacancy. George Lu was in PTC Seat 5, whose term expires 3/31/25. Due to the closeness of the expiration date, we recruited for a full term for Seat 5. The City Council may choose to appoint a commissioner to finish out the current Seat 5 term and then serve the subsequent full term or leave Seat 5 vacant until 4/1/25, when the new commissioner would begin.

Additionally, PTC Seat 6’s term, which is currently occupied by Commissioner Doria Summa, will expire on 3/31/25. The newly appointed commissioner will begin service upon that term’s expiration.

Seat Number* Term Length Service Begins Term Expiration Seat 4 Partial Upon appointment March 31, 2026
Seat 5 Full Upon appointment or April 1,
2025, at Council’s discretion
March 31, 2029
Seat 6 Full April 1, 2025 March 31, 2029
*Seat numbers have been implemented for tracking purposes.

ITEM 2 Item 2 Page 1 Packet Page 32 of 582
On the January 21, 2025 City Council meeting, City Council selected thirteen candidates who received at least one vote for interviews. Initially scheduled for February 3, 2025, the interviews were rescheduled to a Special Meeting on February 4, 2025.

MEMBERSHIP REQUIREMENTS
According to Palo Alto Municipal Code1, members of the PTC must be residents of the City who are not council members, officers or employees of the city.

FISCAL/RESOURCE IMPACT
There is no Fiscal/Resource Impact.

ENVIRONMENTAL REVIEW
Council action on this item is not a project as defined by CEQA because it an organizational or administrative activity that will not result in direct or indirect physical changes in the environment. CEQA Guidelines section 15378(b)(5).

ATTACHMENTS
Attachment A: Selected PTC Candidates’ Applications - Redacted APPROVED BY:

Mahealani Ah Yun, City Clerk
1 Palo Alto Municipal Code 2.02.010 https://codelibrary.amlegal.com/codes/paloalto/latest/paloalto_ca/0-0-0- 61282
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Staff Report
From: City Manager
Report Type: STUDY SESSION
Lead Department: City Manager
Meeting Date: February 10, 2025
Report #:2412-3878
TITLE
Housing and Homelessness in Palo Alto: Review of current efforts including the 2024 Gap Analysis Report, Update on Enforcement Work, Overview of Engagement Framework to Develop an Implementation Plan, and Discussion of Other Potential Next Steps

RECOMMENDATION
Staff recommends that Council:

1. Receive an update on actions taken regarding unhoused services coordination in Palo Alto including discussion and feedback on the Council-directed 2024 Palo Alto Gap Analysis Report (Dec. 9, 2024 Information Report1).

2. Receive an overview of local enforcement efforts and changes in state and federal law.

3. Receive an overview of the suggested community engagement next steps related to the development of an Implementation Plan Addressing Homelessness in Palo Alto, potentially including:

3.1. Consideration of a referral to the Human Relations Commission (HRC) to discuss and review the Gap Analysis Report with the intention for the HRC to recommend areas of priority to the Council; and

3.2. Engagement and outreach to develop an Implementation Plan to Address Homelessness in Palo Alto for Council consideration and approval.

4. Discuss items 1-3 above and have an initial discussion of 3 broad topics: housing production and homelessness prevention programs, homelessness support services, and enforcement efforts related to health and safety. Refer follow-up discussions to the Policy and Services Committee (if desired) and advance the engagement efforts described above.
1 Council Information Report, December 9, 2024
https://cityofpaloalto.primegov.com/meetings/ItemWithTemplateType?id=6549&meetingTemplateType=2&comp iledMeetingDocumentId=12534
ITEM 3 Item 3 Page 1 Packet Page 78 of 582

EXECUTIVE SUMMARY
At the direction of Council in setting 2024 Priority Objectives, staff prepared a baseline conditions analysis of services related to housing and unhoused services in Palo Alto. Staff also prepared a report on the current unhoused population in Palo Alto. These reports were shared with the Council on Dec. 9, 2024 as an Information Report. As a next step beyond this baseline information, staff is requesting Council discussion of the report and current unhoused services coordination. Specifically, Council initial feedback is requested on 1) housing production and homelessness prevention programs, 2) homelessness support services, and 3) enforcement efforts related to health and safety.

More specific questions to explore are the adequacy of homelessness prevention programs to reduce the number of people entering homelessness; the adequacy of housing production to increase the number of people exiting homelessness; what support and capacity the City can commit to unhoused support services; and what enforcement strategies would foster community health and safety. Staff will pursue a facilitated community engagement effort as a next step of information gathering to help inform the next Council discussion and subsequent next steps on this important topic. This information can be used in the creation of an implementation plan addressing homelessness in Palo Alto if such a strategy is desired as a next step to ensure balance among competing needs.

BACKGROUND
The City of Palo Alto has prioritized housing stability and services for the unhoused in alignment with regional efforts outlined in the Santa Clara County Community Plan to End Homelessness 2020–20252. In April 2021, City staff presented a report to the Council highlighting strategies for addressing homelessness, which served as a foundation for reviewing the County Plan and later pursuing a Homekey grant.3 On Aug. 9, 2021, the Council unanimously endorsed the Plan’s goals, including reducing the annual inflow of homelessness, increasing supportive housing, expanding prevention services, doubling shelter capacity, and addressing racial inequities among the unhoused population. The three pillars of the County Plan are to 1) Address the root causes of homelessness; 2) Improve the quality of life for unsheltered individuals and create healthy neighborhoods for all; and 3) Expand homelessness prevention and housing programs.

Since endorsing the County Plan, the City has taken significant steps to advance the Plan’s housing and homelessness strategies.
2 Santa Clara County Community Plan to End Homelessness 2020-2025:
https://housingtoolkit.sccgov.org/sites/g/files/exjcpb501/files/CommunityPlan_2020.pdf 3 Council Staff Report, April 5, 2021 https://www.cityofpaloalto.org/files/assets/public/v/1/agendas-minutesreports/reports/city-manager-reports-cmrs/year-archive/2021/id-12133.pdf; Council Action Minutes, August 9, 2021
https://cityofpaloalto.primegov.com/Public/CompiledDocument?meetingTemplateId=3354&compileOutputType= 1 ITEM 3 Item 3 Page 2 Packet Page 79 of 582
Key City initiatives include:
• Expanding renter protections,
• Piloting and later formalizing safe parking programs, • Securing State Homekey funds, and
• Contributing to affordable housing projects (such as Wilton Court Apartments).

In Dec. 2023,4 the Council identified a need to better understand the unhoused population in Palo Alto, subsequently elevated as a Council Priority Objective which included exploring safe parking expansion, “Initiate research to understand Palo Alto unhoused population and explore feasibility of expanding safe parking options on Geng Road.” During the 2024 Council Retreat and subsequent budget process, Councilmembers indicated an interest in a direction and plan for addressing housing and services for the unhoused. This became a Council Priority Objective to “Conduct a gap analysis of housing and services for the unhoused in Palo Alto, considering Council direction, City activities and work, and County activities and work.” The resulting gap analysis and related research were presented to Council as an Information Item on December 9, 20245 and are summarized in the Analysis section for Council consideration. An updated version of the Gap Analysis, revised to correct clerical errors in the final row of Table 2.3 (page 21) is included with this report as Attachment A.

ANALYSIS
Section 1: Status Update on Unhoused Services Coordination in Palo Alto Baseline Conditions
The Dec. 9th information item provided much needed data on baseline conditions in Palo Alto, both in terms of the unhoused population and services for that population. Additionally, it clarified key terminology and roles to ensure an understanding of definitions and constraints.

For example, people often suggest prioritizing Palo Altans for services or housing.6 However, most permanent supportive housing programs and services addressing homelessness leverage at least some federal funds from the U.S. Department of Housing and Urban Development (HUD). Federal funds require “coordinated entry” and a “Continuum of Care”, which in turn, require things such as no-wrong-door services and prioritization based on vulnerability.7 Nowrong-door means that individuals experiencing homelessness and in need of housing resources should be able to access those through a system that is low-barrier and provides 4 Council Meeting, December 4, 2023 https://www.youtube.com/watch?v=A-2CuhXvs84 5 Council Staff Report, December 9, 2024
https://cityofpaloalto.primegov.com/meetings/ItemWithTemplateType?id=6666&meetingTemplateType=2&comp iledMeetingDocumentId=12534
6 Council Staff Report, January 13, 2025,
https://cityofpaloalto.primegov.com/meetings/ItemWithTemplateType?id=6678&meetingTemplateType=2&comp iledMeetingDocumentId=12763
7 This report describes procedures in place as of the writing of this report. It does not incorporate changes that may be made by the new federal administration.

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multiple points of entry. This limits the feasibility of geographic preferences for permanent housing programs, though individual client preferences are taken into account whenever possible.

Santa Clara County’s coordinated entry system provides a multitude of access points for individuals and families to seek services. The coordinated entry system determines eligibility for programs through an assessment of an individual or household’s vulnerability, based on factors such as disability, experience of gender-based violence, mental health challenges, and other vulnerabilities. Permanent supportive housing and rapid rehousing programs funded using HUD Continuum of Care funding must accept eligible individuals and households from the coordinated entry system regardless of their geographic affiliation within Santa Clara County.

However, matchmakers within the Continuum of Care work with eligible households to review available housing options and take their geographic preferences into account whenever possible in determining among possible housing placements.

The shelter referral system operates somewhat differently from coordinated entry for permanent housing programs. Shelter referrals, including for the Palo Alto Homekey site, would go through the County’s centralized Here4You call center, then would be referred to sites based on city/area affiliation (e.g., Palo Alto) and household type (e.g., single adult, family with minor children). When working with callers, the Here4You team first attempts to address a caller’s housing crisis using housing problem solving techniques and services prior to shelter placement.

If housing problem solving does not resolve the housing crisis, the caller will be placed on the shelter queue. For the Palo Alto Homekey site, priority would be given to those connected to Palo Alto, followed by other North County cities. Here4You outreach staff will be available to support street outreach to unhoused Palo Alto residents to get them onto the waitlist even prior to the opening of the site.

Another example relates to definitions. For example, HUD defines unsheltered homelessness as someone whose primary nighttime location is a public or private place not designated for, or ordinarily used as, a regular sleeping accommodation for people (e.g., a car, public park, bus station, campground). HUD does not consider someone to be homeless if they are “couch surfing”, sleeping in crowded situations, or temporarily staying with others due to a loss of housing/hardship—all considered common forms of housing instability among transitional-aged youth ages 18-24.8
Looking at Palo Alto baseline conditions, it is important to also understand the regional and national context. In a recent federal report, data indicates that nationally, homelessness on a single night in 2024 was 771,480 people. This is the highest number ever recorded and an 18% increase over the prior year.9 In contrast to the high national increase, California had a more modest increase of about three percent (3% or 187,084 people), which is also the highest 8 The U.S. Department of Housing and Urban Development (HUD), The 2024 Annual Homelessness Assessment Report to Congress, https://www.huduser.gov/portal/sites/default/files/pdf/2024-AHAR-Part-1.pdf 9 Ibid.

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historical number recorded for the state. The most recent Santa Clara County count in January 2023 was a one percent (1%) increase (9,903 people) over the prior year countywide, yet a 25% decrease (206 people) for Palo Alto.10 The next count in Palo Alto occurred January 23, 2025.

Within this national context, while the City has made significant strides in addressing homelessness and housing instability, it remains a complex challenge locally.

The December “Understanding the Unhoused” report highlights key data about individuals experiencing homelessness in Palo Alto. For instance, a higher percentage of people experiencing homelessness in Palo Alto (91%) are unsheltered compared to the countywide average (75%), with a significant portion (88%) living in vehicles. This report complements the Gap Analysis by providing detailed demographic, housing, and service utilization data, serving as a foundation for identifying opportunities and service gaps.

Key Facts from Gap Analysis Report
The Gap Analysis identifies a mismatch between demand and availability of certain programs and interventions. For example, in 2023 during a single-day count of unhoused vehicle dwellers in Palo Alto, there were 181 individuals in 102 vehicles, including 69 RVs. However, there are only 40 safe parking spots in Palo Alto. Of those, 18 are restricted to passenger vehicles and overnight parking, with only 22 spaces for RVs and 24-hour parking.11 While there is frequently excess capacity at the overnight, passenger vehicle, congregational sites, there has been a waiting list for 24-hour RV parking. Another example is related to people who could benefit from affordable housing and the amount of affordable housing available. In terms of affordable housing with supports in place explicitly for people experiencing homelessness:

Table 1: Palo Alto Unhoused Assessed to Need Rapid Rehousing or Permanent Supportive Housing vs. Forthcoming Units12
Service Needs Rapid Rehousing Permanent Supportive Housing Forthcoming (entitled) Units 32 0
Palo Alto Unhoused Residents
Assessed to Need Various Services
115 120
10 HUD Exchange, CoC Homeless Populations and Subpopulations Reports, https://www.hudexchange.info/programs/coc/coc-homeless-populations-and-subpopulationsreports/?filter_Year=2024&filter_Scope=CoC&filter_State=CA&filter_CoC=CA-500&program=CoC&group=PopSub.

Santa Clara County 2023 PIT Report,
https://public.tableau.com/views/PIT2023v2/Exec?:showVizHome=no&amp;embed=true&. 11 In 2023, this number was 16 passenger vehicle spots and 12 RV spots. 12 See Attachment A “Housing and Unhoused Services Gap Analysis in Palo Alto”, updated January 8, 2025, page

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There are also current Palo Altans who are cost-burdened—or spend more than 30% of their income on housing costs—many of whom would be eligible for an affordable unit if one were available:

Table 2: Currently Entitled and Proposed Housing Units (not inclusive of Rapid Rehousing and Permanent Supportive Housing Units) Compared to Cost Burdened Renters13 Income Level
Extremely
Low Income
Very Low
Income Low Income
Median
Income
Above Median
Income
Entitled Units 46 96 49 60 331
Proposed
Units (not yet
entitled)
3 22 408 51 1,973
CostBurdened
Renters14
1,460 865 915 550 635
Structure of Gap Analysis Report
The Gap Analysis report, which aligns with the Santa Clara County Community Plan to End Homelessness, organizes its findings into three core categories:
• Addressing the root causes of homelessness through system and policy changes:

Current renter protections and anti-displacement provisions exist but lack proactive enforcement mechanisms. While there are ongoing efforts to increase affordable housing, additional strategies and internal organizational alignment could enhance the City’s capacity to meet local needs.
• Improving the quality of life for unsheltered individuals and creating healthy neighborhoods for all: Despite available services, barriers such as shelter capacity, safety concerns, and transportation limitations prevent some individuals from accessing resources.
• Expanding homelessness prevention and housing programs to meet demand: While the City has over 2,300 affordable housing units, most are occupied and there are long (in some cases, closed) waitlists, and the pipeline for new units remains insufficient. For example, there are no permanent supportive housing units in development, despite significant demand.
13 See Attachment A “Housing and Unhoused Services Gap Analysis in Palo Alto”, updated January 8, 2025, page

21. 14 This row’s data was updated from the December 2024 “Housing and Unhoused Services Gap Analysis in Palo Alto”. It now includes updated data on cost burdened renters, as well as corrects the cost-burdened renter data under “Above Median Income” which previously had shown the total number of cost-burdened renters instead of the subset which are “Above Median Income”.

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Gaps and Opportunities
Several gaps and opportunities for improvement were identified in the two reports, and in subsequent discussions among staff and community stakeholders15:
• Affordable Housing Pipeline: While the pipeline for affordable housing is encouraging, it remains insufficient relative to demand. For example, in Palo Alto there are no permanent supportive housing units in development to address the needs of over 120 individuals currently waiting.
• Homelessness Prevention: There is a countywide homelessness prevention program, however the need for additional funding and outreach limits the City’s ability to reduce any inflow of individuals into homelessness.
• Internal Coordination and Resource Allocation: The City’s current structure for addressing homelessness spans multiple departments, with no unified plan. This makes it challenging to coordinate efforts effectively, allocate resources efficiently, and act on Council direction to prioritize focus areas.
• Enforcement and Public Concerns: Community members have expressed confusion about where to report issues related to encampments or RV dwellers and how the City will respond once issues are reported. A clear plan coupled with public education on how various concerns can be reported and addressed could help bridge this gap. • Case Management: Limited resources for case management present a critical barrier to supporting unhoused individuals effectively. High caseloads and ongoing demand for permanent supportive housing strain the system and limit the capacity to deliver meaningful assistance.

Addressing these gaps and opportunities with a clear policy direction will enable Palo Alto to better meet the needs of unhoused residents while improving outcomes for the broader community. This is further discussed in the Next Steps subsection of this staff report.

Section 2: Enforcement: Law Changes and Current Efforts In addition to the above, enforcement of conduct laws, especially regarding health and safety matters, is one part of the City’s response to address the health and safety impacts related to homelessness while mitigating impacts on the wider community. The City recognizes the complexity of enforcing laws while ensuring compassionate outreach to individuals experiencing homelessness. Palo Alto employs a nuanced approach that balances public health, safety, and cleanliness with respect for the dignity and rights of unhoused individuals. 15 The RV Dwellers Group, consisting of service providers, City staff, a representative of Stanford University, members of the faith-based community, a Councilmember, and a Human Relations Commission member, met in December and discussed the two reports.

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A. New Developments in 2024
In 2024, there were two legal developments regarding the enforcement of criminal laws regulating conduct sometimes engaged in by unhoused persons, particularly camping on public property.

Grants Pass v. Johnson. First, in Jun. 2024 the U.S. Supreme Court issued a decision in the case of City of Grants Pass v. Johnson.16 In Grants Pass the Court held that the enforcement of laws prohibiting camping17 on public property does not constitute “cruel and unusual punishment” prohibited by the Eighth Amendment. The Grants Pass decision reversed the prior rule in the Ninth Circuit, established in 2018 in the case of Martin v. City of Boise.18 In Martin the Ninth Circuit had held that cities may not constitutionally enforce “no camping" laws when a city’s homeless population exceeds available shelter beds. The Circuit reasoned that homelessness is an involuntary status if alternative shelter is not available, and that criminal punishment under those circumstances is “cruel and unusual” in violation of the Eight Amendment of the U.S.

Constitution.

Because most cities and counties were unable to show adequate shelter beds for everyone unhoused in the jurisdiction, under Martin, most were effectively barred from issuing criminal citations for camping in public places. Between 2018 when Martin was decided and June 2024 when it was overruled by Grants Pass, federal courts throughout the Ninth Circuit enjoined cities and counties from enforcing many local criminal laws, particularly relating to clearing large encampments. The Grants Pass decision removed this constraint, allowing cities to pursue enforcement of their laws against public camping regardless of shelter availability without risk of a legal challenge under the Eighth Amendment. An easy infographic on the Grants Pass decision can be found here: https://bcsh.ca.gov/calich/documents/grants_pass_fact_sheet.pdf.

Governor’s Executive Order. One month after the Grants Pass decision was announced, Governor Newsom issued an Executive Order19 instructing state agencies under the Governor’s authority to begin taking action to remove encampments on state property, prioritizing those that present an imminent threat to life, health, safety or infrastructure. The Executive Order describes procedures for advance notice to persons living in encampments, the importance of offering shelter and services, and processes for retaining removed belongings. The Order was mandatory for agencies under the Governor’s control (this does not include Palo Alto). The Order also included non-mandatory language encouraging local government entities, including 16 https://www.supremecourt.gov/opinions/23pdf/23-175_19m2.pdf 17 Camping is not defined in federal law. Each local jurisdiction that regulates camping defines the conduct that is prohibited. To take one example, the local law at issue in the Grants Pass case defined camping as setting up or remaining in or at a campsite, which is any place where bedding, sleeping bags, or other material used for bedding purposes or any stove or fire is placed for the purpose of maintaining a temporary place to live. 18 https://cdn.ca9.uscourts.gov/datastore/opinions/2018/09/04/15-35845.pdf. 19 https://www.gov.ca.gov/wp-content/uploads/2024/07/2024-Encampments-EO-7-24.pdf ITEM 3 Item 3 Page 8 Packet Page 85 of 582
cities like Palo Alto, to adopt similar policies and use their resources to remove encampments under their jurisdiction that present an imminent threat to life, safety, or infrastructure.

Challenges that Remain after Grants Pass and the Governor’s Executive Order. The Grants Pass decision acknowledges that the root causes of homelessness in the U.S. are multi-faceted and complex, and that local officials need to use a variety of tools in pursuit of solutions. While Grants Pass removed a significant constraint on cities taking enforcement action when nocamping and other laws are broken by unhoused persons, the decision does not address or resolve many other challenges that impede fundamental change. As discussed in other parts of this report, these challenges include lack of affordable housing, limited availability of supportive services, and insufficient shelter beds or shelter options that are incongruous to individuals’ needs.

In addition, enforcement activities are constrained by significant resource limitations throughout the criminal justice system (including local police, county jail facilities, prosecutors, public defenders, superior court judges, and probation officers).

Finally, the Grants Pass decision does not mean that state and local criminal laws cannot be further challenged under a variety of statutory and constitutional provisions.

B. The Criminal Justice System and the Unhoused: Where We Are Now State and local laws prohibit a variety of conduct that can have negative impacts on the health and safety of others, impair property rights, or compromise public order. People often mistakenly associate unlawful behaviors they observe with homelessness, even though the behavior itself—not the person's housing status—is the crime or nuisance. This distinction highlights the importance of addressing two related but separate issues: homelessness (e.g., prevention, services, housing) and crime or nuisance. With limited exceptions (e.g., special laws that only apply to minors), state and local criminal laws apply to conduct, regardless of the subject’s personal characteristics or housing status. This section discusses various state and local laws that apply to everyone who engages in the prohibited conduct, regardless of whether they are housed or unhoused.

The Palo Alto Police Department staffs a Special Problems Detail (SPD) made up of officers assigned to work on a variety of issues, including but not limited to quality of life issues, collaborating with community partners, the City’s outreach team, and City departments, traffic enforcement, and any other critical issues affecting our community such as crime trends or major crimes. The SPD and other officers engage in enforcement action on a regular basis. In addition, City Code Enforcement and Public Works personnel issue administrative citations, manage clean-ups, and abate nuisances.

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Relevant state and local laws include, for example:
• Closing parks and community centers between 10:30 pm and sunrise • Prohibiting outdoor fires
• Barring open alcohol containers in public places
• Prohibiting urination or defecation in a public place • Prohibiting public nuisances
• Prohibiting vehicles from being abandoned or stored on City streets (defined as failing to move at least ½ mile within a 72-hour period)
While the following behaviors may sometimes generate concern, they do not, by themselves, violate federal, state or local law:
• Sleeping on the sidewalk, provided public access is not blocked • Sleeping in a vehicle
• Sleeping outside or in a tent in a park between sunrise and 10:30pm • Carrying around large amounts of personal property in bags or carts • Hanging around on sidewalks or public benches
• Being present in a public parking garage that is otherwise open to the public • Asking others for money
• Being without a home or shelter
How enforcement works. The SPD and other police officers respond to complaints and proactively patrol sensitive areas. Officers are trained in communicating with persons with mental health and other disabilities and utilize assistance from non-enforcement community partners to gain compliance with the law when appropriate and possible. Officers engage individuals displaying behavior that violates state or local law, with a goal of gaining compliance with legal requirements. Officers make contact, educate individuals on what the law requires, seek voluntary compliance, and offer resources. Where needed and appropriate, officers will take applicable enforcement action with a citation or other necessary action.

To issue a criminal citation for a misdemeanor offense, officers must either: (a) directly observe violations of state or local law, or (b) identify a complaining victim or eyewitness to the conduct who is willing to testify on the record.

Where serious or violent conduct is involved, officers will make a custodial arrest, transporting the individual to the County Jail in San Jose. At the jail, County Sheriff personnel make decisions regarding processing and detention, in conjunction with the District Attorney and Superior Court. Commonly, individuals delivered to the jail are processed and released within several hours or a few days, pending further action by the District Attorney and Superior Court. Once released, the individuals are free to return to their community if desired.

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For non-violent misdemeanors, which are the great majority of matters in Palo Alto, officers issue the subject a criminal citation and do not transport to the jail. The citation requires the subject to appear in court at a specified time, subject to a further decision by the District Attorney’s Office regarding charging and calendaring the matter in court. For non-critical offenses, the District Attorney’s Office typically places the matter on the Superior Court calendar when a pattern of repeated citations demonstrates a continuing problem. When a pattern of citations results in a court appearance, the most common outcome is a period of community service. Where applicable, the court may also order substance abuse or behavioral treatment (if applicable), or fines. Custodial detention is rare. It is common for cited individuals to remain in or return to the locations and communities that they consider their home.

Returning to the Community. Some residents and business owners have expressed frustration at the visible signs of homelessness around the city, such as individuals spending long periods of time in parks, libraries, public garages, and sidewalks, and individuals displaying worrisome behaviors. While some concerning conduct violates state or local law and can be cited, enforcement does not often fully resolve the issue.

For all these reasons and those shared in the Gap Analysis, enforcement should not be thought of as a comprehensive solution to homelessness or a way to resolve all community impacts from large numbers of individuals living without adequate housing. At best, enforcement functions as a tool to mitigate health and safety concerns and reduce behaviors that have a negative impact on others. However, enforcement may not be the most effective or costefficient tool to mitigate such impacts, even where it is a legally available option. Enforcement is most effective when used in conjunction with other strategies, such as access to appropriate shelter, housing, and services.

Vehicles and Parking. The state legislature has exerted preemptive authority over vehicle movement and parking regulations. Local jurisdictions may regulate parking to the extent authorized by the state. Enforcement of parking restrictions or other conduct related to vehicles raises a number of special issues, including, for example, a requirement to provide adequate notice through comprehensive posting or individualized notice, and in some circumstances constitutional limits on towing. The Police Department conducts periodic monitoring for parking compliance and responds to complaints, scaled to available resources.

One common complaint involves cars, trailers or RVs that are parked without moving for an extended period of time. State law allows cities to adopt a local ordinance authorizing removal of a vehicle that has been parked in the same place for more than 72 hours. Palo Alto has adopted such an ordinance. Prior to removing a vehicle, the ordinance requires City staff to affix a notice to the vehicle advising that the vehicle will be removed for violation of the ordinance after 72 hours unless it is moved at least five tenths of a mile. If the vehicle is moved, there is nothing in the law that prevents the owner from re-parking in the same location.

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The public has also reported concerns about use of generators, storage of belongings outside of the vehicle, and dumping of waste. Local law has requirements related to all of these issues, and City staff from multiple departments respond, as resources allow, and work with vehicle owners to achieve compliance. For example, for cleanup efforts when personal belongings or encampments accumulate in public spaces, the City provides advance notice and ensures individuals have opportunities to gather and relocate their belongings before clearing the area.

With respect to parking and vehicles, staff has identified several areas where additional local ordinances would enhance staff’s ability to address conduct having a negative impact on others. These include, for example, prohibiting the ”renting” of public parking spaces and regulating use of parking spaces for trailers or other non-vehicles. A detailed discussion of parking and vehicles is beyond the scope of this item. Staff recommends referring further work on this topic to the Policy and Services Committee.

Property. Special rules apply to the handling of property. In general, seizure of property without consent requires a judicial warrant. While there is an exception for abandoned property, courts stringently review the facts and circumstances to determine whether property is truly abandoned as opposed to merely unattended. Accordingly, City staff post notice before taking control of property that is not trash and not clearly abandoned. Further, with the exception of material that is clearly trash, seized property must be retained for a period of time to allow the owner to retrieve it. At this time, Palo Alto does not have a facility or staffing to handle storage of seized property (with the limited exception of small valuable property held by the Police Department under appropriate circumstances). Cities that store seized property invest considerable resources in procuring a storage location and needed equipment, in addition to personnel, procedures, and training required to constitutionally handle this type of activity.

C. What the Public Can Do to Support Effective Enforcement The Police Department encourages the public to promptly report suspicious behavior or criminal activity to our 24-hour dispatch center at (650) 329-2413, or 9-1-1 if it is an emergency.

To request cleanup of garbage or other materials left in the public right-of-way (streets and sidewalks), a park, or a City parking garage, the Palo Alto 311 application can be used.20 A request can also be made by calling the Public Works Department at 650-496-6974. 20 https://www.cityofpaloalto.org/Residents/Services/Report-an-Issue ITEM 3 Item 3 Page 12 Packet Page 89 of 582
Section 3: Engagement
Next Steps Description
The reports collectively emphasize the importance of developing a cohesive and targeted strategy to address homelessness in Palo Alto. By offering a comprehensive overview of baseline conditions, enforcement practices, and areas for improvement, they provide a foundation for advancing Council discussions and engaging stakeholders to craft a tailored plan for the City.

An implementation plan is essential to determine whether strategies should prioritize incentives and supportive measures ("carrots"), enforcement and regulatory approaches ("sticks"), or a balanced combination of both. Without this clarity, efforts may lack focus, and resources may not be deployed in a manner that reflects Council priorities and community expectations. In order to develop a policy direction it will be important to take the pulse of the community through meaningful, inclusive engagement. While the Council often receives communications from residents and business owners who are frustrated, staff also receives communications from residents reaching out to learn how to help people experiencing homelessness or to ask for help to stay housed or find safe shelter. These communications are less frequently items sent directly or “escalated” up to Council.

Staff proposes initiating engagement with key stakeholders, including Councilmembers, Palo Alto Unified School District, businesses, the downtown community, faith-based organizations, Stanford University, the medical community, community-based organizations/service providers, and people with lived experience of homelessness. These groups are highly motivated to address homelessness due to their roles in the community, the impacts they experience, and/or their specific expertise. A neutral facilitator with relevant expertise should be engaged to help ensure thoughtful and balanced discussions that build trust and result in an implementation plan that reflects the values and priorities of the community.

Without this inclusive engagement, there may be reduced community input and a less responsive implementation plan, which could erode trust, reduce buy-in from the community, and potentially require a more costly redesign later as unforeseen challenges and community concerns arise. Similarly, postponing engagement and a plan could lead to missed opportunities and efficiencies. Acting now allows engagement to build on the relationships initiated during the Gap Analysis research and to draw from recent data. However, postponement may require re-establishing relationships and/or conducting new or additional research and data collection.

Staff also recommends that Council refer the Gap Analysis and related staff report to the HRC for conversation and input on which themes and strategies should be prioritized. Given the HRC’s charge to promote the just and fair treatment of all people, particularly vulnerable populations, their perspective will be vital in ensuring that the Implementation Plan is inclusive and equitable. The Commission’s work in addressing disparities related to housing, employment, and access to community resources positions it as an essential partner in ITEM 3 Item 3 Page 13 Packet Page 90 of 582
identifying approaches that consider the full range of needs and potential barriers for marginalized groups within Palo Alto.

Ultimately, staff will bring an implementation plan back to Council stemming from the Council and HRC discussions and co-created by stakeholders during engagement.

Section 4: Discussion
Staff seeks Council initial feedback about 3 broad topics: housing production and homelessness prevention programs, homelessness support services, and enforcement efforts related to health and safety. Council input will help staff to refine and prioritize the focus areas for further development. Specifically, staff seeks guidance on any themes or considerations Council would like prioritized during the comprehensive engagement described above. As staff prepares for this engagement, Council feedback can be on the broad topics listed above or on these specific questions: 1) if the homelessness prevention programs are adequate enough to reduce the number of people entering into homelessness, 2) the adequacy of housing production to increase the number of people exiting homelessness; 3) what support and capacity the City can commit to unhoused services, and 4) what enforcement strategies the City would like to emphasize related to community health and safety. With this being such a complex topic and a vast amount of information in this report, Council can also choose to bring back further discussion to the full Council or Policy and Services Committee on any of the topics within this report.

FISCAL/RESOURCE IMPACT
The recommended next steps require new funding. Based on preliminary research, a budget of not-to-exceed $50,000 is proposed for targeted stakeholder engagement and developing an implementation plan, anticipated to take three to six months. This would be drawn from the existing operating budget. Staff would request informal bids from qualified firms and individuals with relevant expertise (i.e., community engagement, facilitation, projects relating to homelessness and/or housing stability).

Additional efforts in any of these areas are likely to require additional resources. In some cases significant resources may be needed. Consideration of resource requirements and prioritization must be a part of any implementation plan.

STAKEHOLDER ENGAGEMENT
Staff consulted with colleagues and professionals with experience locally and regionally.

Additionally, the “RV Dwellers Group” of service providers, a representative of Stanford University, members of the faith-based community, people from the faith-based community, City staff, a Councilmember, and a Human Relations Commission member, met in December and discussed the two reports.

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ENVIRONMENTAL REVIEW
Not a project.

ATTACHMENTS
Attachment A: Housing and Unhoused Analysis – Updated January 8, 2025 APPROVED BY:

Ed Shikada, City Manager
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Staff Report
Report Type: CONSENT CALENDAR
Lead Department: City Clerk
Meeting Date: February 10, 2025
Report #:2501-4045
TITLE
Approval of Minutes from January 21, 2025 and January 25, 2025 Meetings

RECOMMENDATION
That the minutes be reviewed and approved.

ATTACHMENTS
Attachment A: January 21, 2025 Draft Action Minutes
Attachment B: January 25, 2025 Draft Action Minutes
APPROVED BY:

Mahealani Ah Yun
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Staff Report
From: City Manager
Report Type: CONSENT CALENDAR
Lead Department: Planning and Development Services
Meeting Date: February 10, 2025
Report #:2410-3618
TITLE
Approval of Contract Amendment Number 2 to Contract Number S24189598 with Good City Company in the Amount of $24,930 for a Stream Corridor Protection Ordinance Update; CEQA Status: Exempt Pursuant to CEQA Guidelines 15061(b)(3).

RECOMMENDATION
Staff recommends the City Council approve and authorize the City Manager or designee to execute Amendment No. 2 to Contract No. S24189598 (Attachment A), with Good City Company, for additional public engagement in the amount not to exceed $24,930 for the Stream Corridor Protection Ordinance Update. This second amendment results in a revised total compensation not-to-exceed $117,223.

BACKGROUND
The City Council had expressed an urgency for the Stream Corridor Protection Ordinance update, particularly after facing difficulties approving a residential project in the foothills due to the lack of updated creek protection measures. The Planning and Development Services (PDS) faced a significant backlog and staffing shortages, hindering capacity to address this priority promptly. The update will implement creek protection policies outlined in the Comprehensive Plan, which has been a longstanding priority for the City Council. Delays could impact riparian habitat with development encroaching closer to the creek bank. An exemption from competitive solicitation, pursuant to PAMC 2.30.360(b2), and a contract with Good City Company for an amount not to exceed $74,173 was executed to support this priority project.

In June 20241, the City Council approved a contract amendment to accommodate a biologist for a revised total not to exceed of $92,293. On October 30, 20242, the Planning and 1 City Council Staff Report (Agenda Item 13):
https://cityofpaloalto.primegov.com/Portal/Meeting?meetingTemplateId=14311 2 Planning and Transportation Commission Staff Report (Agenda Item 2):
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Transportation Commission (PTC) recommended that staff conduct a community meeting and additional hearings before the City Council considers the ordinance update. These additional meetings will increase the scope and project budget by $24,930.

ANALYSIS
The PTC, along with several property owners, recommended more opportunities for public input on the proposed ordinance changes, particularly the most recent draft ordinance.

Commissioners stated that it is crucial for those directly affected to share their thoughts, ensuring the final ordinance considers community needs. To facilitate this, a dedicated community meeting is scheduled for February 6, 2025, to present the regulations under consideration to those most directly impacted and hear community concerns. The community input will then be presented to PTC for consideration as part of their recommendation to City Council.

Furthermore, this proposal includes optional meetings with the PTC and City Council. This flexibility allows for ongoing dialogue and refinement of the ordinance based on community input and evolving project needs.

The additional community engagement and optional meetings with the PTC and City Council necessitates an increased budget allocation of $24,930, exceeding the City Manager’s contract authority approval limit. This action increases the not to exceed amount of the contract up to $117,223. This amendment is recommended to maintain continuity with the project work and stakeholders thus far. If not approved, the project would likely see a delay as a result of reprioritization of staff work.

FISCAL/RESOURCE IMPACT
Funding for the contract was included in Planning and Development Services Department Adopted Operating Budget. The amount of $24,930 will be absorbed through the department’s FY 2025 operating budget.

STAKEHOLDER ENGAGEMENT
On March 5, 2024, Good City Company along with the City staff conducted a community information session to hear from the community on potential opportunities and constraints for future development near creek and waterways for consideration in the ordinance update. A total of 17 community members attended the virtual information session to provide their input.

Prior to the community information session, Good City Company has contacted and received input from other stakeholders from neighborhood associations and other public agency partners. This input shaped the information provided to the Architectural Review Board on April 4, 2024; and discussed at the August 14, 2024 PTC Study Session.

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A community meeting is scheduled for February 6, 2025, where staff and consultants will present the project timeline and a summary of current staff recommendations. Community feedback on the staff recommendation will be solicited.

ENVIRONMENTAL REVIEW
Approval of this contract is exempt from review under the California Environmental Quality Act (CEQA) pursuant to CEQA Guidelines Section15061(b)(3) because it can be seen with certainty that this action will not have a significant effect on the environment.

ATTACHMENTS
Attachment A: Good City Company Contract S24189598 Amendment No. 2 APPROVED BY:

Jonathan Lait, Planning and Development Services Director ITEM 5 Item 5 Page 3 Packet Page 153 of 582
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Staff Report
From: City Manager
Report Type: CONSENT CALENDAR
Lead Department: Utilities
Meeting Date: February 10, 2025
Report #:2409-3452
TITLE
Approval of Contract Amendment Number Three to Contract Number C21177024 With Veolia Sustainable Buildings USA West, Inc. to Extend the Contract Time Through August 14, 2026 With No Change in the Amount Not-to-Exceed of $1,985,000 for the Commercial & Industrial Energy Efficiency Program. CEQA - Not a Project

RECOMMENDATION
Staff recommends that the City Council approve and authorize the City Manager or their designee to execute Amendment No. 3 to Contract C21177024 with Veolia (Attachment A) for a contract extension of 18 months through August 14, 2026 to continue providing energy efficiency services including optional additional services offerings for the Commercial and Industrial Energy Efficiency Program. This amendment does not revise the not-to-exceed (NTE) amount of $1,985,000 from the original contract.

BACKGROUND
The Commercial & Industrial (C&I) Energy Efficiency Program (CIEEP), administered by Veolia (formerly Enovity), has supported the City of Palo Alto Utilities’ (CPAU) largest commercial customers since its launch in 2009. This program is CPAU's sole initiative for these key customers, who account for almost 80% of the City’s electric sales (this includes master metered multifamily properties and multifamily common area electricity usage). Veolia (service provider) has effectively delivered CIEEP services through marketing, outreach, and technical assistance, playing a critical role in helping CPAU meet its energy savings goals. Excluding green building code savings and electrification project savings, Veolia and other Small Medium Business (SMB) commercial sector contractors contributed approximately 96% of CPAU’s gross electric savings, as detailed in the annual SB1037 Status Report1. 1 SB 1037 Status Report, Annual Report 2022.
https://www.cmua.org/files/2022%20POU%20Energy%20Efficiency%20Report%20Final.pdf ITEM 6 Item 6 Page 1 Packet Page 166 of 582
City Council has adopted several policies to support funding programs that maximize the deployment of cost-effective, reliable, and feasible energy efficiency (EE) measures as outlined in the City’s 10 Year Energy Efficiency Goals (Staff Report # 120682 Updated 10 Year Energy Efficiency Goals2) adopted by Council in 2021. To achieve these energy efficiency goals, the City has partnered with third-party service providers since 2006, expanding services to C&I customers. These partnerships have led to a variety of successful projects, such as building energy management systems, retro-commissioning, lighting upgrades, HVAC system improvements, and industrial process optimization. C&I customers have deliver the most costeffective EE savings within the City’s portfolio and in 2023, the annual EE energy savings delivered by Veolia’s C&I program totaled 372,193kWh, or 59% of all Gross Energy Savings.

In 2022, Council adopted the ambitious goal of reducing the community’s greenhouse gas (GHG) emissions 80% below 1990 levels by 2030 (“80x30” goal) as part of the City’s initial Sustainability and Climate Action Plan, Implementation Work Plan (2023 – 2025) framework3.

To meet the '80x30' goal, the City must reduce natural gas use by prioritizing the electrification of commercial rooftop packaged heating, ventilation, and air conditioning (HVAC) systems.

Additionally, the City is focusing on electrifying its buildings and operations.

There are significant barriers to electrification of commercial buildings, including customer uncertainty about electric technology, shortage of knowledgeable engineers and contractors, high upfront costs, and complexities related to electric service upgrades. Despite these challenges, CIEEP remains essential for supporting C&I customers and achieving the City’s EE and sustainability goals, particularly in the transition off of natural gas to meet S/CAP targets.

ANALYSIS
Council approval of the proposed amendment will enable the City to continue to pursue aggressive energy efficiency and electrification projects with C&I customers extending services through August 14, 2026. The proposed amendment includes a provision for continued services which can provide several benefits including:

1. Project initiation support, including comprehensive decarbonization assessments, engineering designs, and electrification roadmaps; and

2. A mechanism for ongoing support and optimization, which can help drive customer engagement and project adoption.
2 Staff Report #12068 Updated 10 Year Energy Efficiency Goals https://www.cityofpaloalto.org/files/assets/public/v/1/agendas-minutes-reports/reports/city-manager-reportscmrs/year-archive/2021/id-12068.pdf 3 Sustainability Climate Action Plan, Implementation Work Plan (2023 – 2025) https://www.cityofpaloalto.org/City-Hall/Sustainability/SCAP ITEM 6 Item 6 Page 2 Packet Page 167 of 582
Veolia services assist in ensuring CPAU meets state-mandated energy savings and CO2 reduction goals. They deliver certified professional services and in-person assessments that our internal staff cannot provide. The service provides certified energy managers who conduct thorough on-site evaluations, recommend tailored equipment upgrades, and deliver custom reports that drive energy-savings. Beyond traditional recommendations, an emphasis is placed on electrification measures, focusing on replacing aging gas equipment to align with current decarbonization priorities. Retro-commissioning services and post-installation inspections ensure energy-saving projects are executed accurately, with data loggers enabling precise savings calculations. The expertise and tooling required for these services exceeds staff qualifications.

This contract, executed in August 2020, was significantly impacted by COVID-19, as in-person visits are essential to its success. Participation has rebounded, with 20 active projects in the pipeline. Although staff suggests extending the contract term, we do not recommend increasing the original budget or hourly rates. The total contract value is intentionally high to accommodate large-scale projects, which can cost hundreds of thousands of dollars and take years for full implementation. The budget reflects the irregular size and timeline of projects in this sector, and the remaining contract budget is not expected to be fully used.

Veolia has demonstrated exceptional project management skills, ensuring that all projects are executed efficiently and effectively with positive feedback from customers. Notable Projects Completed with Veolia:

Customer Name Installed Project Total Project
kWh Savings
Total Project Therm
Savings
Stanford Medicine
Cancer Center
Air Handling Unit
Controls Upgrade
264,700 64,000
Lucile Packard Children’s
Hospital
Lighting Project 33,500 1,700
The Westin Hotel Ozone Laundry System 14,000 18,000
*The average California household consumes approximately 6,700kwh of electricity and 360 therms of gas annually.

If Council does not approve the proposed amendment, staff will still work to initiate an Request for Proposal (RFP) however, during this time the program for C&I customers would be suspended while a new contract is negotiated. The next RFP will focus on enhancing project workflows and ensuring smooth coordination between Development Services permitting, and Electrical Engineering reviews. A streamlined process will be critical in driving successful electrification implementation.

FISCAL/RESOURCE IMPACT
ITEM 6 Item 6 Page 3 Packet Page 168 of 582
The funding for this contract is available in the FY 2025 Utilities budget and allocated within the existing CIEEP program and funded by Public Benefits4. Council approval of the proposed amendment will have no additional financial impact as the total NTE contact amount of $1,985,000 remains unchanged from the original contract executed on August 16, 2021. As of October 2024, there is approximately $1,580,000 remaining in the original contract C21177024.

STAKEHOLDER ENGAGEMENT
Since August 2021, following the implementation of a contract for a Commercial & Industrial (C&I) program with Veolia, staff and Veolia have actively engaged with customers to gauge their interest in electrification. Initially, customer interest in electrification was low, and this feedback proved invaluable in designing targeted rebates to support equipment electrification.

In October 2021, staff presented an overview of non-residential electrification to the S/CAP Ad Hoc Committee. When City Council identified the conversion of rooftop gas pack units to heat pump HVAC systems as a cost-effective and high-impact measure, staff developed a program tailored to this need, which was presented to the S/CAP Working Group in September 2023.

Since then, staff has conducted workshops for commercial customers and hosted facility manager meetings and trainings, featuring successful electrification projects, electric alternatives, and equipment manufacturers. Staff has also collaborated with neighboring Community Choice Aggregations and utilities, which face similar challenges in the electrification of commercial buildings.

ENVIRONMENTAL REVIEW
The proposed amendment is categorically exempt under the California Environmental Quality Act (CEQA) n under Section 15301 (Existing Facilities) and Section 15304 (Minor Alterations to Land).

ATTACHMENTS
Attachment A: Veolia Contract C21177024, Amendment No. 3 APPROVED BY:

Alan Kurotori, Utilities Chief Operating Officer
Staff: Jesus Prado, Key Accounts Representative
4 Public Benefit: he City of Palo Alto Utilities (CPAU) receives public benefit funds through a combination of state and federal programs, grants, and utility ratepayer contributions. These funds are allocated to support various programs and services aimed at promoting energy efficiency, renewable energy, and assistance for low-income residents including programs for business customers such as CIEEP.

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Staff Report
From: City Manager
Report Type: CONSENT CALENDAR
Lead Department: Utilities
Meeting Date: February 10, 2025
Report #:2407-3199
TITLE
Approval of Amendment Number Three (3) to Contract Number C19174648 with WaterSmart Software, Inc. (dba WaterSmart) for the WaterSmart Utilities Customer Portal, to Extend the Contract Term for 18 Months, for the Total Not-to-Exceed Amount of $537,763 Over the SevenYear Term; CEQA status –Exempt under CEQA Guidelines Section 15308.

RECOMMENDATION
Staff recommends that the City Council approve and authorize the City Manager, or their designee, to execute Amendment No. 3 (Attachment A) to Contract C19174648 with WaterSmart Software, Inc (dba WaterSmart) for the existing WaterSmart Utilities customer portal, to extend the contract term by an additional one year and six months to a 7-year term, and to adopt a new Exhibit C to modify the compensation structure of the contract. No additional financial authority is requested as part of this contract amendment.

EXECUTIVE SUMMARY
Staff is seeking approval for contract amendment No. 3 to extend the WaterSmart contract term 18 months and to modify the compensation structure of the contract. The WaterSmart customer portal provides customers with information about water consumption and personalized water conservation recommendations. Through WaterSmart, home water reports are sent to single-family customers on a monthly basis. WaterSmart helps the City achieve state and local water conservation and efficiency objectives. The 5-year contract was set to end on August 12, 2024. Amendment No. 2 extended the contract term to February 12, 2025. An additional contract extension of one year and six months will allow customers to continue to receive home water reports and access the online portal through August 12, 2026. This contract amendment will have no budget impact and will not increase the Contract NTE. There is sufficient funds to cover the 1 year and 6 months extension.

BACKGROUND
State requirements and Council policies have resulted in aggressive water reduction goals which are largely achieved through conservation and efficiency programs. WaterSmart fully ITEM 7 Item 7 Page 1 Packet Page 178 of 582
launched for City of Palo Alto Utilities (CPAU) customers in November 2022 and is a valuable tool for customers to receive monthly home water reports with personalized water conservation recommendations and view their monthly and hourly water consumption through the online portal. WaterSmart is integrated with the City’s Utility billing portal MyCPAU through a single sign-on feature; this enables customers to view both their billing and consumption data for both energy and water usage by logging in to one portal.

After a public procurement process, the City entered into a 5-year contract with WaterSmart on August 12, 20191. Two amendments to this contract were previously approved, to adjust the payment schedule in Appendix C (March 2022) and authorized a 6-month extension.

WaterSmart’s launch occurred in November 2022, delayed by staffing changes and administrative challenges resulting in two years of full use of contracted services. This Amendment No. 3 would extend the contract term to August 12, 2026allowing for the issuance of an RFP to ensure both the evaluation of tools in the market place and continuity of services similar to the WaterSmart program for CPAU customers.

Since WaterSmart launched in November 2022, 24% of all CPAU customers have accessed the portal and 29% of all single-family customers have accessed the portal. Through this program, home water reports providing benchmarking comparisons are sent to around 11,000 singlefamily customers on a monthly basis. A control group of around 4,000 single-family customers currently do not get reports. The average open rate of home water report emails is 74%. The portal includes a utility analytics dashboard to help track water savings and engagement.

Preliminary results from the efficiency study show that customers receiving home water reports achieve water savings of 3.4% compared to the control group. To date, the City has saved approximately 23.2. MG through the WaterSmart program.

In April 2023, the City launched courtesy alerts through WaterSmart to notify customers of potential leaks based on their monthly billed consumption. In the alert email, customers are prompted to utilize a self-service tool that explains how to find and fix common leaks. In August 2024, WaterSmart was connected to the City’s hourly Advanced Metering Infrastructure (AMI) data. This integration will provide timely leak alerts and high-usage notifications to customers.

ANALYSIS
Staff is dedicated to improving the functionality of the WaterSmart portal to provide customers with easy access to utility information and to help make informed decisions on water usage in order to meet the City’s water conservation goals. Valley Water’s landscape rebate programs and other City incentives are promoted through WaterSmart to target audiences. Targeted emails are also sent through WaterSmart to relay information about upcoming events, new conservation programs, etc.
1 Contract Approved on August 12, 2019 https://www.cityofpaloalto.org/files/assets/public/v/1/agendas-minutesreports/agendas-minutes/city-council-agendas-minutes/00-archive/2019/watersmart-contract.pdf ITEM 7 Item 7 Page 2 Packet Page 179 of 582
Summary of Proposed Contract Terms
Staff recommends extending the term of the current WaterSmart contract by 18 months and updating Exhibit C Compensation. Amendment No. 3 tailors the compensation structure according to software functionality and transactions such as the number of print reports sent.

The proposed annual not-to-exceed amount under Amendment No. 3 is $96,750 per year, this is within the total not to exceed contract amount authorized by Council of $537,763.

Table 1: Amendment No. 3 Exhibit C Compensation
Module/Functionality Q1 Q2 Q3 Q4
Est. Annual
Cost Yrs 6-7
VertexOne Digital Base $4,500 $4,500 $4,500 $4,500 $18,000 VXsmart - $0.80 x 21,000 (total # of
accounts)
$4,200 $4,200 $4,200 $4,200 $16,800
Home Water Reports Base $240 $240 $240 $240 $960
Home Water Reports Variable -
$0.01280 for each account receiving
reports (est. 15,625)
$50 $50 $50 $50 $200
SSO for End Customer Base $3,250 $3,250 $3,250 $3,250 $13,000 SSO for End Customer Variable -
$0.03207 for each account (est. 21,000)
$169 $169 $169 $169 $674
Transactional Fees - Estimated cost of
all transactional fees, plus a buffer
$11,779 $11,799 $11,799 $11,799 $47,116

FISCAL/RESOURCE IMPACT
Funding for this amendment, totaling $53,000, for FY 2025 is available in the FY 2025 Utilities Department Water Funds. Funding for the following years will be evaluated during the annual budget process. Through the City’s cost-sharing agreement with Valley Water, Contract S231859762, Valley Water will reimburse the City up to $25,000/year for Water Reports.

The below table is a breakdown of pricing and remaining contract budget. The City is currently in year six of the contract; the estimated total cost totaling $192,638 will cover the service needs for the remainder of the contract term (18 months). 2 Contract S23185976 https://portal.laserfiche.com/Portal/DocView.aspx?id=66225&repo=r-704298fc ITEM 7 Item 7 Page 3 Packet Page 180 of 582
Table 2: Break Down of Pricing Estimated Total Costs
Total Billed during Contract Year 1 through Q2 Year 6 $345,125 Estimated Total Cost – Q3 Year 6 through Q4 Year 7 (details below) $192,638 • Year 6 Q3 and Q4 Sub Total (Estimated annual cost minus amount services billed Q1 and Q2) (Amendment No. 3)
$53,000
• Year 7 Sub Total (Amendment No. 3) $96,750
• Additional Services Budget Remaining $42,888
Total Contract Not to Exceed $537,763

POLICY IMPLICATIONS
WaterSmart helps the City achieve state and local water conservation and efficiency objectives.

The proposed Amendment No. 3 continues offering the water conservation programs consistent with the 2020 Urban Water Management Plan (Staff Report #12025) 3 , the Utilities
Strategic Plan, and the City’s Sustainability and Climate Action Plan (S/CAP) 4 . In addition,
WaterSmart helps the City meet the requirements outlined in the agreement with Valley Water, Contract S23185976 (Staff Report # 2304-13805), which provides funding for AMI and water reports.

STAKEHOLDER ENGAGEMENT
Palo Alto markets the WaterSmart program though the City’s websites, at community events, via bill inserts, other social media, and newsletters.

ENVIRONMENTAL REVIEW
Council’s approval of this term agreement for subscription licensing and professional services supporting water conservation is categorically exempt from the California Environmental Quality Act (CEQA) review under CEQA Guidelines section 15308 because it is an action for the protection of the environment.

ATTACHMENTS
Attachment A: WaterSmart Software, Inc. Contract C19174648 Amendment No. 3 APPROVED BY:

Kiely Nose, Interim Utilities Director
Staff: Linda Grand, Utilities Programs Administrator
3 Staff Report #12025 https://www.cityofpaloalto.org/files/assets/public/agendas-minutes-reports/reports/citymanager-reports-cmrs/year-archive/2021/id-12025.pdf 4 S/CAP https://www.cityofpaloalto.org/files/assets/public/v/1/sustainability/reports/2023-2025-scap-workplan_final.pdf 5 Staff Report #2304-1380 https://portal.laserfiche.com/Portal/DocView.aspx?id=66225&repo=r-704298fc ITEM 7 Item 7 Page 4 Packet Page 181 of 582
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Staff Report
From: City Manager
Report Type: CONSENT CALENDAR
Lead Department: Utilities
Meeting Date: February 10, 2025
Staff Report #:2412-3844
TITLE
Adoption of a Resolution Authorizing the City Manager to Approve the Verified Emission Reduction (VER) Master Agreements with AQC Environmental Brokerage Services, Inc. and SCB Brokers, LLC and Authorizing the City Manager to Purchase VERs from AQC Environmental Brokerage Services, Inc. and SCB Brokers, LLC Under Specified Terms and Conditions During Calendar Years 2025 Through 2034, Inclusive, Subject to Limitations; CEQA Status: Not a Project, CEQA Guidelines 15378(b)(5)

RECOMMENDATION
Staff recommends that the City Council adopt the attached resolution (Attachment A):

1. Authorizing the City Manager, or their designee, to execute the Verified Emission Reduction (VER) Master Agreements with AQC Environmental Brokerage Services, Inc. (Attachment B) and SCB Brokers, LLC (Attachment C); and

2. Authorizing the City Manager, or their designee, to purchase a portion of the City’s VER requirements from AQC Environmental Brokerage Services, Inc. and SCB Brokers, LLC under specified terms and conditions during calendar years 2025 through 2034, inclusive, subject to the following limitations:
a. The maximum aggregate transaction limit under these Master Agreements shall be $10 million per counterparty;
b. All transactions are subject to the Palo Alto Municipal Code; and c. All transactions are subject to the City’s Energy Risk Management Policy, Guidelines and Procedures;

EXECUTIVE SUMMARY
To implement the Council-approved Carbon Neutral Natural Gas Plan (Resolution 9649), the City must purchase an annual quantity of VERs (commonly referred to as carbon offsets) equal to the greenhouse gas emissions caused by natural gas use by City gas utility customers. In August 2017 Council adopted a Standard Form VER Master Agreement (Resolution 97031 ). The
1 Resolution 9703 https://www.cityofpaloalto.org/files/assets/public/v/1/city-clerk/resolutions/reso-9703.pdf ITEM 8 Item 8 Page 1 Packet Page 198 of 582
Standard Form VER Master Agreement is available to all VER suppliers for execution with nonsubstantive changes, and agreements with specific suppliers including maximum expenditures and transaction term limits are to be presented to Council for approval.

AQC Environmental Brokerage Services, Inc. and SCB Brokers, LLC have agreed to the terms and conditions of the Standard Form VER Master Agreement. The proposed resolution authorizes the City Manager to execute those agreements and purchase VERs under the agreements within a maximum expenditure and transaction term limits, and increases the pool of approved VER suppliers.

BACKGROUND
Palo Alto Municipal Code Section 2.30.340 (Contracts for Wholesale Utility Commodities) allows for the use of master agreements to buy and/or sell electricity, gas and related services through various preapproved (“enabled”) suppliers. Contracts or transactions executed under Council-approved master agreements must be done in accordance with the City’s Energy Risk Management Policy, Guidelines and Procedures.

On August 15, 2016, Council approved an ordinance modifying the Municipal Code to streamline the purchase and sale of wholesale utility commodities and services and to allow for a Council-approved standard form master agreement (August 15, 2016 City Attorney Report2). The ordinance modified Municipal Code Section 2.30.140 clarifying the process to enable suppliers by specifically allowing the use of a standard form master agreement that contains the City’s minimum contract terms and conditions. Execution of standard form master agreements and delegation of authority to transact under the standard form master agreements with specific suppliers is subject to Council approval. This process is used when contracting for natural gas.

In December 2016, Council adopted Resolution 96493 approving a Carbon Neutral Natural Gas Plan (Plan) to achieve carbon neutrality for the gas supply portfolio by FY 2018 using highquality carbon offsets (VERs) with a cost cap of 10 cents per therm. Implementation of the Plan requires executing contracts to enable the City to purchase VERs from approved suppliers.

In August 2017 Council adopted a Standard Form VER Master Agreement (Resolution 9703), making it available to all VER suppliers for execution with non-substantive changes.

In December 2020 Council adopted Resolution 99304, amending the Carbon Neutral Gas Plan.

The amended plan limited the purchase price of offsets to $19 per ton CO2e, consistent with 2 August 15, 2016 City Attorney Report https://www.cityofpaloalto.org/files/assets/public/v/1/agendas-minutesreports/reports/city-manager-reports-cmrs/year-archive/2016/sr-7093-mini-packet.pdf 3 Resolution 9649 https://www.cityofpaloalto.org/files/assets/public/v/1/city-clerk/resolutions/reso-9649.pdf 4 Resolution 9930 https://www.cityofpaloalto.org/files/assets/public/v/1/city-clerk/resolutions/resolutions-1909- to-present/2020/reso-9930.pdf
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the original maximum 10 cents per therm rate impact, clarified the allowable offset vintages consistent with state Cap and Trade requirements, and clarified the preference for projects located in California.

ANALYSIS
Maintaining a set of active counterparties is essential to achieving competitive pricing. The Standard Form VER Master Agreement is available for potential VER suppliers for execution with non-substantive changes. Per Resolution 9703 approving the Standard Form VER Master Agreement, Master Agreements with specific VER suppliers must include maximum expenditures and transaction term limits and must be approved by Council. The VER suppliers AQC Environmental Brokerage Services, Inc. and SCB Brokers, LLC have agreed to the terms and conditions of the Standard Form VER Master Agreement. The proposed resolution (Attachment A) authorizes the City Manager to execute those agreements and purchase VERs under the agreements within a maximum expenditure and transaction term limits. Current approved VER counterparties include 3Degrees, ACT Commodities, Anew, CarbonFund, and ClimeCo. Adding the two recommended counterparties will increase the likelihood of receiving multiple bids and competitive pricing for the City’s carbon offset needs.

All transactions under the VER Master Agreements will be executed in accordance with the Council-approved Energy Risk Management Policy. The FY2026 budget estimate for the program is $1.9 million which is based on a $13.50 per ton CO2e carbon offset price. If the carbon offset price exceeds the Council-approved maximum of $19 per ton CO2e, the program will need to be modified by Council or terminated. Staff recommends a maximum aggregate transaction limit of $10 million per counterparty, which is consistent with the limits applied to the City’s other VER counterparties.

Adoption of the proposed resolution conforms to the Council-approved Energy Risk Management Policy and the Palo Alto Municipal Code. Further, the recommendation is consistent with the Council-approved Carbon Neutral Gas Plan, the Gas Utility Long-term Plan and the Utilities Strategic Plan objective to manage supply cost by negotiating supply contracts to minimize financial risk.

FISCAL/RESOURCE IMPACT
Funding for the purchase of VERs is available in the FY 2025 Gas supply budget. Funding for the purchase of VERS in subsequent years will be subject to the annual budget process and appropriation of funds.

STAKEHOLDER ENGAGEMENT
Utilities staff worked with the City Attorney’s Office in 2017 to develop the City’s Standard Form VER Master Agreement. If the proposed resolution is adopted by Council, Staff will submit ITEM 8 Item 8 Page 3 Packet Page 200 of 582
the VER Master Agreements with AQC Environmental Brokerages Services, Inc. and SCB Brokers, LLC to the City Manager for execution.

ENVIRONMENTAL REVIEW
Council’s adoption of the attached resolution authorizing the City Manager to approve the VER Master Agreements with AQC Environmental Brokerage Services, Inc. and SCB Brokers, LLC and authorizing the City Manager to purchase VERs from AQC Environmental Brokerage Services, Inc. and SCB Brokers, LLC is not subject to California Environmental Quality Act (CEQA) review as it is an administrative governmental activity that will not result in any direct or indirect physical change to the environment (CEQA Guidelines 15378(b)(5)). Future CEQA review will occur, if necessary, based on the relevant lead agency’s analysis of any impacts from any offset projects that are developed.

ATTACHMENTS
Attachment A: Resolution Approving the VER Master Agreements and Authorizing the City Manager to Purchase VERs
Attachment B: VER Master Agreement with AQC Environmental Brokerage Services Attachment C: VER Master Agreement with SCB Brokers, LLC APPROVED BY:

Kiely Nose, Interim Utilities Director
Staff: Jason Huang, Resource Planner
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Staff Report
From: City Manager
Report Type: CONSENT CALENDAR
Lead Department: Planning and Development Services
Meeting Date: February 10, 2025
Report #:2409-3487
TITLE
Approval of Professional Services Contract Number C25189597 with Rutherford & Chekene in an Amount Not to Exceed $207,812 for Development of a Seismic Hazard Identification and Mitigation Program for a Period of Three Years. CEQA Status: Exempt under CEQA Guidelines 15262.

RECOMMENDATION
Staff recommends that Council approve and authorize the City Manager or designee to execute Contract No. C25189597 (Attachment A), with Rutherford & Chekene, to update and advance the Seismic Hazards Identification and Mitigation Program for a term of three years and a total amount not-to-exceed $207,812, including $188,920 for basic services and $18,892 for additional services.

BACKGROUND
The City’s efforts to mitigate seismic risks in vulnerable buildings date back to the 1986 adoption of the Seismic Hazards Identification Program, codified in Chapter 16.42 of the Palo Alto Municipal Code.1 This ordinance required mandatory evaluations and encouraged voluntary retrofits, successfully addressing unreinforced masonry structures. However, advancements in seismic science and lessons from recent seismic events in California highlight the need for more comprehensive measures.

In April 2017, a comprehensive Seismic Risk Assessment Study by Rutherford & Chekene identified five additional vulnerable building types and estimated potential seismic losses if no action were to be taken. Recommendations included mandatory retrofits for certain building categories, incentives for property owners, and updates to disclosure measures. These findings laid the groundwork for future policy enhancements.
1 Palo Alto Municipal Code, Chapter 16.42: https://codelibrary.amlegal.com/codes/paloalto/latest/paloalto_ca/0- 0-0-74168
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In October 2017, the City Council directed staff to refine the seismic inventory, assess community impacts, and explore program options, disclosures, and incentives.2 This marked an important step toward expanding the seismic retrofit program, with a focus on addressing soft-story woodframe buildings, tilt-up construction, and other high-risk structures. The project was later deprioritized to advance other work including the City’s pandemic response.

In August 2023 the Policy & Services Committee received a status update and reviewed initial policy considerations from the 2016 Seismic Risk Assessment Study by Rutherford & Chekene report.3 Concepts included consideration of mandatory seismic evaluations for an expanded list of vulnerable building types, alignment with modern best practices, and lessons learned from other jurisdictions. The risk assessment reflected years of study, community engagement, and policy refinement that reflected the City’s interest in reducing seismic risks and improving the safety and resilience of Palo Alto’s built environment. The Committee expressed support for the recommendations and was in alignment with staff’s proposed next steps as outlined by staff. The subject contract has not been reviewed by the Policy & Services Committee but reflects its prior discussion and is being presented to the City Council for action.

ANALYSIS
In May 2024, staff advanced work toward seeking proposals from qualified firms to provide services to customize a seismic hazard identification and risk mitigation program for seismically vulnerable buildings. A request for proposals (RFP) for the project was posted on OpenGov, the City’s eProcurement platform, and 3,119 vendors were notified. The solicitation period was posted for 58 days and two proposals were received. The solicitation closed on June 27, 2024.

Table 1: Summary of Request for Proposal
Proposal Description RFP 189597 Seismic Hazard Identification & Risk Mitigation Program
Proposed Length of Project Three Years
Number of Vendors Notified 3,119
Number of Proposal Packages Downloaded 37
Total Days to Respond to Proposal 58
Pre-Proposal Meeting N/A
Pre-Proposal Meeting Date N/A
Number of Proposals Received 2
Proposal Price Range $332,000 - $379,470
Public Link to Solicitation https://procurement.opengov.com/portal/paloalto-ca/projects/94858/document 2 City Council, October 16, 2017; Agenda Item #12, SR #8207, https://www.cityofpaloalto.org/files/assets/public/v/1/agendas-minutes-reports/reports/city-manager-reportscmrs/year-archive/2017/id-8207-seismic.pdf 3 Policy & Services Committee, August 8, 2023; Agenda Item #2, https://cityofpaloalto.primegov.com/Portal/viewer?id=2677&type=0 ITEM 9 Item 9 Page 2 Packet Page 240 of 582
The proposals were evaluated and determined to be responsive to the criteria identified in the RFP. Rutherford & Chekene was selected because of the quality and effectiveness of their services, the experience of their field staff, prior record of performance with the City, and their ability to provide future services.

The proposed contract, totaling $207,812 including optional additional services of $18,892, reflects the scope of services necessary to advance the City’s seismic hazard identification and mitigation efforts. Funding in the amount of $216,000 has been reappropriated from prior City Council funding allocated in the FY 2024 budget.

The proposed work builds upon the findings of the 2016 Seismic Risk Assessment Study by refining and updating the inventory of potentially vulnerable buildings. While the previous study provided a broad assessment of at-risk structures, this phase will focus on validating and expanding that data to ensure accuracy in identifying buildings that may require retrofitting.

Rutherford & Chekene will also develop a seismic hazard identification and mitigation ordinance, transitioning from risk assessment to regulatory action. This ordinance will outline potential retrofit requirements and establish a structured framework for improving seismic resilience.

In addition to technical analysis, this phase will include an in-depth evaluation of retrofit techniques, financing options, and tenant displacement policies to determine which measures should be mandatory versus voluntary. This ensures that policy recommendations balance public safety with economic feasibility for property owners. Community stakeholders, including building owners, tenants, and industry professionals, will be engaged throughout the process to refine and tailor policy recommendations to Palo Alto’s specific needs. This collaborative approach supports a final ordinance that is practical and effective in enhancing the city’s seismic preparedness.

While the Planning and Development Services Department has expertise in managing seismicrelated projects, the complexity of this effort—particularly in technical policy development, stakeholder engagement, and detailed engineering analysis—requires specialized expertise that exceeds current in-house capacity. This approach allows City staff to focus on leveraging strengths in project management and community engagement while gaining access to advanced technical analysis through the consultant.

Rutherford & Chekene will work closely with City staff to integrate local knowledge into the project. Regular check-ins and coordination meetings will ensure that the consultant remains informed of Palo Alto’s unique needs and conditions. This collaboration will be documented through updates provided to the City Council.

City staff will support the project by conducting preliminary data collection, coordinating stakeholder engagement, and managing community outreach, allowing the consultant to focus on technical and policy aspects of the program. Finally, Rutherford & Chekene will implement ITEM 9 Item 9 Page 3 Packet Page 241 of 582
program management tools and establish a long-term framework for seismic hazard mitigation that ensures long-term effectiveness.

To clarify the deliverables, the work produced by Rutherford & Chekene will include an updated inventory of vulnerable buildings, a draft seismic hazard identification and mitigation ordinance, and an analysis of retrofit techniques, financing options, and tenant displacement policies. These deliverables will provide the foundation for staff recommendations to the Council, guiding decisions on mandatory versus voluntary retrofit measures and policy implementation strategies.

Staff will critically evaluate these deliverables to ensure they align with Council priorities, community needs, and feasibility considerations. If discrepancies arise or further refinements are needed, staff will collaborate with the consultant and key stakeholders to adjust recommendations before presenting them to the Council for consideration.

These efforts serve to mitigate seismic risks in vulnerable buildings by reducing seismic risks for both the short- and long-term. By proactively addressing building vulnerabilities and refining policies around retrofitting, tenant displacement, and financial feasibility, the City will enhance public safety, protect property, and ensure that any necessary retrofitting is conducted in a financially viable and equitable manner. This project will enhance protections against seismic events while establishing a structured and sustainable approach to long-term resilience.

FISCAL/RESOURCE IMPACT
Funding of $216,000 has been reappropriated from prior City Council funding in the Fiscal Year 2024 budget. Staff will monitor expenditures closely and will report any significant changes to the budget as part of the quarterly budget review process.

STAKEHOLDER ENGAGEMENT
Professional planners and managers in the Planning and Development Services Department participated in the development of this recommendation. Previous discussions and recommendations from the Policy & Services Committee informed this process. The project will actively involve diverse community stakeholders through advisory group meetings, public presentations, and stakeholder workshops. Specific efforts will focus on engaging property owners of vulnerable building types, tenants impacted by potential retrofits, and local experts in seismic resilience. Feedback from these groups will be considered in policy recommendations.

ENVIRONMENTAL REVIEW
Approval of this contract is exempt from environmental review under California Environmental Quality Act (CEQA) Guidelines Section 15262, because it authorizes only a feasibility or planning study for possible future actions that have not yet been approved or adopted.

ATTACHMENTS
Attachment A: Contract No. C25189597 with Rutherford & Chekene APPROVED BY:

Jonathan Lait, Planning and Development Services Director ITEM 9 Item 9 Page 4 Packet Page 242 of 582
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Staff Report
From: City Manager
Report Type: CONSENT CALENDAR
Lead Department: Utilities
Meeting Date: February 10, 2025
Staff Report: 2407-3222
TITLE
Approval of Two Professional Service Agreements: Contract No. C25190944A with 4Leaf, Inc. and Contract No. C25190944B with Park Engineering, Inc in the Aggregate Amount Not-toExceed $3.75 Million for a Period of Five Years for On-Call Field Inspections and Construction Management Services to Support Utilities Water, Gas, and Wastewater Capital Improvement Projects; CEQA Status: Not a project.

RECOMMENDATION
Staff recommends that the City Council approve and authorize the City Manager or designee to execute two professional service agreements with the following service providers in the combined total amount not-to-exceed $3.75 million for a period of five years for on-call field inspections and construction management services for Water, Gas, and Wastewater Capital Improvement Projects:
1) Contract No. C25190944A with 4Leaf, Inc. (Attachment A), and 2) Contract No. C25190944B with Park Engineering, Inc. (Attachment B)

EXECUTIVE SUMMARY
The current total cost projections for water, gas, and wastewater (WGW) main replacement capital improvement projects (CIPs) is $14 million per year for over the next five years, in addition to $14 million for two water reservoir storage tank upgrade projects expected within the next five years. These projects will require construction staffing resources with specific utility expertise, and generally, a total of 10% of each Utilities Department CIP total project cost is budgeted for internal or external field inspections and construction management. These oncall services contracts will provide construction management and inspection services when there is insufficient internal staff available. This will allow the Utilities Department to add resources to efficiently manage workloads, uphold a high level of service to residents and businesses, and use resources with specialized expertise on complex projects.

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The requested Council approval is for an aggregate not-to-exceed amount of $3.75 million over five years in construction management and field inspection services needed to support the WGW CIPs described above, to be distributed between the two on-call professional service agreements. Staff anticipates WGW main replacement projects will use up to $750,000 annually; however, multiple WGW projects may be ongoing in the same year so these are noted as estimates, not an annual cap. The work will be assigned based on each contracting firm’s hourly rates, staff availability, and specialized expertise, with City staff executing a CIP-specific Task Order under the appropriate contract. Each contract includes a five-year extension option.

Council approval is required for exercising any of these options.

BACKGROUND
The City of Palo Alto owns, operates, and maintains a full suite of utilities for its residents and businesses. The utilities include a potable water distribution and transmission system, a natural gas distribution system, a wastewater collection system, and electrical and fiber optic distribution systems. The Utilities Department invests in CIPs to ensure future reliability of the utility systems, enhance operational safety, and minimize maintenance costs.

Capital improvement construction projects require full-time inspection and construction management to ensure work performed by contractors complies with Utility Standards, engineered plans, and federal and state regulations. The daily responsibilities of the engineering inspectors and construction management include ensuring safety practices are followed and traffic controls are in place as approved, creating record drawings of the utility improvements for Geographic Information System (GIS) updates to aid in future designs and avoid damage during future excavations, and collaborating with utility project managers to ensure project delivery is on time and within budget.

The Utilities Department anticipates a peak in WGW CIP workload in coming years that exceeds engineering staffing resources for field inspection and construction management. These projects will require contract inspectors and construction managers with utility-specific experience when there is insufficient internal staff. Occasionally, some projects, such as the Water Reservoir Storage Tank Upgrade and Rebuild Project or Arastradero Creek Restoration Project, will require inspectors or construction managers with specialized expertise. Having two on-call field inspection and construction management services contracts for WGW CIPs will allow the Utilities Department flexibility to use external resources to provide additional coverage for inspection, construction management, and other professional services, and to assign work based on which firm has the appropriate expertise and availability.

When soliciting contract inspectors or construction managers for a specific CIP, staff contacts each company and requests qualified staffing for the project. Candidate resumes are provided by each company for available personnel with the requested experience. Staff evaluates each resume and the candidate’s availability compared to when the project is anticipated to start. If a candidate is not available, staff can move around internal resources or delay the project until ITEM 10 Item 10 Page 2 Packet Page 272 of 582
a qualified candidate is available. Having two companies under contract allows flexibility to onboard a qualified candidate and ensure the CIP starts on time with qualified staff.

The agreements with 4Leaf, Inc. and Park Engineering Inc. will replace the current five-year agreements with 4Leaf, Inc. and Park Engineering, Inc. that are set to expire in February 2025 (Council Report ID # 108781).

ANALYSIS
Generally, a total of 10% of Utilities’ CIP total project cost is budgeted for internal or external field inspections and construction management. Currently the WGW division has three (3) fulltime inspectors that provide oversight of construction activities performed by contractors on WGW CIP projects. However, depending on the number of projects underway at a given time, these on-call contracts are necessary to provide adequate project inspection and construction management for upcoming projects that require specialized utility experience and to support multiple concurrent CIPs.

Summary of Solicitation Process
A Request for Proposal (RFP #1909442) for on-call field inspection and construction management services across WGW, electric, and fiber divisions, was issued via OpenGov on June 4, 2024. A total of 3,258 providers were notified in the City’s electronic procurement system. At the end of the advertisement period, two proposals for WGW CIPs were received from 4Leaf, Inc. and Park Engineering, Inc. The criteria in selecting the firms include experience in working on WGW projects, sufficient staffing, cost to the City, quality of the proposal, and prior record of performance with the City or other agencies. Staff verified the criteria and proposals of the firms to be satisfactory. A third firm, CMI Contractors, Inc., responded for the electric and fiber services, which will come before Council separately. 4Leaf, Inc. and Park Engineering, Inc. have established performance records working on City WGW CIP and non-CIP projects under existing On-Call Inspection contracts, which expire on February 28, 2025 (Council Report ID # 10878).

Staff recommends the contracts be awarded to 4Leaf, Inc. and Park Engineering, Inc to ensure the availability of experienced staff when needed. On-call services will be assigned on a Task Order basis depending on which contractor has the staffing availability and relevant expertise for an upcoming City WGW CIP. When services are needed, the City will contact the firms regarding their availability to perform the necessary work and request project-specific proposals and resumes for proposed staff. Individual Utilities project managers will be responsible for evaluating the adequacy of each Task Order’s proposed scope of work, reviewing the experience and billing rates of proposed staff with a project team, ensuring 1 Council Report ID # 10878 https://www.cityofpaloalto.org/files/assets/public/v/1/agendas-minutesreports/reports/city-manager-reports-cmrs/year-archive/2020/id-10878-mini-packet-02.10.20.pdf?t=40116.21 2 RFP #190944 https://procurement.opengov.com/portal/palo-alto-ca/projects/98927 ITEM 10 Item 10 Page 3 Packet Page 273 of 582
appropriately qualified staff are assigned to each Task Order, and managing each Task Order budget. To provide checks and balances, the Utilities’ Strategic Business Manager and their team will assist in overall contract management ensuring activities remain withing authorized levels.

Table 1: Summary of Request for Proposal
Proposal Title
On-Call Field Inspection and Construction
Management Services for Utilities
Proposal Number 190944
Proposed Length of Project 10 Years
# of Notices sent to Providers via City’s
eProcurement System (OpenGov)
3,258
# of RFP Packages Downloaded by Firms 52
Total Days to Respond to Proposal 15 Calendar Days
Pre-Proposal Teleconference June 13, 2024
# of Company Attendees at Pre-proposal Meeting 9
# of Proposals Received 3
Range of Cost Proposals
Field Inspector:
$151.82/hour to
$184.51/hour
Construction Manager:
$170.89/hour to
$256.91/hour
Company Name Location (City, State)
Park Engineering, Inc. 372 Village Square, Orinda, CA 94563 4Leaf, Inc. 2126 Rheem Drive, Pleasanton, CA 94588
Public Link to Solicitation OpenGov System-Solicitation Information A total not to exceed amount of $3.75 million is being requested for a five-year contract term to support the upcoming utility capital improvement projects. When the City plans WGW CIP construction, a task order with a specific dollar amount for that project will be issued to one of the two firms with the most available and qualified individuals at the time of request. In the event specialized experience or knowledge is required, Park Engineering has included pricing to subcontract work to ensure the City receives the required experience on specialized projects, which results in a larger range in hourly costs in the table above.

FISCAL/RESOURCE IMPACT
Funding for these contracts will be allocated as needed up to a not-to-exceed amount of $3.75 million to be distributed between the two professional service agreements for WGW inspection and construction management services over the initial term of five years. Staff anticipates WGW replacement projects will use up to $750,000 annually. There is sufficient funding budgeted in FY 2025 in the WGW capital improvement projects, examples are listed in the table below. Funding for future years of these contracts and capital projects is subject to the annual budget process and Council appropriation of funds.

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Utility
Project
Number Project Title
Adopted FY25
Budget
Electric EL-19002 Colorado Substation Site Improvements $1,138,394 Water WS-09000 Water Tank Seismic Upgrade and Rehabilitation $1,037,832

STAKEHOLDER ENGAGEMENT
The evaluation committee formed by staff in water, gas, wastewater, electric and fiber engineering reviewed the submitted proposals. This staff report addresses only the WGW services contracts. The evaluation of upcoming projects and future needs of on-call inspection and construction management personnel was coordinated.

ENVIRONMENTAL REVIEW
City Council approval of these on-call professional services contracts is not a project under CEQA, as an administrative and organizational activity of government that will not result in direct or indirect physical changes in the environment (14 CCR 15378(b)(5)). CEQA evaluations will be performed prior to Council approval of any specific CIP construction contract for which these professional construction management and field inspection services would be assigned.

ATTACHMENTS
Attachment A: Contract with 4Leaf; Contract C25190944A
Attachment B: Contract with Park Eng; Contract C25190944B APPROVED BY:

Kiely Nose, Interim Director of Utilities
Staff: Matt Zucca, Assistant Director of WGW Utilities
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Staff Report
From: City Clerk
Report Type: CONSENT CALENDAR
Lead Department: City Clerk
Meeting Date: February 10, 2025
Report #:2410-3619
TITLE
Adoption of a Resolution Amending the Conflict of Interest Code for Designated City Officers and Employees as Required by the Political Reform Act and Regulations of the Fair Political Practices Commission and Repealing Resolution Number 9937. CEQA Status -- Not a Project

RECOMMENDATION
It is recommended that Council adopt a resolution amending the City’s Conflict of Interest Code of Non-Elected Officials and Designated employees, repealing Resolution 9937.

BACKGROUND
California law requires public officials, both elected and non-elected, to disclose their financial interests to the public. This includes elected officials like Councilmembers and non-elected officials like the City Manager and City Treasurer, as outlined by Government Code Section 87200. Other non-elected officials, such as management staff and consultants, are designated by the agency’s Conflict of Interest Code and must disclose if they have financial decisionmaking authority.

These disclosures, filed through Form 700, alert the public to any personal financial interests that may be impacted by the official’s duties. Form 700 is filed when taking office, annually, and upon leaving office.

On January 11, 2021, City Council adopted Resolution 9937 amending the Conflict of Interest Code designated for City Officers and Employees as required by the Political Reform Act and Regulations of the Fair Political Practices Commission and repealed Resolution No. 9800.

ANALYSIS
The Political Reform Act requires the City review its Conflict of Interest Code every two years.

Chapter 2.09 of the Palo Alto Municipal Code and the Political Reform Act require the City to adopt a list of designated positions and disclosure responsibilities for each position subject to the Conflict of Interest Code for Designated Employees. Disclosure statements from designated positions are due annually each April and within 30 days of a person either assuming or leaving ITEM 11 Item 11 Page 1 Packet Page 340 of 582
a designated position. The attached Resolution amends the City’s Conflict of Interest Code to update the list of designated positions to reflect administrative changes, including title changes and positions added or deleted from the Table of Organization. The attached Resolution (Attachment A) includes the Disclosure Categories and Definitions in Appendix B and resources for Statement of Economic Interests filers in Appendix C.

The last review and update of the Conflict of Interest Code occurred in January 2021.

Accordingly, the City Council is required to approve an update to the code. The following is a summary of the proposed updates, based upon review by City staff:

Addition of positions and/or divisions that will be involved in financial decision making:

HUMAN RESOURCES
• Human Resources Representative
• Manager, Recruitment Division

INFORMATION TECHNOLOGY
• Assistant Director, Information Technology

PLANNING & DEVELOPMENT SERVICES
• Supervisor of Code Enforcement
• Senior Building Inspector

PUBLIC WORKS
Administration Division
• Assistant Director of Climate Action and Sustainability • Management Analyst
Office of Sustainability (additional division)
• Sustainability Programs Administrator

OFFICE OF TRANSPORTATION
• Coordinator Transportation Systems Management

UTILITIES
Administration
• Principal Utilities Program Manager
• Utilities Safety Officer
• Utilities Systems Analyst
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Engineering Division to Electric Engineering & Operating Division (revision) • Manager Electric Operations
Water-Gas-Wastewater Engineering & Operations Division (additional division) • Assistant Director Utilities W-G-W
• Manager Utilities Operations W-G-W
• Engineering Manager W-G-W
• Senior Project Engineer
• Utilities Supervisor
Palo Alto Fiber (additional division)
• Assistant Director Fiber
• Manager, Telecommunications
• Manager, Information Technology
Revision of Titles:

FIRE DEPARTMENT
• Deputy Chief/Fire Marshal to Fire Marshal

LIBRARY DEPARTMENT
• Assistant Director, Libraries Services to Division Head, Operations

UTILITIES DEPARTMENT
Resource Management Division
• Asst Dir Ut/Res Mgmt to Assistant Director, Resource Management Electric Engineering & Operating Division
• Assistant Director Utilities Engineering to Assistant Director, Utilities, Electric, and Fiber • Senior Engineer – U (Senior Project Engineer) to Utilities Supervisor Deletion of positions and/or divisions:

CITY ATTORNEY
• Management Specialist (Attorney)
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UTILITIES
Electric Engineering & Operating Division
• Engineering Manager Water Gas Wastewater
• Manager, Utilities Telecommunications
• Supervising Electric Project Engineer
Operations Division (deletion of division)
There are no updates to the disclosure categories.

Appendix C Resources was updated with new electronic filing system (eFile) information as well as links to the FPPC reference pamphlet and Form 700 Disclosure FAQs.

FISCAL/RESOURCE IMPACT
There are no significant Fiscal/Resource impacts related to this item. The law mandates that every local government agency review its Conflict of Interest Code every two years to determine if any amendments are needed. The cost related to processing the Statements of Economic Interests are part of the City Clerk Department budget.

STAKEHOLDER ENGAGEMENT
Staff collaborated with Human Resources Department on the proposed changes and the attached update to the Conflict of Interest Code was circulated to department heads for confirmation of changes. Updates and edits are reflected in the attached draft resolution.

ENVIRONMENTAL REVIEW
This action is not a project under section 15378 (b)(25) of the California Environmental Quality Act Guidelines (administrative activities that will not result in direct or indirect physical change in the environment).

ATTACHMENTS
Attachment A: Resolution approving an update of Conflict of Interest Code and Appendix "A" Designating Positions Red-Lined
Attachment B: Local Agency Biennial Notice
APPROVED BY:

Mahealani Ah Yun, City Clerk
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Staff Report
Report Type: CONSENT CALENDAR
Lead Department: City Clerk
Meeting Date: February 10, 2025
Report #:2501-4054
TITLE
SECOND READING: Ordinance of the Council of the City of Palo Alto Amending Various Chapters of Title 18 (Zoning) of the Palo Alto Municipal Code to Implement the 2023-2031 Housing Element (FIRST READING: January 21, 2025 PASSED 7-0)

BACKGROUND
The City Council heard this item on January 21, 2025 for a first reading and approved it on the following votes. No changes were made to the ordinance, and it is now before the City Council for a second reading.

MOTION: Councilmember Burt moved, seconded by Councilmember Stone to adopt of Sections 1, 2, and 9 through 11, inclusive, of the proposed ordinance amending various chapters of Title 18 (Zoning) of the Palo Alto Municipal Code to implement the 2023-2031 Housing Element, regarding Housing Element Program 1.5A (Stanford University Lands).

MOTION PASSED: 6-0-1, Veenker recused
MOTION: Councilmember Stone moved, seconded by Mayor Lauing to adopt sections 1 and 3 through 11, inclusive, of the proposed ordinance amending various chapters of Title 18 (Zoning) of the Palo Alto Municipal Code to implement the 2023-2031 Housing Element, regarding Housing Element Programs 3.6D (Expedited Project Review), 4.1A (Replacement Housing), and

6.5C-G (Alternate Housing), and amending Title 21 (Subdivision and Other Divisions of Land) to incorporate changes as directed by Housing and Community Development (HCD) related to Senate Bill 9 implementation.

MOTION PASSED: 7-0

ATTACHMENTS
Attachment A - Ordinance of the Council of the City of Palo Alto Amending Various Chapters of Title 18 (Zoning) of the PAMC to Implement the 2023-2031 Housing Element APPROVED BY:

Mahealani Ah Yun, City Clerk
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Staff Report
From: City Manager
Report Type: ACTION ITEMS
Lead Department: Administrative Services
Meeting Date: February 10, 2025
Report #:2411-3806
TITLE
Approval of the FY 2024 Public Improvement Corporation’s Annual Financial Report; CEQA Status: Not a Project

RECOMMENDATION
Staff recommends that the Board of Directors of the Palo Alto Public Improvement Corporation (PIC) approve the FY 2024 Annual Financial Report for the Palo Alto Public Improvement Corporation.

BACKGROUND
The PIC is a nonprofit corporation formed by the City in 1983, allowing the City to issue Certificates of Participation (COPs) to fund capital improvements. The PIC, through a lease structure, finances the acquisition, improvement, and construction of City facilities. The PIC uses the lease payments by the City’s General Fund to pay the debt service on the COPs. On July 13, 1998, Council adopted a resolution establishing itself as the Board of Directors of the PIC.

The bylaws of the PIC require the Board of Directors of the Corporation to meet at least annually and approve the annual financial report for the Corporation. Therefore, the City Council is required to meet annually as the Board of the PIC.

In 1983 and 1998, the City of Palo Alto issued COPs to fund improvements to the Civic Center and the Golf Course, respectively. In 2002, the Civic Center bonds were refinanced due to a lower interest rate environment and COPs were issued to finance the construction of commercial space adjacent to the new parking structure on Bryant/Florence Street. These bonds (referred to as the Downtown Parking Improvement bonds or 2002B COP) were used to build a two story above-ground structure of approximately 7,638 square feet at 445 Bryant Street, which was previously leased to a commercial tenant (operating as a gym). The building is in the process of transitioning into a community center, including future use by La Comida de California to host a senior nutrition program on a part-time basis.

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In fiscal year 2018, the City issued the 2018 Capital Improvement Project and Refinancing COPs in the amount of $9 million to refinance the 2002B COPs ($0.6 million) and to finance renovations for the Palo Alto Municipal Golf Course ($8.4 million). Fire Station 1 was used as the leased property and collateral for these COPs since it had a market value closer to the COPs issuance amount. The net present value savings of $0.2 million or 6.47 percent on the 2002B refunded bonds and the Civic Center substituted Fire Station 1 as the leased property/collateral. This provided flexibility to leverage the high value of the Civic Center to finance the 2021 Public Safety building COPs.

In fiscal year 2019, the City issued the California Avenue Parking Garage Tax-exempt Series A ($26.8 million plus $4.9 million premium) and Taxable Series B ($10.6 million) COPs. These bonds were issued to fund the construction of the new California Avenue parking garage.

Rinconada Library was used as collateral during the garage construction, and upon completion of the garage, the newly built California Avenue Parking garage became the leased property/collateral for these COPs. To preserve greater operational flexibility to use this garage facility over the life of the bonds (e.g., lease portion of the garage for private parking or other commercial use), a portion of the bonds were issued as taxable bonds.

In fiscal year 2021, the City issued the 2021 Public Safety Building tax-exempt COPs ($101.5 million plus $6.5 million premium) for the construction of the City’s new public safety building.

The debt service is payable solely from and secured by the lease payments to be made by the City’s General Fund to the Public Improvement Corporation pursuant to the Lease Agreement.

Civic Center was used as collateral during the building construction and, upon completion of the building, the newly build Public Safety Building will become the leased property/collateral for these COPs.

The reserve account requirement was waived based on the City’s Financial Advisor’s recommendation on all the outstanding COPs due to the City being a highly rated bond issuer.

This resulted in lower bonds issuance amount and the related interest savings.

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ANALYSIS
The attached financial statement shows the financial condition of the PIC. The debt service payments have been made on time and all financial requirements have been met. At year-end, June 30, 2024, total outstanding debt principal on the COPs equaled $141.8 million as follows:

Table 1: Summary of Outstanding Debt Principal
COPs Description
Principal
Outstanding
(millions)
Fiscal Year Debt
will be Retired
2018 Capital Improvement (2002B
Refinance and Golf Course) $ 8.0 2048
2019 California Ave. Parking Garage $ 34.4 2049
2021 Public Safety Building $ 99.4 2051
Total COPs $141.8
Staff recommends that the Board of Directors of the Palo Alto Public Improvement Corporation (PIC) approve the FY 2024 Annual Financial Report for the PIC.

FISCAL/RESOURCE IMPACT
Approval of the Palo Alto Public Improvement Corporation’s Annual Financial Report will have no resource impact.

STAKEHOLDER ENGAGEMENT
Staff works internally and coordinates with the City Auditor’s Office third party external auditor Macias Gini & O’Connell LLP (MGO) to prepare this report.

ENVIRONMENTAL REVIEW
This activity is not a project under California Environmental Quality Act (CEQA) as defined in CEQA Guidelines, section 15378, because it is an administrative activity that will not result in either a direct or reasonably foreseeable indirect physical changes in the environment.

ATTACHMENTS
Attachment A: Palo Alto Public Improvement Fiscal Year 2024 Annual Financial Report APPROVED BY:

Lauren Lai, Administrative Services Director
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Staff Report
From: City Manager
Report Type: ACTION ITEMS
Lead Department: Fire
Meeting Date: February 10, 2025
Report #:2411-3770
TITLE
PUBLIC HEARING: Objections to Weed Abatement at Affected Properties and Approval of Affected Property List for Commencing Weed Abatement in 2025; CEQA status - exempt

RECOMMENDATION
Staff recommends that Council:

1. Adopt a determination that weed abatement activities in 2025, as described in Resolution 10201 (Attachment A) adopted by Council on December 2, 2024, are exempt under Class 8 (CEQA Guidelines section 15308);

2. Hold a Public Hearing to hear and consider any objections to the proposed destruction and removal of weeds in 2025 at the properties listed in Attachment B; and

3. Approve the final list of affected properties for weed abatement in 2025 (Attachment B) following the public hearing, and direct weed abatement activities to commence at those properties in accordance with Resolution 10201.

EXECUTIVE SUMMARY
The City of Palo Alto contracts with the Santa Clara County Department of Agriculture and Environmental Management to remove and destroy weeds, as defined in Palo Alto Municipal Code Chapter 8.08. This hearing allows all property owners affected and listed on the County’s 2024 Weed Abatement Program Commencement Report (Attachment B) to be heard and have their objections and comments considered by the Council before the Council finalizes the list of properties ordered to abate weed nuisances in the City in 2025, under Resolution 10201.

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An overview of the program and annual calendar for the steps involving City Council action is provided in Attachment C.

BACKGROUND
The Council adopted Resolution 10201 on December 2, 2024, which declared weeds to be a nuisance and ordered the abatement of that nuisance as called for in Palo Alto Municipal Code Chapter 8.08 (Attachment A). Resolution 10201 provided for a public hearing date of February 10, 2025, and required notice to interested property owners and the public.

ANALYSIS
The Santa Clara County Department of Agriculture and Resource Management maintains the contract to abate weeds within the City of Palo Alto. Following City Council’s December 2, 2024 adoption of Resolution 10201 declaring weeds to be a nuisance and ordering abatement thereof in 2025, the Department of Agriculture and Resource Management took steps to notify each affected property owner by mail of the proposed weed abatement action on their respective properties, and posted, on the public notice bulletin board, a list of the properties affected. The Department of Agriculture and Resource Management has furnished copies of the property listing to the City Clerk and the City Fire Marshal. The City Clerk also posted and published notice of the hearing as required.

At this public hearing, property owners may appear and object to the proposed weed destruction or removal. After the hearing and consideration of any objections, the Council may sustain or overrule any or all objections. The Council may remove properties from the weed abatement commencement report if objections are sustained. After finalizing the affected property list at the public hearing (Attachment B), the County will be asked to perform the abatement work to destroy and remove any weeds.

FISCAL/RESOURCE IMPACT
All charges for the weed abatement services are included as a special assessment on bills for property taxes levied against the respective lots and parcels of land, which are considered liens on these properties

STAKEHOLDER ENGAGEMENT
The Council adopted Resolution 10201 on December 2, 2024, declaring weeds to be a nuisance and ordering the abatement of that nuisance as called in Palo Alto Municipal Code Chapter 8.08.

The Commencement Report was posted publicly in Palo Alto on at least 10 days prior to the hearing date.

The notices for the City Council’s February 10, 2025, public hearing ran in the newspaper at least 10 days prior to the hearing and the Santa Clara County Agriculture and Resource Management ITEM 14 Item 14 Page 2 Packet Page 393 of 582
weed abatement program mailed out notice of the public hearing to all addresses on the commencement list on January 3, 2025.

ENVIRONMENTAL REVIEW
Santa Clara County has determined the Weed Abatement Program be Categorically Exempt from the California Environmental Quality Act (CEQA) pursuant to CEQA guidelines Section 15308 (Class 8: Actions by Regulatory Agencies for Protection of the Environment).

ATTACHMENTS
Attachment A: Resolution 10201
Attachment B: 2025 Palo Alto Weed Abatement Program Commencement Report Attachment C: Weed Abatement Timeline and Summary
APPROVED BY:

Geoffrey Blackshire, Fire Chief
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Staff Report
From: City Manager
Report Type: ACTION ITEMS
Lead Department: Planning and Development Services
Meeting Date: February 10, 2025
Report #:2412-3928
TITLE
PUBLIC HEARING / QUASI-JUDICIAL. 3265 El Camino Real [24PLN-00012]: Approval of an Ordinance Rezoning the Subject Parcel From Commercial Services (CS) to Planned Community Zoning (PC) and Adoption of a Record of Land Use Action to Construct a 100% Affordable, FiveStory, 55 Unit Residential Rental Project. Environmental Assessment: Initial Study/15183 Streamlined CEQA Review.

RECOMMENDATION
Staff Recommends the City Council take the following actions:

1. Consider the Initial Study Checklist/Streamlined Environmental Review prepared in accordance with California Environmental Quality Act (CEQA) Guidelines Section 15183;

2. Adopt the Ordinance in Attachment B amending the zone district from CS to PC; and

3. Approve the Record of Land Use Action in Attachment C.

EXECUTIVE SUMMARY
The applicant proposes to rezone the vacant parcel located at 3265 El Camino Real (Attachment A) from Commercial Services (CS) to Planned Community (PC), which is sometimes referred to as Planned Home Zoning (PHZ).1 The parcel would be developed with a 100% affordable, 55- unit residential rental project. Fourteen of the units are proposed to be dedicated at a rate affordable to low income, not to exceed 70% of area median income (AMI) levels. Forty-one of the units would be dedicated at a rate affordable to moderate income, not to exceed 110% of AMI. The applicant has also established a private agreement with the Palo Alto Educator Association (PAEA) to prioritize housing Palo Alto teachers when seeking tenants ; however, there is no guarantee that teachers will be the only occupants of the building.

Staff’s review of the revised project concludes that it is consistent with the findings for approval of a Planned Community rezoning. The ARB and PTC recommended approval of the project on November 21, 2024, and January 15, 2025, respectively. Accordingly, staff recommends that the Council adopt the PC/PHZ ordinance in Attachment B and approve the record of land use 1 Referred to in this report as "Planned Home Zoning" (PHZ) to emphasize the focus on housing as the benefit to the community. PAMC Section 18.38, which outlines the requirement and process for Planned Community (PC) Zoning, remains the underlying code supporting application of this policy.

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action in Attachment C. The Program Statement and Development Schedule are included as Attachment H and the Development Plan is included as Attachment I.

The City prepared an analysis of the project in accordance with CEQA Guidelines Section 15183, which evaluated the project’s consistency with the Comprehensive Plan and the Comprehensive Plan Environmental Impact Report (EIR). The analysis concludes that the project is consistent with the previously adopted Comprehensive Plan and that the adopted EIR adequately addresses the impacts of the proposed project.

BACKGROUND
On February 3, 2020, Council unanimously endorsed using Planned Community (PC) Zoning for housing and mixed-use housing projects to help spur housing production and rebranded it Planned Home Zoning (PHZ). In exchange for deviation from certain standards as allowed under the rezoning, if approved by Council, the project must include at least 20% of the housing units as deed restricted for lower-income households. Moreover, the number of housing units must offset the number of net new commercial jobs that are generated by the project. The project’s consistency with this Council direction is discussed further in this analysis.

The applicant filed a prescreening application in 2023 to consider a zone change in accordance with Council’s direction regarding PHZ projects. Council held a prescreening hearing on September 11, 2023, to consider the proposed project.

Project Description
On January 10, 2024, Trachtenberg Architects filed an application on behalf of Half Dome Capitol to rezone the subject parcel from CS to PC/PHZ and to redevelop the site with 44 residential rental units. Twenty percent of the units were proposed to be restricted at a rate affordable to low income (not to exceed 80% AMI) and 80% of the units would be restricted at a rate affordable to moderate income (not to exceed 110% AMI).

After the April 10, PTC meeting, the applicant revised the submittal in response to commissioner requests for a deeper level of affordability and more units. The revised proposal is a six-story building with 55 units that is 70 feet tall to the top of the roof deck line, 79 feet tall to the elevator overrun. Twenty-five percent of the units are proposed to be restricted at a rate affordable to low income (rents based on 70% AMI) and 75% of the units are proposed to be restricted at a rate affordable to moderate income (rents based on 110% AMI). The project includes 33,089 square feet of gross floor area on a 7,493 square foot lot (floor area ratio of

4.42: 1.0). The project also includes a 1,700 square foot roof top deck and 32 total parking spaces provided in an at-grade parking garage utilizing a parking lift system. The building’s exterior materials will be stucco siding, metal infill panels to frame the windows, and a painted cementitious paneling at the elevator and stairs on the side of the building which faces the Kasa Hotel and at the rear. The applicant’s project description is included in Attachment H. The project plans are included in Attachment I.

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Requested Entitlements, Findings and Purview:

The following discretionary application is being requested:
• Planned Community (PC/PHZ) Rezoning: The process for evaluating this type of application is set forth in PAMC 18.38.065. PC rezoning applications require review by the PTC and the Architectural Review Board, a final review of a development plan for review and recommendation by the PTC, and a decision by the Council. The findings under 18.38.060 must be made in the affirmative for project approval. The Architectural Review Board makes a recommendation on the development plan in accordance with the findings for architectural review in Section 18.76.020 pursuant to 18.38.065(b).

These findings are included in Attachment B. For housing projects rezoning to PC (labeled “Planned Home Zoning”) Council expressed an expectation that projects provide at least 20% of the units at below market rate.

Council Prescreening
City Council held a prescreening to evaluate the proposed rezoning of the property for a 100% affordable housing project at the subject property on September 11, 2023. At the prescreening, Councilmembers provided the following feedback (applicant responses provided):
• How long do the parking stackers take to cycle through? Will tenants be leaving all at once and create a circulation issue?
o 10-60 seconds depending on vehicle location; Different zones can operate individually.
• How will parking be allocated? Will spaces be un-bundled with units? o Unbundled; anticipated rates are $150/space.
• What is the estimated rent and will it be affordable to teachers? o See “Public Benefit” discussion below.
• Is the proposed driveway wide enough to allow vehicles to move in and out? o Driveway expanded from 14 feet to 20 feet
Unbundled parking is a tool that encourages alternative modes of transit to and from work by providing parking on-site as a cost, rather than for free. Coupling unbundled parking with providing a free transit pass to tenants are incentives in the proposed TDM plan to reduce vehicle trips to and from work. While the applicant has proposed unbundled parking at a rate of $150/unit for units that receive a parking stall, it is a deviation and request of the PHZ application from the City’s definition of “affordable rent” under PAMC 16.65.020(d) which requires that parking be included in a tenant’s rent. . However, if parking were included in each unit’s rent, this would require rents to be uniformly lowered to maintain the effectiveness of unbundled parking as a tool. The applicant has noted that this would also make the project financially infeasible.

Staff has concerns that applying a flat fee for unbundled parking will disproportionately impact low-income tenants. As a result, staff recommends adopting COA #14 which provides that the unbundled parking cost be capped at 4% and 5% of anticipated rent plus the utility allowance for the low-income and moderate-income units, respectively. This ratio would result in lowITEM 15 Item 15 Page 3 Packet Page 407 of 582 income units paying roughly $90.36 or $103.28 a month for parking, and moderate-income units paying roughly $177.40 or $202.80 a month for parking (see anticipated rents in Public Benefit section below). Either option would be a deviation from the City’s current code requirements, but Council could also require the applicant include the cost for parking in rent for these units.

Planning and Transportation Commission (PTC)
The PTC held the first formal hearing for this project on April 10, 2024, and the second hearing on January 15, 2025. Links to the PTC staff reports, meeting minutes, and video recordings are provided in the footnote below.2
At the initial hearing Commissioners provided feedback/requested information on expanding the rooftop open space, expanding the TDM plan provisions, the affordability level of the units, and analyzing site circulation. Following the PTC and ARB’s initial review, the applicant made substantive changes to the project design, which included increasing the unit count from 44 units to 55 units. The proposed floor area ratio (FAR) and height increased commensurate to the increase in units, resulting in a proposed FAR of 4.42 (previously 3.58 FAR) and height of 79 feet, 8 inches (previously 64 feet). The applicant has stated that this change allowed the project to be economically viable while addressing PTC and Council feedback to provide the units at a deeper level of affordability.

On January 15, 2025, the PTC recommend approval of the project on a 3-2 vote [Chang, Summa – against]. Both Chair Chang and Commissioner Summa raised concerns that the project was not an Affordable Housing project based on the anticipated rent levels shown in the staff report for the Moderate-Income deed-restricted units and should not benefit from provisions in Title 16 that waive development impact fees for 100% Affordable Housing projects. At the hearing, the PTC made the following motion:

Recommend approval of the project subject to the following additional conditions of approval:

1. Future residents shall be notified that if a future Residential Parking Permit (RPP) will be enacted, that they may be excluded from it.

2. The property manager shall provide an annual report to the City of the number of Palo Alto Unified School District employees that occupy the building and which unit types they are occupying.
2 April 10, 2024, PTC Agenda Item #2, 3265 El Camino Real:
https://cityofpaloalto.primegov.com/Portal/Meeting?meetingTemplateId=13632 November 21, 2024 ARB Agenda Item #3, 3265 El Camino Real:
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There was a robust discussion between the commissioners about whether units that are deedrestricted at a Moderate-Income level are truly below market rate or are charging rents that are comparable to market rate units based on available data. The PTC recommended that Council ITEM 15 Item 15 Page 5 Packet Page 409 of 582
could study this to inform decisions on future housing projects and the options within the PHZ process. Staff would recommend that this item be added to the PTC or Council Work Plan and prioritized to other work if the Council would like to investigate this further.

The PTC also wanted to understand the length of time that these units will be deed-restricted for and when that will be decided as it is not explicitly captured in draft Condition of Approval #14. During the discussion, staff noted that PAMC 16.65.075 requires that all affordable units be deed restricted to 99-years or a 55-year timeframe, when required by tax credit financing, and that those timeframes are typically negotiated by staff through the regulatory agreement after the project is approved. It is important to note that PAMC 16.65.075 applies to the City’s inclusionary housing requirements for ownership projects and that rental projects do not have an inclusionary housing requirement. Other 100% affordable housing projects have been deed restricted to a 55-year timeframe to maintain tax credit financing and staff recommends these units be similarly restricted given that the project is not receiving public subsidy. Draft Condition of Approval (COA) #14 has been updated to capture this recommendation.

Architectural Review Board
The ARB reviewed the project on April 18, 2024 and suggested improvements to the design related to the front and rear stucco facades, window placement towards Kasa Hotel, privacy screening between patios at level 2, expanding the rooftop deck, recessing the garage door, including an interior door to the garage from the lobby, and introducing a skylight over the bike area at the rear of the building. On November 1, 2024, the ARB reviewed the revised design and recommended approval of the project on a 4-1 vote [Baltay – against]. Board member Baltay was concerned that the design of the units and open space were substandard and inappropriate to expect residents to occupy given the physical limitations of the site and the density proposed. At the hearing, the ARB made the following motion:

Recommend approval of the project with the following additional conditions of approval:

1. Modify the façade at the stairwells to introduce natural light.

2. Modify the rear wall to introduce natural light into the bike storage room.

3. Include auditory/visual warnings at garage door when opening.

4. Consider a schedule for garage door operation (e.g. open certain hours)

5. Return to the ARB Ad-Hoc to evaluate the painted cementitious panel along the stairwells
a. Provide a detail showing how the articulation will be handled; consider using different colors/materials to create shadow and depth on the façade.
b. Provide detail which shows the vertical transition between boards

6. Remove the requirement to recess the garage door from COA #28; Require that the door must open in less than 10 seconds to ensure efficient access to the site from El Camino Real.

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Except for COA #5a and 5b above, all other conditions were provided to be addressed at the building permit stage. Following Council approval of the project, staff will return to the ARB AdHoc Committee to resolve COA #5a and 5b.

ANALYSIS
Comprehensive Plan, Area Plans, and Guidelines Compliance The Comprehensive Plan land use designation for the project site is Service Commercial, which allows for higher density multi-family near transit. The proposed project is located along El Camino Real, which is considered a high-quality transit corridor. Therefore, the proposed use is consistent with this land use designation. The project is also consistent with the policies set forth in the Comprehensive Plan, as detailed in Attachment C.

Housing Element
This site is included as a Housing Inventory Site in the adopted Housing Element, with an anticipated capacity of 44 units that may be provided at market rate. The project proposes 55 units, all of which would be below market rate, provided at a rate affordable to low income (70%) or moderate income (110%). Therefore, the project is consistent with the Housing Element and contributes to the City’s Regional Housing Needs Allocation (RHNA) goals, including goals to increase the number of units provided at below market rate levels.

North Ventura Coordinated Area Plan
The proposed development is located within the boundaries of the North Ventura Coordinated Area Plan (NVCAP). Therefore, the land use designation and the zoning of the site has changed since the application was first filed. However, as detailed in the ordinance implementing the NVCAP, projects that have been deemed complete prior to the effective date of the ordinance, would not be subject to the NVCAP goals and policies or the zoning regulations set forth in the ordinance. This project was deemed complete prior to adoption of the NVCAP and therefore continues to be analyzed in accordance with the regulations set forth under the existing zoning and land use designation. Nevertheless, the proposed land use designation under NVCAP is High-Density Mixed-Use. This land use designation is “intended to support five-to-six story midrise apartment buildings.” This designation requires active uses for ground floor frontages. As detailed in NVCAP, active uses include building lobbies. Therefore, the project is also consistent with the land use designation under the NVCAP.

El Camino/South El Camino Real Design Guidelines3
The project is subject to both the El Camino Real and the South El Camino Real Design Guidelines. As detailed in Attachment F, the project is consistent with these guidelines. 3 South El Camino Real Design Guidelines: chrome: www.cityofpaloalto.org/files/assets/public/v/1/planning-ampdevelopment-services/file-migration/current-planning/forms-and-guidelines/south-el-camino-real-designguidelines.pdf ITEM 15 Item 15 Page 7 Packet Page 411 of 582
Zoning Compliance
For a PHZ project, the zoning development standards are customized for the building/site.

Therefore, this project would deviate from the zoning development standards in a manner that is consistent with the zoning ordinance through to rezoning process. However, as detailed in the Zoning Comparison Table (Attachment D), there are several aspects of the project that exceed the underlying Service Commercial (CS) zoning district development standards, including:
• Floor Area Ratio: 4.42:1.0 where 0.6:1.0 FAR is permitted; • Lot Coverage Ratio: 0.87:1.0 where 0.5:1.0 is permitted; • Height: 79 feet, 8 inches where 50 feet is permitted; • Parking: 324 parking stalls where 55 are required;
• Rear Yard Setback: 0-5 feet where 10 feet is required; • Minimum Landscape/Open Space per Unit: 31 square feet where 150 square feet is required;
• Rooftop Open Space: Rooftop garden provides 76% of open space for project where only 60% is permitted to be provided by rooftop garden; • Bike Parking: Four short-term bike parking spaces are provided off-site where six are required on-site;
• Vehicle Loading Space: No short-term vehicle loading space is provided on site where one is required for projects with 50 or more units.

Given that the project is 100% affordable, the Affordable Housing Incentive Program (AHIP) standards could also be applied to the site by-right to modify some development standards.

Therefore, Attachment D also includes a comparison of the proposed development standards and the AHIP development standards for informational purposes.

Multi-Modal Access & Parking
The property is located on El Camino Real near the cross street of Lambert Avenue and is accessed via a right-in, right-out-only driveway entrance. The applicant proposes 32 parking spaces, or 0.5 spaces per residential unit. 30 parking spaces would be provided in vehicle stackers that would be independently accessible and two ADA parking spaces would be provided. This is an increase in the provided parking ratio from the original proposal reviewed by Council, which included 22 parking spaces in vehicle stackers for the 44 units proposed at that time. Typically, one parking space per unit is required for studio and one-bedroom units, and a Transportation Demand Management (TDM) plan can be used for an up to 100% reduction in required spaces for a 100% affordable housing project where units are available to households with income levels at or below the 120% AMI thresholds. The applicant has proposed a TDM plan for the proposed project, which is provided in Attachment E. The Office of Transportation has reviewed and approved the proposed TDM plan which includes, among 4 PAMC 18.52.040(b)(8) provides that the accessible loading zone adjacent to an accessible parking stall contributes to the number of vehicle spaces provided on site. While 32 spaces are provided, only 31 can be used to park a vehicle.

ITEM 15 Item 15 Page 8 Packet Page 412 of 582
other measures, a provision to provide free bus passes to all tenants via the Valley Transportation Authority (VTA) Smart Pass program.

There are north and south-bound VTA bus stops within the immediate vicinity of the site that connect the site to other regional transit options like Caltrain. Conditions of Approval #30 and #31 require monitoring of the parking lift system and TDM program to ensure they are effective. If any deficiencies are found within the annual monitoring reports, penalties or modifications to the programs can be enacted to ensure the lift system works and the TDM plan goals are achieved. Fifty-five long-term bike parking spaces are proposed on the ground floor in a shared storage room, four short-term bike parking stalls are provided along El Camino Real, and five on-site shared electric bikes are provided in the storage room.

Based on the nature of the puzzle lift system, vehicle stalls are shuffled around using the wall kiosk in the garage or a remote key fob until a stall is moved to the ground level for a vehicle to exit from or pull into the space. For the puzzle lift system to function properly, some stalls need to be left unused. In this case, two stalls will be left unused resulting in 30 of the 32 parking lift stalls being usable within the garage. The City’s traffic consultant Fehr & Peers analyzed the vehicle turning radii for the proposed parking lift stalls as detailed in the transportation analysis in Attachment I. Given that all stalls comply with the size requirements set forth in Chapter

18.54, in accordance with the conditions of approval that require proper management of the system, the proposed design is consistent with the City’s requirements.

Caltrans is currently developing El Camino Real along the project frontage to add a bicycle lane.

This eliminates the potential for a vehicle loading area as well as a trash loading area (e.g. for trash pickup) along El Camino Real in front of the property. Therefore, vehicle pick-up and dropoff as well as trash pickup for the project are anticipated to occur on Lambert Avenue. Bins will be brought out to Lambert Avenue and staged there by the property management prior to pickup, then moved back to the trash enclosure following pick-up.

Public Benefit
As noted in the background section of this report, in February 2020 Council provided direction to staff to consider planned community rezoning applications for housing development projects that provide increased inclusionary below market rate units, rebranding these as Planned Home Zoning projects to emphasis the increased BMR units and/or affordability level of those units as the public benefit of the project.

As a part of Council’s direction, a menu of options was identified as possible ways to meet the increased affordability requirements. Using Option #2, the weighted system, as shown below, the project is proposing an equivalency of 75% affordable units, exceeding the 20% minimum requirement in accordance with Council’s direction, as noted in Table 1 below. Since no commercial component is proposed, this project would inherently create more housing than jobs.

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Several Council members and commissioners raised concerns that these units would not be affordable to the target demographic the applicant has committed to serving and requested additional information from staff about affordability levels and teacher salaries. The California Department of Housing and Community Development (HCD) provides yearly data on the AMI limits for each income category, which varies based on the number of individuals in each household. The image below reflects the AMI for Santa Clara County for 2024:5 An image of the 2024-25 Palo Alto Unified School District (PAUSD) salary schedule is below:6 5 HCD Income Table: https://www.hcd.ca.gov/sites/default/files/docs/grants-and-funding/income-limits-2024.pdf 6 PAUSD Salary Schedule:
https://resources.finalsite.net/images/v1717104008/pausdorg/r4v8ge0e5ln1e3szj8zw/salary_schedule_teachers_ 202425.pdf
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Based on the income limits, a low-income studio would be affordable to all individual salaries in the schedule and low-income 1-bedrooms would be affordable to over 90% of individual salary levels. Most of the salary steps in the PAUSD schedule, however, are too high for an individual to income-qualify to rent these low-income units.

Moderate-income studios would be affordable for 35% of individual salary levels, and moderate-income 1-bedrooms would be affordable to 4% of individual salary levels. These figures are likely too low, however, because the PAUSD salary schedule only represents one individual’s income, while many units may be occupied by households with more than one income. Even the most expensive unit in the project will be affordable to a household making

1.8 times the lowest individual salary in the PAUSD schedule, and many households may have a combined income too high to qualify for these restricted units.

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Given the sizes of each unit within the proposed project, it’s likely that a two-person household would be the largest household size occupying these units. The City’s Below Market Rate (BMR) administrator would be responsible for income certifying individual(s) who apply to live in these units with the additional caveat that any teachers that apply to live in these units would be considered first over other potential tenants. There is no requirement in the draft ordinance that all or any of the future tenants in the building be teachers.

As noted earlier in the report, following the April PTC and ARB meetings, the developer modified their design to increase the number of units from 44 to 55. This was driven by feedback from the PTC which encouraged ways to deepen the levels of affordability for the project. By increasing the number of units in the project, the applicant has been able to commit to limiting rent for the low-income units at 70% AMI as well as limiting rents for moderateincome units at 110% AMI. Previously, the applicant noted that it was not financially feasible to limit the low-income rents at 70% AMI and had proposed limiting them to 80% AMI instead.

Anticipated 2024-25 rents for each unit type are shown below, as well as the household incomes at which these units would be affordable; anticipated rents are subject to change each year. The anticipated rents below reflect the cost of rent, plus an assumed utility allowance that Santa Clara County provides for units ($210/month for studios, $220/month for onebedrooms). Rents for each unit type and income range would be $2,049/$2,362 for 70% AMI, or $3,338/$3,836 for 110% AMI. Notably, although rents are set using assumed household sizes of 1-person per studio and 2-persons per 1-bedroom, income qualification is based on actual household size. Thus, although rent plus utilities for a low-income studio may not exceed $2,259 per month, a two-person household may qualify for such studio with a household income of up to $118,000 per year (80% AMI for a two-person household).

Rent + Utility Allowance
Rent at
70% AMI
Affordable to
Annual Income
Rent at
110% AMI
Affordable to
Annual Income
Studio $2,259 $90,370 $3,548 $142,010
1-Bed $2,582 $103,250 $4,056 $162,250
Consistency with Application Findings
Staff has prepared a detailed review of the proposed project’s consistency with the Findings for approval. The draft Architectural Review findings for the proposed project and draft findings for the PC ordinance are provided in Attachment C. Staff finds that the proposed project, as conditioned, meets all of the applicable findings for Architectural Review and the required determinations for PC ordinances.

POLICY IMPLICATIONS
Approving the proposed affordable housing project would support the city’s housing goals, providing 55 units with priority for local educators while aligning with the Comprehensive Plan and making progress toward the City’s RHNA targets. Redevelopment activates an underutilized site and would increase property tax revenue. However, the PTC, despite its support for the ITEM 15 Item 15 Page 12 Packet Page 416 of 582
project, has noted concerns over affordability thresholds and the loss of revenue from development impact fees, as noted above. This project is entitled to an exemption from impact fees because it fits the City’s definition of 100% affordable housing. Staff believe the rent restrictions for the moderate-income units are a meaningful benefit that are likely to be more impactful over time. In addition, this project represents an unusual model for rent-restricted housing production that does not rely on public funding or competitive tax credits.

Ultimately, the subject entitlement process as a legislative application conveys broad latitude to the City Council in terms of its discretion to approve or deny the project. Not approving the project could slow progress on housing production and may discourage future, similar, affordable housing proposals and influence ongoing work related to expanding the Housing Focus Area along a strategic location on El Camino Real. Moreover, with the recent upzoning of this site through the NVCAP, a substantially similar project could likely be achieved through use of the state density bonus law.

FISCAL/RESOURCE IMPACT
In accordance with the adopted fee schedule, applications for zone changes are processed as Cost Recovery applications; therefore, the City recovers the cost of staff time for processing the application. Additionally, because this is a 100% affordable housing development, no impact fees are required. The property is currently undeveloped; accordingly, the current site does not generate any revenue for the City. Therefore, there is no financial impact as a result of processing of this application except that property taxes would increase as a result of the development, once constructed.

STAKEHOLDER ENGAGEMENT
The Palo Alto Municipal Code requires notice of this public hearing be published in a local paper and mailed to owners and occupants of property within 600 feet of the subject property at least ten days in advance. Notice of a public hearing for this project was published in the Daily Post on January 31, 2025. Postcard mailing occurred on January 29, 2025.

Public Comments
As of the writing of this report, the City received one comment from the property owner for 3295 El Camino Real, which is provided in Attachment G. At a follow up meeting with staff and the applicant, the neighboring property owners asked for further clarity as to how their site would be protected during construction and afterwards for any regular maintenance needs, as well as understand whether any shoring or maintenance easements would be necessary between the two properties. The applicant noted that they designed the project to ensure that all shoring would be done within their own property boundaries and that no access or maintenance easements would be needed from the adjacent owners. Staff confirmed with the Chief Building Official that should any easements be necessary in the future; the City does not need to be party to those agreements and they can be established and recorded between the property owners at their own expense outside of the City’s review process. Additional public comments in support of the project are included in Attachment G.

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ENVIRONMENTAL REVIEW
The City, acting as the lead agency, has analyzed the project in accordance with the authority and criteria contained in the California Environmental Quality Act (CEQA). Specifically, the City prepared an analysis of the project in accordance with CEQA Guidelines Section 15183, which evaluated the project’s consistency with the Comprehensive Plan and the Comprehensive Plan Environmental Impact Report (EIR). Section 15183 allows for streamlining of infill projects where the previously adopted EIR for a Comprehensive Plan adequately addresses the impacts of the proposed project. Plan level technical reports were prepared to confirm that the Comprehensive Plan EIR, including any mitigation that would be addressed as required through that EIR, would adequately address the impacts of the proposed project. This analysis and relevant attachments are included in Attachment I.

ATTACHMENTS
Attachment A: Location Map
Attachment B: Ordinance
Attachment C: Draft Record of Land Use
Attachment D: Zoning Comparison Table
Attachment E: TDM Plan
Attachment F: South El Camino Real Design Guidelines Comparison Attachment G: Public Comments
Attachment H: Program Statement and Schedule
Attachment I: Development Plan and Environmental Documents APPROVED BY:

Jonathan Lait, Planning and Development Services Director ITEM 15 Item 15 Page 14 Packet Page 418 of 582
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Staff Report
From: City Manager
Report Type: INFORMATION REPORTS
Lead Department: Administrative Services
Meeting Date: February 10, 2025
Report #:2412-3887
TITLE
Semi-Annual Report of Contracts Awarded by the City Manager, Procurement Officer or Other Designated Employees for the period of July 1, 2024 through December 31,2024 ;CEQA StatusNot a Project.

RECOMMENDATION
This is an informal report, no action is required

DISCUSSION
Palo Alto Municipal Code (PAMC) Section 2.30.710(a) requires the City Manager to provide a semi-annual report to Council consisting of contracts awarded by the City Manager, Procurement Officer or other designated employees for:

1. Goods contracts $85,000 through $250,000 per year (Attachment A), and

2. Professional and General Services $25,000 through $85,000 and Public Works Contracts $85,000 through $250,000 per year (Attachment B).

The contracts in Attachment A consist of twelve (12) distinct awards for goods, and the contracts in Attachment B consist of sixty-two (62) distinct awards for a wide range of services.

These awards are a core element of the efficient and effective provision of services by the City to our community and reflect extensive coordination and prudent decision-making.

For informational purposes, Attachment C provides excerpts from the PAMC that set forth the authority designated by Council to the Procurement Officer to award and sign contracts (PAMC

2.30.200) and City Manager to award and sign contracts (PAMC 2.30.210).

ENVIRONMENTAL REVIEW
This activity 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.

ITEM 16 Item 16 Page 1 Packet Page 495 of 582

ATTACHMENTS
Attachment A: Goods Contracts Awarded $85,000 through $250,000 per year Attachment B: Professional and General Services $25,000 through $85,000 per year and Public Works Contracts $85,000 through $250,000 per year
Attachment C: Excerpts from the Palo Alto Municipal Code APPROVED BY:

Lauren Lai, Administrative Services Director
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ITEM 16 Item 16 Page 3 Attachment A Packet Page 497 of 582 ITEM 16 Item 16 Page 4 Attachment B Packet Page 498 of 582 ITEM 16 Item 16 Page 5 Attachment B Packet Page 499 of 582 ITEM 16 Item 16 Page 6 Attachment B Packet Page 500 of 582 ITEM 16 Item 16 Page 7 Attachment C Packet Page 501 of 582 ITEM 16 Item 16 Page 8 Attachment C Packet Page 502 of 582 ITEM 16 Item 16 Page 9 Attachment C Packet Page 503 of 582 City Council
Staff Report
From: City Manager
Report Type: INFORMATION REPORTS
Lead Department: Office of Emergency Services
Meeting Date: February 10, 2025
Report #:2501-4000
TITLE
Palo Alto Local Hazard Mitigation Plan Annual Update for Calendar Year 2024; CEQA Status: Not a Project

RECOMMENDATION
This is an informational report as a status update on the Palo Alto Local Hazard Mitigation Plan. No Council action is required.

EXECUTIVE SUMMARY
The Office of Emergency Services provides this Local Hazard Mitigation Plan (LHMP) annual report to share the progress the City has made as of December 2024 on LHMP projects over the prior twelve months. The purpose of this information report is to provide an update on the City’s implementation of the mitigation actions identified in the 2023 Santa Clara County MultiJurisdictional Hazard Mitigation Plan, Palo Alto Annex. It should be noted that the Council will see updates specifically on wildfire related plans separately from this update.

BACKGROUND
The City of Palo Alto, as part of the Santa Clara County multi-jurisdictional planning process (including participating local cities and special districts), developed a Multi-Jurisdictional Hazard Mitigation Plan from 2022- 2023 to meet Federal guidelines and thereby reduce risk from all hazards by identifying resources, information, and strategies for risk reduction. The Federal Disaster Mitigation Act of 2000 requires state and local governments to develop hazard mitigation plans as a condition for federal disaster grant assistance.

The performance period for the 2023 Santa Clara County Operational Area Hazard Mitigation Plan, Volume 1 became effective in February 2024 with the final approval of the plan by FEMA.

FEMA approved the City of Palo Alto Local Jurisdictional Annex, Volume 2 in July 2024, and the Palo Alto City Council adopted both Volumes 1 and 2 on October 7, 2024. The performance period for this plan is five years.

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The 2023 MJMHP Base Plan - Volume 1 and the Palo Alto Annex -Volume 2 which articulates our local natural hazards and mitigation activities can be viewed online at https://www.cityofpaloalto.org/Departments/Emergency-Services/Plans-andInformation/Local-Hazard-Mitigation-Plan

ANALYSIS
OES coordinated this update with departmental staff members responsible or knowledgeable of each of the projects on this list. As of this reporting period, the performance period for this plan is considered to be 30% complete (including complete and ongoing projects). This includes 17 actions that were part of the previous 2017 LHMP that were not completed, and 10 new actions. Each action provides a description of the action, what hazard(s) applies to the action, the lead agency for the action, potential sources of funding, expected timeline for completion, the priority assigned to the action, and current status of the action. • 1 out of 27 initiatives (4%) have been completed.
• 7 out of 27 initiatives (26%) indicated work is conducted as an ongoing capability. • 16 out of 27 initiatives (59%) reported progress toward completion. • 2 out of 27 initiatives (7%) reported having not started. • 1 out of 27 initiatives (4%) is closed and not will not be continued.

FISCAL/RESOURCE IMPACT
No additional resource impact is expected at this time.

STAKEHOLDER ENGAGEMENT
OES coordinated this update with departmental staff members responsible or knowledgeable of each of the projects on this list

ENVIRONMENTAL REVIEW
This item is presented only for Council’s information and therefore it is not a project subject to environmental review by the California Environmental Quality Act (CEQA).

ATTACHMENTS
Attachment A: City of Palo Alto LHMP Update CY2024
APPROVED BY:

Chief Ken Dueker, Director Office of Emergency Services ITEM 17 Item 17 Page 2 Packet Page 505 of 582
ITEM 17 Item 17 Page 3 Packet Page 506 of 582
City of Palo Alto Local Hazard Mitigation Plan Annual Update Reporting Period
The reporting period for this progress report is from 1 January 2024 to 31 December 2024 Background
This is an annual update of the status of identified projects/actions listed in the City of Palo Alto Local Hazard Mitigation Plan 2023.

The City of Palo Alto, as part of the Santa Clara County multi-jurisdictional planning process (including participating local cities and special districts), developed a Multi-Jurisdictional Hazard Mitigation Plan from 2022- 2023 to meet Federal guidelines and thereby reduce risk from all hazards by identifying resources, information, and strategies for risk reduction. The Federal Disaster Mitigation Act of 2000 requires state and local governments to develop hazard mitigation plans as a condition for federal disaster grant assistance. To prepare the plan, the participating planning partners organized resources, assessed risks from natural hazards, developed planning goals and objectives, reviewed mitigation alternatives, and developed an action plan to address probable impacts from natural hazards. By completing this process, these jurisdictions maintained compliance with the Disaster Mitigation Act, achieving eligibility for mitigation grant funding opportunities afforded under the Robert T. Stafford Act. Volume I of the County plan provides the analysis of natural hazards for the Operational Area. It provides the content that informs the Palo Alto LHMP.

The 2023 MJMHP Base Plan - Volume 1 and the Palo Alto Annex -Volume 2 which articulates our local natural hazards and mitigation activities can be viewed online at https://www.cityofpaloalto.org/Departments/Emergency-Services/Plans-and-Information/LocalHazard-Mitigation-Plan Purpose
The purpose of this information report is to provide an update on the implementation of the mitigation actions identified in the 2023 Santa Clara County Multi-Jurisdictional Hazard Mitigation Plan, Palo Alto Annex. The objective is to maintain a planning process that will keep the Santa Clara County Operational Area Hazard Mitigation Plan dynamic and responsive to the needs and capabilities of the City of Palo Alto and its stakeholders.

Summary Overview of the Plan’s Progress
The performance period for the 2023 Santa Clara County Operational Area Hazard Mitigation Plan, Volume 1 became effective in February 2024 with the final approval of the plan by FEMA.

FEMA approved the the City of Palo Alto Local Jurisdictional Annex, Volume 2 in July 2024, and ITEM 17 Item 17 Page 4 Attachment A Packet Page 507 of 582

Page 2 of 5 ends

the Palo Alto City Council adopted Volume 1 and 2 on 7 October 2024. The performance period for this plan is 5 years.

As of this reporting period, the performance period for this plan is considered to be 30% complete (including complete and ongoing projects). The Palo Alto Volume 2 includes hazard mitigation actions to be pursued during the 5-year performance period. This includes 17 actions that were part of the previous LHMP that were not completed, and 10 new actions. As of the reporting period, the following overall progress can be reported:
● 1 out of 27 initiatives (4%) have been completed.
● 7 out of 27 initiatives (26%) indicated work is conducted as an ongoing capability. ● 16 out of 27 initiatives (59%) reported progress toward completion. ● 2 out of 27 initiatives (7%) reported having not started. ● 1 out of 27 initiatives (4%) is closed and not will not be continued.

Review of the Action Plan
Appendix 1 provides the action plan, reporting the status of each initiative. Actions PA-2 through PA-32 were actions carried over from the previous 2017 LHMP. Actions 1-10 are new as of the 2023 LHMP. In the table, each action provides a description of the action, what hazard(s) applies to the action, the lead agency for the action, potential sources of funding, expected timeline for completion, the priority assigned to the action, and current status of the action.

Public review notice
The contents of this report are considered to be public knowledge and have been prepared for total public disclosure. Copies of the report may be provided to the governing boards of all planning partners and to local media outlets. Any questions or comments regarding the contents of this report should be directed to: City of Palo Alto OES, 650-617-3197 or [email protected].

Next Plan Update
The Office of Emergency Services will provide a Calendar Year 2025 update in early February of 2025.

ITEM 17 Item 17 Page 5 Attachment A Packet Page 508 of 582 Appendix 1: Local Hazard Mitigation Plan 2023: Calendar Year 2024 Update of Activities Action
Item Number Action Item Description Hazard(s) Mitigated Lead Position, Office,
Department, or
Division Responsible
for Implementation
Potential Funding Sources
Expected
Timeline for Completion
Priority Status Calendar Year 2024 Status Comments: Currect project status & anticipated actions over next 12 months PA-2 *
San Fransicquito Creek Upper Reach Flood Reduction and Ecosystem Restoration Project to widen channel, improve floodwalls, and replace the Pope-Chaucer Bridge
Flood, Heavy Precipitation/Atmospheric River
San Francisquito Creek
Joint Powers Authority
General Fund, Hazard Mitigation Grant
Program (HMGP),
Flood Mitigation Assistance (FMA)
Short-Term High In Progress
The capacity of the creek was analyzed and it was determined that the creek has less capacity than what was previously concluded.

This is partly due to the bulking that occurs with the natural debris accumulates at choke points. The consultant is working with staff to evaluate creek widening alternatives to improve the creek capacity, reduce the velocity and minimize flooding. The JPA is moving forward with the next steps of the outreach to select the alternative that is feasible.

PA-3* Newell Creek Bridge replacement project to accommodate a 100-year flood event.

Flood, Heavy Rain, High Wind, Atmospheric River Public Works - Engineering CALTRANS/ Santa Clara Valley Water
District (SCVWD)
Short-Term High In Progress
Right-of-Way(ROW) acquisition is complete, Caltrans approved ROW and Utility Certification. Permits from Regulatory Agencies (Army Corp of Engineers, Water Board, CA Dept of Fish and Wildlife) and Encroachment permits from East Palo Alto and SCVWD were secured. Caltrans HQ is reviewing the Request for Authorization (E76) and Advance Construction Funding. Their response is anticipated by March 2025. Project will be advertized for construction in Spring of 2025.

PA-6*
Storm Drain System Replacement and Rehabilitation to maintain the integrity of the storm drain system of deteriorated storm drain infrastructure to eliminate potential pipeline blockages that could cause street flooding Flood, Heavy Rain, High Wind, Atmospheric River Public Works - Engineering Capital Improvement Project (CIP): SD06101
Ongoing Medium Ongoing
Broken and deteriorating pipes were replaced in various locations including Middlefield Rd./ Oregon Expwy, Fielding Dr./Louis Rd, Forest Ave./Bryant St. as part of Capital Improvement Projects.

Other repairs were done in-house by staff at Alester Drive and Page Mill Road. Staff will continue to monitor the system and repair or replace pipes when funding is available.

PA-7* Recycled Water Pipeline Expansion Project to expand the recycled water purple pipeline within South Palo Alto towards Stanford Research Park. Drought, Climate Change Utilities- Engineering/WGW CIP: WS-07001 Short-Term Medium Closed - Not completed.

It is unlikely the City will be recommending any further expansion of recycled water during this planning cycle. The One Water Plan is a framework the Council may use to consider water supply projects and conservation activities to address future water supply reliability.

PA-8*
Continue to maintain good standing and compliance in the NFIP and improve Community Rating System Class to provide higher CRS premium discounts.

Flood, Heavy Rain, High Wind Public Works - Engineering General Fund Long-term High Ongoing CRS review was completed and FEMA's CRS specialists determined that staffs actions met the requirements to guarantee a CRS rating of 6. Residents continue to receive a 20% saving on flood insurance. The next review / inspection is determined by CRS Specialist and currently scheduled for Fall 2026.

PA-10* Construct new public Safety Building to mitigate current risks to public safety essential services. Earthquake, Terrorism Public Works - Engineering CIP: PE-15001 Short-Term High In Progress Construction of the new Public Safety Building is nearly complete and the anticipated move in date is early 2025.

PA-11* Rebuild Fire Station 4 to reduce impact from seismic events Earthquake, Terrorism Public Works - Engineering CIP: PE-15003 Short-Term High In Progress The design of Fire Station 4 is currently underway. Construction of the temporary fire station is anticipated to start at the end of January 2025, with construction of the new station scheduled to begin in spring 2025.

PA-13* Replace the Baylands Tide Gate to reduce flood hazards in the Palo Alto flood zone.

Flood, Heavy Rain, High Wind, Atmospheric River, Dam and Levee Failure, Tsunami
Santa Clara Valley Water District Santa Clara Valley Water District funds Long-term Medium In Progress Palo Alto staff reviewed and commented on 90% plans in May 2024. Valley Water is working on the revised plans and intends to submit the 100% Construction Documents in early 2025 for review.

The project is still on track to start in Fall 2025.

PA-15*
Implement Wastewater Long-Range Facilities Plan to improve facilities for treatment and discharge of waste; and to improve water recycling opportunities
Flood, Heavy Rain, High Wind, Extreme Heat, Earthquake, Sea Level Rise Public Works - Environmental Services CIP: WQ-10001 Ongoing High In Progress The local salt removal facility (AWPS) will improve recycled water quality for both Palo Also and Mountain View (both distribute recycled water). The improved quality will enable Mountain View to expand their recycled water distribution to new commercial customers that are building facilities near Mountain View’s recycled water distribution system. Palo Alto City Council approved on May 13, 2024 the construction of the $63-million saltremoving plant. Construction should begin in early 2025 and conclude in the summer of 2027.

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PA-19* Install Fiber Optic Service to Black Mountain Radio Repeater Site to improve public safety communications along Skyline Drive.

Earthquake, Heavy
Precipitation/Atmospheric
River, High Wind, Wildfire,
Space Weather
Utilities -
Engineering/Electric CIP: TBD Short-term Low In Progress Substructure for Phase 1 was completed in Spring 2022 and the substructure for Phase 2 was completed in June 2023. Phase 3 substructure installation is currently in progress. Phase 4 construction is currently paused for an easement relocation from Mid-peninsula Open Space. Will resume construction early next year when the easement paperwork is completed. Phase 5
substructure installation along Arastradero road is currently in progress.

PA-21*
Construct a second electrical transmission interconnection to PG&E using a new corridor to reduce the single dependency of our connection to the electric grid.

Wildfire, Power Outage,
Heavy Precipitation /
Atmospheric River,
Extreme Heat/Extreme Cold, High Wind, Space Weather
Utilities -
Engineering/Electric
CIP, HMGP, Pre- Disaster Mitigation
(PDM)
Long-Term Medium In Progress CPA staff submitted a 2nd application to CAISO for a new transmission project. Staff is expecting a response by July 2025.

PA-27*
Address hazardous fuels and reduce structural ignitability in the Foothills region in accordance with the Community Wildfire Protection Plan and Foothills Fire Management Plan.

Wildfire, Extreme
Temperature
Community Services
Department - Parks and
Open Space
General Fund, HGMP Short-Term Medium Ongoing
In 2024, the FFMP working group performed the required wildfire mitigation activities in Foothills and Arastradero Nature Preserves with a combination of city resources and contracted vendors.

Additionally, the Public Works Department Urban Forestry Division contracted for electrical line clearance of the above ground lines in the Foothills. The Palo Alto Fire Department conducted their annual defensible space home assessments for the residential properties in the Palo Alto WUI. Our team also installed 17 new smoke detection sensors throughout the Foothills (among 50 total sensors) in concert with the Fire Safe Council, Stanford University and Town of Woodside. in 2024 we also updated the Community Wildfire Protection Plan/Foothills Fire Management Plan as part of a county wide process.

PA-29* Consider a policy for Seismic Retrofitting of earthquake prone structures. Earthquake Planning and Development Services General Fund Short-Term Low In Progress
City council approval of contract for services in ealry 2025, project beginning in March 2025 with final project results anticipated in 24 months.

PA-32* Conduct public education that raises awareness of Palo Alto threats and hazards and improves community resilience.

All hazards, including
Earthquake, Dam Failure,
Flood, Wildfire, Landslide,
Tsunami, Heavy Rain, High Wind, Extreme Heat, Drought
Palo Alto Office of
Emergency Services
Staff Time; General
Fund Ongoing High Ongoing
Public Safety departments continue to engage our community at various events throughout the year to rasie awareness, lower personal risks, and increase preparedness. This includes social media messaging, classes, conversations at events, emergency messaging, and online content.

PA-36*
Where appropriate, support retrofitting, purchase or relocation of structures located in high hazard areas and prioritize those structures that have experienced repetitive losses.

All hazards, including
Earthquake, Flood, Dam
Failure, Heavy Rain, High Wind, Wildfire
Planning and Development
Services HMGP, PDM, FMA Short-Term Medium Ongoing
The city maintains a record of repetitive loss structures in high hazard areas but the City is not considering purchase or relocation of these structures in the next 12 months.

PA-37* Integrate the hazard mitigation plan into other plans, ordinances and programs that dictate land use decisions within the community.

All hazards, including
Earthquake, Flood, Dam
Failure, Wildfire, Landslide,
Tsunami, Heavy Rain, High Wind, Extreme Heat, Drought
Planning and Development
Services
Staff Time; General
Fund Ongoing High Ongoing
The LHMP will be incorporated by reference into applicable city planning processes as applicable including the Comprehensive Plan Elements, the Sustainability and Climate Action Plan, and area plans, as well as ordinances and programs that dictate land use decisions.

PA-38* Actively participate in the plan maintenance protocols outlined in Volume 1 of the hazard mitigation plan. All hazards Palo Alto Office of Emergency Services Staff Time; General
Fund Short-Term High Ongoing The City is in compliance with the stated maintenance protocols.

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1 Seismic retrofit two existing potable water storage reservoirs. Foundation work and anchorage will be retrofitted along the lower sections of the tank shell to restrain the tank against uplift, The tanks have a combined storage capacity of 2.0 million gallons, and they are planned to store emergency water storage for the City of Palo Alto.

Earthquake, Landslide Utilities- Engineering/WGW
CIP, HMGP, Building Resilient Infrastructure
and Communities
(BRIC)
Short-Term High In Progress
Engineering condition and coating assessment of Park Tank completed. Condition assessment and engineering seismic analysis of Park and Dahl Tank planned for FY2025, subject to funding.
2 Replace non-seismically restrained potable water piping in liquification zones with new fused and fully restrained piping. 10 miles of unrestrained pipe within a liquification zone will be replaced with fused HDPE piping.

Earthquake Utilities- Engineering/WGW CIP, HMGP, BRIC Short-Term Medium In Progress Seismic retrofit of a water supply facility and 1.5 miles of water main replaced in 2024. About 1 mile of water main planned for FY2025, subject to funding.
3 Install two permanent standby stationary generators at Dahl and Park Pumping Potable Water Stations. These stations are located in WUI areas and service other WUI designated properties. Power lines are deenergized during wildfire events and standby stationary generators will be imperative to ensure power supply and continued operation of critical pumping facilities during a wildfire event.

Earthquake, Wildfire,
Power Outages, High Wind Utilities- Engineering/WGW CIP, HMGP, BRIC Short-Term High In Progress Portable generators procured for greater operational flexibility.

Generators purchased and currently being fabricated. Deployment planned for 2025.
4 Wildfire hardening of critical utilities infrastructure. This action would remove and replace the existing roof and install a new roofing system, soffit, fascia, and front door with WUI compliant materials, systems, and techniques. All vent screens will be removed and replaced with WUI compliant mesh. All vegetation within 30-feet of the structures will be removed and trees limbed for adequate defensible space around each structure. There is a total of four structures located at four different sites, located in and round the Foothills Nature Preserve Area in the City of Palo Alto.

Wildfire, Smoke, Air Quality, High Wind Utilities- Engineering/WGW CIP, HMGP, BRIC Ongoing Low Not Started Will be studied in the Water System Comprehensive Capital Improvement Plan.

New Actions from 2023 Planning Process
5 Conduct an assessment for electrification of City facilities to achieve at least an 80 percent reduction in current natural gas usage by 2030. This assessment will provide a schedule, cost estimate, and timeline of what facilities this electrification must occur at to achieve the goals of the SCAP per this scenario.

Climate Change Public Works - Engineering

CIP, HMGP, BRIC,
Federal Energy Related Grants
Long-Term Low Complete
The electrification assessment for City owned-city maintained, city owned - leased to others to maintain and leased buildings was completed.
6 Apply mitigation techniques to approximately 11 miles of overhead line to mitigate the possibility of a wildfire due to overhead electric lines. This could include the utilization of more robust equipment or construction practices; rerouting to avoid vegetation and improve access for inspection and maintenance; or converting the overhead lines to underground where feasible.

Wildfire, Smoke, Air Quality, High Wind Utilities -
Engineering/Electric
CIP, HMGP, BRIC, Cal Fire Wildfire Mitigation
Short-Term High In Progress
Electrical undergrounding is proceeding through the project area, with work completed on Arastradero Road, and work continuing along Arastradero Creek Trail. Substructure for Phase 1 was completed in Spring 2022 and the substructure for Phase 2 was completed in June 2023. Phase 3 substructure installation is currently in progress. Phase 4 construction is currently paused for an easement relocation from Mid-peninsula Open Space. Will resume construction early next year when the easement
paperwork is completed. Phase 5 substructure installation along Arastradero road is currently in progress.
7 Study a location of historic seepage from the Foothills Nature Preserve Dam. This project will investigate and monitor the seepage flow by channelizing seepage flow and potentially installing weir(s).

Dam-Levee Failure,
Earthquake, Flood,
Landslide, Climate Change
Public Works - Engineering CIP, HMGP Short-Term High In Progress In fall 2024, City’s consultant completed a field assessment identifying location of a seepage weir on the downstream side of the Foothill Nature Preserve Dam as requested by the
Department of Water Resources’ Division of Safety of Dams. The weir is anticipated to be installed by early 2025 which will allow the City to collect quantitative measurements of the seepage flow. The quantitative data would further assist in better understanding of the seepage trend and guide if future long-term solution is required.
8 Restore the width and height of the earthen flood levee between Harbor Road near the Baylands Interpretive Center and the perimeter levee of the airport to six inches above its original height.

Dam-Levee Failure, Flood,
Tsunami, Climate Change
Community Services
Department - Parks and
Open Space
CIP Long-term Low Not Started
A permanent CIP is not likely to occur in the next several years.

The Army Corps of Engineers determined the cost to benefit ratio does not support federal funding for this project currently.

They will re-evaluate in 2040.
9 Improve the quality of the tertiary-treated recycled water by microfiltration or ultrafiltration followed by reverse osmosis to reduce the level of Total Dissolved Solids (TDS).

Drought, Climate Change Public Works -
Environmental Services CIP Long-Term Medium In Progress The Salt Removal Facility has a current active RFP and staff believes that construction will commence in 2025 with completion in 2028.
10 Evaluate options for protecting electric substations from outside vandalism and intrusion. If necessary, fences and other protections will be repaired.

Security lighting will be designed and issued for construction.

Terrorism and Weapons of Mass Destruction, Active
Shooter
Utilities -
Engineering/Electric
CIP, HMGP, FederalState Physical
Security Funding for Utilities
Short-Term Medium In Progress
7 of 9 electric substations have new security lighting and cameras installed. The engineering design and the IFB for contract construction is in progress. Construction is estimated to be completed Summer 2026.

ITEM 17 Item 17 Page 8 Attachment A Packet Page 511 of 582 City Council
Staff Report
From: City Manager
Report Type: INFORMATION REPORTS
Lead Department: Planning and Development Services
Meeting Date: February 10, 2025
Report #:2409-3442
TITLE
Information Item: Summary of Fiscal Year 2023-2024 Community Development Block Grant (CDBG) Program Accomplishments — Review of the CDBG Consolidated Annual Performance and Evaluation Report (CAPER). CEQA Status — Not a Project.

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

EXECUTIVE SUMMARY
The City is required to annually report its accomplishments achieved through its Community Development Block Grant (CDBG) program to the U.S. Department of Housing and Urban Development (HUD). This annual report to HUD is called the Consolidated Annual Performance and Evaluation Report (CAPER). In accordance with the City’s CDBG Citizen Participation Plan, the City’s Human Relations Commission (HRC) conducts a public hearing on the draft CAPER to allow for public review and discussion. The City then submits the draft CAPER to HUD by the annual September deadline. Afterwards, staff provides City Council with an informational report disseminating the draft CAPER as submitted to HUD (Attachment A).1 No action is required by City Council to receive the draft CAPER.

During FY 2023-2024 (Program Year 2023), the City’s CDBG subrecipients provided projects, programs, and activities that benefitted extremely low-, very low-, low-, and moderate-income individuals and households in Palo Alto. Through CDBG and CDBG-CV funds, 613 persons and 19 microenterprises were assisted in FY 2023-2024. Of the 632 persons and microenterprises assisted by CDBG, 501 were extremely low-income, 105 were low-income, 8 were moderateincome, and 18 were non-low-moderate income.

BACKGROUND
The City of Palo Alto receives funds annually from HUD as an entitlement city under the CDBG program. As a recipient of CDBG funds, the City is required to prepare a CAPER at the end of 1 The Consolidated Annual Performance and Evaluation Report (CAPER) uses the questions, report organization, and information format required and provided by HUD.

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each fiscal year. The CAPER describes the City’s progress on implementing the projects, programs, and activities identified in the City’s CDBG FY 2023-2024 Annual Action Plan (AAP)2 and the goals and objectives of the 2020-2025 Consolidated Plan (ConPlan).3 The HRC reviewed the draft CAPER on September 12, 2024, briefly discussed the findings, and asked a few clarifying questions. The HRC did not provide any comments on the draft CAPER that required any changes. Additionally, there were no members of the public that spoke to this item. The City submitted the draft CAPER for FY 2023-2024 to HUD by the September 28, 2024 deadline. The City also responded to minor comments from HUD and submitted minor typographical amendments to the draft CAPER in November 2024.

ANALYSIS
During FY 2023-2024, the City’s CDBG subrecipients continued to provide vital services to extremely low-, very low-, low-, and moderate-income households while addressing the priorities and needs of the community and the City’s funding priorities. A total of $895,067 was available for CDBG projects, programs, and activities during FY 2023-2024.

As reported in the 2023-2024 Final CAPER, major FY 2023-2024 accomplishments from the City’s CDBG program are as follows:
• Catholic Charities of Santa Clara County – Long Term Care Ombudsman Program [Goal:

Assist 50 individuals; Actual: 50 individuals]. The program provided advocacy and complaint investigation for elderly residents of long-term care facilities in Palo Alto, which included regular contact with Palo Alto Residential Care Facilities to observe and monitor conditions of care;
• Alta Housing – SRO Resident Supportive Services [Goal: Assist 131; Actual: 145 individuals]. Alta Housing engaged a service coordinator to provide 40 hours of weekly services to provide case management and support counseling services to residents at Alma Place and Barker Hotel to help them maintain housing stability. Activities included financial counseling, health maintenance, information, and referral problem-solving, employment assistance, crisis intervention, and case management. Both Alma Place and Barker Hotel are single-room occupancy facilities;
• LifeMoves – Case Management [Goal: Assist 27 individuals; Actual: 193 individuals].

LifeMoves provided case management services to Opportunity Services Center and Hotel De Zink clients for locating housing and/or employment and be connecting clients 2 The Annual Action Plan outlines the projects, programs, and activities the City intends to undertake with CDBG funds to address the needs and implement the strategies identified in the City’s Consolidated Plan (ConPlan). 3 The ConPlan is a five-year strategic plan that addresses the housing and non-housing community development needs of lower income persons in the City and establishes annual goals and objectives to meet the identified needs.

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to benefits;
• Project Sentinel – Fair Housing Services [Goal: Assist 12 individuals; Actual: 19 individuals]. Project Sentinel provided fair housing services to City residents including community education and outreach regarding fair housing law and practices, investigation, counseling, and legal referral for victims of housing discrimination; • Silicon Valley Independent Living Center (SVILC) – Case Management Services [Goal:

Assist 25 individuals; Actual: 24 individuals]. SVLIC provided assistance for individuals with disabilities and their families. This assistance helped these persons to transition from homelessness, health care facilities, unstable or temporary housing to permanent affordable, accessible, integrated housing involving emergency assistance, security deposits, rent, information, and referrals;
• Rebuilding Together Peninsula – Safe at Home Program [Goal: Assist 5 households; Actual: 6 households]. Program preserved affordable housing by transforming homes through critical repairs and accessibility modifications, at no cost to the service recipient. The majority of the low-income homeowners served were elderly seniors and/or people with disabilities, who are physically and financially unable to maintain safe living conditions for themselves and their families; • Peninsula Healthcare Connection (PHC) – Harm Reduction Services [Goal: 100 individuals; Actual: 114 individuals]. PHC delivered Harm Reduction materials to referral families. Materials included: substance use treatment recommendations such as rehab center options, support group meeting referrals, harm reduction kits designed for safe needle use and storage, and basic needs resources, such as Narcan; • WeeCare/Upwards – BOOST Program [Goal: 19 microenterprises; Actual: 19 microenterprises]. WeeCare worked with Family Child Care Home (FCCH) providers in Palo Alto who are already on the wait list for the BOOST program. These providers received staff training-learning best practices on how to grow and sustain their organization and how to better support the families they serve. Funds requested to pay WeeCare staff salaries for training providers on how to use Child Management System (CCMS) software. CCMS was developed for providers to create work plans, goals, capacity, and revenue, empowering them to reach service and operations goals; and • Move Mountain View (MMV) [Goal: 109 individuals; Actual: 62 individuals]. The program provides reserved off-street parking for participants, as well as permanent housing solutions through intensive case management. MMV operates four 24/7 RV Safe Parking lots and three Congregational Safe Parking locations. The total capacity of these lots in Palo Alto and Mountain View is 109 vehicles. A total of 159 vehicle dwellers are currently enrolled in the program. One of locations is located in Palo Alto at the Geng Road Safe Parking lot. The Geng Road Safe Parking Lot is where MMV utilizes Palo ITEM 18 Item 18 Page 3 Packet Page 514 of 582
Alto’s CDBG-CV funds. Funding pays for the salary of one full-time Client Counseling Case Manager and one full-time Client Case Manager Housing Specialist. MMV experienced significant staff turnover in these positions during the program year, which resulted in fewer individuals being served than initially projected.

TIMELINE
As required by HUD, the FY 2023-2024 draft CAPER was submitted by the September 28, 2024 deadline. The FY 2025-2026 CDBG Formula Allocation is expected to be posted in April 2025, pending the approval of the FY25 federal budget. Staff continues to monitor legislative developments that may impact future CDBG funding.

FISCAL/RESOURCE IMPACT
This informational report has no fiscal impact.

STAKEHOLDER ENGAGEMENT
An advertisement was published in The Daily Post on August 28, 2024 announcing the availability of the draft CAPER for public review and comment. The draft CAPER was posted on the City’s CDBG webpage (www.cityofpaloalto.org/cdbg) from August 28, 2024 through September 12, 2024, meeting the 15-day public comment period requirement. Hardcopies of the draft CAPER were also available for review at the City’s Development Center, Planning & Development Services Department at City Hall, and the City’s Downtown Public Library. The HRC held a public hearing on September 12, 2024, to discuss the draft CAPER and provide the public the opportunity to comment; the meeting fulfills the public hearing requirement for the CAPER. There were no public comments made during the hearing and the HRC did not provide comments necessitating changes to the contents and or metrics of the draft CAPER.

ENVIRONMENTAL REVIEW
Council review on this item is not considered a project as defined by CEQA because the CAPER is for informational purposes only with no action required by City Council.

ATTACHMENTS
Attachment A: FY23/24 Draft Consolidated Annual Performance and Evaluation Report (CAPER) APPROVED BY:

Jonathan Lait, Planning and Development Services Director ITEM 18 Item 18 Page 4 Packet Page 515 of 582
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Staff Report
From: City Manager
Report Type: INFORMATION REPORTS
Lead Department: Community Services
Meeting Date: February 10, 2025
Report #:2501-4020
TITLE
Key Findings of the 2024 Human Services Needs Assessment; CEQA Status - Not a Project

RECOMMENDATION
This is an informational report and City Council action is not required.

EXECUTIVE SUMMARY
This report transmits the results of the Human Services Needs Assessment conducted in 2024.

Through qualitative and survey research, and review of existing data of service providers, the Human Services Needs Assessment identifies community needs, common barriers to service participation, and specific needs for high-risk groups along with recommendations for additional considerations regarding the Human Services Resource Allocation (HSRAP) framework and human services needs that would benefit from future community conversations. The HRC revised the Priority of Needs for the FY26/27 HSRAP application process based on the recommendations from the assessment and will continue to work with staff on addressing the other recommendations from the report. This includes possible future adjustments to the HSRAP framework and working in collaboration with community partners on human services needs and gaps identified, all with the goal of informing the HRC’s work in the coming period as well as the FY28/29 HSRAP process, focus and investments.

BACKGROUND
The Human Services Resource Allocation Process (HSRAP) is the established mechanism by which the City solicits, reviews, and allocates the City’s General Fund dollars to human service organizations in the community; the process has been in place since 1984. One of the first steps in the process is to establish the Priority of Needs (i.e., allowable funding categories) for each funding period. The City’s Human Relations Commission (HRC) has historically done so by identifying human services needs through information provided by the community at its monthly meetings and from the findings of a biennial Needs Assessment conducted in advance of every HSRAP application period. These biennial Needs Assessments were limited in scope and included a survey of Palo Alto human services providers and local demographic information.

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Since the last full-scale Human Services Needs Assessment (HSNA) was conducted in 2012, Office of Human Services (OHS) staff determined that there was a need for a more thorough examination into local human service needs and issued a Request for Proposal (RFP) in late 2023 for a consultant to conduct an assessment. A contract was awarded to RDA Consulting (RDA) in early 2024 and they began work in the Spring of 2024.

The key aim of the HSNA was to identify the needs, gaps, barriers and challenges faced by Palo Altans seeking human services, provide an understanding of local service needs, and help guide future grant making priorities. Together RDA and OHS identified three overarching questions for the HSNA:
(1) What human services needs are Palo Alto residents experiencing? (2) What are the strengths and gaps in existing services available to Palo Alto residents? (3) What are the opportunities for HSRAP to better fill gaps in services? The keys methods of community engagement and secondary qualitative and quantitative data gathering activities employed for the HSNA included:
• Qualitative Research (Focus Groups and Individual Interviews) • 51 total participants
• Survey Research (Community & Service Providers)
• Community Survey translated into five languages
• 385 Survey responses from community members and 34 from service providers • Secondary Data – Including data on current HSRAP grantees and other Human Services providers in Palo Alto and Santa Clara County
The completed HSNA (Attachment A) was presented to the HRC at their October 23, 2024 meeting1. Feedback centered on understanding and interpreting assessment findings and identifying next steps.

ANALYSIS
Key Finding from the 2024 HSNA report:

Community Needs – The report indicated through the results of both the qualitative and quantitative research tools that the greatest needs include:
(A) Essential services for high needs groups–primarily:
(1) Individuals experiencing housing insecurity and homelessness, (2) Individuals with disabilities, and
(3) Older adults.
1 Human Relations Commission, October 23, 2024; Agenda Item 2, Action Minutes; https://portal.laserfiche.com/Portal/DocView.aspx?id=123818&repo=r-704298fc ITEM 19 Item 19 Page 2 Packet Page 541 of 582
(B) Community connection, isolation, and inclusion
The survey tool (given to both community members and service providers) asked both what the greatest needs were and the level to which those needs are not being met currently. Those results indicated that needs for community connection, isolation, and inclusion are largely met, and essential services for high needs groups are largely unmet - further stating that this is especially true for: (a) individuals experiencing homelessness; (b) adults with disabilities; and (c) those who identified as Hispanic or Latino/a/x, another race (including multiracial), and those who did not share their race/ethnicity.

Common Barriers to Service Participation – The report identified the following as barriers or limitations to receiving services:

1. Inaccessibility of services

2. Waitlists or lack of capacity

3. Long or confusing application processes

4. Service costs
Additional barriers identified include location and transportation to services as well as not knowing what services/resources are available.

Essential Services for High Need Groups - The report delves deeper into specific needs for “high need” groups (defined as individuals who fall into demographic categories that have high rates of unmet need relative to other demographics subgroups) stating that:

While high needs groups, such as unhoused individuals, adults with disabilities, and older adults, benefit in part from existing services within Palo Alto and neighboring cities within the County, they still lack comprehensive safety net services. Additionally, long waitlists for critical services and resources including shelter, along with the high demand for mental health services, remain pressing issues. Individuals who are currently unhoused, have a disability, or both, had the highest rates of unmet need overall.” Some of the specific areas of need reported in the HSNA include the following (Note – The full HSNA report provides details as to the level that these areas of need are being currently being met).
• Housing Assistance & Homelessness Services – Individuals across all sectors (unhoused, low income and more upper income individuals) named affordable housing and safe and accessible shelter as one of the most pressing needs facing local residents. As that relates to shelters, persons experiencing homelessness reported long wait times and short stays. The lack of affordable housing affects many sectors of the community including older adults, individuals with disabilities, young families, etc.

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• Services for Individuals with Disabilities –The report stated that “For many disabled individuals in the community, accessing consistent, affordable support from trained professionals is difficult in Palo Alto and the Bay Area overall. Both children and adults, require professional support workers trained to address specific medical diagnoses and disabilities. However, finding such specialized disability support staff locally is often challenging. The high cost of living in Palo Alto has led to a shortage of healthcare providers, therapists, and direct support workers within the city. As a result, individuals with disabilities find that they must travel long distances to receive services.” • Older Adult Services - A large proportion of both service providers and community members named the importance of sustaining older adult services as an area in critical need of additional funding, resources, and focus. It was found that older adults feel increasingly isolated and find it harder to access essential services that they need.

Service providers expressed concerns about the growing population of older adults whose needs are greater than their resources. Providers note that there are limits to what local agencies can provide in such areas as transportation, social activities, medical services, and counseling for older adults in relation to the need. • Mental Health Supports for Adults & Youth – Nearly all provider survey respondents responded that adult mental health support is a need among their client populations; this was also true for a majority of individuals who responded to the survey.

Approximately two-thirds of community members (65%) and some service providers also named youth mental health as a specific area of unmet need. As the quantitative survey was not administered to school age youth (under the age of 18), the report acknowledges that the extent of unmet need of youth may be underrepresented. • Food & Nutrition Services – While the need for food and nutrition services was affirmed by most survey respondents as an area of need, it was more specifically indicated as an area of greater unmet need by those whose household income is less than $60,000 and unhoused individuals who indicated that there were not free sources of food on the weekend.

Community Connection, Isolation, and Inclusion - The report indicates that across background characteristics that “Community connection and engagement, along with leisure/recreation, and cultural services or affinity spaces were the most widely shared needs identified by needs assessment participants….” Although the overall levels of unmet need were lower in relation to other areas. Experiencing higher unmet needs in these areas are specific communities such as those experiencing homelessness, individuals with disabilities, older adults, immigrants and those with limited English proficiency, and lower income residents. A specific conversation about these needs have been identified as an area that would benefit from additional community conversation in the final section of this report.

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Additional survey results and demographics are included on pages 7 - 24 of the HSNA.

Staff and HRC Responses to the Findings and Recommendations from the HSNA:

Priority of Needs
The only action taken by the HRC at their October 23, 2024 review meeting of the HSNA was to finalize the proposed Priority of Needs - allowable HSRAP funding categories - as the Request for Proposal (RFP) for the FY26/27 HSRAP process was to be issued early December 2024.

RDA was asked to propose a new Priority of Needs for HSRAP based on the findings from the needs assessment and human serviced best practices for number of funding categories. In general, the HRC felt the proposed Priority of Needs did a good job of encompassing the needs that were highlighted in the HSNA. However, they felt that a couple key areas of need were missing based on current HSRAP funding in critical service areas of need. The following Priority of Needs was adopted for the FY26/27 HSRAP cycle, the text in BOLD indicates the changes that the HRC made to RDA’s proposed Priority of Needs.
• Homelessness services
• Housing support services
• Services for individuals who are disabled
• Services for older adults and their caregivers
• Food & nutrition services
• Mental and physical health services
• Services for youth and their caregivers
HSRAP Framework & Consideration of Service Improvements As part of the HRC’s work for the coming two years in anticipation of the FY28/29 HSRAP cycle, the Commission will be addressing the other recommendations and areas for further consideration of the HSNA. This includes the consideration of developing additional key elements of the HSRAP frameworks including guiding values, funding framework, and overarching strategic priorities.

The report also includes a series of recommendations for further Service Improvements from the main findings from the report. These are areas of need in the community that would benefit from being discussed and/or addressed cross-sectionally with partners such as the City of Palo Alto, Human Relations Commission, service providers, nonprofit partners, community members and other stakeholders. These follow up areas include:
• Barriers to Service Participation
• Housing Assistance & Homelessness Services
• Services for Individuals with Disabilities
• Older Adult Services
• Mental Health Supports for Adults & Youth
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• Food & Nutrition Services
• Areas of Unmet Needs
• Community Connection, Isolation & Inclusion

FISCAL/RESOURCE IMPACT
The information in this report does not impact resources at this time.

STAKEHOLDER ENGAGEMENT
There was significant outreach to the community for the HSNA. This included outreach to area Human Services providers that provide services to Palo Alto resident and several touchpoints with current HSRAP grantees to encourage them, as well as their clients, to complete the needs assessment survey and participate in focus groups opportunities as well as targeted outreach to providers of services to vulnerable populations. Outreach was also done to local communities of faith, Palo Alto Unified School District, Child Care providers, local service group, City website/social media channels, County services representatives, flyers in local libraries/community centers, OHS list serve, paid ads in the Palo Alto Daily Post and Palo Alto Online, County-wide Human Service provider list serv, key stakeholder interviews and in-person interviews with community members at local libraries, among other outreach efforts.

ENVIRONMENTAL REVIEW
This is an informational report and not subject to CEQA.

ATTACHMENTS
Attachment A: City of Palo Alto Human Services Needs Assessment Report 2024 APPROVED BY:

Kristen O'Kane, Community Services Director
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Palo Alto City CouncilFebruary 10, 2025

Palo Alto City Council
February 10, 2025