Agenda packet — Palo Alto City Council, August 11, 2025 (part 4 of 5)

11. Addendum A: Managed Services Systems Inventory
The AWS infrastructure services inventory to be included on the AWS managed services:

Table 7: AWS services inventory
Service Configuration summary
S3 Standard
50 TB per month
PRD
Amazon FSx for Windows File
Server
Desired storage capacity (1 TB)
STG
Amazon Virtual Private Cloud
(VPC)
Number of Site-to-Site VPN Connections (10)
QAS
Amazon Elastic File System
(EFS)
Data stored in Standard storage (5 TB per month)
DEV
Amazon S3 Glacier (Glacier API
only)
S3 Glacier storage (10 TB per month)
SBX
Amazon EC2 (r5.large) Quantity
- 12
Operating system (Linux), Storage for each EC2 instance (General Purpose SSD (gp2)), Storage amount (500 GB)
PRD
Amazon EC2 (r5.xlarge)
Quantity - 8
Operating system (Linux), Storage for each EC2 instance (General Purpose SSD (gp2)), Storage amount (500 GB)
STG
Amazon EC2 (x1.16xlarge)
Quantity - 3
Operating system (Linux), Storage for each EC2 instance (General Purpose SSD (gp2)), Storage amount (4000 GB)
QAS
Amazon EC2 (t2.small) Quantity
- 2
Operating system (Linux), Storage for each EC2 instance (General Purpose SSD (gp2)), Storage amount (500 GB)
DEV
Amazon EC2 (t2.xlarge)
Quantity - 1
Operating system (Windows), Storage for each EC2 instance (General Purpose SSD (gp2)), Storage amount (500 GB)
PRD
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Amazon EC2 (m5.large)
Quantity - 1
Operating system (Linux), Storage for each EC2 instance (General Purpose SSD (gp2)), Storage amount (500 GB)
STG
Amazon EC2 (m4.2xlarge)
Quantity - 1
Operating system (Linux), Storage for each EC2 instance (General Purpose SSD (gp2)), Storage amount (500 GB)
QAS
Amazon EC2 (r5a.large)
Quantity - 4
Operating system (Linux), Storage for each EC2 instance (General Purpose SSD (gp2)), Storage amount (150 GB)
DEV
Amazon EC2 (r5.2xlarge)
Quantity - 1
Operating system (Linux), Storage for each EC2 instance (General Purpose SSD (gp2)), Storage amount (500 GB)
PRD
Amazon EC2 (t2.xlarge)
Quantity - 1
Operating system (Linux), Storage for each EC2 instance (General Purpose SSD (gp2)), Storage amount (500 GB)
STG

The corresponding SAP systems relevant within the scope of Managed Services:

Table 8: SAP System inventory
City SAP systems
System type Version Tier Database Operating system
ECC EHP 8 PRD HANA Suse Linux
ECC EHP 8 STG HANA Suse Linux
ECC EHP 8 QAS HANA Suse Linux
ECC EHP 8 DEV HANA Suse Linux
ECC EHP 8 SBX HANA Suse Linux
BW 7.5, SP16 PRD HANA Suse Linux
BW 7.5, SP16 STG HANA Suse Linux
BW 7.5, SP16 QAS HANA Suse Linux
BW 7.5, SP16 DEV HANA Suse Linux
CRM 7.0, EHP4 PRD HANA Suse Linux
CRM 7.0, EHP4 STG HANA Suse Linux
CRM 7.0, EHP4 QAS HANA Suse Linux
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CRM 7.0, EHP4 DEV HANA Suse Linux
Gateway PRD HANA Suse Linux
Gateway STG HANA Suse Linux
Gateway QAS HANA Suse Linux
Gateway DEV HANA Suse Linux
ESS/ MSS Portal PRD HANA Suse Linux
ESS/ MSS Portal STG HANA Suse Linux
ESS/ MSS Portal QAS HANA Suse Linux
ESS/ MSS Portal DEV HANA Suse Linux
Solution Manager PRD HANA Suse Linux
NWDI DEV HANA Suse Linux
BSI Taxfactory/Jump Server PRD HANA Suse Linux
Open VPM Server PRD Suse Linux
SAP Router PRD Windows
SAP AD PRD Windows
Fiori Frontend PRD HANA Suse Linux
Fiori Frontend STG HANA Suse Linux
Fiori Frontend QAS HANA Suse Linux
Fiori Frontend DEV HANA Suse Linux
HANA DB Server PRD HANA Suse Linux
HANA DB Server QAS
STG HANA Suse Linux
HANA DB Server DEV HANA Suse Linux

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12. Addendum B: City and EPI-USE Labs Responsibilities
The following table will define the high-level responsibilities of the parties in a RACI format.

Table 9: RACI Table
ID
Service
R – Responsible, A - Accountable, C –
Communicated, I – Informed, P- Participate
Frequency EPI-
USE CoPA
1 Service Management

1.1 Account Management

1.1.1 Governance meetings Monthly RAC RAC

1.1.2 Platform capacity planning (usage-based) Ongoing R CI

1.1.3 Platform capacity planning (future project-
based) Quarterly R CI

1.1.4 Provide SLA and usage reports and
performance metrics Monthly RA CI

1.2 Service Request Management

1.2.1 Log service requests in Client Central Ongoing CI RA

1.2.2 Review, approve service requests Ongoing RA RA

1.3 Incident Management

1.3.1 Daily support desk operations Ongoing RA RA

1.3.2 Review, approve, resolve, escalate incidents Ongoing RA RA

1.3.3 Confirm resolved incidents/solutions Ongoing RA RA

1.3.4 Create incidents/solutions Ongoing RA RA

1.4 SAP Online Support Service

1.4.1 Create OSS users Ongoing CI RA

1.4.2 Assign OSS permissions Ongoing CI RA

1.4.3 Manage developer keys Ongoing CI RA

1.4.4 Manage object keys Ongoing CI RA

1.4.5 Support management of S-User ID Ongoing CI RA
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1.4.6 Monitor remote support connection to OSS Ongoing CI RA

1.4.7 Open/close SAP remote support connections Ongoing CI RA 2 Infrastructure

2.1 Data Center Management

2.1.1 Infrastructure (AWS) all support Ongoing RA CI

2.1.2 AWS tenancy administration Ongoing RA CI

2.2 Network Management

2.2.1 Proactively monitor data center networks and
utilization Ongoing RA CI

2.2.2 Change data center network configuration Ongoing RA CI

2.2.3 All network maintenance Ongoing RA CI

2.3 Storage Management

2.3.1 Proactively monitor storage performance &
capacity Ongoing RA CI

2.3.1 Manage data files, file systems and disks Ongoing RA CI

2.3.1 Scale storage capacity (additional) Request RA CI

2.4 Operating System

2.4.1 Create/maintain OS users Ongoing RA CI

2.4.2 Monitor for/report security incidents Ongoing RA CI

2.4.3 Configure/change OS parameters Ongoing RA CI

2.4.4 Monitor/remediate OS, logs, file systems Ongoing RA CI

2.4.5 Interact with vendor to remediate OS issues Ongoing RA CI

2.4.6 Proactively monitor swap and paging Ongoing RA CI

2.4.7 Proactively monitor memory usage Ongoing RA CI

2.4.8 Manage OS patches Ongoing RA CI

2.4.9 Perform OS upgrades Ongoing Project CI

2.5 System Startup/Shutdown
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2.5.1 Scheduled OS/hardware system startup &
shutdown Request RA CI

2.5.2 Shutdown/restart OS/hardware after
failure/maintenance Ongoing RA CI

2.6 Backup/Restore

2.6.1 Perform periodic file system and database
backups Ongoing RA CI

2.6.2 Requests for ad-hoc backups Ongoing RA CI

2.6.3 Monitor backup processes Ongoing RA CI

2.6.4 Perform periodic backup/restore testing;
include result in the relevant report Biannual RA CI

2.6.5 Perform restore and recovery of file
systems/databases/tables after failure Ongoing RA CI

2.6.6 Perform restore and recovery of file
systems/databases/tables upon request Ongoing RA CI

2.6.7 Perform verification of restored systems Ongoing RA CI

2.6.8 Perform functional verification Ongoing RA CI

2.7 Integration

2.7.1 Configure integration with customer directory
service Ongoing RA CI

2.7.2 Integration with SAP Cloud (Network
connections and VPN) Ongoing RA CI

2.8 SFTP Service

2.8.1 Provide file sharing on hosted systems Request RA CI

2.8.2 User and access management to hosted
systems Request RA CI

2.8.3 Create/maintain shared folders Request RA CI

2.8.4 Implement and maintain antivirus software
on servers Ongoing RA CI

2.8.5 Antivirus software licenses Ongoing RA CI

2.8.6 Backup data on shared folders Ongoing RA CI
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2.8.7 Restore data on shared folders Request RA CI
3 Database Management

3.1 SAP HANA

3.1.1 Proactively monitor database health and
resource usage Ongoing RA CI

3.1.2 Monitor table growth to prevent operational
issues Ongoing RA CI

3.1.3 Partition/rebalance tables due to uneven
growth Ongoing RA CI

3.1.4 Plan and perform file system extensions Ongoing RA CI

3.1.5 Perform HANA housekeeping (manage logs,
traces, free up resources) Ongoing RA CI

3.1.6 Maintain HANA configuration parameters
based on best practices Ongoing RA CI

3.1.7 Start/stop database Request RA CI

3.1.8 Add hardware for scale-out configuration Request RA CI

3.1.9 Update/patch database Ongoing RA CI

3.1.10 Configure HANA Transports Management Request RA CI

3.1.11 Implement /maintain additional SAP tools (in
HANA context delivered by SAP) Request RA CI

3.1.12 Analyze and optimize expensive SQL
statements for improved performance Request RA CI

3.1.13 System troubleshooting to resolve issues and
return HANA to normal operation Ongoing RA CI

3.1.14 Create/maintain HANA Studio users Request RA CI

3.1.15 Management of database users Ongoing RA CI

3.1.16 Backups Ongoing RA CI

3.1.17 Recover database after technical issues Ongoing RA CI 4 Basic Operations

4.1 Monitoring
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4.1.1 Configuration of basis monitoring tools Ongoing RA CI

4.1.2 Monitoring of alert consoles for different tools Ongoing RA CI

4.1.3 Logging of performance events Ongoing RA CI

4.1.4 Respond to events according to notification
and escalation procedures Ongoing RA CI

4.1.5 Identification, installation, and activation of
monitoring tools Ongoing RA CI

4.2 SAP Upgrades & Enhancement Packs

4.2.1 SAP Major release upgrades Request Project CI

4.2.2 SAP Enhancement Pack upgrades Request Project CI

4.2.3 Upgrade database Request RA CI

4.2.4 Perform functional changes and
developments Request CI RA

4.2.5 Testing of upgraded system and functionality Request CI RA

4.3 SAP Support Packs

4.3.1 Apply SAP kernel upgrades Biannual RA CI

4.3.2 Apply SAP patches Annual RA CI

4.3.3 Apply SAP Notes Request RA RA

4.3.4 Post-support pack testing Request CI RA

4.4 SAP Security Management

4.4.1 Create/maintain/review/audit roles, profiles,
authorizations Ongoing CI RA

4.4.2 Create/maintain/lock/unlock users, assign
roles Ongoing CI RA

4.4.3 Maintain users/roles/profiles in client 000 Ongoing RA CI

4.4.4 Provide customer access to client 000 Request RA CI

4.4.5 Monitor and share information about security
fixes published by SAP Ongoing RA RA

4.5 Client Copies & Refreshes (excludes
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4.5.1 Perform copy/refresh Request CI RA

4.5.2 Perform technical post-processing Request CI RA

4.5.3 Perform validation of copied/refreshed system Request CI RA

4.6 System Copies (to non-production)

4.6.1 Perform system copy Request CI RA

4.6.2 Perform technical post-processing Request CI RA

4.6.3 Perform validation of installed system Request RA CI

4.7 Change Control

4.7.1 Application development, customizing,
configuration, maintenance, support Ongoing CI RA

4.7.2 Planning change requests Ongoing CI RA

4.7.3 Apply SAP notes for applications Ongoing CI RA

4.7.4 Apply SAP security notes Ongoing RA RA

4.8 Printer Management

4.8.1 Create, change, lock, unlock, maintain
printers within SAP Request CI RA

4.8.2 Printers within SAP, configured on the OS
(due to security constraints) Request RA CI

4.8.3 Analyze printing and spool issues Request CI RA

4.8.4 Spool system housekeeping Ongoing CI RA

4.8.5 Design and implement print forms Request CI RA

4.8.6 Troubleshoot issues with printer hardware Request CI RA

4.9 Desktop Support

4.9.1 SAPGUI support Request CI RA

4.9.2 SAP SSO support Ongoing CI RA

4.9.3 Desktop and front-end user support Request CI RA

4.10 Additional Proactive Services

4.10.1 Analyze SAP EarlyWatch Alert reports and
consider technical recommendations Ongoing RA CI
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4.10.2 Implement data archiving strategy and
processes Request CI RA

4.10.3 Monitor and maintain data archiving systems Ongoing CI RA

4.11 System Installations / Migrations

4.11.1 Install new systems / migrate from on
premise to cloud Request Project CIP

4.11.2 Technical configuration of all
installed/migrated systems Request Project CIP

4.11.3 Integration of new/migrated systems to cloud
operations environment Request Project CIP

4.11.4 Integrate all hosted systems with customer
Solution Manager in cloud Request Project CIP

4.12 Disaster Recovery

4.12.1 Implement disaster recovery setup according
to architecture blueprint Request RA CIP

4.12.2 Develop plan for disaster recovery (data
center and system infrastructure only) Request RA CIP

4.12.3 Manage and monitor disaster recovery
architecture and replication Ongoing RA CIP

4.12.4 Develop plan for disaster recovery of
applications and connectivity to cloud Request RA CIP

4.12.5 Test disaster recovery system (data center
and system infrastructure only) Quarterly RA CIP

4.12.6 Execute full disaster recovery failover test Annually RA CIP

4.12.7 Technical and connectivity testing for disaster
recovery failover Annually RA CIP

4.12.8 Application testing for disaster recovery
failover Annually RA CI

4.13 Management of Local Area Network

4.13.1 Provide and maintain network at sites Ongoing CI RA 5 NetWeaver ABAP Operations

5.1 General Operations
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5.1.1 Proactive availability monitoring of SAP
instances Ongoing RA CI

5.1.2 Troubleshooting SAP instances Ongoing RA CI

5.1.3 Analyze systems logs and fix technical
failures Ongoing RA CI

5.1.4 Proactive monitoring of SAP processes Ongoing RA CI

5.1.5 Analyze update terminations and take
appropriate action Ongoing RA CI

5.1.6 Clean up terminated updates Ongoing RA CI

5.1.7 Analyze lock entries and take appropriate
action Ongoing RA CI

5.1.8 Proactively monitor ABAP short dumps Ongoing RA CI

5.1.9 Troubleshoot performance issues (excludes
ABAP and application issues) Ongoing RA CI

5.1.10 Maintain SAP system profile parameters Ongoing RA CI

5.1.11 Implement/update tools for SAP support
service readiness Ongoing RA RA

5.1.12 Management of web service runtime Ongoing CI RA

5.1.13 Configure RFC connections to SAP and non-
SAP systems Ongoing CI RA

5.2 Interface Administration

5.2.1 Create/execute/monitor/troubleshoot batch
input sessions Ongoing RA CI

5.2.2 Configure/monitor/troubleshoot interfaces
and related (IDOCS, scripts etc.) basis
configuration
Ongoing RA CI

5.3 Job Scheduling

5.3.1 Schedule and monitor standard housekeeping
jobs Ongoing RA CI

5.3.2 Schedule/monitor/change application batch
jobs Request CI RA

5.4 Change Control
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5.4.1 Configure and maintain SAP Transport
Management System and routes Request RA CI

5.4.2 Release tasks and transport requests Ongoing CI RA

5.4.3 Import transport requests Request CI RA

5.4.4 Troubleshooting SAP Transport Management
System Ongoing RA CI

5.4.5 Address functional transport issues Ongoing CI RA

5.4.7 Testing of completed transport requests Ongoing CI RA

6.0 Sandbox Basis administration Ongoing RA P

6.1 Knowledge transfer to City basis on Sandbox Ongoing R P

13. Addendum C: Change Request Form
The Change Request Form provided below may only be used pursuant to Section 4 (Not to Exceed Compensation) of this Agreement, regarding Additional Services, as an Attachment A (Scope of Work) to an approved Task Order as detailed in Section 4. The Change Request Form, by itself, is not permitted to be used separate from a Task Order as detailed under Section 4 and any use of a Change Request Form that is separate from and not part of an approved Task Order as detailed under Section 4 shall be void and without effect.

Agreement ref: Originator:

Client name: City of Palo Alto Change request date:

Title of change:

Reason for change:

Include an outline of the reason for the change and the impact of not implementing it. Attach written change request.

Description of
change:

Include full details of the change including any specifications, areas of the Services impacted.

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Impact on charges:

Include full details of any charges, if any, for the change, and any revision to the charges.

Impact on
agreement:

Describe the resulting updates to the Clauses and Schedules to the Agreement.

Implementation
schedule:

Assumptions /
additional
information:

Provide any assumptions made at the time of the change and any relevant supporting information.

14. [RESERVED]

15. [RESERVED]
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EXHIBIT B
SCHEDULE OF PERFORMANCE, AMENDMENT NO.1
(AMENDED, REPLACES PREVIOUS)

CONSULTANT shall perform the Services so as to complete each milestone within the number of days/weeks specified below. The time to complete each milestone may be increased or decreased by mutual written agreement of the Project Managers for CONSULTANT and CITY so long as all work is completed within the term of the Agreement. CONSULTANT shall provide a detailed schedule of work consistent with the schedule below within 2 weeks of receipt of the notice to proceed (“NTP”) from the CITY. Exhibit A (Scope of Services) also contains deliverable and frequency information for the provision of Services under this Agreement.

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

1. Task 1: Transfer existing AWS hosting account in AWS cloud Completed

2. Task 2: Maintain account with AWS for hosting City’s infrastructure
Annual ongoing

3. Task 3: Perform hosting and networking maintenance services Annual ongoing

4. Task 4: Perform SAP Basis Services Annual ongoing

5. Task 5: Perform ad-hoc services on as needed requests that are not covered in the Scope of Services. These services constitute Additional Services under Section 4 (Not to Exceed
Compensation) of this Agreement, implemented pursuant to City-approved Task Order as detailed in Section 4.

As-needed basis with the
performance schedule as
provided in the approved
Task Order, as noted in the
checkbox below.

Optional Schedule of Performance Provision for On-Call or Additional Services Agreements. (This provision only applies if checked and only applies to on -call agreements per Section 1 or agreements with Additional Services per Section 4.)

The schedule of performance shall be as provided in the approved Task Order, as detailed in Section 1 (Scope of Services) in the case of on-call Services, or as detailed in Section 4 in the case of Additional Services, provided in all cases that the schedule of performance shall fall within the term as provided in Section 2 (Term) of this Agreement.

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EXHIBIT C
COMPENSATION, AMENDMENT NO.1
(AMENDED, REPLACES PREVIOUS)

CITY agrees to compensate CONSULTANT for Services performed in accordance with the terms and conditions of this Agreement, and as set forth in the budget schedule below. Compensation shall be calculated based on the rate schedule attached as Exhibit C -1 up to the not to exceed budget amount for each task set forth below.

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

CONSULTANT agrees to complete all Services, any specified reimbursable expenses, and Additional Services (if any, per Section 4), within this/these amount(s). Any work performed or expenses incurred for which payment would result in a total exceeding the maximum amount of compensation set forth in this Agreement shall be at no cost to the CITY.

(CONTINUED ON THE NEXT PAGE.)

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BUDGET SCHEDULE
TASK AMENDMENT NO.1

CONTRACT
YEAR 1
(PAID in
FULL)

CONTRAC
T YEAR 2
(PAID in
FULL)

CONTRACT
YEAR 3
(PAID in
FULL)

CONTRACT
YEAR 4
(Effective
August 1,
2025 –
December 31,
2026)

SUBTOTALS
Task 1
(Transfer existing AWS hosting
account in AWS cloud)

$4,500
(Paid)

$4,500
(Paid)
Task 2
(Maintain account with AWS for
hosting City’s infrastructure. Task 2
costs include estimated AWS costs.

If actual AWS costs are lower than
estimated, Consultant will charge
City the lower costs. If actual AWS
costs are higher, City may apply
Additional Services funds to cover
the overage per Section 4, or the
parties will amend the Agreement
per Section 29.4 for City to add
funds to cover the overage.)

$192,000
(Paid)

$144,000
(Annual)

$204,000
(17 Months)

$192,000
(One-time
Paid)

$636,000
(Annual fees)
Task 3
(Perform hosting and networking
maintenance services)

$86,400
(Annual)

$122,400
(17 Months)

$381,600
(Annual fees)
Task 4
(Perform SAP Basis Services)

$8,640
(Paid)

$372,600
(Annual)

$527,850
(17 Months)

$8,640
(Paid)

$1,645,650
(Annual fees)
Subtotals for Services (Tasks 1-4) $808,140 $603,000 $603,000 $854,250 $2,868,390 Docusign Envelope ID: ED1CBE7F-8D59-424C-ABDD-289D79D7B4A3 Item 11
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C22182051 Amendment No. 1

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Reimbursable Expenses (if any) $0 $0 $0 $0 $0
Subtotals for Services and
Reimbursable Expenses (if any) $808,140 $603,000 $603,000

$854,250
$2,868,390

Task 5
(Additional Services)
(Perform ad-hoc services on as-
needed requests that are not covered
in the Scope of Services. These
services constitute Additional
Services, Amendment No.1 under
Section 4 (Not to Exceed
Compensation) of this Agreement,
implemented pursuant to City-
approved Task Order as detailed in
Section 4.)

As needed, per
Task Order,
per Section 4
of this
Agreement,
Not to Exceed
Amount at Far
Right Across
All Contract
Years

As needed,
per Task
Order, per
Section 4
of this
Agreement,
Not to
Exceed
Amount at
Far Right
Across All
Contract
Years

As needed,
per Task
Order, per
Section 4 of
this
Agreement,
Not to
Exceed
Amount at
Far Right
Across All
Contract
Years

$200,000
(Years 1-3)

$85,425
(Year 4)
Amendment No. 1, Up to Year 4
Maximum Total Compensation
$808,140* $603,000* $603,000* $854,250*
$3,153,815
*Maximum Total Compensation Amounts per each contract year in the table above do not include the cost of Additional Services t hat may be approved by City per Section 4 (Not to Exceed Compensation); the cumulative amount of which across all contract years shall not exceed the maximum amount for Additi onal Services in this Agreement.

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

Reimbursable expenses, if any are specified as reimbursable under this section, will be reimbursed at actual cost. The expenses (by type, e.g. travel) for which CONSULTANT will be reimbursed are: NONE Docusign Envelope ID: ED1CBE7F-8D59-424C-ABDD-289D79D7B4A3 Item 11
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City Council
Staff Report
From: City Manager
Report Type: CONSENT CALENDAR
Lead Department: Community Services
Meeting Date: August 11, 2025
Report #:2505-4734
TITLE
Approval of Amendment #1 to Contract C23184669A With LifeMoves to Extend the Contract by Two Years Through July 1, 2025 – June 30, 2027 in the Amount of $512,377 for a Total Contract Value Not To Exceed $972,377 for the Provision of Homeless Outreach Service; and Amend the FY 2026 Budget in the General Fund and the Permanent Local Housing Allocation (PLHA) Grant Fund; CEQA Status – Not A Project.

RECOMMENDATION
Staff recommends that the City Council:

1. Approve and authorize the City Manager or their designee to execute Amendment #1 to Contract No. C23184669A (Attachment A) with LifeMoves to continue outreach services to the unhoused for an additional two years in an amount not to exceed $512,377. This amendment results in a revised total contract not-to-exceed amount of $972,377 over four years; and

2. Amend the Fiscal Year 2026 Budget Appropriation (requires a 2/3 approval) for:
a) General Fund by:
i) Increasing the Community Services Department Contract Services expense appropriation by $25,000; and
ii) Increasing the Community Services Other Revenue (from Stanford University) estimate by $25,000
b) Permanent Local Housing Allocation (PLHA) Grant Fund by:
i) Increasing the Community Services Department Contract Services expense appropriation by $162,201;
ii) Decreasing the Ending Fund Balance by $162,201

EXECUTIVE SUMMARY
This report recommends extending the City’s contract with LifeMoves to continue providing homeless outreach and engagement services for an additional two years, through June 30, 2027. Originally launched as a pilot program from July 1, 2023, to June 30, 2025, the initiative Item 12
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has delivered consistent, effective street outreach to unhoused individuals in Palo Alto, including services on Stanford University land under a revenue-sharing agreement.

Maintaining continuity with LifeMoves is critical to sustaining momentum, as existing outreach staff have built strong, trust-based relationships with local unhoused residents. The contract extension will also support a coordinated effort to assess and prepare individuals for placement in the Homekey Palo Alto interim shelter, which will be operated by LifeMoves under a separate service agreement.

BACKGROUND
Following an initial unsuccessful RFP in May 2022, the scope of services was revised and additional funding secured through the Permanent Local Housing Allocation (PLHA) Entitlement Fund. A new RFP issued in November 2022 resulted in the selection of LifeMoves, based on their qualifications and experience.

The Homeless Outreach Team (HOT) contract with LifeMoves was initiated as a pilot program during Fiscal Years 2024 and 2025. Funding for the program was provided through a combination of State Permanent Local Housing Allocation (PLHA) entitlement funds, City General Fund contributions, and financial support from Stanford University.

The program is staffed by a two-person outreach team, including one Spanish-speaking staff member, who conduct direct street outreach throughout Palo Alto and select areas on the Stanford campus. The team’s core objective is to build relationships with unhoused individuals and connect them with available support services. In addition to targeting specific areas for regular outreach, the HOT team has responded to referrals and direct requests for engagement from City staff, local business owners, and residents.

The team has maintained a consistent presence in key public spaces, including the downtown corridor, transit center, and City facilities such as City Hall, libraries, and community centers.

The HOT team has also collaborated with the Police Department’s Special Problems Team and provided training to various City work groups on effective and compassionate engagement with unhoused individuals. Notably, the team supported outreach efforts during the activation of the Overnight Warming Location (OWL) this past cold weather season and conducted targeted outreach to RV dwellers impacted by the closure of parking along El Camino Real due to the Caltrans Bike Lane Project.

As of the March 2025 performance report, the HOT team has engaged with more than 119 unduplicated individuals, with many individuals requiring multiple contacts. One of the key challenges identified by the team is the difficulty in encouraging individuals to engage, due to limited availability of affordable housing options and long shelter waitlists.

Despite these challenges, the program continues to emphasize relationship-building and trust, which are critical to supporting unhoused individuals over time. This ongoing engagement is particularly important to ensure that unhoused Palo Alto residents are assessed and ready to Item 12
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transition into the Homekey Palo Alto interim shelter upon its opening (as outlined in the updated Scope of Services).

ANALYSIS
Staff recommends extending the contract with LifeMoves to continue homeless outreach services in Palo Alto. As demonstrated during the pilot phase, having a dedicated and responsive outreach team has enhanced the City’s ability to address issues involving unhoused individuals. The Homeless Outreach Team (HOT) has been crucial in responding to referrals from City staff, residents, and local businesses, and in maintaining a regular presence in key areas such as the downtown corridor, transit center, and City facilities.

The continuation of these services reflects a commitment to best practices in addressing homelessness and aligns with the Santa Clara County Community Plan to End Homelessness.

The HOT team plays a critical role in reducing barriers to housing and services, coordinating with local providers, and advancing a housing-first approach. These efforts support the City's broader strategy to move individuals toward stability and permanent housing.

The recommended updates to the Scope of Services (SOS) for FY 2026–2027 incorporate lessons learned from the two-year pilot. Recognizing the value of strong partnerships, the revised SOS emphasizes improved coordination with local service providers and the Palo Alto Police Department’s Special Problems Detail. A key enhancement to these efforts is the continuation of the weekly “Monday Morning Huddle,” a coordination meeting with other local service providers initiated late in the pilot period. This collaboration fosters shared problem- solving, strengthens service connections, and promotes effective transitions (warm hand off) for individuals in need.

In addition, the updated SOS reinforces the City's commitment to the success of the soon-to- open Homekey Palo Alto interim shelter. LifeMoves will lead a coordinated and focused outreach effort to ensure that as many unhoused Palo Alto residents as possible are assessed and ready to enter the shelter upon opening. This includes close, ongoing collaboration with regional service providers to support streamlined referrals and placements.

FISCAL/RESOURCE IMPACT
Funding for the continuation of this contract is through a combination of funding sources and requires a budget amendment. The primary funding source will be the City’s allocation of State Permanent Local Housing Allocation (PLHA) entitlement funds. Additional support will be provided through a revenue agreement with Stanford University (Attachment B: Stanford University Revenue Agreement Pledge), which includes an anticipated contribution of $25,000 per year in recognition of outreach services provided on Stanford lands.

The total contract costs and funding sources are summarized below.

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Year 1 $251,301: $226,301 from PLHA entitlement funding (reflecting remaining allocations from entitlement years 2019, 2020, and 2021, which have already been received), and$25,000 from Stanford University (anticipated). Year 2 $261,076: $236,261 from PLHA entitlement funding (reflecting projected allocations from entitlement years 2022 and 2023), and $25,000 from Stanford University (anticipated).

It is important to note that additional PLHA funding from entitlement year 2024 is expected to be released prior to the start of Year 2 of the contract. However, the award amount is not yet known and is therefore not included in this funding estimate.

On December 18, 2023, the City Council recognized $592,368 in grant revenue from the PLHA grant for street outreach, and allocated $387,368 to the ending fund balance, as only a portion was needed in FY2024. 1 In FY2025, $209,000 was used from this fund for LifeMoves services, leaving approximately $178,000 for future needs. This amount, in addition to interest earned, is available in the PLHA ending fund balance for FY2026, or approximately $181,000. Additionally, prior year contract savings of $64,100 has been carried forward and will be used for year 1 of this extended agreement. This leaves approximately $19,000 left for future uses in the PLHA fund. PLHA grant funding is available to support the current contract extension. Continuation of services beyond 2026 will be contingent upon an evaluation of service performance, community impact and need, and the availability of grant or alternative City funding.

STAKEHOLDER ENGAGEMENT
A report on Housing and Homelessness in Palo Alto—including an overview of current initiatives and a gap analysis—was presented to the City Council on February 10, 2025. During the meeting, members of the public had the opportunity to provide input during oral communications. As a follow-up to Council direction at that meeting, the Council Policy and Services Committee will be discussing options to address homelessness impacts at a Special Meeting on August 25, at 6:00 pm.

ENVIRONMENTAL REVIEW
Approval of this contract is not a project under the California Environmental Quality Act (CEQA) per CEQA Guidelines 15061(b)(3).

ATTACHMENTS
Attachment A: Amendment 1 LifeMoves Contract C23184669A Attachment B: Stanford University Revenue Agreement Pledge APPROVED BY: Kristen O'Kane, Community Services Director 1 City Council, December 18, 2023; Agenda Item #17; SR#2311-2216; https://cityofpaloalto.primegov.com/Portal/viewer?id=0&type=7&uid=aeed86d9-14cb-42e9-9838-50f9649c661f Item 12
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AMENDMENT NO. 1 TO CONTRACT NO. C23184669A

BETWEEN THE CITY OF PALO ALTO AND

LIFEMOVES

This Amendment No. 1 (this “Amendment”) to Contract No. C23184669A (the “Contract” as defined below) is entered into as of May 28, 2025, by and between the CITY OF PALO ALTO, a California chartered municipal corporation (“CITY”), and LIFEMOVES, a California non-profit corporation, located at 2550 Great America Way, Suite 201, Santa Clara, CA 95054 (“CONSULTANT”). CITY and CONSULTANT are referred to collectively as the “Parties” in this Amendment.

R E C I T A L S

A. The Contract (as defined below) was entered into by and between the Parties hereto for the provision of a range of services to meet and engage unhoused individuals where they are, including outreach services, welfare checks, , services assessments for local and county wide serve and service coordination, in connection with the Project (the “Services”, as detailed more fully in Exhibit A).

B. The Parties now wish to amend the Contract in order to extend the term from June 30, 2025, through June 30, 2 027. The Parties also wish to amend the scope of services and increase the contract value by Five Hundred Twelve Thousand, Three Hundred Seventy-Seven Dollars ($512,377) for Fiscal Years 26 (starting July 1, 2025) & 27 (starting July 1, 2026) , to a new total not- to-exceed compensation amount of Nine Hundred Seventy-Two Thousand Three Hundred Seventy-Seven Dollars ($972,377), as detailed therein.
.

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

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

a. Contract. The term “Contract” shall mean C ontract No. C23184669A between CONSULTANT and CITY, dated June 19, 2023.
b. Other Terms. Capitalized terms used and not defined in this Amendment shall have the meanings assigned to such terms in the Contract.

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

The term of this Agreement shall be from the date of its full execution through June 30, 2027, unless terminated earlier pursuant to Section 19 (Termination) of this Agreement.

//
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SECTION 3. Section 4 “NOT TO EXCEED COMPENSATION” of the Contract is hereby amended to read as follows:

The compensation to be paid to CONSULTANT for performance of the Services shall be based on the compensation structure detailed in Exhibit C, entitled “COMPENSATION,” including any reimbursable expenses specified therein, and the maximum total compensation shall not exceed Nine Hundred Seventy-Two Thousand Three Hundred Seventy-Seven Dollars ($972,377). The hourly schedule of rates, if applicable, is set out in Exhibit C-1, entitled “SCHEDULE OF RATES.” Any work performed or expenses incurred for which payment would result in a total exceeding the maximum compensation set forth in this Section 4 shall be at no cost to the CITY.

SECTION 4. The following exhibit(s) to the Contract is/are hereby amended or added, as indicated below, to read as set forth in the attachment(s) to this Amendment, which is/ are hereby incorporated in full into this Amendment and into the Contract by this reference:

a. Exhibit “A” entitled “ SCOPE OF SERVICES FY2026 -2027, AMENDMENT NO. 1” , AMENDED, REPLACES PREVIOUS.

b. Exhibit “ C” entitled “ COMPENSATION, AMENDMENT NO. 1 ”, AMENDED, REPLACES PREVIOUS.

SECTION 5. Legal Effect. Except as modified by this Amendment, all other provisions of the Contract, including any exhibits thereto, shall remain in full force and effect.

SECTION 6. Incorporation of Recitals. The recitals set forth above are terms of this Amendment and are fully incorporated herein by this reference.

(SIGNATURE BLOCK FOLLOWS ON THE NEXT PAGE.)

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SIGNATURES OF THE PARTIES

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

CITY OF PALO ALTO

City Manager

APPROVED AS TO FORM:

City Attorney or designee

LIFEMOVES

Officer 1

By:

Name:

Title:

Attachments:

EXHIBIT A: SCOPE OF SERVICES, AMENDMENT NO. 1 (AMENDED, REPLACES PREVIOUS) EXHIBIT C: COMPENSATION, AMENDMENT NO. 1 (AMENDED, REPLACES PREVIOUS) Docusign Envelope ID: 2A0D33C1-7AF9-4A5A-A5E0-0CBC93FC78A4 Aubrey Merriman, Chief Executive Officer

AUBREY MERRIMAN
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EXHIBIT “A”
SCOPE OF SERVICES, AMENDMENT NO. 1
(AMENDED, REPLACES PREVIOUS)

Through the City of Palo Alto Homeless Outreach Services program, the City seeks to support, expand, and enhance existing City of Palo Alto (“Palo Alto” or “City”) homeless outreach efforts with additional tools and innovative strategies to effectively engage with unsheltered individuals in Palo Alto.

The Palo Alto Homeless Outreach Services team will be staffed by two full -time outreach workers who are dedicated to this program. The outreach workers will be engaging with unsheltered Palo Alto residents 40 hours per week, with a regular work schedule to be determined after assessing the optimal window of time to meet with those unhoused local residents. LifeMoves will provide additional staff support should a member of the Palo Alto Homeless Outreach Services team be absent for a significant length of time. A Homeless Outreach Team (HOT) director will supervise the outreach workers and coordinate outreach efforts in Palo Alto.

Scope of Work/Tasks
Consultant will:

Provide Supervision:

Assign a Palo Alto Outreach director (0.1 FTE) to ensure the delivery of high-quality services and provide oversight for the two outreach workers assigned to this program.

Provide Outreach Services:

Hire or assign at least two (2.0 FTE) outreach workers to the Palo Alto Homeless Outreach Team (PA HOT).

At least one outreach worker will be bilingual, with an ability to speak Spanish and English.

For those who are unsheltered, LifeMoves outreach workers will:
• Provide customized outreach and engagement services in the field, building upon current best practices and protocols used by the LifeMoves Palo Alto Outreach program within the County of San Mateo and other LifeMoves outreach programs;
o Street Outreach - Proactively seek out and develop relationships through repeated contacts with unhoused individuals throughout the community, while maintaining a regular presence within the community. The outreach workers will seek to engage with local, unsheltered individuals living on the streets, in areas not meant for human habitation or in vehicles (personal and recreational vehicles).
o Frequent locations that include Palo Alto retail settings, public transportation hubs, civic facilities, public parking garages and lots, isolated spaces, parks and spaces open to the public for recreation and reflection, areas where vehicularly housed individuals gather, and other locales that are not meant for human habitation. Outreach is conducted primarily in the field where clients live and spend time;
o Connect individuals to healthcare, transportation services, or services addressing other basic needs;
o Offer supplies or other items to assist clients with basic needs and build trust; o Connect individuals to the Coordinated Assessment System (CAS) and assist them in completing VI- SPDAT assessments, as needed;
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o Seamlessly transfer clients requesting case management and housing assistance to colleagues at LifeMoves programs or sites, including the Opportunity Services Center, or other local agencies, and;
o Execute additional outreach and assistance during inclement weather and other emergencies. o Proactively identify and connect with unhoused Palo Alto residents with the goal of moving them to interim supportive housing and permanent housing; and
o Engage in a coordinated and focused effort to maximize the number of unhoused Palo Altans assessed and ready to enter the Homekey Palo Alto interim shelter at its opening, including regularly and closely partnering with other area service providers.

For concerned residents, local partners, and the retail community, LifeMoves outreach workers will:
• Offer timely response and technical expertise to support public safety for all community members, including service and medical providers, law enforcement, City or County officials, stakeholders, or other community members;
o Provide rapid acknowledgement to requests for contact and support to unsheltered homeless individuals or households in Palo Alto. Staff will respond within one business day, Monday – Friday; o Locate and support individuals who are on a list for the City of Palo Alto, or who are the subject of rapid response inquiries in the City;
o Offer intervention techniques to community stakeholders on best practices for interacting with unhoused individuals in crisis;
o Build rapport and develop positive relationships with business owners, local partners, law enforcement, residents living near to locations where unsheltered individuals congregate or spend significant time, and civic collaborators (including representatives of Stanford University) concerned about homelessness in the community;
o Establish a trusted presence as a LifeMoves ambassador within Palo Alto, including wearing LifeMoves-branded attire and associated credentials;
o Participate in regular accountability meetings, forge additional connections with other stakeholders, and share trends and lessons learned in the community ; o Proactively identify and connect with unhoused Palo Alto residents with the goal of moving them to stable housing; and
o Participate in regular accountability meetings, forge additional connections with other stakeholders, such as facilitating the “Monday Morning Huddle” with other local homeless service providers and share trends and lessons learned in the community.

Reporting Requisites and Deliverables:
• Maintain a comprehensive log of outreach activities and contacts, including types of interactions, locations, identified needs/issues, and services, connections, and resources provided • Collect and document data as required and assist in compiling statistical data in Housing Management Informational Systems (HMIS) and the organization’s client database • Submit detailed outreach reports to the City. Specific items to be tracked will be determined between the City and Provider
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• LifeMoves (Provider) will provide a quarterly activity report to demonstrate progress toward meeting Scope of Program Services within 30 days of agreed upon deadlines (dates to be determined once contract established). Each report will include information from the previous three months as well as other requested information from the City of Palo Alto. The narratives will include language around collaboration with other providers, and outreach to community members or business community.

• The Q4 report will focus on the preceding three months but also provide data on contracted services for the entire fiscal year. Reports will be prepared in the format agreed upon by the City and LifeMoves (Provider).
o Meet at least quarterly with the contract manager to review outreach reports and service provisions
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Objectives and Metrics:

During the term of the Agreement, Consultant will report on the following objectives:

Metric Contract Period (July 1,
2025 - June 30, 2027
1 Number of unduplicated clients who receive outreach and engagement
services, including case management
40 individuals
2 Number of unduplicated clients who complete a CAS assessment 24 individuals 3 Number of unduplicated clients who are connected to ongoing health services 24 individuals
4 Total number of case management interactions between clients and case managers 420 interactions
5 Total number of provided services to basic need resources such as food, showers, and clothing. 180 provided services
6 Total number of provided services with benefits assistance 90 provided services 7 Total number of ID vouchers provided to clients 24 provided services

Additional Outcomes:

Outreach workers will refer clients to the appropriate agencies for services and may provide case management services as time allows. Outcomes, including clients’ acceptance of case management services, enrollment into an interim housing program, and exits to permanent housing will be recorded by the agency providing services; in the case of LifeMoves, through the LifeMoves proprietary database and HMIS, and for other agencies, through requests for information and HMIS.

Every effort will be made to report on the following outcomes, but the outcomes are not quantified here because they do not fall under the scope of work of the outreach workers funded through this contract.

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Outcomes
1 Number of unduplicated clients who move into emergency shelter 2 Number of unduplicated clients who move into interim housing 3 Number of unduplicated clients who move into permanent housing 4 Number of clients connected to housing vouchers via CAS assessment Docusign Envelope ID: 2A0D33C1-7AF9-4A5A-A5E0-0CBC93FC78A4 Item 12
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EXHIBIT “C”
COMPENSATION, AMENDMENT NO. 1
(AMENDED, REPLACES PREVIOUS)
CITY agrees to compensate CONSULTANT for Services performed in accordance with the terms and conditions of this Agreement, and as set forth in the budget schedule below. CITY’s Project Manager may approve in writing the transfer of budget amounts between any of the tasks or categories listed below, provided that the total compensation for the Services, including any specified reimbursable expenses, and the total compensation for Additional Services (if any, per Section 4 of the Agreement) do not exceed the amounts set forth in Section 4 of this Agreement.

CONTRACT OVERVIEW (FY24 –27)
Fiscal Year Original Contract Value Amended Contract Value Total FY24 $ 230,000   $ 460,000.00 FY25 $ 230,000
FY26   $ 251,301 $ 512,377.00
FY27   $ 261,076

NTE: $ 972,377.00

BUDGET SCHEDULE (FY26-27)

TASK NOT TO EXCEED AMOUNT
Task 1
Outreach and Engagement: Staff will outreach to approximately six people per day and complete a CAS assessment with anyone who does not already have one completed.
$ 409,901.60
Task 2
Connection to Services: Staff will connect people to ongoing health services and case management services.
$ 54,676.54
Task 3
Connection to Shelter/Housing: Saff will connect people to shelter and permanent housing.
$ 47,798.86
Sub-total for Services $ 512, 377
Reimbursable Expenses (if any) $ 0
Total for Services and Reimbursable Expenses $ 512,377 Additional Services (if any, per Section 4) $ 0
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Maximum Total Compensation (FY26-27) $ 512,377

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

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

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City Council
Staff Report
From: City Manager
Report Type: CONSENT CALENDAR
Lead Department: Planning and Development Services
Meeting Date: August 11, 2025
Report #:2506-4848
TITLE
QUASI-JUDICIAL. 3150 El Camino Real [24PLN-00231]: Approval of a Vesting Tentative Map to Merge Five Parcels Together to Create One 111,030-Square-Foot Parcel to Facilitate Construction of 368 New Residential Rental Units. CEQA Status: Streamlined CEQA Review in Accordance with Section 15183. Zoning District: CS (Service Commercial).

RECOMMENDATION
Staff recommends the City Council take the following actions:

1. Find the project consistent with the CEQA Guidelines section 15183 analysis previously approved by the Director of Planning and Development Services (Attachment C); and

2. Approve the Record of Land Use Action (RLUA) in Attachment B, approving the Vesting Tentative Map based on findings and subject to conditions of approval.

EXECUTIVE SUMMARY
The applicant requests approval of a Vesting Tentative Map to merge five parcels to create one 111,030-square-foot parcel located at 3128 and 3150-3160 El Camino Real. Through a separate, Streamlined Housing Development Review Process, the applicant proposed, and the Director of Planning and Development Services approved, construction of a 368-unit residential apartment project. The development application included 74 units provided at below market rate and made affordable to low-income households (50%-80% of Area Median Income).

The Vesting Tentative Map also includes necessary utility easements in accordance with the City of Palo Alto Municipal Code and City of Palo Alto Utilities standards, which would be formally accepted by the City as part of the Final Map process.

A location map is included in Attachment A. The proposed Vesting Tentative Map is linked in Attachment C.

BACKGROUND
On August 27, 2024, Acclaim Properties filed a Vesting Tentative Map application concurrently with a Streamlined Housing Development Review application. In accordance with the Vesting Item 13
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Tentative Map Palo Alto Municipal Code (PAMC) Sections 21.13, approval of the map application was deferred until all other entitlements were approved. For this application the associated entitlements for the planned improvements were approved on July 11, 2025, following a study session with the Architectural Review Board on November 7, 2024,1 and completion of the environmental analysis.

The project includes a request for approval of a Vesting Tentative Map to merge five parcels into one 111,030-square-foot parcel located at 3150 El Camino Real, to develop a 368-unit apartment building. Approval of the map also includes acceptance of proposed public utility easements which are required per City of Palo Alto Utility.

The process for evaluating this type of application is set forth in Title 21 of the PAMC and California Government Code 66474. The process for approval of a Vesting Tentative Map is outlined in PAMC Sections 21.13.020. Vesting Tentative maps require PTC review. The PTC reviews whether the proposed subdivision is consistent with the Subdivision Map Act (in particular, Government Code 66474), Title 21 of the Palo Alto Municipal Code, the Palo Alto Comprehensive Plan, and other applicable provisions of the Palo Alto Municipal Code and State Law. The PTC’s recommendation is forwarded to the City Council for final approval.

The PTC reviewed the project on May 14, 2025, and voted unanimously to recommend that Council approve the Vesting Tentative Map.2 Commissioner Hechtman also identified three minor inconsistencies in the Draft Record of Land Use Action, which have been corrected.

Following the completion of this Vesting Tentative Map, the applicant is required to file an application for a Final Map. The Final Map would be placed on the City Council consent agenda and must be in substantial conformance with the Vesting Tentative Map.

ANALYSIS
The proposed project and relevant discussion and findings herein reflect the Vesting Tentative Map. The Director previously approved the proposed site improvements associated with this lot merger as part of a streamlined housing development review application. The map also includes dedication of relevant public utility easements associated with the new site improvements.

Neighborhood Setting and Character
This property is located adjacent to Palo Alto Square to the north; the Parmani Hotel and the entry to the Stanford Research Park on Hansen Way to the south; the Clocktower Square Office Park to the west; and a mix of commercial and proposed residential uses to the east within the 1 Link to the November 7, 2024 ARB Staff Report:
https://cityofpaloalto.primegov.com/Portal/Meeting?meetingTemplateId=13926 Video: https://www.youtube.com/watch?v=GXNKd9VWddc
2 Link to the September 19, 2024 ARB Staff Report:
https://cityofpaloalto.primegov.com/Portal/Meeting?meetingTemplateId=13926 Video: https://www.youtube.com/watch?v=GXNKd9VWddc
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North Ventura neighborhood across El Camino Real. Palo Alto Square is comprised of two 10- story towers with four two-story structures, while the adjacent Parmani Hotel and Clocktower Square Office Park properties are comprised of two-story structures. Across El Camino Real is a variety of one- and two-story personal service businesses (private gyms). A five-story affordable housing project has been approved across El Camino Real at 3001/3017 El Camino Real but has not yet been constructed. City-wide, the character of El Camino Real is continuing to transition from commercial uses to multi-family residential and mixed uses and continues to be an appropriate location to place high density housing.

Consistency with the Comprehensive Plan, Area Plans, and Guidelines5 Staff’s analysis finds that the proposed Vesting Tentative Map is consistent with the Comprehensive Plan, in that the site is designated as the “Commercial Service” land use designation, which allows for multi-family residential uses. The site is also identified as a Housing Inventory Site in the Housing Element; therefore, development of the site with multifamily residential use is appropriate and consistent with the Housing Element, as discussed further below. The map facilitates the redevelopment of a parcel within the City’s urban service area which is consistent with Policy L-1.2 of the Comprehensive Plan. The associated development to be constructed on the lot would add new residential units that contribute to the housing inventory including 74 affordable housing units, consistent with Goal 2 of the Housing Element, which states “assist in the provision of safe, attainable, and sustainable housing, especially affordable housing, to meet the needs of all economic segments of the community.” Consistencies with other Comprehensive Plan policies are included in Attachment B.

Housing Element
All parcels included in this proposed lot merger are Housing Inventory Sites in the City’s adopted Housing Element. The five properties have a projected capacity of 29, 16, 179, 113, and 44 units, resulting in a consolidated capacity of 381 units for the site with a projected capacity of 77 low-income units. The 368-unit proposal with 74 inclusionary below market rate units (BMR) is 13 units below the anticipated capacity for the five sites combined and three below the anticipated capacity for low-income units. In preparing the Housing Element to meet the City’s required Regional Housing Needs Allocation (RHNA) of 6,086 units, the City planned for and analyzed a buffer, meaning that in identifying Housing Inventory Sites, the City planned for an additional 727 units, including a buffer of an additional 261 low and very low income units because actual development of housing projects across the City are dependent on numerous factors. In addition, the City will be able to count all housing developments, even ones not included in the Housing Element, toward fulfillment of the required RHNA. Therefore, although the project does not build to the full identified capacity for the site, the project still proposes a housing development project on a Housing Inventory Site and includes 74 5 The Palo Alto Comprehensive Plan is available online: bit.ly/PACompPlan2030 Item 13
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inclusionary below market rate units on site, consistent with the City’s goals of providing housing, and particularly providing below market rate units. The difference in the number of units identified in the Housing Element and the units proposed in this project does not result in a Housing Element capacity below the required RHNA, therefore, re-designation of another Housing Inventory Site to accommodate this difference is not required. The proposed project and relevant discussion and findings herein reflect the Vesting Tentative Map. The Director previously approved the proposed site improvements associated with this lot merger as part of a streamlined housing development review application. The map also includes dedication of relevant public utility easements associated with the new site improvements.

Zoning Compliance7
All of the subject parcels are zoned Service Commercial (CS) and are located within the El Camino Real Focus Area. The project complies with the applicable development standards set forth in PAMC Chapter 18.14, except as modified in accordance with the El Camino Real Focus Area standards, and the Objective Design Standards in PAMC 18.24. The five parcels will be merged into one parcel and that final parcel is consistent with the code requirements for the zoning district, which has no minimum or maximum lot size requirements. Likewise, CS-zoned parcels have no maximum density and is consistent with height and floor area allowed under the El Camino Real Focus Area, which sets forth the allowed density when no maximum is identified. Therefore, the proposed 144 du/ac is consistent with the zoning. Accordingly, staff finds that the proposed Vesting Tentative Map is consistent with the zoning code.

Consistency with Application Findings
As detailed in Attachment B, staff finds that this project meets all required findings for a Vesting Tentative Map and facilitates development of a housing development project that is consistent with the City’s regulations, goals, and policies.

FISCAL/RESOURCE IMPACT
Processing of this application has limited fiscal impact. Applicants are responsible for staff and consultant costs of processing this application through payment of applicable fees per the City’s deposit-based cost recovery program. It is anticipated that the project will result in a change in local tax revenues that the site generates, specifically in the sales tax and property tax categories. These impacts will be reflected in the City’s tax revenue forecasts.

The project would be required to pay Development Impact Fees, which are currently estimated at $20,674,685.30.

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 7 The Palo Alto Zoning Code is available online: bit.ly/PAZoningCode Item 13
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least ten days in advance of the hearing. Notice of a public hearing for this project was published in the Daily Post and postcard mailing occurred on July 25, 2025, which is 10 days in advance of the meeting.

Public Comments
The owners of the Parmani Hotel next door raised a concern regarding access to the existing utilities (a transformer and an electric meter) along the shared property line between these two sites. The current transformer straddles the property line and serves the Fish Market and Parmani Hotel properties. Although the neighboring property owners have stated their intent to propose modifications to their property that could resolve this issue, no project has yet been proposed. To address the neighbor’s comments and City of Palo Alto Utilities requirements the applicant has proposed to replace the existing transformer on the 3150 El Camino Real property in their utility yard along El Camino Real. This will eliminate the existing non-complying issue with the transformer straddling property line while ensuring the Parmani Hotel has continued access to City services.

During the May 14, 2025 PTC hearing, a public speaker raised concerns about the traffic analysis, availability of parks/open space, and the number of parking spaces provided for the project. Regarding the traffic analysis, the speaker suggested that the analysis did not analyze intersection traffic flow at University Avenue and Arastradero Road, which are two and one mile from the project site, respectively. While the City’s intersection study in Attachment H of the CEQA document looked at all intersections within 0.5 miles of the project site, the cumulative background conditions of existing traffic patterns for El Camino Real were also incorporated to evaluate the Level of Service (LOS) impact created by the project. It is important to note, however, that LOS analysis is not a CEQA threshold for determining impacts from a project on the environment.

The commenter suggested that this project should be responsible for increasing the available parkland within the City. However, PAMC 21.50 does not require land to be dedicated unless the project includes a subdivision which creates 50 or more parcels. Because the project does not create 50 or more parcels, the applicant will instead pay fees. These fees are used toward development of parkland within the vicinity.

Lastly, the commenter suggested that the ARB project is under parked. However, per Table 3 of PAMC 18.14.020, the requirement for parking for residential projects in the El Camino Real Focus Area is one vehicle parking space per unit. For the 368-unit development the developer is proposing 455 parking stalls, all of which are below-grade.

ENVIRONMENTAL REVIEW
The subject project has been assessed in accordance with the authority and criteria contained in the California Environmental Quality Act (CEQA), the State CEQA Guidelines, and the Item 13
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environmental regulations of the City. Specifically, the proposed Vesting Tentative Map has been reviewed under a streamlined CEQA review in accordance with CEQA Guidelines Section 15183. A link to the exemption documentation is available in Attachment C.

ATTACHMENTS
Attachment A: Location Map
Attachment B: Draft Record of Land Use Action
Attachment C: Link to Project Plans and CEQA Analysis
APPROVED BY:

Jonathan Lait, Planning and Development Services Director Item 13
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ACTION NO. 2025-__

RECORD OF THE COUNCIL OF THE CITY OF PALO ALTO LAND USE ACTION FOR 3150 EL CAMINO REAL: VESTING TENTATIVE MAP, 24PLN-00231 At its meeting on _________, 2025, the City Council of the City of Palo Alto (“City Council”) approved the Vesting Tentative Map to merge five existing parcels to create one resulting parcel for a 368-unit apartment building, making the following findings, determinations and declarations:

SECTION 1. Background.

A. On August 27, 2024, Acclaim Properties submitted a subdivision map application for a Vesting Tentative Map to merge five parcels into one resulting parcel for 3150 El Camino Real (“The Project”).

The project site is comprised of five existing lots: APN No. 148-20-079, approximately 8,250 square feet, an undeveloped parcel; APN No. 148-20-080, approximately 4,950 square feet, an undeveloped parcel; APN No. 148-20-035, approximately 52,250 square feet, developed with a commercial eating and drinking use; APN No. 148-20-054, approximately 27,225 square feet, developed with a commercial eating and drinking use; APN No. 148-20-055, approximately 18,425 square feet, developed with a commercial eating and drinking use. Uses abutting the site include a ten-story office building to the north, a two-story hotel to the west, various one and two-story commercial uses to the east across El Camino Real, and a two-story hotel to the south.

B. Following staff review, the Planning and Transportation Commission reviewed the project and recommended approval on May 14, 2025, subject to conditions of approval.

C. On ___________, 2025 the City Council held a public meeting in accordance with the City Council’s policies and procedures and approved the project subject to conditions of approval.

SECTION 2. Environmental Review. The City, as the lead agency for the Project, has determined the project is eligible for a Streamlined review for consistency with the Comprehensive Plan and Comprehensive Plan EIR in accordance with California Environmental Quality Act (CEQA) Guidelines section 15183. Documentation to support the streamlined review is available as part of the public record on file with the Planning and Development Services Division.

SECTION 3. Vesting Tentative Map Findings. A legislative body of a city shall deny approval of a Subdivision Map, if it makes any of the following findings (California Government Code Section 66474). The City Council cannot make these findings for the following reasons:

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1.That the proposed map is not consistent with applicable general and specific plans as specified in Section 65451:

There is no adopted specific plan for this project site. The site is consistent with the Comprehensive Plan as described below.

2.That the design or improvement of the proposed subdivision is not consistent with applicable general and specific plans:

There is no adopted specific plan for this project site. The proposed Vesting Tentative Map and related improvements is consistent with the Comprehensive Plan in that it facilitates housing development on a site designated for multi-family use within the urban services area, consistent with Goal 2 of the Housing Element and Goal L1.2 of the Land Use Element. The project does not replace existing housing. The project includes 74 units that will be offered at a rate affordable to low-income households at 50%-80% area median income (AMI). The project improves the city’s jobs housing imbalance, consistent with the Transportation Element’s goals and policies.

3. That the site is not physically suitable for the type of development:

The Project site is suitable for multi-family residential development in that it’s identified as a Housing Inventory Site in the Housing Element and is located within the City’s El Camino Real Focus Area, an area identified for high density housing within the City. The proposed parcel meets the minimum code requirements for the CS zone district with respect to lot area, width, and depth. The proposed number of apartment units created on the resulting parcel complies with the applicable densities set forth in the land use element and zoning code, consistent with the focus area standards.

4.That the site is not physically suitable for the proposed density of development:

The proposed improvements include a total of 368 multi-family residential units and results in 144 dwelling units (DU) per acre across the resulting parcel. There is no maximum density for projects on El Camino Real and the improvements are consistent with the floor area and height allowances for the site as set forth in the zoning. The improvements also fall within the identified unit capacity of the site set forth in the adopted Housing Element. Therefore, it is physically suitable for the parcel.

5. That the design of the subdivision or the proposed improvements are likely to cause substantial environmental damage or substantially and avoidably injure fish or wildlife or their habitat:

The project is located within the built environment that does not contain quality habitat for fish or other wildlife on the site or within the vicinity of the site. The nearest stream is a portion of Adobe Creek approximately 1,000 feet southeast from the project site. The adopted Palo Alto Item 13
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2030 Comprehensive Plan includes Map N-1, which identified sensitive animal and plant species within the Palo Alto quadrangle, a large geographic area that includes the urban portions along the bay and within the foothills, based on information in the California natural Diversity Database (CNDDB). Based on this map, and the urban nature of the site, the subject property does not contain any habitat for endangered, rare, or threatened species and has not historically supported any of these species.

6. That the design of the subdivision or type of improvements is likely to cause serious public health problems:

The subdivision of this parcel and associated improvements would not have the potential to result in serious health problems. The proposed multi-family use would not include use or storage of hazardous materials and the use is located within the urban environment adjacent to other commercial uses. The site is not located on a hazardous waste site pursuant to government code 65962.5.

7. That the design of the subdivision or the type of improvements will conflict with easements, acquired by the public at large, for access through or use of, property within the proposed subdivision. In this connection, the governing body may approve a map if it finds that alternate easements, for access or for use, will be provided, and that these will be substantially equivalent to ones previously acquired by the public. This subsection shall apply only to easements of record or to easements established by judgment of a court of competent jurisdiction and no authority is hereby granted to a legislative body to determine that the public at large has acquired easements for access through or use of property within the proposed subdivision.

There are no public access easements over the property currently. Therefore, the design of the subdivision will not conflict with any public easements for access through, or use of, the property. New public utility easements will be provided to existing and proposed electrical utilities as part of this subdivision map as required in accordance with City of Palo Alto Utilities standards. New public access easements will be provided to provide the 12-foot effective sidewalk width along El Camino Real, consistent with approved plans and policies.

SECTION 4. Vesting Tentative Map Approval Granted. Vesting Tentative Map Approval is filed and processed in accordance to PAMC Section 21.13.020 and granted by the City Council under PAMC Sections 21.12 and 21.20 and the California Government Code Section 66474, subject to the conditions of approval in Section 6 of this Record of Land Use Action.

SECTION 5. Final Map. The Final Map submitted for review and approval by the City Council shall be in substantial conformance with the Vesting Tentative Map prepared by CBG titled “VESTING TENTATIVE PARCEL MAP FOR LOT MERGER” consisting of five pages, dated April 16, 2025 and submitted April 17, 2025, except as modified to incorporate the conditions of approval in Section 6. A copy of the Vesting Tentative Map is on file in the Department of Planning and Development Services, Current Planning Division. Prior to the expiration of the Item 13
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Vesting Tentative Map approval, the subdivider shall cause the subdivision or any part thereof to be surveyed, and a Final Map, as specified in Chapter 21.08, to be prepared in conformance with the Vesting Tentative Map as conditionally approved, and in compliance with the provisions of the Subdivision Map Act and PAMC Title 21 and submitted to the City Engineer (PAMC Section 21.16.010[a]).

SECTION 6. Conditions of Approval.

Planning

1. PROJECT PLANS. The Vesting Tentative Map submitted for review and approval by the City Council shall be in substantial conformance with the Vesting Tentative Map titled “VESTING TENTATIVE PARCEL MAP FOR LOT MERGER – 3150 EL CAMINO REAL (24PLN- 00231)”, prepared by TALUS and submitted April 17, 2025, except as modified to incorporate the conditions of this approval.

2. FINAL MAP COVER PAGE. At such time as the Final Map is filed, the cover page shall include the name and title of the Director of Planning and Development Services.

3. DEVELOPMENT IMPACT FEES. The Property Owner or their designee shall pay all applicable development impact fees associated with the proposed development and subdivision prior to issuance of the building permit(s), as detailed in the Streamlined Housing Development Review Approval. Impact fees may be paid at occupancy in accordance with the requirements under PAMC 16.64.030.

4. INDEMNITY. To the extent permitted by law, the Applicant shall indemnify and hold harmless the City, its City Council, its officers, employees and agents (the “indemnified parties”) from and against any claim, action, or proceeding brought by a third party against the indemnified parties and the applicant to attack, set aside or void, any permit or approval authorized hereby for the Project, including (without limitation) reimbursing the City for its actual attorneys’ fees and costs incurred in defense of the litigation. The City may, in its sole discretion, elect to defend any such action with attorneys of its own choice.

Public Works Engineering

5. PUBLIC WORKS APPLICATIONS, FORMS, AND DOCUMENTS: Applicant shall be advised that most forms, applications, and informational documents related to Public Works Engineering conditions can be found at the following link:
https://www.cityofpaloalto.org/Departments/Public-Works/Engineering- Services/Forms-and-Permits

6. OVERVIEW AND GUIDELINES FOR THE REVIEW OF SUBDIVISION PROJECTS: Developer shall familiarize themselves with the guidelines described in the November 2007 Item 13
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revision of the document titled “Overview and Guidelines for the Review of Subdivision Projects”. Particularly Section II (items 5 through 12) and Section V (items A through C). https://www.cityofpaloalto.org/files/assets/public/planning-amp-development- services/file-migration/current-planning/forms-and-guidelines/overview-and- guidelines-for-the-review-of-subdivision-projects.pdf

7. SUBDIVISION IMPROVEMENT AGREEMENT: The applicant shall execute a Subdivision Improvement Agreement and provide improvement securities (Bonds) for all proposed public improvements. THE AGREEMENT SHALL BE EXECUTED PRIOR TO MAP

RECORDATION OR ISSUANCE OF ANY PERMITS FOR CONSTRUCTION, ONSITE AND OFFSITE. ADVISORY -- The applicant shall provide a detailed itemized stamped and signed engineer's estimate for all off-site public improvements which will be reviewed to determine the security amount.

8. FINAL MAP: This project is subject to, and contingent upon the approval of a tentative map and recordation of a Final Map. The submittal, approval and recordation of the Map shall be in accordance with the provisions of the California Subdivision Map Act and Palo Alto Municipal Code Title 21 Subdivision requirements. All existing and proposed property lines, easements, dedications shown on the tentative map are subject to City’s technical review and staff approval during the map process prior to issuance of any construction permits.

9. MAP THIRD-PARTY REVIEW: The City contracts with a third-party surveyor that will review and provide approval of the map’s technical correctness as the City Surveyor, as permitted by the Subdivision Map Act. The Public Works Department will forward a Scope & Fee Letter from the third-party surveyor and the applicant will be responsible for payment of the fee’s indicated therein, which is based on the complexity of the map.

10. STREETWORK PERMIT: The applicant shall obtain a Streetwork Permit from the Department of Public Works for all public improvements.

11. GRADING AND EXCAVATION PERMIT: A Grading Permit is required per PAMC Chapter

16.28. The permit application and all applicable documents (see Section H of application) shall be submitted to Public Works Engineering. Add the following note:
“THIS GRADING PERMIT WILL ONLY AUTHORIZE GENERAL GRADING AND INSTALLATION OF THE STORM DRAIN SYSTEM. OTHER BUILDING AND UTILITY IMPROVEMENTS ARE

SHOWN FOR REFERENCE INFORMATION ONLY AND ARE SUBJECT TO SEPARATE BUILDING PERMIT APPROVAL.”

12. ROUGH GRADING: provide a Rough Grading Plan for the work proposed as part of the Grading and Excavation Permit application. The Rough Grading Plans shall including the following: pad elevation, elevator pit elevation, ground monitoring wells, limits of over excavation, stockpile area of material, overall earthwork volumes (cut and fill), temporary shoring for any existing facilities, ramps for access, crane locations (if any), Item 13
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tree protection measures, etc.

13. CIVIL ENGINEER CERTIFICATION: Upon completion of the rough grading work and at the final completion of the work, applicant shall provide an as-graded grading plan prepared by the civil engineer that includes original ground surface elevations, as-graded ground surface elevations, lot drainage patterns and locations and elevations of all surface and subsurface drainage facilities. The civil engineer shall certify that the work was done in accordance with the final approved grading plan.

14. SOILS ENGINEER CERTIFICATION: Upon completion of the rough grading work and at the final completion of the work, applicant shall provide a soil grading report prepared by the soils engineer, including locations and elevation of field density tests, summaries of field and laboratory tests and other substantiating data, and comments on any changes made during grading and their effect on the recommendations made in the soils engineering investigation report. The soils engineer shall certify as to the adequacy of the site for the intended use.

15. SHORING & TIEBACKS: Provide a shoring plan showing the existing utilities (if needed), to clearly indicate how the new structures will be constructed while protecting the existing utilities (if any). If tiebacks are proposed they shall not extend onto adjacent private property, existing easements or into the City’s right-of-way without having first obtained written permission from the private property owners and/or an encroachment permit from Public Works.

16. HYDRAULICS AND HYDROLOGY REPORT: This report compares the site’s pre-project and post-project conditions. Include a description of the existing site and how the proposed project works in terms of drainage. The report shall include calculations per the Santa Clara County Drainage Manual (2007) comparing 10-year versus 100-year storms (6 duration).

17. DIRECT CONNECTIONS TO STORM DRAIN SYSTEM: If the project proposes to replace and/or add connections to the City maintained storm drain system, then the applicant may be responsible for improvements to the system. These improvements may include, but not limited to, upsizing the storm drain facility, replacing or adding City standard catch basins, pipes and manholes. THIS MAY INCLUDE REPLACING BRICK AND MORTAR MANHOLES. The extent of required improvements will be at the public works staff discretion and shall be consistent with Storm Drain Master Plan and Public Works Construction Standards. Any work on the city's storm drain systems requires permits and inspection by Public Works inspectors.

18. CCTV OF STORM DRAIN SYSTEM: Post construction the applicant may be required to provide CCTV inspection of the City’s storm drain facilities to verify that any lines were not broken, cracked or damaged during construction. The video shall be high resolution and done by professional who is familiar with the process and meticulous. A CCTV Item 13
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inspection video is required for new storm drain connection (s) to verify proper connections were made into the City’s system and that no construction material was left behind. Videos of storm drain system may also be required where construction occurred less than 5-ft from the city’s storm drain system. Videos shall be provided from structure to structure, such as manhole to manhole. Contractor may want to conduct their own inspection in advance of construction to verify the existing pipe integrity. If existing damages are located, they shall be reported to Public Works inspectors prior to the start of construction. If not reported, the contractor may be responsible to restore the pipe segment as determined by Public Works prior to final.

19. GEOTECHNICAL ENGINEER STATEMENT: The grading plans shall include the following statement signed and sealed by the Geotechnical Engineer of Record: “THIS PLAN HAS

BEEN REVIEWED AND FOUND TO BE IN GENERAL CONFORMANCE WITH THE INTENT AND PURPOSE OF THE GEOTECHNICAL REPORT”.

20. CONSTRUCTION DEWATERING: This project may require a dewatering permit during construction due to the groundwater level relative to the depth of excavation.

21. SWPPP: This proposed development will disturb more than one acre of land.

Accordingly, the applicant shall apply for coverage under the State Water Resources Control Board’s (SWRCB) NPDES general permit for storm water discharge associated with construction activity. A Notice of Intent (NOI) shall be filed for this project with the SWRCB in order to obtain coverage under the permit. The General Permit requires the applicant to prepare and implement a Storm Water Pollution Prevention Plan (SWPPP).

The applicant is required to submit two copies of the NOI and the draft SWPPP to the Public Works Department for review and approval prior to issuance of the building permit. The SWPPP should include both permanent, post-development project design features and temporary measures employed during construction.

22. ENCROACHMENT PERMIT: Prior to any work in the public right-of-way, the applicant shall obtain an encroachment permit from the Public Works Department for any work that encroaches onto the City right-of-way.

23. LOGISTICS PLAN: A construction logistics plan shall be provided addressing all impacts to the public including, at a minimum: work hours, noticing of affected businesses, bus stop relocations, construction signage, dust control, noise control, storm water pollution prevention, job trailer, contractors’ parking, truck routes, staging, concrete pours, crane lifts, scaffolding, materials storage, pedestrian safety, and traffic control. All truck routes shall conform to the City of Palo Alto’s Trucks and Truck Route Ordinance, Chapter 10.48, and the route map. NOTE: Some items/tasks on the logistics plan may require an encroachment permit.

24. STORMWATER POLLUTION PREVENTION: All improvement plan sets shall include the “Pollution Prevention – It’s Part of the Plan” sheet.

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25. C.3 THIRD-PARTY CERTIFICATION: Applicant shall provide certification from a qualified third-party reviewer that the proposed permanent storm water pollution prevention measures comply with the requirements of Provision C.3 and Palo Alto Municipal Code Chapter 16.11.

26. Submit the following:
a. Provide a stamped and signed C.3 data form (April 2024 version) from SCVURPPP. https://scvurppp.org/2024/09/19/provision-c-3-data-form-2024/ b. Final stamped and signed letter confirming which documents were reviewed and that the project complies with Provision C.3 and PAMC 16.11.

27. C.3 STORMWATER AGREEMENT: The applicant shall enter into a Stormwater Maintenance Agreement with the City to guarantee the ongoing maintenance of the permanent storm water pollution prevention measures. The City will inspect the treatment measures yearly and charge an inspection fee. The agreement shall be executed by the applicant team prior to building permit final.

28. C.3 FINAL THIRD PARTY CERTIFICATION PRIOR TO OCCUPANCY: Within 45 days of the installation of the required storm water treatment measures and prior to the issuance of an occupancy permit for the building, the third-party reviewer shall submit to the City a certification verifying that all the permanent storm water pollution prevention measures were installed in accordance with the approved plans.

29. OUTSIDE AGENCY APPROVAL: A portion of the proposed work is within Caltrans right-of- way. Evidence of encroachment permit approval shall be submitted prior to issuance of City permits.

30. PRIOR TO PUBLIC WORKS FINAL/ACCEPTANCE (STORM DRAIN LOGO): The applicant is required to paint “No Dumping/Flows to Matadero Creek” in blue on a white background adjacent to all onsite storm drain inlets. The name of the creek to which the proposed development drains can be obtained from Public Works Engineering.

Stencils of the logo are available from the Public Works Environmental Compliance Division, which may be contacted at (650) 329-2598. Include the instruction to paint the logos on the construction grading and drainage plan.

SECTION 7. Term of Approval. Vesting Tentative Map. All conditions of approval of the Vesting Tentative Map shall be fulfilled prior to approval of a Final Map (PAMC Section 21.16.010[c]).

Unless a Final Map is filed, and all conditions of approval are fulfilled within a two-year period from the date of Vesting Tentative Map approval, the Vesting Tentative Map shall expire and all proceedings shall terminate. A request for an extension of time may be granted by the city council after recommendation of the planning commission, after the written extension request of the subdivider is submitted, prior to the expiration of the Vesting Tentative Map approval, or Item 13
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any previous extension granted. Such extension(s) shall be subject to the maximum limitations set forth in the Subdivision Map Act.
//
//
//
//
//
INTRODUCED:

PASSED:

AYES:

NOES:

ABSENT:

ABSTENTIONS:

ATTEST: APPROVED:
_________________________ ____________________________
City Clerk Mayor
APPROVED AS TO FORM: APPROVED AS TO CONTENT:
___________________________ ___________________________ Assistant City Attorney City Manager
___________________________
Director of Planning and
Development Services
PLANS AND DRAWINGS REFERENCED:

Those plans prepared by TALUS titled “VESTING TENTATIVE PARCEL MAP FOR LOT MERGER – 3150 EL CAMINO REAL (24PLN-00231)” consisting of five pages, dated April 16, 2025 and submitted April 17, 2025.

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If you need assistance reviewing the above documents, please contact the Project Planner or call the Planner-on-Duty at 650-617-3117 or email [email protected]
Project Plans
In order to reduce paper consumption, a limited number of hard copy project plans are provided to Councilmembers for their review. The same plans are available to the public, at all hours of the day, via the following online resources.

Directions to review Project plans and environmental documents online:

1. Go to: bit.ly/PApendingprojects

2. Scroll down to find “3150 El Camino Real” and click the address link

3. On this project-specific webpage you will find a link to the project plans and other important information
Direct Link to Project Webpage:
https://www.cityofpaloalto.org/Departments/Planning-Development-Services/Current- Planning/Projects/3150-El-Camino-Real
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Attachment C - Link to
Project Plans and CEQA
Analysis

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City Council
Staff Report
From: City Clerk
Report Type: CONSENT CALENDAR
Lead Department: City Clerk
Meeting Date: August 11, 2025
Report #:2505-4752
TITLE
FIRST READING: Adoption of an Ordinance to align chair and vice chair selection language for the Parks and Recreation Commission (Palo Alto Municipal Code Ch. 2.25) and the Architectural Review Board (Palo Alto Municipal Code Ch. 2.21) with the City’s other Boards, Commissions, and Committees (BCCs); and Adoption of a Resolution doing the same for the Storm Water Management Oversight Committee – CEQA Status: Not a Project

RECOMMENDATION
Staff recommends that the City Council adopt an ordinance standardizing the chair and vice chair selection language for the Parks and Recreation Commission (PRC) and Architectural Review Board (ARB) and adopt a resolution doing the same for the Storm Water Management Oversight Committee (SWMOC). The updated language will be: “The Commission shall elect a chairperson and a vice chairperson from its membership who shall serve in such capacity for one year each, or until a successor is elected, unless his or her term as a member of the Commission sooner expires.”

BACKGROUND
Per the BCC Handbook, each body will annually select a chair and vice chair to preside over meetings1. The chair is responsible for applying parliamentary procedures to facilitate structured and productive meetings. The chair ensures that the BCC completes its annual work plan, promotes civility and decorum, and ensures that all members are heard in a fair and safe manner.

Most BCCs have language in the PAMC specifying that a chair and vice chair are selected each year and will serve for one year or until a successor is elected.

PRC, ARB, and SWMOC currently diverge from the other BCCs with regard to their selection of a chair and vice chair. PRC is the only commission that must select a chair at a specific meeting. It must select a chair “each year at the first regular meeting of the Parks and Recreation 1 City Boards, Commissions, and Committees Handbook:
https://www.cityofpaloalto.org/files/assets/public/v/4/city-clerk/board-and-commission-handbook.pdf Item 14
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Commission… 3” ARB and SWMOC have a standing practice of selecting a chair and vice chair each year, but their respective PAMC chapter and resolution do not have language on the topic.

ANALYSIS
Staff recommends aligning the chair and vice chair selection language for PRC, ARB, and SWMOC with the following language: “The Commission shall elect a chairperson and a vice chairperson from its membership who shall serve in such capacity for one year each, or until a successor is elected, unless his or her term as a member of the Commission sooner expires.” This recommended action will bring consistency to BCC’s chair selection language and timing and provide the Commission with additional flexibility. Staff recommends standardizing the chair selection process across all BCCs so expectations and practices are uniform. On January 13, 2025, City Council adopted an ordinance 4 that moved the appointment of Public Art Commission, Human Relations Commission, and Parks and Recreation Commission members to November 1 of each year. This change requires PRC commissioners to vote on a chair in January after just one or two meetings with the new membership. Removing the timing requirement would give new and incumbent commissioners an opportunity to get acquainted before selecting a chair. PRC staff currently agendizes the chair selection at the January meeting, regardless of other potentially time-sensitive agenda items or the bandwidth of the commission.

FISCAL/RESOURCE IMPACT
There are no fiscal impacts associated with this action.

STAKEHOLDER ENGAGEMENT
Staff in the City Clerk’s Office collaborated on the proposed ordinance with staff in the Community Services Department, Planning and Development Services Department, and PRC members.

ENVIRONMENTAL REVIEW
This action is not a project under section 15378(b)(5) of the California Environmental Quality Act Guidelines (administrative activities that will not result in direct or indirect physical change in the environment).
3 Palo Alto Municipal Code Section 2.25.040 https://codelibrary.amlegal.com/codes/paloalto/latest/paloalto_ca/0- 0-0-61408
4 City Council, January 13, 2025; Agenda Item #8; Staff Report #2409-3480 https://portal.laserfiche.com/Portal/DocView.aspx?id=125150&repo=r-704298fc&searchid=c13e0943-f4b1-4780- 815b-a9343ab27559
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ATTACHMENTS
Attachment A: Attachment A: Ordinance of the Council of the City of Palo Alto Amending Chapter 2.21 (Architectural Review Board) and Chapter 2.25 (Parks and Recreation Commission) of the Palo Alto Municipal Code to Amend Procedures for Electing a Chair and Vice Chair Attachment B: Attachment B: Resolution of the Council of the City of Palo Alto Amending and Restating Resolution 10200 for the Storm Water Management Oversight Committee APPROVED BY:

Mahealani Ah Yun, City Clerk
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*NOT YET APPROVED*
137_20250721_ts24 1

Ordinance No. _____
Ordinance of the Council of the City of Palo Alto Amending Chapter 2.21 (Architectural Review Board) and Chapter 2.25 (Parks and Recreation Commission) of the Palo Alto Municipal Code to Amend Procedures for Electing a Chair and Vice Chair

The Council of the City of Palo Alto ORDAINS as follows:

SECTION 1. Findings and Declarations. The City Council finds and declares as follows:

A. The City has an Architectural Review Board (ARB) and a Parks and Recreation Commission (PRC) as established by ordinance.

B. The City Council now desires to amend the Palo Alto Municipal Code through this ordinance to codify existing practice that the ARB elect a chair and vice chair from its membership.

C. The City Council also desires to amend the procedure for electing a chairperson of the PRC to eliminate the requirement that the commission elect a chairperson at the first regular meeting of the PRC. This is consistent with other boards and commissions of the City.

SECTION 2. New s ection 2.2 1.020 (Officers) is hereby added to Chapter 2.2 1 (Architectural Review Board) of Title 2 (Administrative Code) to read as follows:

2.21.020 Officers.

The Board shall elect a chairperson and a vice chairperson from its membership who shall serve in such capacity for one year each, or until a successor is elected, unless his or her term as a member of the Board sooner expires.

SECTION 3. Section 2.25.040 (Officers) of Chapter 2.25 (Parks and Recreation Commission) of Title 2 (Administrative Code) is hereby amended to read as follows (deleted text in strikethrough, new text in underline):

2.25.040 Officers.

Each year, at the first regular meeting of the parks and recreation commission, the commission shall nominate and elect one of its members as the chairperson. The chairperson shall hold office for one year and until his or her successor is elected, unless his or her term as a member of the commission expires earlier.

The Commission shall elect a chairperson and a vice chairperson from its membership who shall serve in such capacity for one year each, or until a successor is elected, unless his or her term as a member of the Commission sooner expires.

Item 14
Attachment A - Ordinance
of the Council of the City of
Palo Alto Amending Chapter

2.21 (Architectural Review
Board) and Chapter 2.25
(Parks and Recreation
Commission) of the Palo
Alto Municipal Code to
Amend Procedures for
Electing a Chair and Vice
Chair

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SECTION 4. Severability.

If any section, subsection, sentence, clause, or phrase of this Ordinance is for any reason held to be invalid or unconstitutional by a decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of this Ordinance. The City Council hereby declares that it would have passed this Ordinance and each and every section, subsection, sentence, clause, or phrase not declared invalid or unconstitutional without regard to whether any portion of the Ordinance would be subsequently declared invalid or unconstitutional.

SECTION 5. Environmental Review
This ordinance is categorically exempt under CEQA regulation 15320 because it is a change in the organization of a local government agency that does not affect the geographical area in which previously existing powers are exercised.

SECTION 6. Effective Date
This Ordinance shall be effective 31 days after adoption.

INTRODUCED:

PASSED:

AYES:

NOES:

ABSENT:

ABSTENTIONS:

NOT PARTICIPATING:

ATTEST:

____________________________ ____________________________ City Clerk Mayor

APPROVED AS TO FORM: APPROVED:

____________________________ ____________________________ Assistant City Attorney City Manager

____________________________
Director, Planning and Development
Services

____________________________
Director, Community Services Department
Item 14
Attachment A - Ordinance
of the Council of the City of
Palo Alto Amending Chapter

2.21 (Architectural Review
Board) and Chapter 2.25
(Parks and Recreation
Commission) of the Palo
Alto Municipal Code to
Amend Procedures for
Electing a Chair and Vice
Chair

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1 138_20250721_ts24
Resolution No. ____

Resolution of the Council of the City of Palo Alto Amending and Restating Resolution 10200 for the Storm Water Management Oversight Committee to Elect a Chairperson and Vice Chairperson

R E C I T A L S

A. On November 14, 2005, the City Council adopted Resolution No. 8573, establishing the Storm Drain Oversight Committee to review the proposed operating and capital budget of the Storm Drainage Fund and the year -end financial report documenting the expenditures of the Storm Drainage Fund in the previous fiscal year.

B. On August 29, 2016, the City Council adopted Resolution No. 9624, calling a Mail Ballot Election in connection with the City’s proposed Storm Water Management Fee.

C. On October 24, 2016, the City Council adopted Resolution No. 9635, proposing a Storm Water Management Fee to replace the Storm Drainage Fee, calling a Public Hearing for October 24, 2016 with respect to such Fee and adopting Procedures relating to the conduct of a Protest Hearing and Mail Ballot Election.

D. On May 1, 2017, the City Council adopted Resolution 9677, which replaced the Storm Drain Oversight Committee with the Storm Water Management Oversight Committee.

E. On June 21, 2021, the City Council adopted Resolution 9969, which imposed term limits on members of the Storm Water Management Oversight Committee by amending and restating Resolution 9677. The City Council also moved the recruitment period to March from the past practice of May appointments.

F. On December 2, 2024, the City Council adopted Resolution 10200 to move the recruitment period to November to coincide with other boards and commissions with the same recruitment period. Existing terms will be extended to October 31. Going forward, terms begin on November 1.

G. The City Council now intends to require the election of a chairperson and vice chairperson by adding new Section 2.5 to the existing provisions. This is consistent with existing practice and other boards and commissions of the City.

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

SECTION 1. The Storm Drain Oversight Committee is decommissioned effective May 31, 2017.

Item 14
Attachment B - Resolution
of the Council of the City of
Palo Alto Amending and
Restating Resolution 10200
for the Storm Water
Management Oversight
Committee

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SECTION 2. Committee Established. The City of Palo Alto Storm Water Management Oversight Committee is hereby created to review proposed storm water management capital improvements and operating programs to be funded from the Storm Water Management Fees and to monitor expenditures of the fund.

SECTION 2.5. Chairperson and Vice Chairperson. The Committee shall elect a chairperson and a vice chairperson from its membership who shall serve in such capacity for one year each, or until a successor is elected, unless his or her term as a member of the Committee sooner expires.

SECTION 3. Committee Membership and Appointment. The Committee shall consist of seven members who are selected and appointed by the City Council for a term of four years.

Committee members shall serve without compensation. Each Committee member shall be a resident of Palo Alto, an employee of a business located in Palo Alto or an owner of real property within the City. No member shall be a council member, officer or employee of the City. Effective January 1, 2022, terms of office due to expire on May 31 of each year shall be extended to expire on March 14 of the following year, and thereafter terms of office shall commence on March 15.

Effective January 1, 2025, terms of office due to expire on March 1 4 of each year shall be extended to expire on October 31 of the same year, and thereafter terms of office shall commence on November 1.

SECTION 4. Term limits. Effective January 1, 2022, no person may serve more than two consecutive terms of office as a member of the Committee. (a) For the purposes of this section, a member will be considered to have served a term of office if he or she serves more than two years within one term. (b) A member’s service that began on or before January 1, 2022 shall count under the provisions of this section only for those members who served for at least one day o n the Committee between January 1, 2021 and January 1, 2022. Notwithstanding the previous sentence, members on Committee as of January 1, 2022 shall be permitted to complete their term.
(c) A member who has served two consecutive terms of office may remain as a member of the Committee for up to six months past the end of the term if no replacement is appointed or until a replacement is appointed, whichever comes first. (d) A member who has served two consecutive terms of office shall not be appointed to the Committee within one year of the last date of service.

SECTION 5. Committee Duties. The Committee shall discharge its oversight duties by:

(a) Meeting at least once a year to review the proposed operating and capital budgets of the Storm Water Management Fund for the next fiscal year . The Committee shall prepare a report documenting its findings with respect to the proposed budget and submit the report to the Finance Committee of the City Council prior to June 30th each year.

Item 14
Attachment B - Resolution
of the Council of the City of
Palo Alto Amending and
Restating Resolution 10200
for the Storm Water
Management Oversight
Committee

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(b) Meeting at least once a year to review the year -end financial report documenting the expenditures of the Storm Water Management Fund in the previous fiscal year.

The Committee shall prepare a report documenting its findings with respect to the expenditures and submit the report to the City Council prior to May 31st each year.

SECTION 6. Meeting Procedures. The Committee shall conduct open public meetings, duly noticed in accordance with the Ralph M. Brown Act. The Committee may establish rules and procedures governing the conduct of its meetings.

SECTION 7. The City Clerk is directed to place advertisements announcing Committee vacancies in a newspaper of general circulation in the City, two times within a two week period.

SECTION 8. This resolution supersedes Resolution 10200.

SECTION 9. This resolution shall be effective upon adoption.

SECTION 10. This amendment to Resolution 10200 is categorically exempt under CEQA regulation 15320 because it is a change in the organization of a local government agency that does not affect the geographical area in which previously existing powers are exercised.

INTRODUCED AND PASSED:

AYES:

NOES:

ABSENT:

ABSTENTIONS:

ATTEST:

___________________________________ ____________________________________ City Clerk Mayor

APPROVED AS TO FORM: APPROVED:

___________________________________ ____________________________________ Assistant City Attorney City Manager

____________________________________
Director of Public Works
Item 14
Attachment B - Resolution
of the Council of the City of
Palo Alto Amending and
Restating Resolution 10200
for the Storm Water
Management Oversight
Committee

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City Council
Staff Report
From: City Manager
Report Type: CONSENT CALENDAR
Lead Department: Planning and Development Services
Meeting Date: August 11, 2025
Report #:2506-4820
TITLE
FIRST READING: Adoption of an Ordinance Adding PAMC Chapter 16.15 to Restate Procedures for Expedited Permitting of Electric Vehicle Charging Systems to Comply with State Law. CEQA Status: Exempt under CEQA Guidelines Section 15061(b)(3).

RECOMMENDATION
Staff recommends that the City Council adopt the attached ordinance restating procedures for expedited permitting of electric vehicle charging systems to comply with Government Code Section 65850.7 and to restore provisions previously adopted under Ordinance No. 5415, including new findings related to the public health and safety impact of tree protection standards.

BACKGROUND
Government Code Section 65850.7, enacted by Assembly Bill 1236 (2015), requires local agencies to adopt an ordinance that provides an expedited, streamlined permitting process for electric vehicle charging systems (EVCS). In 2021, Assembly Bill 970 added mandatory timelines for processing these applications. Together, these laws establish the parameters for local review, limit discretionary actions, and require that cities publish objective checklists for applicants.

The City of Palo Alto complied with these mandates in 2017 by adopting Ordinance No. 5415, which added Section 16.14.440 to the Palo Alto Municipal Code. However, the provisions adopted by that ordinance were inadvertently removed during a subsequent amendment to Chapter 16.14. The proposed ordinance corrects that administrative error by reinstating the required permitting procedures in a new standalone chapter—Chapter 16.15.

Although the ordinance text was removed from the Code, the City has continued to review and process EVCS applications consistent with the requirements of state law.

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The ordinance also includes updated findings to support the application of the City’s tree protection standards during EVCS permit review. These findings are intended to establish that such standards qualify as objective public health and safety measures under Government Code Section 65850.7.

ANALYSIS
Government Code Section 65850.7 requires cities to adopt a streamlined process for reviewing EVCS permit applications. The law limits the scope of local agency review and only allows denial or conditioning of a permit where there is a “specific, adverse impact upon the public health or safety,” based on objective standards in effect at the time the application is deemed complete.

The City previously adopted the required ordinance in 2017. However, the relevant provisions were unintentionally removed from the Municipal Code when adopting the triennial building code updates due to a clerical oversight. The current action restores the City’s compliance with state law by re-codifying the ordinance in Chapter 16.15. Although the ordinance text was removed, the City has continued to process EVCS applications in accordance with the requirements of AB 1236 and AB 970.

Inclusion of Findings Related to Tree Protection Standards The ordinance includes findings to establish that the City’s tree protection standards may be applied during EVCS permit review without exceeding the limits of state law. These findings are based on documented public health and safety effects associated with the loss of urban canopy and the failure of damaged trees.

Staff determined that including these findings was necessary to support continued enforcement of the following objective standards under the “specific, adverse impact” clause in Government Code Section 65850.7:
Mitigation of tree removal through canopy replacement or payment of an in-lieu fee; and
Compliance with the City’s adopted standards for construction within a Tree Protection Zone (TPZ), which include trenching by hand or air-spade and protective fencing requirements to prevent root damage and tree destabilization.

These findings allow staff to apply the tree protection requirements as part of EVCS permit review where applicable. They do not create new standards, but clarify the legal basis for applying existing regulations in the context of state-mandated permit streamlining. Permit applications that comply with these requirements will continue to be processed and approved through the expedited procedure.

Tree protection requirements include compliance with adopted trenching and fencing standards for work near protected trees. These standards are documented in the City’s Public Item 15
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Works Specifications and applied consistently to all construction activity involving a Tree Protection Zone (TPZ), including limits on root disturbance and mandatory fencing setbacks.

FISCAL/RESOURCE IMPACT
There is no significant fiscal impact associated with adoption of the ordinance. Implementation will continue within existing Building Division and Urban Forestry staffing and procedures.

STAKEHOLDER ENGAGEMENT
No formal public outreach was conducted for this administrative update. Internal coordination included staff from Planning and Development Services, Public Works Urban Forestry program, the City Attorney’s Office, and the Office of Sustainability.

ENVIRONMENTAL REVIEW
Council action on this item is exempt from review under the California Environmental Quality Act (CEQA) pursuant to CEQA Guidelines Section 15061(b)(3), as it can be seen with certainty that the activity will not have a significant effect on the environment.

ATTACHMENTS
Attachment A: Ordinance Expedited Permitting Process for Electric Vehicle Charging Stations APPROVED BY:

Jonathan Lait, Planning and Development Services Director Item 15
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*Not Yet Approved*
1 0290175_20250611_ms29

Ordinance No. ____
Ordinance of the Council of the City of Palo Alto Restating Procedures for Expedited Permitting Processing for Electric Vehicle Charging Systems

The City Council of the City of Palo Alto ORDAINS as follows:

SECTION 1. Findings and Declarations.

A. The State of California and the City of Palo Alto have consistently promoted and encouraged the use of fuel-efficient electric vehicles.

B. The State of California recently adopted Assembly Bill 1236, which requires local agencies to adopt an ordinance that creates an expedited and streamlined permitting process for electric vehicle charging systems.

C. Creation of an expedited, streamlined permitting process for electric vehicle charging stations would facilitate convenient charging of electric vehicles and help reduce the City’s reliance on environmentally damaging fossil fuels.

D. On June 27, 2017, the City Council adopted Ordinance 5415, creating an expedited permitting process for Electric Vehicle Charging Stations as Section 16.14.440 of the Palo Alto Municipal Code.

E. The provisions adopted by Ordinance 5415 were inadvertently omitted from subsequent ordinances amending Chapter 16.14 of the Palo Alto Municipal Code. The City Council now wishes to correct this omission by re-codifying the provisions adopted by Ordinance 5415 in their own chapter of the Palo Alto Municipal Code.

F. Urban tree canopy has a quantifiable impact on public health and safety. Near- surface temperatures in cities generally significantly exceed those in surrounding rural areas (the “urban heat island” effect). See A.J. Arnfield. Two decades of urban climate research: A review of turbulence, exchanges of energy and water, and the urban heat island. International Journal of Climatology, 23 (2003), pp. 1-26.

G. Heat exposure has been associated with adverse health outcomes, including higher rates of all-cause and cardiovascular mortality and emergency hospitalizations, across a range of study designs, and covering geographical regions worldwide. Bobb JF, Peng RD, Bell ML, Dominici F. 2014. Heat-related mortality and adaptation to heat in the United States.

Environ Health Perspect 122:811–816; https://doi.org/10.1289/ehp.1307392. In the United States, extreme heat is by far the most common cause of weather-related fatalities, accounting for 207 fatalities in 2023 alone. National Weather Service Weather Related Fatality and Injury Statistics, Available at: https://www.weather.gov/hazstat/.

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H. Climate change is anticipated to greatly exacerbate the public health impacts of urban heat. One 2014 analysis found that an increase in average temperatures by 5°F (central climate projection) would lead to an additional 1,907 deaths per summer across 105 U.S. cities studied, which would exceed the total number of severe weather fatalities that occurred across the United States in 2012 by more than a factor of three. Bobb et al., 2014.

I. A significant and growing body of research has shown that a change in the level of urban tree canopy can have a quantifiable impact on the urban temperatures. A study of 27 U.S. cities analyzed the effects of a decrease in urban canopy over a ten-year period, and concluded that full reforestation would cause average daily maximum summer air temperatures to decline by an estimated average 1.7 °C (1.4–2.0 °C) across cities. Kroeger, T., McDonald, R. I., Boucher, T., Zhang, P. & Wang, L. Where the people are: Current trends and future potential targeted investments in urban trees for PM10 and temperature mitigation in 27 U.S. cities. Landsc. Urban Plan. 177, 227–240 (2018).

J. Because the cooling effects of trees can be highly localized, a change in canopy cover can affect the temperature of the immediate surroundings at levels that far exceed city- level average change. A meta-analysis of studies on the cooling effects of street trees found that cooling intensity varies from 0.4° C (0.7° F) to 3.0° C (5.4° F) depending on the site and the time of day. McDonald, R.I., et al., Planting Healthy Air: A global analysis of the role of urban trees in addressing particulate matter pollution and extreme heat. 2016, The Nature Conservancy: Arlington, VA., www.nature.org/healthyair.

K. This cooling effect quantifiably reduces heat-related morbidity and mortality.

One study of 97 U.S. cities estimated that urban tree cover saves 245-346 lives annually and helps avoid more than 50,000 doctor’s visits due to heat annually. McDonald, R. I., Kroeger, T., Zhang, P. & Hamel, P. The value of US urban tree cover for reducing heat-related health impacts and electricity consumption. Ecosystems 23, 137–150 (2019).

L. Analysis of extreme heat events in Toronto, Canada found that the number of heat-related ambulance calls was negatively correlated to canopy cover (Spearman Rank rho = −0.094, p = 0.029) and positively correlated to hard surface cover (Spearman Rank rho = 0.150, p < 0.001). Graham D.A., Vanos J.K., Kenny N.A., Brown R.D. The relationship between neighbourhood tree canopy cover and heat-related ambulance calls during extreme heat events in Toronto, Canada. Urban For. Urban Green. 2016;20:180–186. doi: 10.1016/j.ufug.2016.08.005.

M. One study quantified the average difference in urban tree coverage between majority white and majority person-of-color (POC) neighborhoods, and concluded that greater urban tree canopy in majority white neighborhoods helps avoid 632 ± 100 deaths, while the less robust tree canopy in majority POC neighborhoods helped avoid only 442 ± 97 deaths annually.

McDonald, R.I., Biswas, T., Chakraborty, T.C. et al. Current inequality and future potential of US Item 15
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urban tree cover for reducing heat-related health impacts. npj Urban Sustain 4, 18 (2024). https://doi.org/10.1038/s42949-024-00150-3.

N. In another key study, researchers concluded that increased vegetative cover could help offset projected increases in heat-related mortality for heat wave conditions in 2050 by 40 to 99% across three U.S. metropolitan regions. Stone B., Vargo J., Liu P., Habeeb D., DeLucia A., Trail M., Hu Y., Russell A. Avoided heat-related mortality through climate adaptation strategies in three US cities. PLoS ONE. 2014;9:e100852. doi: 10.1371/journal.pone.0100852.

O. As extreme heat becomes increasingly common due to climate change, a project that reduces the City’s urban canopy by requiring the removal of a tree would have a specific adverse impact upon the public health or safety by reducing resistance to heat-related morbidity and mortality.

P. Palo Alto requires the negative impact of tree removal to be mitigated through canopy replacement or payment of an in-lieu fee. The City’s mitigation standards reflect best practices in the Urban Forestry field. When installing an electric vehicle charging station would require removal of a tree, compliance with these mitigation measures is necessary to avoid a net reduction in urban tree canopy and the associated specific, adverse impact on the public health or safety.

Q. Like a reduction in tree canopy, tree failure can cause significant adverse impacts on public safety. An analysis of wind-related tree failures in the United States found those failures caused 407 deaths from 1995 to 2007 at an average of 31 deaths per year (1 in 9.7 million). Schmidlin, T.W. 2009. Human fatalities from wind-related tree failures in the United States, 1995–2007. Natural Hazards 50:13–25.

R. Construction activity in a tree’s root zone has a quantifiable impact on the risk of tree failure. Trees adjacent to construction have been found to be nearly twice as likely to die as those not exposed to development and redevelopment activities. Koeser, A., R. Hauer, K.

Norris, and R. Krouse. 2013. Factors influencing long-term street tree survival in Milwaukee, WI, USA. Urban Forestry & Urban Greening 12:562–568.

S. Site inspections of fallen urban trees frequently reveal root damage and evidence of trenching or other construction near the trunk of the tree. In one analysis of fallen urban trees, 58% showed evidence of site or trenching works within four meters of trunk.

Moore, G.M. 2014. Wind-Thrown Trees: Storms or Management? Arboriculture & Urban Forestry. 40:53-69.

T. Research indicates that enforcement of construction and excavation standards within a tree protection zone (TPZ) is an important way to minimize the public safety risk of tree falls. Steenberg, J.W.N., P.J. Robinson, and P.N. Duinker. 2018. A spatio temporal analysis of the relationship between housing renovation, socioeconomic status, and urban forest ecosystems. Environment and Planning B: Urban Analytics and City Science.

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U. Palo Alto has adopted TPZ excavation standards that reflect industry-wide best practices to minimize damage to a tree’s root system. When installing an electric vehicle charging station would require trenching or construction activity in a tree protection zone, compliance with these standards is necessary to avoid a specific, adverse impact on the public health or safety.

SECTION 2. Chapter 16.15 (Expedited Permitting Process for Electric Vehicle Charging Stations) of the Palo Alto Municipal Code is hereby added to read:

16.15.010. Expedited Permitting Process for Electric Vehicle Charging Stations

(a) Definitions
(1) “Electric vehicle charging station” or “charging station” means any level of electric vehicle supply equipment station that is designed and built in compliance with Article 625 of the California Electrical Code, as it reads on the effective date of this Chapter, and delivers electricity from a source outside an electric vehicle into a plug-in electric vehicle.

(2) “Specific, adverse impact” means a significant, quantifiable, direct, and unavoidable impact, based on objective, identified, and written public health or safety standards, policies, or conditions as they existed on the date the application was deemed complete.

(3) “Electronic submittal” means the utilization of one or more of the following:
i. Electronic mail or email.
ii. The internet.
iii. Facsimile.

(b) Expedited Permitting Process. Consistent with Government Code Section 65850.7, the Chief Building Official shall implement an expedited, streamlined permitting process for electric vehicle charging stations, and adopt a checklist of all requirements with which electric vehicle charging stations shall comply with in order to be eligible for expedited review. The expedited, streamlined permitting process and checklist may refer to the recommendations contained in the most current version of the “Electric Vehicle Charging Station Permitting Guidebook” published by the Governor’s Office of Business and Economic Development. The City’s adopted checklist shall be published on the City’s website.

(c) Permit Application Processing
(1) Prior to submitting an application for processing, the applicant shall verify that the installation of an electric vehicle charging station will not have specific, adverse impact to public health and safety and building occupants.

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Verification by the applicant includes but is not limited to: electrical system capacity and loads; electrical system wiring, bonding and overcurrent protection; building infrastructure affected by charging station equipment and associated conduits; areas of charging station equipment and vehicle parking.

(2) A permit application that satisfies the information requirements in the City’s adopted checklist shall be deemed complete and be promptly processed.

Upon confirmation by the Chief Building Official or designee that the permit application and supporting documents meets the requirements of the City adopted checklist, and is consistent with all applicable laws and health and safety standards, the Chief Building Official or designee shall, consistent with Government Code Section 65850.7, approve the application and issue all necessary permits. Such approval does not authorize an applicant to energize or utilize the electric vehicle charging station until approval is granted by the City. If the Chief Building Official or designee determines that the permit application is incomplete, he or she shall issue a written correction notice to the applicant, detailing all deficiencies in the application and any additional information required to be eligible for expedited permit issuance.

(3) The Chief Building Official or designee shall not condition the approval for any electric vehicle charging station permit on the approval of such a system by an association, as that term is defined by Civil Code Section 4080.

(4) Permit applications under this section may be submitted electronically, including electronic signatures on all forms, applications, and other documentation.

(d) Technical Review. It is the intent of this section to encourage the installation of electric vehicle charging stations by removing obstacles to permitting for charging stations so long as the action does not supersede the Chief Building Official’s authority to address higher priority life-safety situations. If the Chief Building Official or designee makes a finding based on substantial evidence that the electric vehicle charging station could have a specific adverse impact upon the public health or safety, as defined in this section, the City may require the applicant to apply for a use permit.

SECTION 3. Severability. If any section, subsection, sentence, clause, or phrase of this Ordinance is for any reason held to be invalid or unconstitutional by a decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of this Ordinance. The City Council hereby declares that it would have passed this Ordinance and each and every section, subsection, sentence, clause, or phrase not declared invalid or Item 15
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unconstitutional without regard to whether any portion of the Ordinance would be subsequently declared invalid or unconstitutional.

SECTION 4. CEQA. The City Council finds that this Ordinance falls under the California Environmental Quality Act (CEQA) exemption found in Title 14 California Code of Regulations Section 15061(b)(3) because it can be seen with certainty that there is no possibility it will have a significant negative effect on the environment.

SECTION 5. Effective Date. This ordinance shall be effective on the thirty-first date after the date of its adoption.

INTRODUCED:

PASSED:

AYES:

NOES:

ABSTENTIONS:

ABSENT:

ATTEST: APPROVED:

______________________________ ____________________________ City Clerk Mayor

APPROVED AS TO FORM: APPROVED:

____________________________ ____________________________ City Attorney or Designee City Manager

____________________________
Director of Planning
and Development Services
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City Council
Staff Report
From: City Manager
Report Type: ACTION ITEMS
Lead Department: Fire
Meeting Date: August 11, 2025
Report #:2503-4437
TITLE
PUBLIC HEARING: Consideration of Objections for Weed Abatement Assessments; and Adoption of Resolution Confirming the Weed Abatement Report and Ordering Abatement Costs to be a Special Assessment on the Properties Specified in the Report; CEQA status - categorically exempt.

RECOMMENDATION
Staff recommends Council:
1) Hold a public hearing to hear and consider objections from affected property owners of proposed assessments related to completed weed abatement work, and 2) Adopt a resolution confirming the report and ordering abatement costs to be a special assessment on the properties specified in the report (Attachment A)

EXECUTIVE SUMMARY
The Santa Clara County Department of Agriculture and Environmental Management and the City of Palo Alto work together to protect our community from fire. One of the purposes of the Weed Abatement Program is to prevent fire hazards posed by vegetative overgrowth and the accumulation of combustible materials. Adoption of the resolution will result in the total of $12,735.97 imposed as liens on the properties listed in the attachment for the cost of weed abatement work performed.

BACKGROUND
The Weed Abatement Division of Santa Clara County Agriculture and Environmental Management administers the contract for weed abatement within the City of Palo Alto, in accordance with an agreement established on April 18, 1977, between the City and County. On December 2, 2024, in accordance with Palo Alto Municipal Code Chapter 8.08, the City Council declared weeds to be a nuisance and ordered that the nuisance be abated. A public hearing was held on February 10, 2025, to consider objections to the proposed destruction or removal of the weeds.

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Property owners were notified in the first week of January 2025 that weeds were to be abated by April 30, 2025, either by the owners or by the County. If the property owners chose to have the County abate the weeds, the abatement charges would be levied against the respective properties as an assessment by the County Assessor. Once the above steps had been taken, the County Weed Abatement Division instructed its contractor to abate weeds on City and private properties within Palo Alto. The County then informs the property owners of the costs for destroying and removing the weeds. The City Clerk has published the required notice of this hearing in the Palo Alto Daily Post. The cost report by the County Weed Abatement Division has been posted on the City Hall Plaza bulletin board for at least ten (10) days prior to this hearing.

ANALYSIS
Property owners may object to the charges for weed abatement being levied against their properties. The charge consists of the contractor’s cost, plus 150 percent administrative charges, in accordance with Palo Alto’s contract with Santa Clara County (CMR #7527, December 12, 2016). A representative from the County Weed Abatement Division will be present at the public hearing with the records of weed abatement that have taken place.

Should there be any modifications in the proposed assessments as a result of the hearing, changes in the assessment spreadsheet will be made as necessary. After any recalculations are completed, and Council adopts the attached resolution confirming the abatements and ordering those costs to be imposed as liens on the abated properties, the assessments will be submitted to the County Assessor for entry on the October tax roll upon which general City taxes are to be collected.

FISCAL/RESOURCE IMPACT
There is no direct fiscal impact of this action to the City. The assessments identified on Exhibit A of the resolution, totaling $12,735.97, will be imposed as liens on the properties listed and will be borne by the property owners, not the City.

STAKEHOLDER ENGAGEMENT
The entire weed abatement program is coordinated by the Santa Clara County Department of Agriculture and Environmental Management. Coordination includes contracts, inspections, nuisance reports/lists and fees.

ENVIRONMENTAL REVIEW
The Weed Abatement Program is Categorically Exempt from CEQA pursuant to CEQA Guidelines Section 15308.

ATTACHMENTS
Attachment A: Resolution Confirming 2025 Weed Abatement Program Assessment Report Attachment B: Weed Abatement Summary and Timeline
APPROVED BY: Geoffrey Blackshire, Fire Chief
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NOT YET APPROVED Attachment A

Resolution No.

Resolution Confirming Weed Abatement Report and Ordering Cost of Abatement to be a Special Assessment on the Respective Properties Described Therein

R E C I T A L S

A. The Council of the City of Palo Alto has heretofore declared weeds growing on certain properties within the City to be a public nuisance by Resolution No. 10201, dated December 2, 2024, and

B. The Council on February 10th, 2025, held a public hearing for objections to the proposed destruction and removal of weeds at the properties indicated in the County’s list for weed abatement.

C. The Fire Chief, through his Administrator, the Weed Abatement Division of Santa Clara County Department of Agriculture and Environmental Management, has caused the weeds to be abated on the properties described in the County’s list for weed abatement; and

D. The Fire Chief, through his Administrator, the Weed Abatement Division of Santa Clara County Department of Agriculture and Environmental Management, has filed his report and assessment list for weed abatement as provided by law and a hearing has been duly set and noticed, for objections to said report and assessment list and for confirmation; and

E. The Council has duly considered the report and assessment list and any objections thereto.

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

SECTION 1. The report and assessment list is in all respects complete and correct and is hereby confirmed. The amounts of the cost for abating the nuisance are confirmed and those remaining unpaid, as shown on Exhibit “A” attached hereto and incorporated herein, shall constitute special assessments against the respective parcels of land and are a lien on the property for the amount of the respective assessment.

SECTION 2. All written or oral protests or objections to said report and assessment list are overruled or denied.

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NOT YET APPROVED Attachment A

SECTION 3. The unpaid assessments shown on Exhibit “A” shall be entered upon the 2025- 2026 tax roll against the parcels of land and shall be collected at the same time and in the same manner as general City taxes, subject to the same interest and penalties, and subject to the same procedure and sale in case of delinquency. All laws and ordinances applicable to the levy, collection, and enforcement of City taxes are hereby made applicable to this special assessment.

SECTION 4. Santa Clara County has determined the weed abatement program to be categorically exempt from CEQA pursuant to CEQA Guidelines Section 15308.

INTRODUCED AND PASSED:

AYES:

NOES:

ABSENT:

ABSTENTIONS:

ATTEST:

City Clerk Mayor
APPROVED AS TO FORM: APPROVED:

Assistant City Attorney City Manager
Fire Chief
Director of Administrative Services

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2025 WEED ABATEMENT PROGRAM

CITY OF PALO ALTO

ASSESSMENT REPORT
Exhibit A

TAX ROLL

Situs APN OWNER ADDRESS AMT
1 1605 Edgewood 003-12-002 Miao, Nina Yanti 931 Clara Dr PALO ALTO 94303-4002 $1,920.47 2 782 Greer 003-41-065 Deng, Jingjing And Jiang , Lijun 20653 Cheryl Dr CUPERTINO 95014 $105.00 3 1071 Embarcadero 003-42-055 Kothary, Nishita N And Shah , Niraj 1071 Embarcadero Rd PALO ALTO 94303-3149 $105.00 4 2385 St Francis 003-48-021 Zadik, Yair And Linda 2385 St Francis Dr PALO ALTO 94303-3136 $105.00 5 2075 Louis 003-50-021 Keller, Jeffrey R 2075 Louis Rd PALO ALTO 94303-3452 $201.00 6 742 Southampton 003-59-041 Agrawal, Parag And Agarwala , 1725 Newell Rd PALO ALTO 94303-2951 $105.00 7 260 Byron 120-02-030 Liveright, Michael 260 Byron St PALO ALTO 94301-1307 $201.00 8 655 Embarcadero 120-08-023 L S & Co Partnership 555 Byron St Unit 105 PALO ALTO 94301-1303 $201.00 9 733 Ramona 120-27-063 Koda, Ross K Trustee P O Box 156 SOUTH DOS PALOS 93665 $105.00 10 2220 Bryant 124-14-024 L S & Co. 555 Byron St Unit 105 PALO ALTO 94301 $201.00 11 1001 Colorado 127-04-091 Tsunoda Roland T 1001 Colorado Ave PALO ALTO 94303-3806 $201.00 12 4102 Sutherland 127-16-005 Yurchenco, James R 4102 Sutherland Dr PALO ALTO 94303-4730 $105.00 13 3189 Louis 127-24-031 Kato, Takashi And Ayano 3189 Louis Rd PALO ALTO 94303-3955 $105.00 14 Middlefield 127-33-064 E & R Inv Properties Llc Et Al Po Box 500 BURLINGAME 94011 $105.00 15 924 Colorado 127-40-006 Lin Stanley B And Jean Lai Trustee 1037 High St PALO ALTO 94301-2425 $105.00 16 464 Colorado 132-08-115 Tanphaichitr, Saksiri M And Bellers , 464 Colorado Ave PALO ALTO 94306-2414 $105.00 17 454 Colorado 132-08-118 Ramchandran, Asish And Kavitha 2657 Kipling St PALO ALTO 94306 $105.00 18 2689 Bryant 132-13-055 Chou, Lynn H L Po Box 60416 PALO ALTO 94306 $201.00 19 3166 Kipling 132-15-002 Pao, Joy J And Ke , Shian-ren 67 Orchard Hills St ATHERTON 94027 $105.00 Report Date: 7/9/2025 (List Sorted by APN) Page 1
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2025 WEED ABATEMENT PROGRAM

CITY OF PALO ALTO

ASSESSMENT REPORT
Exhibit A

TAX ROLL

Situs APN OWNER ADDRESS AMT
20 354 El Verano 132-16-088 Zhou, Zheng Trustee 354 El Verano Ave PALO ALTO 94306-2952 $105.00 21 3120 Cowper 132-20-155 Valentine, Mary E 3120 Cowper St PALO ALTO 94306-3001 $105.00 22 339 El Verano 132-21-022 Mizote, Harumi Trustee 339 El Verano Ave PALO ALTO 94306-2940 $1,536.50 23 309 El Verano 132-21-023 Zhang, Qianli And Qiu , Yunfeng 309 El Verano Ave PALO ALTO 94306-2940 $105.00 24 3271 Bryant 132-21-027 Conlin, Charlene M Trustee 25210 Jake St VENETA 97487 $105.00 25 3535 Bryant 132-22-034 Darden, Ruthie L Trustee 3535 Bryant St PALO ALTO 94306-4263 $105.00 26 3358 Bryant 132-22-070 Beeson, Donald H Trustee Po Box 60458 PALO ALTO 94306 $201.00 27 3541 Bryant 132-23-033 Kaposhilin, Nicholas Trustee 936 N California Ave PALO ALTO 94303-3405 $105.00 28 84 Roosevelt 132-23-055 Leung, John Ka Yu And Joanna Kong Po Box 5358 SAN MATEO 94402-0358 $105.00 29 34 Roosevelt 132-29-061 Lyons, Charles P Trustee & Et Al 34 Roosevelt Cir PALO ALTO 94306-4216 $105.00 30 18 Roosevelt 132-29-069 Bernstein, Amir D Trustee 18 Roosevelt Cir PALO ALTO 94306 $105.00 31 3830 Carlson 132-30-058 Cheng, Jing 4521 Campus Dr Unit 363 IRVINE 92612 $105.00 32 Birch 132-33-060 At&t Comms Of Calif Inc 1090 E Duane Ave SUNNYVALE 94085 $201.00 33 3561 Park 132-34-052 Mahal, Jaswinder 180 Park Sharon Dr SAN JOSE 95136-2535 $105.00 34 451 Wilton 132-35-025 Song, Zhiqiang And Chen , Weiwei 451 Wilton Ave PALO ALTO 94306-2859 $105.00 35 365 Wilton 132-35-033 Tong, Peter And Pao , Chung Chian 18444 Forest Crossing Ct OLNEY 20832 $105.00 36 421 Fernando 132-39-037 Williger, Edward M P O Box 20089 STANFORD 94309-0089 $201.00 37 3585 El Camino Real 132-40-058 2060 Birch Llc 42840 Christy St Unit 209 FREMONT 94538 $105.00 38 3545 El Camino Real 132-40-063 South East Travel Service (usa) Co 3545 El Camino Real PALO ALTO 94306 $105.00 Report Date: 7/9/2025 (List Sorted by APN) Page 2
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2025 WEED ABATEMENT PROGRAM

CITY OF PALO ALTO

ASSESSMENT REPORT
Exhibit A

TAX ROLL

Situs APN OWNER ADDRESS AMT
39 3130 Ramona 132-48-033 Ding, Zhimin And Zhu , Xinyi 3130 Ramona St PALO ALTO 94306-2922 $105.00 40 2740 Byron 132-55-020 Rv Constructions.com Llc 2791 Cowper St PALO ALTO 94306-2448 $105.00 41 613 Stanford 137-01-059 Baumann, John R Trustee 613 Stanford Ave PALO ALTO 94306-1412 $201.00 42 2150 Yale 137-01-134 Liang, Ke 33206 Falcon Dr FREMONT 94555 $105.00 43 2175 Oberlin 137-03-036 Yu, Shuping And Dai , Xiaojie 2175 Oberlin St PALO ALTO 94306-1340 $105.00 44 2153 Oberlin 137-03-037 Mendelowitz, Louis I 2153 Oberlin St PALO ALTO 94306-1318 $105.00 45 3700 El Camino Real 137-11-078 Kss Investment Llc 1380 Miravalle Ave LOS ALTOS 94024-5744 $105.00 46 788 Los Robles 137-13-112 Bloomquist, Lynda L Trustee 788 Los Robles Av PALO ALTO 94306-3159 $201.00 47 883 Ilima 137-14-054 Xie Xinmin And Li Xiaosu Trustee 2633 Martinez Drive BURLINGAME 94010 $105.00 48 4025 Orme 137-20-044 Zhu Jay Jiabi Trustee & Et Al 827 Richardson Ct PALO ALTO 94303-4152 $105.00 49 4146 El Camino Real 137-24-034 Juan, Chung-chiung And Su Chen 6 Atherton Oaks Ln ATHERTON 94027 $201.00 50 3460 Hillview 142-16-059 Stanford Real Estate 415 Broadway, 3rd Redwood City 94063 $105.00 51 1072 Arastradero 142-16-061 Stanford Real Estate 415 Broadway, 3rd Redwood City 94063 $105.00 52 3495 Deer Creek 142-16-062 Stanford Real Estate 415 Broadway, 3rd Redwood City 94063 $201.00 53 Deer Creek 142-16-064 Stanford Real Estate 415 Broadway, 3rd Redwood City 94063 $105.00 54 3500 Deer Creek 142-16-066 Stanford Real Estate 415 Broadway, 3rd Redwood City 94063 $201.00 55 4208 Ruthelma 148-02-002 Shiu, Boon W And Choi , Keehyun 4208 Ruthelma Ave PALO ALTO 94306-4109 $105.00 56 4236 Darlington 148-03-044 Wang, Youxiang And Li , Zhengqi 4236 Darlington Ct PALO ALTO 94306-4129 $105.00 57 4201 Park 148-03-060 Bordia, Anupam And Surbhi 4201 Park Blvd PALO ALTO 94306-4144 $105.00 Report Date: 7/9/2025 (List Sorted by APN) Page 3
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2025 WEED ABATEMENT PROGRAM

CITY OF PALO ALTO

ASSESSMENT REPORT
Exhibit A

TAX ROLL

Situs APN OWNER ADDRESS AMT
58 4338 Silva 148-12-013 Karupasamy, Karthikeyan Trustee & 444 Del Medio Ave MOUNTAIN VIEW 94040-1161 $105.00 59 4346 Silva 148-12-014 Jiang, Wei And Han , Qiuxia Trustee 4346 Silva Ave PALO ALTO 94306-4421 $105.00 60 4350 Silva 148-12-016 Hu, Zhe And Ma , Yinglan 591 Sierra Ave MOUNTAIN VIEW 94041-2144 $105.00 61 4179 Oak Hill 175-01-025 Bachrach, Sylvia Rashmi Trustee & 12 Star Way MOUNTAIN VIEW 94040 $201.00 62 4243 Manuela 175-02-053 Weakland, Alan Trustee & Et Al 515 S Flower St Floor 25 LOS ANGELES 90071 $105.00 63 4100 Old Adboe 175-20-074 Yamarashi Iruka Llc 333 W Santa Clara St Ste 700 SAN JOSE 95113 $105.00 64 4103 Old Trace 175-20-078 Smithwick, Alton D And Ursula L 803 Russell Ln MILPITAS 95035 $105.00 65 890 Mockingbird 175-20-082 Joshi, Vivek Trustee & Et Al 890 Mockingbird Ln PALO ALTO 94306-3719 $105.00 66 4186 Old Adobe 175-20-092 Waters, Christopher J Trustee & Et 609 Arboleda Dr LOS ALTOS 94024 $201.00 67 3000 Alexis 182-35-035 Palo Alto Hills Golf And Country 3000 Alexis Dr PALO ALTO 94304-1303 $105.00 68 3130 Alexis 182-43-024 Von Clemm, Peter F And Jennifer J 3130 Alexis Dr PALO ALTO 94304-1305 $105.00 69 966 Laurel Glen 182-43-038 Jacobsen, Ruth E Trustee 966 Laurel Glen Dr PALO ALTO 94304-1322 $201.00 70 951 Laurel Glen 182-49-004 Bogerty, Sharon D 951 Laurel Glen Dr PALO ALTO 94304-1323 $105.00 71 930 Laurel Glen 182-54-006 Yeh Knoll Holding Inc A Barbados Ice House St CENTRAL HONG KONG $201.00 72 931 Laurel Glen 182-54-012 Sheth, Beerud Trustee & Et Al 931 Laurel Glen Dr PALO ALTO 94304-1323 $201.00 73 Laurel Glen 182-54-013 Ngai, Kenneth S Trustee & Et Al 3121 Bandera Dr PALO ALTO 94304-1341 $105.00 TOTAL $12,735.97

Report Date: 7/9/2025 (List Sorted by APN) Page 4
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Attachment A - Resolution Confirming
2025 Weed Abatement Program
Assessment Report

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Attachment C

City of Palo Alto Weed Abatement
The City of Palo Alto contracts with the Santa Clara County Department of Agriculture and Environmental Management (SCCDAEM) to remove and destroy weeds in its efforts to mitigate potential fire hazards (as defined in Palo Alto Municipal Code Chapter 8.08). The entire weed abatement program is coordinated by the SCCDAEM. Abatement proceedings must follow a legally established course. This is and annual process with weed abatement occurring in late Spring. City of Palo Alto involvement is limited to the following 3 steps for City Council:

1) (Nov-Dec) City of Palo Alto declares Weeds a Nuisance to allow for County abatement and sets a later date (Jan-Feb) for a public hearing to review the Annual Commencement Report (list of “nuisance” parcels).
2) (Jan-Feb) Public Hearing to review the Annual Commencement Report and approve the County abatement proceedings. 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. Upon adoption of the resolution confirming the weed abatement commencement report and ordering weed nuisances abated, the County will be asked to perform the abatement work to destroy and remove any weeds. 3) (July/August) Public Hearing to approve the invoices for the abatement work performed by the SCCDAEM.

The Santa Clara County Weed Abatement Program
The Santa Clara County Department of Agriculture and Environmental Management and the City of Palo Alto work together to protect our community from fire. The purpose of the Weed Abatement Program is to prevent fire hazards posed by vegetative overgrowth and the accumulation of combustible materials.

Typically, a property is placed on the program list by a County Weed Abatement Inspector who identifies a potential fire hazard on the property. The Palo Alto Fire Department (PAFD) & Code Enforcement also report addresses of concern and forward (verified) complaints from residents to the SCCDAEM.

Residents can report addresses of concern to POAFD, code enforcement, or directly to the County Weed Abatement Program.

Santa Clara County program staff annually inspect “nuisance” parcels at the beginning of the fire season, which is typically April 30
th for CPA parcels.

The Weed Abatement program is entirely funded from fees charged to residents. All parcels on the list will be charged a basic inspection fee. If the parcel is not in compliance at the time of inspection, the property owner will be charged an additional failed inspection fee, and they will receive a final courtesy notice as a reminder to abate their weeds within 2 weeks.

If the weeds are not abated by the property owner, the work will be completed by the County contractor. The property owner will pay the contractor’s fees plus a County administrative fee. All fees will be included in their property tax bill.

Properties that meet and maintain the minimum fire safety standards will only be charged for the annual fee. These properties will be removed from the list after three years of compliance.

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Attachment B - Weed
Abatement Summary and
Timeline

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City Council
Staff Report
From: City Manager
Report Type: ACTION ITEMS
Lead Department: Utilities
Meeting Date: August 11, 2025
Report #:2501-4081
TITLE
Approval of Resolutions Amending the Amended and Restated Water Supply Agreement Between the City and County of San Francisco and Wholesale Customers in Alameda County, San Mateo County and Santa Clara County and the Updated Tier 2 Drought Response Implementation Plan; CEQA Status: Not a Project and Categorically Exempt under CEQA Guidelines Sec. 15307, 15308

RECOMMENDATION
Staff recommends City Council approval of two resolutions (1) amending the Amended and Restated Water Supply Agreement between the City and County of San Francisco and Wholesale Customers in Alameda County, San Mateo County and Santa Clara County (Attachment A) and (2) approving the updated the Tier 2 Drought Response Implementation Plan (Attachment B)

EXECUTIVE SUMMARY
Approval of the two recommended resolutions will result in:

1. A revised Water Supply Agreement (WSA) that modifies the minimum purchase requirements and the drought allocation plan between the City of County of San Francisco and the wholesale customers (Tier 1) an includes various administrative adjustments.

2. A revised drought response implementation plan among the wholesale customers (Tier 2).

This is a final step in a multi-year negotiation process including coordination and collaboration with the 26 wholesale customers including neighboring jurisdictions such as Mountain View, Sunnyvale, and Santa Clara and reflects a package deal of terms. Overall, the amendments are minor in cost and operational impact, with some potential benefits to Palo Alto in drought scenarios.

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Minimum Purchase Quantities 1 (MPQs): Adjustments to MPQs for four wholesale customers will result in a modest increase in water rates—estimated at $0.007 to $0.04 per ccf (0.13%–0.72%)—shared across all wholesale and SFPUC retail customers. This change addresses excess costs currently borne by some agencies, notably Mountain View.
Tier 1 Water Shortage Allocation Plan: The updated Tier 1 plan poses no risk to Palo Alto and may provide benefits. If Palo Alto exceeds its drought allocation but overall wholesale usage remains below limits, it will avoid excess use fees. General WSA Updates: Administrative in nature, these changes have no financial or resource impact.
Revised Tier 2 Drought plan slightly increases water cutbacks for Palo Alto during droughts (e.g., from 16% to 18% for a 20% system-wide reduction), and aligns with the City’s existing Water Shortage Contingency Plan and will not alter customer restrictions.

Resolution Amending the Amended WSA
The proposed amendments to the WSA aim to adjust the minimum purchase requirements and improve the Tier 1 Water Shortage Allocation Plan for the Wholesale Customers of the RWS, in response to evolving water use patterns and regional needs.

Resolution Approving Updated the Tier 2 Drought Response Implementation Plan The updated Tier 2 Plan refines how water from the RWS is allocated among Wholesale Customers during droughts, maintaining key features of the existing plan while introducing important updates to improve equity, resilience, and flexibility.

The new Tier 2 formula uses a structured, sequential approach to distribute available water taking into account minimum and maximum cutback percentages, residential indoor use, non- residential indoor use, and seasonal demand. Any remaining water is allocated to move each wholesale customer toward a “Target Allocation” that reflects both historical use and their Individual Supply Guarantee (ISG), while staying within the cutback bounds.

While the resulting changes are relatively minor for Palo Alto, they represent significant financial and operational benefits for other BAWSCA agencies, and as such are high priorities among these agencies. Notably, unanimous approval by all 26 BAWSCA agencies is required for the changes to become effective. The Utilities Advisory Commission discussed this topic at its June meeting and did not make a recommendation.

BACKGROUND
Water Supply Agreement History
1 Section 3.07.C of the Amended and Restated Water Supply Agreement (Attachment D) explains that it is a requirement for Alameda County Water District, and the cities of Milpitas, Mountain View and Sunnyvale to purchase a minimum annual quantity of water from San Francisco (Minimum Purchase Quantity or MPQ as set out in Attachment E of the Amended and Restated Water Supply Agreement).

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In June 2009, the City of Palo Alto entered into a Water Supply Agreement with the City and County of San Francisco (San Francisco) and Wholesale Customers in Alameda County, San Mateo County and Santa Clara County (2009 WSA). The 2009 WSA establishes the terms by which the twenty-six Wholesale Customers purchase water from the RWS, including how water is allocated between SFPUC’s retail customers and the Wholesale Customers (Tier 1 Plan). The 2009 WSA builds upon the 1984 "Settlement Agreement and Master Water Sales Contract between the City and County of San Francisco and Certain Suburban Purchasers in San Mateo County, Santa Clara County and Alameda County."
In September 2017, the Bay Area Water Supply and Conservation Agency (BAWSCA) and the Water Management Representatives (WMR) of the BAWSCA member agencies began reviewing the issue of minimum purchase requirements, as described in Section 3.07.C of the WSA, and discussing the creation of a process to transfer minimum annual purchase quantities among the Wholesale Customers. Section 3.07 of the WSA provides that four Wholesale Customers (Alameda County Water District and the Cities of Milpitas, Mountain View, and Sunnyvale, collectively, the “Original Minimum Purchase Customers”) may purchase water from sources other than from San Francisco, but they are each obligated to purchase a specific minimum annual quantity of water from the San Francisco, referred to as a “Minimum Purchase Requirement."
Throughout 2017 and 2018, the WMR held multiple meetings during which the agencies currently subject to Minimum Purchase Requirements (Original Minimum Purchase Customers) and the other Wholesale Customers shared their interests and concerns regarding changes to the Minimum Purchase Requirements and allowing transfers of minimum annual purchase quantities.

On September 10, 2018, Council adopted Resolution 97913 appointing BAWSCA as its authorized representative in discussions and negotiations with San Francisco to amend the Agreement to address issues arising from implementation of the Agreement. The resolution also states this appointment continues unless and until revoked by the City Council. In 2019, the City of Palo Alto approved the 2018 Amended and Restated WSA (2018 WSA), at which time the Wholesale Customers expressed a collective interest in working together to develop a process for the expedited and permanent transfer of minimum annual purchase quantities. The Wholesale Customers directed BAWSCA to facilitate negotiation of a new WSA amendment to provide a procedure for expedited and permanent transfers of minimum annual purchase quantities in a manner that safeguards the financial and water supply interests of Wholesale Customers not participating in such transfers. This amendment was memorialized in the 2021 Amended and Restated WSA (2021 WSA).

Tier 2 Plan History and Negotiations and Development of Minimum Purchase Quantity Reset Proposal
3 Resolution 9791 https://www.paloalto.gov/files/assets/public/v/1/city-clerk/resolutions/reso- 9791.pdf?t=53184.44
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The WSA authorizes the Wholesale Customers to adopt a methodology for allocating the water collectively available from the RWS among the twenty-six Wholesale Customers during system- wide shortages caused by drought (the Tier 2 Plan). San Francisco is not a party to the Tier 2 Plan. The existing Tier 2 Plan was adopted in 2011 and was originally set to expire in 2018. In 2018, the California State Legislature passed two bills to implement a long-term framework for water use efficiency, commonly referred to as, “Making Water Conservation a California Way of Life.” These bills were anticipated to impact urban water use, and the extent of those impacts to the Wholesale Customers was unknown at the time. As such, the WMR instructed BAWSCA to hold off on initiating an update to the existing Tier 2 Plan. In 2018, and every year since, the BAWSCA Board of Directors (BAWSCA Board) has extended the term of the exiting Tier 2 Plan by one year. In 2024, the BAWSCA Board extended the term of the existing Tier 2 Plan through the end of 2025 and specified that the existing Tier 2 Plan will be superseded by an updated Tier 2 Plan once unanimously adopted by the twenty-six Wholesale Customers.

Since the existing Tier 2 Plan was adopted in 2011, conditions impacting water use have changed (e.g., water supply sources, water use trends, land use, and customer base). During the 2021 to 2023 drought, the Tier 1 and Tier 2 Plans were implemented for the first time. At that time, it became clear that the existing Tier 2 Plan no longer operated as originally intended and that an update was necessary.

In January 2021, BAWSCA began facilitating an update to the Tier 2 Plan, the method for allocating water from the RWS among the Wholesale Customers during shortages caused by drought. The Tier 2 Plan is an agreement among the twenty-six Wholesale Customers, and must be unanimously adopted by them. Each Wholesale Customer appointed a lead negotiator to represent the interests of its agency in the negotiations. Between January 2022 and June 2024, BAWSCA and the lead negotiators, supported by a consulting firm providing technical and modeling expertise, met at least 62 times, most often for half-day, in-person meetings and smaller virtual sub-group sessions, to negotiate the terms of the updated Tier 2 Plan.

In November 2021, San Francisco declared a water shortage emergency in response to the Governor’s executive action declaring a drought state of emergency across most of California.

This action triggered implementation of the Tier 1 and Tier 2 Plans by BAWSCA and San Francisco for the first time.

Throughout the two and a half years of Tier 2 Plan negotiations, the Wholesale Customers gained insight into unique characteristics of each agency and specific challenges related to water supplies and droughts. During these discussions, Wholesale Customers subject to the Minimum Purchase Requirements (Minimum Purchase Customers) articulated the unique challenges that the Minimum Purchase Requirements present.

In June 2023, following several years of discussions regarding the Minimum Purchase Requirements, the SFPUC proposed amending the 2021 WSA to reset the existing minimum annual purchase quantities to align with current water consumption trends, while protecting investment in the RWS. For the remainder of 2023, the SFPUC, the Original Minimum Purchase Item 17
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Customers, and BAWSCA held multiple meetings to identify amendments that would address challenges related to the Minimum Purchase Requirements. Once the SFPUC and the Original Minimum Purchase Customers finalized their recommended amendments to the Minimum Purchase Requirements, the Original Minimum Purchase Customers presented the proposals to the broader Wholesale Customers’ group to secure their support. Negotiations among the Wholesale Customers were concluded in Fall 2024.

In June 2024, the lead negotiators concluded negotiations on the updated Tier 2 Plan. The agency representatives collectively agreed that they were ready to recommend the Tier 2 Plan to their governing boards for adoption.

The Tier 1 and Tier 2 Plans are illustrated in the figure below.

Tier 1 Tier 2
Figure 1: Illustration of Tier 1 and Tier 2 Plans

ANALYSIS
Amendments to the Water Supply Agreement
Minimum Purchase Requirements
If a Minimum Purchase Customer does not meet its Minimum Purchase Requirement in a particular fiscal year, it must pay San Francisco for the difference between its metered water purchases during the fiscal year and its minimum annual purchase quantity set forth in Attachment E of the 2021 WSA.

It is assumed that the Minimum Purchase Requirements were originally designed to prevent four specific multi-source agencies from shifting from the RWS to other imported water sources. However, changed conditions, including recurring droughts, improved water use efficiency, and investments in local supplies have reduced demand on the RWS. Despite these improvements, the RWS remains vulnerable to severe droughts, prompting the SFPUC to invest Item 17
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in alternative water supplies. The Minimum Purchase Customers are well-positioned to develop their own local, drought-resilient supplies, which would reduce the regional dry-year supply gap, improving reliability of the RWS for all users. These amendments may reduce a perceived existing disincentive to improve efficiency and develop alternative supplies.

1.1. Reduction of Minimum Annual Purchase Quantities (MPQ) MPQs set in the 1984 Settlement Agreement and Master Water Sales Contract (1984 Contract) were calculated based on 80% of each of the four Original Minimum Purchase Customer’s purchases from the RWS in the 1980s. The MPQs were later reduced by 5% as part of the 2009 WSA. Upon adoption of this 2025 WSA amendment, the minimum annual purchase quantities of the Original Minimum Purchase Customers will be reset to 80% of each of the Minimum Purchase Customer’s average purchases from the most recent four non-drought years and the amendment will establish a continuing, periodic review of the minimum annual purchase quantities on a 10-year schedule.

1.2. Rebound Year Minimum Annual Purchase Quantity
Existing Section 3.07.C of the 2021 WSA provides that Minimum Purchase Requirements will be waived during drought, other period of water shortage on the RWS, or if the Governor declares a state of emergency that impacts water supply use or deliveries from the RWS. Minimum Purchase Requirements are reinstated in the first year immediately following a drought. However, water use does not rebound to pre-drought levels for several years, depending on the level of conservation achieved.

The amendment provides a temporary, one-year reduction in the minimum annual purchase quantities equal to half of the demand reduction from pre-drought levels to allow for drought rebound. For example, if a Minimum Purchase Customer’s pre- drought use and minimum annual purchase quantity are 10 million gallons per day (MGD) and drought RWS purchases are 8 MGD, the Rebound Year minimum annual purchase quantity will be set at 9 MGD.

1.3. Collective Minimum Annual Purchase Quantities Considered Before Application of Imputed Sales
Existing Section 3.07 of the 2021 WSA provides that if a Minimum Purchase Customer does not meet its Minimum Purchase Requirement in a particular fiscal year, it must pay the SFPUC for the difference between its metered water purchases during the fiscal year and its minimum annual purchase quantity. This amendment provides that the collective purchases from Original Minimum Purchase Customers will be considered together before an individual Original Minimum Purchase Customer is required to pay Item 17
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the difference between its metered water purchases and its Minimum Purchase Requirement. If collective purchases are more than the sum of minimum annual purchase quantities, payments to the SFPUC for an Original Minimum Purchase Customer(s) who did not meet its Minimum Purchase Requirement will not be required.

If collective purchases are less than the sum of minimum annual purchase quantities, payments to the SFPUC for an Original Minimum Purchase Customer(s) who did not meet its Minimum Purchase Requirement will be proportionate to its share of total under usage.

Tier 1 Water Shortage Allocation Plan
The Tier 1 Water Shortage Allocation Plan (“Tier 1 Plan” included as Attachment H of the WSA) is the method and process for allocating water from the RWS between San Francisco retail customers and the Wholesale Customers collectively during system-wide shortages caused by drought of 20% or less. Section 3.11.C.3 of the WSA provides that the SFPUC will honor allocations of water among the Wholesale Customers (“Tier 2 Allocations”) provided by BAWSCA or if unanimously agreed to by all Wholesale Customers.

The Tier 1 and Tier 2 Plans were implemented for the first time during the 2021 to 2023 drought. During the 2014 to 2017 drought, the Tier 1 and Tier 2 Plans were superseded by state-wide mandates from the Governor. During Tier 2 Plan negotiations, BAWSCA, the SFPUC, and the Wholesale Customers agreed to update the Tier 1 Plan to add a new “Tier 1 Family Plan.”
When the SFPUC declares a shortage emergency, it determines whether voluntary or mandatory rationing is required. At the end of the 12-month drought period, each Wholesale Customer’s purchases from the RWS are compared to their annual drought allocation. Excess use charges are only applied during mandatory rationing periods.

The new Tier 1 Family Plan ensures that excess use charges are only applied when the collective Wholesale Customer usage exceeds the Tier 1 allocation. If this occurs, excess use charges will be proportionally applied to agencies that exceeded their individual Tier 2 Allocations. For example, if the twenty-six Wholesale Customers collectively exceed the Tier 1 allocation by 2 MGD, and only two agencies exceed their Tier 2 Allocations by 3 MGD each, then these two agencies will share the excess use charges proportionally.

General Updates to the WSA
Sections 2.03, 3.09, 9.07, and Attachment A, Definitions of “Imputed Sales” and “Level of Service Goals and Objectives” have been updated with current cross references, dates and corrections.

Updated Tier 2 Drought Response Implementation Plan
The updated Tier 2 Plan maintains many of the key elements of the existing Tier 2 Plan, such as a rolling base period that captures service area growth over time and inclusion of Individual Supply Guarantee (ISG), but it also provides necessary updates to ensure a minimum supply of RWS water for base/indoor use for the portion of each service area where RWS is delivered.

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Tier 2 Plan Update Process
Between January 2022 and June 2024, BAWSCA facilitated negotiations between the Wholesale Customers through a series of meetings, workshops, and workgroups to update the Tier 2 Plan.

The Wholesale Customers began by reviewing the prior Plan and other shortage allocation plans throughout the state, then discussed and agreed upon policy principles for a revised Tier 2 Plan. BAWSCA, with support from a technical consultant team, introduced potential elements of a formula to align with the agreed upon policy principles. In monthly workshops, the Wholesale Customers discussed these options and provided feedback on which elements should be included, along with suggested refinements. These workshops, and the discussions, suggestions, and comments expressed by the Wholesale Customers during this process, provided the primary forum through which the updated Tier 2 Plan was developed.

Tier 2 Plan Policy Principles
The Wholesale Customers collectively developed four policy principles to guide the development and performance of the updated Tier 2 Plan. These policy principles are outlined below.
Policy Principle #1 - Provide sufficient water for the basic health and safety needs of customers.
Policy Principle #2 - Minimize economic and other adverse impacts of water shortages on customers and the BAWSCA region.
Policy Principle #3 - Provide predictability of drought allocations through consistent and predetermined rules for calculation, while allowing for flexibility to respond to unforeseen circumstances.
Policy Principle #4 - Recognize benefits of, and avoid disincentives for, water use efficiency and development of alternative water supply projects.

Tier 2 Plan Allocation Formula
The updated Tier 2 Plan establishes a sequential allocation formula to determine how the available water from the RWS will be allocated among the individual Wholesale Customers.

The allocation formula can generally be described as follows:
The Minimum and Maximum Cutback establish the upper and lower bounds for each Wholesale Customer’s final allocation. The Minimum Cutback is equal to 1/3 of the Overall Average Wholesale Customer Reduction, but no less than 5%. The Maximum Cutback is equal to 1.5 times the Overall Average Wholesale Customer Reduction.

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Each Wholesale Customer is allocated water on a residential per capita basis based on the State Indoor Water Use Efficiency Standard5 and the portion of each Wholesale Customer’s water demand met by the RWS.
Each Wholesale Customer is allocated water based on its estimated non-residential indoor use by applying a cutback factor equal to half of the Overall Average Wholesale Customer Reduction to each Wholesale Customer’s estimated non-residential indoor demand, also known as Base Period purchase, from the RWS. Each Wholesale Customer is allocated water based on its estimated seasonal purchases from the RWS.
Remaining water is allocated to bring each Wholesale Customer’s final allocation as close to its “Target Allocation” as possible, while ensuring that each Wholesale Customer’s final allocation is between the Minimum and Maximum Cutback bounds.

The Target Allocation is based on a weighted share of (1) the Wholesale Customer’s Base Period purchases from the RWS and (2) its ISG.

Tier 2 Plan Term
The term of the updated Tier 2 Plan is coordinated with the term of the WSA to avoid simultaneous renegotiation of these related agreements.

FISCAL/RESOURCE IMPACT
Amendments to the Water Supply Agreement
Minimum Purchase Requirements
The amendments to the WSA regarding the MPQs will have a small impact on the cost of water for all Wholesale Customers and SFPUC’s retail customers. Some of the four MPQ agencies are currently paying for water they are unable to use due to decreased demands and investments in alternative supplies. This is particularly true for Palo Alto’s neighbor, Mountain View, which has paid more than $11 million in penalties over the past several years.

Because the RWS revenue requirement must be recovered through water rates, reducing the MPRs for the four customers is estimated to cost all Wholesale Customers and SFPUC’s retail customers an additional $0.007-$0.04 per ccf (hundred cubic feet). This is approximately a

0.13%-0.72% water rate increase.

Tier 1 Water Shortage Allocation Plan
The amendments to the WSA regarding the Tier 1 Plan modification will have no adverse impact on Palo Alto. However, the amendments do have potential benefits. If Palo Alto were to 5 SB 1157 (Hertzberg), signed into law in September 2022, established the standard for efficient indoor residential water use be 47 gallons per capita per day, lowering to 42 GPCD in 2030.

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exceed its water allocation during a drought, but the Wholesale Customers collectively use less than the total wholesale allocation, Palo Alto will not be charged excess use fees.

General Updates to the WSA
These amendments are administrative and have no fiscal or resource impact.

Updated Tier 2 Drought Response Implementation Plan
The negotiated Tier 2 Plan does not result in a fiscal or resource impact but does yield slightly higher water cutbacks for Palo Alto during droughts. This is mainly due to the large amount of outdoor water use in the City which is of relatively lower importance in times of shortage compared to indoor uses.

During times of water shortages, Palo Alto implements a Water Shortage Contingency Plan which lays out increasingly strict water use restrictions depending on the “stage” of shortage.

The differences between the current Tier 1 Plan and the new negotiated Tier 2 Plan are small enough such that the actions Palo Alto customers will be asked to take will not change.

For example, for a 20% Wholesale Customer cutback, the current Tier 1 Plan results in a 16% cutback for Palo Alto whereas the new Tier 2 Plan results in an 18% cutback for Palo Alto. Stage 2 of Palo Alto’s Water Shortage Contingency Plan covers cutbacks from 11%-20% and institutes water use restrictions such as the application of potable driveways and sidewalks.

STAKEHOLDER ENGAGEMENT
The San Francisco Public Utilities Commission voted unanimously to approve the WSA amendments at its May 13, 2025, Commission meeting via Resolution 25-00747.

As of the end of July 2025, 11 of the 26 BAWSCA agencies have approved the WSA amendments and the updated Tier 2 Drought Response Implementation Plan. Eight agencies, including Palo Alto, are scheduled to approve by August with the remaining 7 planned in the following month or shortly thereafter.

This item was discussed at the UAC's June 4, 2025, meeting, however, the Commission did not provide a recommendation. The majority of the Commissioners expressed agreement with the terms and conditions though some discussion was raised regarding additional costs to the City.

Staff clarified the additional cost of the Minimum Purchase Requirement amendment is $0.007 to $0.040 per ccf (0.13% to 0.72% rate increase). Other Commissioners opened the discussion beyond the agreements recommended for adoption and began discussing other efforts underway with SFPUC and BAWSCA and the desire to hold recommended approvals for leverage. Specifically, two Commissioners suggested holding the recommended approval until the UAC received additional information from SFPUC related to underlying assumptions and analysis for SFPUC’s worst-case drought scenario and demand projections for the purposes of 7 Resolution 25-0074 https://sfpuc.sharefile.com/share/view/s126c89893d1642f4b023bfb290442f85 Item 17
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alternative water supply planning. These Commissioners mentioned an upcoming BAWSCA Policy Committee meeting. Other Commissioners questioned whether and what additional information would be available next month and noted that staff was not working on preparing anything. The discussion was too far-reaching to summarize in full, the video can be seen here9 with the UAC discussion starting at about 1:37. Ultimately the Commissioners voted on two motions. The first motion to recommend Council approve these resolutions failed 3 (Scharff, Mauter, and Croft in favor): 3 (Tucher, Gupta, Metz against) with Commissioner Phillips absent.

A second motion for the item to be continued to the next month also failed 2 (Gupta and Tucher in favor): 4 (Scharff, Mauter, Metz, and Croft against), with Commissioner Phillips absent.

ENVIRONMENTAL REVIEW
Approval of a resolution amending the Amended and Restated Water Supply Agreement between the City and County of San Francisco and Wholesale Customers in Alameda County, San Mateo County and Santa Clara County is not a "project" for the purposes of CEQA as it involves an administrative activity that does not result in a direct change to the environment (see 14 CCR Section 15378(b)(5)), and would not result in a direct or reasonably foreseeable indirect physical change in the environment (see 14 CCR Section 15060(c)(2)). Approval of a resolution approving the updated the Tier 2 Drought Response Implementation Plan is categorically exempt from the California Environmental Quality Act as an action taken by a regulatory agency for the protection of natural resources (CEQA Guidelines Section 15307), and an as action taken by a regulatory agency for protection of the environment (CEQA Guidelines Section 15308).

ALTERNATIVE ACTIONS
The three components addressed in the two proposed resolutions are the result of several years of negotiations and cannot be disentangled from one another.

Amendments to the WSA must be and were approved by the SFPUC on May 13, 2025. All 26 BAWSCA agencies must also approve the amendments to enact these changes.

The negotiated Tier 2 Plan must be approved by all 26 BAWSCA agencies. If Palo Alto or any other Wholesale Customer fails to approve the Tier 2 Plan, the BAWSCA Board of Directors may determine a new methodology. If the BAWSCA Board takes no action or cannot come to an agreement, the SFPUC will determine a Tier 2 formula and decide how water will be allocated among the Wholesale Customers in a water supply shortage.

ATTACHMENTS
Attachment A: Resolution Amending the Amended and Restated Water Supply Agreement 9 UAC June 4, 2025 Meeting, UAC Discussion started at about 1:37 https://www.youtube.com/watch?v=agZwObaclBo
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Attachment B: Resolution Approving the Updated Tier 2 Drought Allocation Implementation Plan
Attachment C: Redlines of the Water Supply Agreement Amendments Attachment D: CLEAN Water Supply Agreement Amendments
APPROVED BY:

Alan Kurotori, Director of Utilities
Staff: Karla Dailey, Assistant Director of Utilities, Resource Management Division Item 17
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NOT YET APPROVED
Resolution Amending the Water Supply Agreement 1
6056955; 21502307.7
R
ESOLUTION NO. _______
R
esolution of the Council of the City of Palo Alto Approving an Amendment to the Amended and Restated Water Supply Agreement Between the City and County Of San Francisco And Wholesale Customers in Alameda County, San Mateo County, And Santa Clara County R E

C I T A L S
A. W
ater supply agencies in Alameda, San Mateo, and Santa Clara Counties have purchased water from the City and County of San Francisco (San Francisco) for many years; and B. The San Francisco Public Utilities Commission (SFPUC) operates the Regional Water System, which delivers water to communities in Alameda, San Mateo, and Santa Clara Counties, as well as to customers within San Francisco (collectively, “the Parties”); and C. The Parties entered into the “Settlement Agreement and Master Water Sales Contract between the City and County of San Francisco and Certain Suburban Purchasers in San Mateo County, Santa Clara County and Alameda County” in 1984 (1984 Settlement Agreement and Master Water Sales Contract); and
D. In April 2003, water supply agencies in Alameda, San Mateo and Santa Clara Counties (collectively referred to as the Wholesale Customers) established the Bay Area Water Supply and Conservation Agency (BAWSCA), as authorized by Water Code Sections 81300 et seq.; and
E. Upon expiration of the 1984 Settlement Agreement and Master Water Sales Contract, the Parties entered into the “Water Supply Agreement between San Francisco and Wholesale Customers in Alameda County, San Mateo County, and Santa Clara County” (Water Supply Agreement or WSA) on July 1, 2009, authorized by SFPUC Resolution No. 09-0069, dated April 28, 2009; and
F. In 2017, the Wholesale Customers directed BAWSCA to act as its authorized representative in discussions and negotiations with San Francisco to amend the Water Supply Item 17
Attachment A - Resolution
Amending the Amended
and Restated Water Supply
Agreement

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Agreement to address a number of substantive issues and these negotiations resulted in the Parties' adoption of the Amended and Restated Water Supply Agreement in 2018 authorized by SFPUC Resolution No. 18-0212, dated December 11, 2018; and G. On March 4, 2019 this Council, by Resolution No. 9821 approved the Amended and Restated Water Supply Agreement (2018 WSA); and
H. Pursuant to WSA Section 3.07, four Wholesale Customers (Alameda County Water District and the Cities of Milpitas, Mountain View, and Sunnyvale, collectively, the “Original Minimum Purchase Customers”) may purchase water from sources other than the SFPUC, but they are each obligated to purchase a specific minimum annual quantity of water from the SFPUC, referred to as a “Minimum Purchase Requirement;” and I. Historically, if a Minimum Purchase Customer does not meet its Minimum Purchase Requirement in a particular fiscal year, it must pay the SFPUC for the difference between its metered water purchases during the fiscal year and its minimum annual purchase quantity set forth in WSA Attachment E; and
J. Some Original Minimum Purchase Customers pay the SFPUC for water that is not delivered due to either insufficient potable demand within their service area or conservation efforts during drought rationing; and
K. As part of the 2018 negotiations, the Wholesale Customers and the SFPUC resolved to work promptly to identify a resolution to this as part of a future contract amendment; and L. In 2019, the Wholesale Customers directed BAWSCA to draft a proposed amendment to the 2018 WSA to provide a procedure for expedited and permanent transfers of minimum annual purchase quantities that safeguards the financial and water supply interests of Wholesale Customers not participating in such transfers and these negotiations resulted in the Parties' adoption of the Amended and Restated Water Supply Agreement in 2021, authorized by SFPUC Resolution No. 21-009, dated January 26, 2021; and Item 17
Attachment A - Resolution
Amending the Amended
and Restated Water Supply
Agreement

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M. On April 4, 2022 this Council by Resolution No. 10024 approved the Amended and Restated Water Supply Agreement (2021 WSA); and
N. The 2021 WSA provided a significant, but incomplete solution to address the Original Minimum Purchase Customer’s concerns with the minimum purchase quantities through a transfer process; and
O. 2021 WSA Section 3.11.C. provides that the SFPUC may reduce the amount of water available to the Wholesale Customers in response to a drought; and P. 2021 WSA Section 3.11.C. provides that the Tier 1 Shortage Plan (Attachment H to the WSA) will be used, during system-wide shortages of 20% or less, to allocate water from the Regional Water System between Retail and Wholesale Customers; and Q. 2021 WSA Section 3.11.C. further provides that the SFPUC will honor allocations of water among the Wholesale Customers (Tier 2 Allocations) unanimously agreed to by all Wholesale Customers or provided by BAWSCA; and
R. In 2021, the SFPUC and BAWSCA implemented the Tier 1 and Tier 2 Plans for the first time; and
S. Throughout 2022 and 2024, the Wholesale Customers convened at least once per month, most often for half-day in-person workshops, to negotiate an update to the method for sharing water made available from the SFPUC during shortages caused by drought (Tier 2 Plan); and
T. Each Wholesale Customer appointed a lead negotiator to represent the interests of its agency in the negotiations; and
U. During the Tier 2 Plan negotiations, the Original Minimum Purchase Customers renewed discussions among the Wholesale Customers to identify a comprehensive and final solution to concerns about the minimum purchase quantities; and Item 17
Attachment A - Resolution
Amending the Amended
and Restated Water Supply
Agreement

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V. During the Tier 2 Plan negotiations, the Wholesale Customers identified, and the SFPUC agreed to, changes to the Tier 1 Plan that would facilitate agreement on the updated Tier 2 Plan; and
W. In June 2023, following several years of discussions regarding the Minimum Purchase Requirements, the SFPUC proposed amending the 2021 WSA to reset the existing minimum annual purchase quantities to align with current water consumption trends, while protecting investment in the RWS; and
X. In 2024, the SFPUC, the Original Minimum Purchase Customers, and BAWSCA held multiple meetings to identify amendments that would address challenges related to the Minimum Purchase Requirements; and
Y. Once the SFPUC and the Original Minimum Purchase Customers discussed amendments to the Minimum Purchase Requirements, the Original Minimum Purchase Customers presented proposals to the broader Wholesale Customer group to secure their support; and
Z. In 2024, the Wholesale Customers came to a final agreement on a package that includes an updated Tier 2 Plan, amendments to the minimum purchase quantity requirements, and amendments to the Tier 1 Plan; and
AA. With its Alternative Water Supply Program, the SFPUC is in the early stages of planning for projects to support the Wholesale and Retail Customers' ability to respond to climate change and address future water supply challenges and vulnerabilities, such as regulatory changes, earthquakes, disasters, emergencies, and increases in population and employment; and
BB. The Original Minimum Purchase Customers are particularly well-suited to develop local, drought resilient supplies, which improve the reliability of the San Francisco Regional Water System (RWS) for all users; and
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Attachment A - Resolution
Amending the Amended
and Restated Water Supply
Agreement

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CC. Under 2021 WSA Section 3.06.D, the Parties agree that they will diligently apply their best efforts to use both surface water and groundwater sources located within their respective service areas and available recycled water to the maximum feasible extent, taking into account the environmental impacts, the public health effects, and the effects on supply reliability of such use, as well as the cost of developing such sources; and DD. Each Wholesale Customer recognizes the importance of local water supplies in improving regional water supply reliability and commits to develop and use available local water supplies within their service areas, consistent with Section 3.06.D of the WSA; and EE. The City of Mountain View approved a Recycled Water Feasibility Study Update Draft Report on March 22, 2022 with seven staff recommendations, including: (1) working with the City of Palo Alto and the Santa Clara Valley Water District on the first phase of an advanced water purification system to improve recycled water quality, (2) planning and siting a recycled water storage reservoir in the City of Mountain View’s North Bayshore Area to improve system performance and reliability, and (3) building-out the recycled water distribution system to serve all of North Bayshore and a portion of NASA Ames; and
FF. The City of Sunnyvale approved an updated Recycled Water Master Plan on September 24, 2024 and directed staff to look into expanding the recycled water system, which currently includes 22 miles of recycled water pipelines, two recycled water pump stations, and a recycled water storage tank with a 2.5-million-gallon capacity; and GG. The City of Milpitas continues to promote the use of recycled water to existing and new customers along the recycled water pipeline within the city, and has committed to developing local groundwater supplies to help meet projected long term water demand; and HH. Since 1995, the Alameda County Water District has invested over $300 million in water supply reliability initiatives to enhance local water supplies and reduce its dependence on imported supplies, including water conservation, conjunctive use groundwater management, brackish groundwater desalination, and groundwater banking; and Item 17
Attachment A - Resolution
Amending the Amended
and Restated Water Supply
Agreement

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II. As of January 2025, the SFPUC has budgeted $298.3 million over the next ten years to fund water supply projects; and
JJ. T he Parties now desire to approve an amendment to the 2021 WSA to reduce the minimum annual purchase quantities to 80% of average purchases from the most recent four (4) non-drought years and establish a continuing, periodic review of the minimum annual purchase quantities on a 10-year schedule; and
KK. T he amendment will also establish a Rebound Year minimum annual purchase quantity calculation for the first year following a waiver of the Minimum Purchase Requirements; and
LL. T he amendment further provides that Imputed Sales will not apply to an Original Minimum Purchase Customer that does not meet its individual Minimum Purchase Requirements if the collective SFPUC purchases from all Original Minimum Purchase Customers are equal to or greater than the total collective minimum annual purchase quantity; and MM. The Parties also desire to adopt an amendment to the Tier 1 Plan to provide that excess use charges will not apply to Wholesale Customers that exceed their individual annual shortage allocation if the Wholesale Customers’ collective SFPUC purchases are less than the total Tier 1 allocation; and
NN. T he amendment further provides that if the collective Wholesale Customers’ SFPUC purchases exceed total Tier 1 allocation, excess use charges will be applied to each Wholesale Customer that exceeded its individual annual allocation, proportional to the collective Wholesale Customer's overuse of the total Tier 1 allocation; and OO. T he Parties also desire to adopt an amendment to the 2021 WSA to include the following substantive modifications:
a) update references in Section 2.03.C regarding BAWSCA’s authority to amend attachments;
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Attachment A - Resolution
Amending the Amended
and Restated Water Supply
Agreement

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b) extend the timing of the completion of the WSIP to reflect the currently adopted program completion date (Section 3.09);
c) correct a reference to a SFPUC resolution number in Section 9.07; d) update “Imputed Sales” definition in Attachment A to reference Attachment E; e) update “Level of Service Goals and Objectives” definition in Attachment A to reflect updated and expanded Level of Service Goals and Objectives adopted by the SFPUC in November 2023; and
PP. T he SFPUC approved these amendments and authorized the execution of a 2025 Amended and Restated Water Supply Agreement incorporating these amendments on May 13, 2025 pursuant to SFPUC Resolution No. 25-0074; and
QQ. T he amendment considered now is not a "project" for the purposes of CEQA as it involves an administrative activity that does not result in a direct change to the environment (see 14 CCR Section 15378(b)(5)), and would not result in a direct or reasonably foreseeable indirect physical change in the environment (see 14 CCR Section 15060(c)(2)); and T
he Council of the City of Palo Alto does hereby RESOLVE as follows:

Section 1. The Council approves the revisions included in the attached Exhibit A, approves those revisions to be incorporated into a revised WSA titled the "2025 Amended and Restated Water Supply Agreement Between the City and County of San Francisco Wholesale Customers in Alameda County, San Mateo County, and Santa Clara County" dated as of 2025 (2025 Amended and Restated Water Supply Agreement).
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Item 17
Attachment A - Resolution
Amending the Amended
and Restated Water Supply
Agreement

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Section 2. The City Manager is authorized and directed to execute the 2025 Amended and Restated Water Supply Agreement, when final execution copies are prepared and distributed by BAWSCA.

INTRODUCED AND PASSED:

AYES:

NOES:

ABSTENTIONS:

ABSENT:

ATTEST:

City Cle
rk Mayor

APPROVED AS
TO FORM: APPROVED:

Assistant City Attorney City Manager
Dir
ector of Utilities
Director of Administrative Services
A
ttachment:

Exhibit A: Redline and clean excerpts showing changes to Sections 2.03, 3.07, 3.09, 9.07, Attachment A, Attachment E and Attachment H of the Amended and Restated Water Supply Agreement.

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Attachment A - Resolution
Amending the Amended
and Restated Water Supply
Agreement

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Resolution Approving Tier 2 Drought Response Implementation Plan 1

6056956 21488606.4
RESOLUTION NO. ________
Resolution of the Council of the City of Palo Alto Approving Tier 2 Drought Response Implementation Plan Pursuant to Section 3.11.C of the Amended and Restated Water Supply Agreement

R E C I T A L S
A. The City of Palo Alto is one of twenty-six (26) agencies in San Mateo, Santa Clara and Alameda Counties (Wholesale Customers) which purchase water from the City and County of San Francisco (San Francisco) pursuant to a Water Supply Agreement entered into in 2009, and recently amended in 2018, 2021 and 2025 (the Agreement or WSA). Collectively these 26 agencies are referred to in the Agreement as Wholesale Customers; and B. Section 3.11 of the Agreement addresses situations when insufficient water is available in the San Francisco Regional Water System (RWS) to meet the full demands of all users. Section 3.11.C provides that during periods of water shortage caused by drought, the San Francisco Public Utilities Commission (SFPUC) will allocate available water between its retail customers and the Wholesale Customers collectively, in accordance with a schedule contained in the Water Shortage Allocation Plan set forth in Attachment H to the Agreement (Tier 1 Plan); and
C. Section 3.11.C authorizes the Wholesale Customers to adopt a Drought Allocation Plan, including a methodology for allocating the available water among the individual Wholesale Customers (Tier 2 Plan). The WSA also commits the SFPUC to honor allocations of water unanimously agreed to by all Wholesale Customers or, if unanimous agreement cannot be achieved, water allocations that have been adopted by the Board of Directors of the Bay Area Water Supply and Conservation Agency (BAWSCA). The Agreement also provides that the SFPUC can allocate water supplies as necessary during a water shortage emergency if no agreed upon plan for water allocation has been adopted by the 26 Wholesale Customers or the BAWSCA Board of Directors; and
D. Commencing in January 2022, representatives appointed by the managers of each of the Wholesale Customers began meeting monthly to develop a set of principles to serve as guidelines for an equitable allocation methodology, and to develop formulas and procedures, in order to implement those principles. These discussions, and supporting technical analyses, have been conducted with the assistance of BAWSCA; and E. The Tier 2 Plan, attached to this resolution as Exhibit A, has been endorsed by all of the Wholesale Customer representatives who participated in the formulation process and they have each recommended that it be formally adopted by the governing body of their respective agencies; and
F. The Tier 2 Plan allocates the collective Wholesale Customer share of RWS supply made available by the SFPUC among each of the 26 Wholesale Customers through December 31, 2034 and is coordinated with the term of the Agreement, and extension and renewal terms.

Item 17
Attachment B - Resolution
Approving the Updated Tier
2 Drought Allocation
Implementation Plan

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The Council of the City of Palo Alto does hereby RESOLVE as follows:

Section 1. The Tier 2 Drought Response Implementation Plan, as attached as Exhibit A (Tier 2 Plan), is approved.

Section 2. This approval is conditioned upon all of the other twenty-five Wholesale Customers approving the Tier 2 Plan, such approvals being evidenced through adoption of similar resolutions or, in the case of private-sector organizations, by other equivalently binding written commitments signed by an executive officer acting within the scope of delegated authority, and all such approvals occurring on or before December 31, 2025.

Section 3. If such resolutions or binding commitments are not adopted by that date, this resolution will automatically expire and be of no further effect after December 31, 2025, unless it has been extended prior thereto by further action of this [Council, Board, etc.].

Section 4. The Council finds that adoption of this resolution is categorically exempt from the California Environmental Quality Act as an action taken by a regulatory agency for the protection of natural resources (CEQA Guidelines Section 15307), and an as action taken by a regulatory agency for protection of the environment (CEQA Guidelines Section 15308).

INTRODUCED AND PASSED:

AYES:

NOES:

ABSTENTIONS:

ABSENT:

ATTEST:

City Clerk Mayor

APPROVED AS TO FORM: APPROVED:

Assistant City Attorney City Manager

Director of Utilities
Director of Administrative Services
Attachment: Exhibit A. Tier 2 Drought Response Plan and Example Tier 2 Plan Excel-Based Model Item 17
Attachment B - Resolution
Approving the Updated Tier
2 Drought Allocation
Implementation Plan

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3.07. Restrictions on Purchases of Water from Others; Minimum Annual Purchases A. Each Wholesale Customer (except for Alameda County Water District and the cities of Milpitas, Mountain View and Sunnyvale) agrees that it will not contract for, purchase or receive, with or without compensation, directly or indirectly, from any person, corporation, governmental agency or other entity, any water for delivery or use within its service area without the prior written consent of San Francisco.

B. The prohibition in subsection A does not apply to:

1. recycled water;

2. water necessary on an emergency and temporary basis, provided that the Wholesale Customer promptly gives San Francisco notice of the nature of the emergency, the amount of water that has been or is to be purchased, and the expected duration of the emergency; or

3. water in excess of a Wholesale Customer’s Individual Supply Guarantee.

C. Minimum Annual Purchase Quantities. Alameda County Water District and the cities of Milpitas, Mountain View and Sunnyvale may purchase water from sources other than San Francisco, provided that San Francisco shall require that each purchase a minimum annual quantity of water from San Francisco. These Minimum Annual Purchase Quantities are set out in Attachment E and shall also be included in the Individual Water Sales Contracts between San Francisco and each of these four Wholesale Customers (collectively referred to as the Original Minimum Purchase Customers). Pursuant to Section 3.04, certain Wholesale Customers may also be required to purchase Temporary Modified Minimum Annual Purchase Quantities, set out in Attachment E-1, from San Francisco. Attachment E will be updated pursuant to Section 3.04 to reflect any reduction in existing Minimum Annual Purchase Quantities and any addition of new Minimum Annual Purchase Quantities when Temporary Modified Minimum Annual Purchase Quantities expire and are removed from Attachment E-1; Individual Water Sales Contracts between San Francisco and any Wholesale Customers who are participants in a transfer under Section 3.04 will similarly be amended, as necessary.

1. Annual Notice. After the end of each fiscal year, the SFPUC will send a written notice to each Wholesale Customer that is subject to the minimum annual purchase requirements of this section with a Minimum Annual Purchase Quantity, or a Temporary Modified Minimum Annual Purchase Quantity with a copy to BAWSCA. The notice will include: (1 Item 17
Attachment C - Redlines of
the Water Supply
Agreement Amendments

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(a) the quantity of water delivered to the
each of those Wholesale CustomerCustomers
individually and all of the Original Minimum Purchase Customers collectively during the previous fiscal year; (
2 (b) each Wholesale Customer’s individual Minimum Annual Purchase Quantity or Temporary Modified Minimum Annual Purchase Quantity (as adjusted for a Rebound Year, if applicable, under Section 3.07.C.2);
) whether or not the Wholesale Customer met its minimum annual purchase requirement under this section; (3
(c) whether or not each Wholesale Customer met its individual Minimum Annual Purchase Quantity or Temporary Modified Minimum Annual Purchase Quantity (as adjusted for a Rebound Year, if applicable);
(d) whether or not the Original Minimum Purchase Customers collectively purchased a volume of water from San Francisco that is equal to or greater than the sum of their four Minimum Annual Purchase Quantities (as adjusted for a Rebound Year, if applicable); (e) any Imputed Sales charged to the Wholesale Customer;Customers; and (4 (f) the status of any Temporary Modified Minimum Annual Purchase QuantityQuantities of the Wholesale Customer, if applicable. Customers.

C.2. Waiver and Rebound Year. The minimum annual purchase requirements set out in Attachments E and E-1 will be waived during a Drought or other period of water shortage if the water San Francisco makes available to these Wholesale Customers is less than itstheir Minimum Annual Purchase QuantityQuantities or Temporary Modified Minimum Annual Purchase Quantities, and may be waived during a state of emergency declared by the Governor of California that impacts water supply use or deliveries from the Regional Water System. Once the waiver is no longer in effect, each of the minimum annual purchase requirements set out in Attachments E and E-1 shall be temporarily set, for one full fiscal year (referred to as the Rebound Year), to the midpoint between (1) the Wholesale Customer’s actual San Francisco purchases for the final year in which the waiver was in effect, up to a maximum of the Customer’s Minimum Annual Purchase Quantity or Temporary Modified Minimum Annual Purchase Quantity, and (2) the Wholesale Customer’s Minimum Annual Purchase Quantity or Temporary Modified Minimum Annual Purchase Quantity set out in Attachment E or Attachment E-1, as applicable. Any fiscal year in which a Wholesale Customer meets its Rebound Year-adjusted Temporary Modified Minimum Item 17
Attachment C - Redlines of
the Water Supply
Agreement Amendments

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21706153.3
Annual Purchase Quantity, but not its standard T
emporary Modified Minimum Annual Purchase
Quantity, will not count as a fiscal year in which the Wholesale Customer has met or exceeded its Temporary Modified Minimum Purchase Quantity for the purposes of Section 3.04.C(4)(a).

D. Minimum Annual Purchase Quantity Reset. As shown on Attachment E, in Fiscal Year 2025-26, the Parties reset the then-existing Minimum Annual Purchase Quantities of the Original Minimum Purchase Customers to 80% of the average San Francisco purchases of each Customer over the four most recent non-drought years preceding Fiscal Year 2024-25, effective for Fiscal Year 2024-25. If the Parties extend the Term of this Agreement beyond June 30, 2034 pursuant to Section 2.02, the Parties will review the Minimum Annual Purchase Quantities of the Original Minimum Purchase Customers again ten years after the Fiscal Year 2025-26 reset. If the Original Minimum Purchase Customers, or San Francisco, want to propose a reset of the Minimum Annual Purchase Quantities for Fiscal Year 2035-36, they will provide written notice on or before June 30, 2034. The Parties will meet and confer promptly to evaluate written reset proposals. By November 30, 2035, if the Parties have come to an agreement, the SFPUC will calculate the revised Minimum Annual Purchase Quantities based on the agreed upon methodology and provide written notice to the Original Minimum Purchase Customers and BAWSCA. The Original Minimum Purchase Customers will have at least 15 business days to review and meet and confer with the SFPUC with any questions or concerns before the revised quantities are finalized. If the Parties are unable to come to an agreement, the then-existing Minimum Annual Purchase Quantities will remain unchanged. Any changes to the Minimum Annual Purchase Quantities under this Section

3.07.D will be reflected in a revised Attachment E approved with the written concurrence of San Francisco and BAWSCA in accordance with Section 2.03.C. The Parties intend to include a continuing, periodic review of the Minimum Annual Purchase Quantities on a ten-year schedule in the successor to this Agreement.

E. Collective Minimum Annual Purchase Quantities Considered Before Application of Imputed Sales. Imputed Sales will not apply to any of the individual Original Minimum Purchase Customers in a particular fiscal year if those Customers have collectively purchased a volume of water from San Francisco that is equal to or greater than the sum of their four Minimum Annual Purchase Quantities shown in Attachment E (or adjusted for a Rebound Year pursuant to Section

3.07.C.2, if applicable). If the Original Minimum Purchase Customers do not collectively purchase that sum, any Original Minimum Purchase Customer that has not met its standard or Rebound Year-adjusted Minimum Annual Purchase Quantity will be responsible for Imputed Sales proportional to its share of the difference between that sum and the Original Minimum Purchase Customers’ total purchases from San Francisco. Examples of this calculation are contained in Item 17
Attachment C - Redlines of
the Water Supply
Agreement Amendments

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21706153.3
Attachment E-3.

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Attachment C - Redlines of
the Water Supply
Agreement Amendments

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21702335.2
Redline Comparing 2021 Amended and Res tated Water Supply Agreement and 2025 Proposed Amendments: Sections 2.03, 3.09, and 9.07, and Attachment A Definitions

2.03. Amendments .

C. Amendments to Attachments. The following attachments may be amended with the written concurrence of San Francisco and BAWSCA on behalf of the Wholesale Customers:

Attachment Name
C Individual Supply Guarantees (amendments reflecting Section

3.04 transfers only)
E Minimum Annual Purchase Quantities (amendments reflecting Section 3.04 transfers and Section 3.07 resets only)
E-1 Temporary Modified Minimum Annual Purchase Quantities G Water Quality Notification and Communications Plan
(as may be amended)
J Water Use Measurement and Tabulation
L-1 Identification of WSIP Projects as Regional/Retail
N-1 Balancing Account/Rate Setting Calculation Table
N-2 Wholesale Revenue Requirement Schedules
N-3 Schedule of Projected Water Sales, Wholesale Revenue Requirement and Wholesale Rates
P Management Representation Letter
R Classification of Existing System Assets (subject to Section

5.11)
Amendments to these attachments shall be approved on behalf of San Francisco by the Commission and on behalf of BAWSCA by its Board of Directors, unless the Commission by resolution delegates such authority to the General Manager of the SFPUC or the Board of Directors by resolution delegates such authority to the General Manager/CEO of BAWSCA.

Item 17
Attachment C - Redlines of
the Water Supply
Agreement Amendments

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21702335.2

3.09. Completion of WSIP
San Francisco will complete construction of the
physical facilities in the WSIP by
DecemberJune 30, 20212032. The SFPUC agrees to provide for full public review and comment by local and state interests of any proposed changes that delay previously adopted project completion dates or that delete projects. The SFPUC shall meet and consult with BAWSCA before proposing to the Commission any changes in the scope of WSIP projects which reduce their capacity or ability to achieve adopted Level of Service Goals and Objectives.

The SFPUC retains discretion to determine whether to approve the physical facilities in the WSIP until after it completes the CEQA process as set forth in Section 4.07.

9.07. City of Brisbane, Guadalupe Valley Municipal Improvement District, Town of Hillsborough
A. The parties acknowledge that San Francisco has heretofore provided certain quantities of water to the City of Brisbane (“Brisbane”), Guadalupe Valley Municipal Improvement District (“Guadalupe”) and the Town of Hillsborough (“Hillsborough”) at specified rates or without charge pursuant to obligations arising out of agreements between the predecessors of San Francisco and these parties, which agreements are referred to in judicial orders, resolutions of the SFPUC and/or the 1960 contracts between San Francisco and Brisbane, Guadalupe and Hillsborough. The parties intend to continue those arrangements and accordingly agree as follows:

1. Nothing in this Agreement is intended to alter, amend or modify the terms of SFPUC Resolution No. 74-06530053 or the indenture of July 18, 1908 between the Guadalupe Development Company and the Spring Valley Water Company.

2. Nothing in this Agreement is intended to alter, amend or modify the Findings of Fact and Conclusions of Law and Judgment dated May 25, 1961 in that certain action entitled City and County of San Francisco v. Town of Hillsborough in the Superior Court of the State of California in and for the County of Marin, No. 23282, as modified by the Satisfaction of Judgment filed October 23, 1961 and the Compromise and Release between Hillsborough and San Francisco dated August 22, 1961. The rights and obligations of Hillsborough under these documents shall continue as therein set forth.

3. Nothing in this Agreement is intended to affect or prejudice any claims, rights or remedies of Guadalupe or of Crocker Estate Company, a corporation, or of Crocker Redline Comparing 2021 Amended and Restated Water Supply Agreement and 2025 Proposed Amendments: Sections 2.03, 3.09, and 9.07, and Attachment A Definitions Item 17
Attachment C - Redlines of
the Water Supply
Agreement Amendments

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21702335.2
Land Company, a corporation, or of
San Francisco, or of their successors and assigns,
respectively, with respect to or arising out of that certain deed dated May 22, 1884, from Charles Crocker to Spring Valley Water Works, a corporation, recorded on May 24, 1884, in Book 37 of Deeds at page 356, Records of San Mateo County, California, as amended by that certain Deed of Exchange of Easements in Real Property and Agreement for Trade in Connection Therewith, dated July 29, 1954, recorded on August 4, 1954, in Book 2628, at page 298, Official Records of said San Mateo County, or with respect to or arising out of that certain action involving the validity or enforceability of certain provisions of said deed entitled City and County of San Francisco v. Crocker Estate Company, in the Superior Court of the State of California in and for the County of Marin, No. 23281.

Attachment A - Definitions
“Imputed Sales” apply when a Wholesale Customer does not meet the minimum ann ual
purchase requirements of Section 3.07.C, as shown on Attachment E and Attachment E-1, except in fiscal years in which a waiver of these requirements is in effect. Imputed Sales are calculated as the difference between (1) a Wholesale Customer’s metered water purchases during a fiscal year, from July 1 to June 30, and (2) the larger of (a) or (b) as follows: (a) the Wholesale Customer’s Minimum Annual Purchase Quantity, as specified in Attachment E and may be adjusted pursuant to Section 3.07.C.2, or (b) the Wholesale Customer’s Temporary Modified Minimum Annual Purchase Quantity, as specified in Attachment E-1. and may be adjusted pursuant to Section 3.07.C.2. If a Wholesale Customer has more than one Temporary Modified Minimum Annual Purchase Quantity, the largest quantity is used for calculating Imputed Sales. Imputed Sales are considered wholesale water usage for the purposes of calculating the Proportional Annual Use, and any fees charged for Imputed Sales are considered wholesale revenues.
“Level of Service Goals and Objectives” refers to the “Phased WSIP Goals and Objectives” adopted by the Commission in Resolution No. 08-0200 dated October 30, 2008 as part of the approval of the WSIP, as updated and expanded by the "2023 Amended and Updated Water Enterprise Level of Service Goals and Objectives," adopted by the Commission in Resolution No. 23-0210 dated November 28, 2023, and any amendments that may be adopted by the Commission.

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ATTACHMENT E

MINIMUM ANNUAL PURCHASE QUANTITIES
(Section 3.07.C)

AGENCY MINIMUM ANNUAL PURCHASE QUANTITY
(IN MGD)1
Alameda County Water District 7.6486.682
City of Milpitas 5.3414.371
City of Mountain View 8.9306.047
City of Sunnyvale 8.9307.412
1 In Fiscal Year (FY) 2025-26, the then-existing Minimum Annual Purchase Quantities for Alameda County Water District and the Cities of Milpitas, Mountain View, and Sunnyvale were reset to 80% of each of those four customers’ average San Francisco purchases over the four non-drought years preceding FY 2024-25 (FY 2017-18, FY 2018-19, FY 2019-20, and FY 2020-21), effective FY 2024-25. Prior to this reset, from the effective date of this Agreement (July 1, 2009) through FY 2023-24, those four customers had the following Minimum Annual Purchase Quantities:

1. Alameda County Water District: 7.648 MGD

2. City of Milpitas: 5.341 MGD

3. City of Mountai n View: 8.930 MGD

4. City of Sunnyvale: 8.930 MGD
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ATTACHMENT H

WATER S

HORTAGE ALLOCATION PLAN
This Interim Water Shortage Allocation Plan (“Plan"), also known as the Tier 1 Shortage Plan, describes the method for allocating water between the San Francisco Public Utilities Commission (“SFPUC"), on the one hand, and the Wholesale Customers collectively, on the other, during shortages caused by drought. The Plan also implements a method for allocating water among the individual Wholesale Customers, known as the Tier 2 Drought Response Implementation Plan (“Tier 2 Plan”), which has separately been adopted by the Wholesale Customers and does not include the SFPUC. The Plan includes provisions for transfers, banking, and excess use charges. The Plan applies only when the SFPUC determines that a system-wide water shortage due to drought exists, and all references to “shortages” and “water shortages” are to be so understood. This Plan was initially adopted pursuant to Section 7.03(a) of the 1984 Settlement Agreement and Master Water Sales Contract and has been incorporated and updated to correspond to the terminology used in the June 2009 Water Supply Agreement between the City and County of San Francisco and Wholesale Customers in Alameda County, San Mateo County and Santa Clara County (“Agreement”), as amended and restated from time to time.

SECTION 1. SHORTAGE CONDITIONS

1.1. Projected Available SFPUC Water Supply. The SFPUC shall make an annual determination as to whether or not a shortage condition exists. The determination of projected available water supply shall consider, among other things, stored water, projected runoff, water acquired by the SFPUC from non- SFPUC sources, inactive storage, reservoir losses, allowance for carryover storage, and water bank balances, if any, described in Section 3.

1.2 Projected SFPUC Customer Purchases. The SFPUC will utilize purchase data, including volumes of water purchased by the Wholesale Customers and by Retail Customers (as those terms are used in the Agreement) in the year immediately prior to the drought, along with other available relevant information, as a basis for determining projected system-wide water purchases from the SFPUC for the upcoming year.Supply Year (defined as the period from July 1 through June 30).

1.3. Shortage Conditions. The SFPUC will compare the projected available water supply (Section 1.1) with projected system-wide water purchases (Section 1.2). A shortage condition exists if the SFPUC determines that the projected available water supply is less than projected system-wide water purchases in the upcoming Supply Year (defined as the period from July 1 through June 30).. When a shortage condition exists, SFPUC will determine whether voluntary or mandatory actions will be required to reduce purchases of SFPUC water to required levels.

1.3.1 Voluntary Response. If the SFPUC determines that voluntary actions will be sufficient to accomplish the necessary reduction in water use throughout its service area, the SFPUC and the Wholesale Customers will make good faith efforts to reduce their water purchases to stay within their annual shortageTier 1 and Tier 2 allocations as applicable (see Section 2 of this Attachment H) and associated monthly water use budgets. The SFPUC will not impose excess use charges during periods of voluntary rationing, but may suspend the prospective accumulation of water bank credits, or impose a ceiling on further accumulation of bank credits, consistent with Section 3.2.1 of this Plan.

1.3.2 Mandatory Response. If the SFPUC determines that mandatory actions will be required to accomplish the necessary reduction in water use in the SFPUC service area, the SFPUC may implement excess use charges as set forth in Section 4 of this Plan.

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1.4. Period of Shortage. A shortage period commences when the SFPUC determines that a water shortage exists, as set forth in a declaration of water shortage emergency issued by the SFPUC pursuant to California Water Code Sections 350 et seq. Termination of the water shortage emergency will be declared by resolution of the SFPUC.

SECTION 2. SHORTAGE ALLOCATIONS

2.1. Annual Tier 1 Allocations between the SFPUC and the Wholesale Customers. The annual water supply available during shortages will be allocated between the SFPUC and the collective Wholesale Customers as follows:

Level of System Wide
Reduction in Water Use
Required

Share of Available Water
SFPUC Share Wholesale Customers Share
5% or less
6%
through 10%
11% through 15%
16% through 20%

35.5%

36.0%

37.0%

37.5%

64.5%

64.0%

63.0%

62.5%
This Plan refers to the SFPUC’s and Wholesale Customers’ respective shares of available water so established as the SFPUC’s and Wholesale Customers’ Tier 1 allocations. The water allocated to the SFPUC shall correspond to the total allocation for all Retail Customers. In the event that the SFPUC share of the available water supply in the above table results in Retail Customers having a positive allocation (i.e., a supply of additional water rather than a required percentage reduction in water use), the SFPUC’s percentage share of the available water supply in the table shall be reduced to eliminate any positive allocation to Retail Customers, with a corresponding increase in the percentage share of the available water supply allocated to the Wholesale Customers. For any level of required reduction in system-wide water use during shortages, the SFPUC shall require Retail Customers to conserve a minimum of 5%, with any resulting reallocated supply credited to storage for inclusion in calculation of projected available water SFPUC water supply in a subsequent year (Section 1.1).

The parties agree to reevaluate the percentages of the available water supply allocated to Retail and Wholesale Customers by May 1, 2028.

2.2 Annual Tier 2 Allocations among the Wholesale Customers. The annual water supply allocated to the Wholesale Customers collectively during system wide shortages of 20 percent or less (i.e., the Wholesale Customers’ Tier 1 allocation) will be apportioned among them based on a methodology, known as the Tier 2 Plan, that has been separately adopted by all of the Wholesale Customers, and not the SFPUC, as described in Section 3.11(C) of the Agreement. In any year for which the methodology must be applied, the Bay Area Water Supply and Conservation Agency (“BAWSCA”) will calculate each Wholesale Customer’s individual percentage share of the amount of water allocated to the Wholesale Customers collectively pursuant to Section 2.1. Following the declaration or reconfirmation of a water shortage emergency by the SFPUC, BAWSCA will deliver to the SFPUC General Manager a list, signed by the President of BAWSCA’s Board of Directors and its General Manager, showing each Wholesale Customer together with its percentage share and stating that the list has been prepared in accordance with the methodology adopted by the Wholesale Customers. The SFPUC shall allocate water to each Wholesale Customer, as specified in the list. The shortage allocations so established (known as Tier 2 Item 17
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allocations) may be transferred as provided in Section 2.5 of this Plan. If BAWSCA or all Wholesale Customers do not provide the SFPUC with individual allocations, the SFPUC may make a final allocation decision after first meeting and discussing allocations with BAWSCA and the Wholesale Customers.

The Tier 2 Plan methodology adopted by the Wholesale Customers utilizes the rolling average of each individual Wholesale Customer’s purchases from the SFPUC during the three immediately preceding Supply Years. The SFPUC agrees to provide BAWSCA by November 1 of each year a list showing the amount of water purchased by each Wholesale Customer during the immediately preceding Supply Year.

The list will be prepared using Customer Service Bureau report MGT440 (or comparable official record in use at the time), adjusted as required for any reporting errors or omissions, and will be transmitted by the SFPUC General Manager or his designee.

2.3. Limited Applicability of Plan to System Wide Shortages Greater Than Twenty Percent. The Tier 1 allocations of water between the SFPUC and the Wholesale Customers collectively, provided for in Section 2.1, apply only to shortages of 20 percent or less. The SFPUC and Wholesale Customers recognize the possibility of a drought occurring which could create system-wide shortages greater than 20 percent despite actions taken by the SFPUC aimed at reducing the probability and severity of water shortages in the SFPUC service area. If the SFPUC determines that a system wide water shortage greater than 20 percent exists, the SFPUC and the Wholesale Customers agree to meet within 10 days and discuss whether a change is required to the allocation set forth in Section 2.1 in order to mitigate undue hardships that might otherwise be experienced by individual Wholesale Customers or Retail Customers. Following these discussions, the Tier 1 water allocations set forth in Section 2.1 of this Plan, or a modified version thereof, may be adopted by mutual written consent of the SFPUC and the Wholesale Customers. If the SFPUC and Wholesale Customers meet and cannot agree on an appropriate Tier 1 allocation within 30 days of the SFPUC’s determination of water shortage greater than 20 percent, then (1) the provisions of Section 3.11(C) of the Agreement will apply, unless (2) all of the Wholesale Customers direct in writing that a Tier 2 allocation methodology agreed to by them be used to apportion the water to be made available to the Wholesale Customers collectively, in lieu of the provisions of Section 3.11(C).

The provisions of this Plan relating to transfers (in Section 2.5), banking (in Section 3), and excess use charges (in Section 4) shall continue to apply during system-wide shortages greater than 20 percent.

2.4. Monthly Water Budgets. Within 10 days after adopting a declaration of water shortage emergency, the SFPUC will determine the amount of Tier 1 water allocated to the Wholesale Customers collectively pursuant to Section 2.1. The SFPUC General Manager, using the Tier 2 allocation percentages shown on the list delivered by BAWSCA pursuant to Section 2.2, will calculate each Wholesale Customer’s individual annual Tier 2 allocation. The SFPUC General Manager, or his designee, will then provide each Wholesale Customer with a proposed schedule of monthly water budgets based on the pattern of monthly water purchases during the Supply Year immediately preceding the declaration of shortage (the “Default Schedule”). Each Wholesale Customer may, within two weeks of receiving its Default Schedule, provide the SFPUC with an alternative monthly water budget that reschedules its annual Tier 2 shortage allocation over the course of the succeeding Supply Year. If a Wholesale Customer does not deliver an alternative monthly water budget to the SFPUC within two weeks of its receipt of the Default Schedule, then its monthly budget for the ensuing Supply Year shall be the Default Schedule proposed by the SFPUC.

Monthly Wholesale Customer water budgets will be derived from annual Tier 2 allocations for purposes of accounting for excess use. Monthly Wholesale Customer water budgets shall be adjusted during the year to account for transfers of shortage allocation under Section 2.5 and transfers of banked water under Section 3.4.

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2.5. Transfers of Shortage Allocations. Voluntary transfers of shortage allocations between the SFPUC and any Wholesale Customers, and between any Wholesale Customers, will be permitted using the same procedure as that for transfers of banked water set forth in Section 3.4. The SFPUC and BAWSCA shall be notified of each transfer. Transfers of shortage allocations shall be deemed to be an emergency transfer and shall become effective on the third business day after notice of the transfer has been delivered to the SFPUC. Transfers of shortage allocations shall be in compliance with Section 3.05 of the Agreement. The transferring parties will meet with the SFPUC, if requested, to discuss any effect the transfer may have on its operations.

SECTION 3. SHORTAGE WATER BANKING

3.1. Water Bank Accounts. The SFPUC shall create a water bank account for itself and each Wholesale Customer during shortages in conjunction with its resale customer billing process. Bank accounts will account for amounts of water that are either saved or used in excess of the shortage allocation for each agency; the accounts are not used for tracking billings and payments. When a shortage period is in effect (as defined in Section 1.4), the following provisions for bank credits, debits, and transfers shall be in force. A statement of bank balance for each Wholesale Customer will be included with the SFPUC’s monthly water bills.

3.2. Bank Account Credits. Each month, monthly purchases will be compared to the monthly budget for that month. Any unused shortage allocation by an agency will be credited to that agency’s water bank account. Credits will accumulate during the entire shortage period, subject to potential restrictions imposed pursuant to Section 3.2.1. Credits remaining at the end of the shortage period will be zeroed out; no financial or other credit shall be granted for banked water.

3.2.1. Maximum Balances. The SFPUC may suspend the prospective accumulation of credits in all accounts. Alternatively, the SFPUC may impose a ceiling on further accumulation of credits in water bank balances based on a uniform ratio of the bank balance to the annual water allocation. In making a decision to suspend the prospective accumulation of water bank credits, the SFPUC shall consider the available water supply as set forth in Section 1.1 of this Plan and other reasonable, relevant factors.

3.3. Account Debits. Each month, monthly purchases will be compared to the budget for that month.

Purchases in excess of monthly budgets will be debited against an agency’s water bank account. Bank debits remaining at the end of the fiscal year will be subject to excess use charges (see Section 4).

3.4. Transfers of Banked Water. In addition to the transfers of shortage allocations provided for in Section 2.5, voluntary transfers of banked water will also be permitted between the SFPUC and any Wholesale Customer, and among the Wholesale Customers. The volume of transferred water will be credited to the transferee’s water bank account and debited against the transferor’s water bank account.

The transferring parties must notify the SFPUC and BAWSCA of each transfer in writing (so that adjustments can be made to bank accounts), and will meet with the SFPUC, if requested, to discuss any affect the transfer may have on SFPUC operations. Transfers of banked water shall be deemed to be an emergency transfer and shall become effective on the third business day after notice of the transfer has been delivered to the SFPUC. If the SFPUC incurs extraordinary costs in implementing transfers, it will give written notice to the transferring parties within ten (10) business days after receipt of notice of the transfer. Extraordinary costs means additional costs directly attributable to accommodating transfers and which are not incurred in non-drought years nor simply as a result of the shortage condition itself.

Extraordinary costs shall be calculated in accordance with the procedures in the Agreement and shall be subject to the disclosure and auditing requirements in the Agreement. In the case of transfers between Wholesale Customers, such extraordinary costs
shall be considered to be expenses chargeable solely to individual Wholesale Customers and shall be borne equally by the parties to the transfer. In the case of Item 17
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transfers between the SFPUC and a Wholesale Customer, the SFPUC’s share of any extraordinary transfer costs shall not be added to the Wholesale Revenue Requirement.

3.4.1. Transfer Limitations. The agency transferring banked water will be allowed to transfer no more than the accumulated balance in its bank. Transfers of estimated prospective banked credits and the “overdrafting” of accounts shall not be permitted. The price of transfer water originally derived from the SFPUC system is to be determined by the transferring parties and is not specified herein. Transfers of banked water shall be in compliance with Section 3.05 of the Agreement.

SECTION 4. WHOLESALE EXCESS USE CHARGES

4.1. Amount of Excess Use Charges. Monthly excess use charges shall be determined by the SFPUC at the time of the declared water shortage consistent with the calendar in Section 6 and in accordance with Section 6.03 of the Agreement. The excess use charges will be in the form of multipliers applied to the rate in effect at the time the excess use occurs. The same excess use charge multipliers shall apply to the Wholesale Customers and all Retail Customers. The excess use charge multipliers apply only to the charges for water delivered at the rate in effect at the time the excess use occurred.

4.2 Monitoring Suburban Water Use. During periods of voluntary rationing, water usage greater than a customer’s allocation (as determined in Section 2) will be indicated on each SFPUC monthly water bill.

During periods of mandatory rationing, monthly and cumulative water usage greater than a Wholesale Customer’s shortage allocation and the associated excess use charges will be indicated on each SFPUC monthly water bill.

4.3. Suburban Excess Use Charge Payments. An annual reconciliation will be made of monthly excess use charges according to the calendar in Section 6. Annual excess use charges will be calculated by comparing total annual purchases for each Wholesale Customer with its annual shortage allocation (as adjusted for transfers of shortage allocations and banked water, if any). Excess use charge payments by those Wholesale Customers with net excess use will be paid according to the calendar in Section 6. The SFPUC may dedicate excess use charges paid by Wholesale Customers toward the purchase of water from the State Drought Water Bank or other willing sellers in order to provide additional water to the Wholesale Customers. Excess use charges paid by the Wholesale Customers constitute Wholesale Customer revenue and shall be included within the SFPUC's annual Wholesale Revenue Requirement calculation.

4.4. Tier 1 Family Plan. During periods of mandatory rationing, the SFPUC will not assess excess use charges on any of the Wholesale Customers if the Wholesale Customers’ collective cumulative purchases over the course of the Supply Year are less than the Wholesale Customers’ Tier 1 allocation, as set forth in Section 2.1. If the Wholesale Customers’ collective cumulative purchases exceed the Wholesale Customers’ Tier 1 allocation, the SFPUC shall assess excess use charges on each individual Wholesale Customer that exceeded its individual Tier 2 allocation (established in accordance with Section 2.2) over the course of the Supply Year in proportion to each individual Wholesale Customer’s share of the collective Wholesale Customers’ purchases that exceeded the Wholesale Customers’ Tier 1 allocation.

SECTION 5. GENERAL PROVISIONS GOVERNING WATER SHORTAGE

ALLOCATION PLAN

5.1. Construction of Terms. This Plan is for the sole benefit of the parties and shall not be construed as granting rights to any person other than the parties or imposing obligations on a party to any person other than another party.

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5.2. Governing Law. This Plan is made under and shall be governed by the laws of the State of California.

5.3. Effect on Agreement. This Plan describes the method for allocating water between the SFPUC and the collective Wholesale Customers during system-wide water shortages of 20 percent or less. This Plan also provides for the SFPUC to allocate water among the Wholesale Customers in accordance with directions provided by the Wholesale Customers through BAWSCA under Section 2.2, and to implement a program by which such allocations may be voluntarily transferred among the Wholesale Customers.

The provisions of this Plan are intended to implement Section 3.11(C) of the Agreement and do not affect, change or modify any other section, term or condition of the Agreement.

5.4. Inapplicability of Plan to Allocation of SFPUC System Water During Non-Shortage Periods.

The SFPUC’s agreement in this Plan to a respective share of SFPUC system water during years of shortage shall not be construed to provide a basis for the allocation of water between the SFPUC and the Wholesale Customers when no water shortage emergency exists.

5.5. Termination. This Plan shall expire at the end of the Term of the Agreement... The SFPUC and the Wholesale Customers can mutually agree to revise or terminate this Plan prior to that date due to changes in the water delivery capability of the SFPUC system, the acquisition of new water supplies, and other factors affecting the availability of water from the SFPUC system during times of shortage.

SECTION 5. ALLOCATION CALENDAR

6.1. Annual Schedule. The annual schedule for the shortage allocation process is shown below. This schedule may be changed by the SFPUC to facilitate implementation.

6.1.1 In All Years Target Dates

1. SFPUC delivers list of annual purchases by each Wholesale Customer during the immediately preceding Supply Year
November 1

2. SFPUC meets with the Wholesale Customers and presents water supply forecast for the following Supply Year
February

3. SFPUC issues initial estimate of available water supply February 1

4. SFPUC announces potential first year of drought (if applicable) February 1

5. SFPUC and Wholesale Customers meet upon request to exchange information concerning water availability and projected system- wide purchases
February 1-May 31

6. SFPUC issues revised estimate of available water supply, and confirms continued potential shortage conditions, if applicable March 1

7. SFPUC issues final estimate of available water supply April 15 th or sooner if adequate
snow course measurement data
is available to form a robust
estimate on available water
supply for the coming year.

8. SFPUC determines amount of water available to Wholesale Customers collectively
April 15
th or sooner if adequate
snow course measurement data
is available to form a robust
estimate on available water
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supply for the coming year.

In Drought Years Target Dates

9. SFPUC formally declares the existence of water shortage emergency (or end of water shortage emergency, if applicable) under Water Code Sections 350 et. seq.

April 15-30

10. SFPUC declares the need for a voluntary or mandatory response April 15-30

11. BAWSCA submits calculation to SFPUC of individual Wholesale Customers’ percentage shares of water allocated to Wholesale Customers collectively
April 15- 30

12. SFPUC determines individual shortage allocations, based on BAWSCA’s submittal of individual agency percentage shares to SFPUC, and monthly water budgets (Default Schedule)
April 25—M ay 10

13. Wholesale Customers submit alternative monthly water budgets (optional)
May 8-May 24

14. Final drought shortage allocations are issued for the Supply Year beginning July 1 through June 30
June 1

15. Monthly water budgets become effective July 1

16. Excess use charges indicated on monthly Suburban bills August 1 (of the beginning year) through June 30 (of the
succeeding year)

17. Excess use charges paid by Wholesale Customers for prior year August of the succeeding year Item 17
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3.07. Restrictions on Purchases of Water from Others; Minimum Annual Purchases A. Each Wholesale Customer (except for Alameda County Water District and the cities of Milpitas,
Mountain View and Sunnyvale) agrees that it will not contract for, purchase or receive, with or without compensation, directly or indirectly, from any person, corporation, governmental agency or other entity, any water for delivery or use within its service area without the prior written consent of San Francisco.

The prohibition in subsection A does not apply to:

1. recycled
water;

2. water necessary on an emergency and temporary basis, provided that the Wholesale
Customer promptly gives San Francisco notice of the nature of the emergency, the amount of water that has been or is to be purchased, and the expected duration of the emergency; or

3. water in excess of a Wholesale Customer’s Individual Supply Guarantee.

Minimum Annual Purchase Quantities. Alameda County Water District and the cities of Milpitas, Mountain View and Sunnyvale may purchase water from sources other than San Francisco, provided that San Francisco shall require that each purchase a minimum annual quantity of water from San Francisco. These Minimum Annual Purchase Quantities are set out in Attachment E and shall also be included in the Individual Water Sales Contracts between San Francisco and each of these four Wholesale Customers (collectively referred to as the Original Minimum Purchase Customers). Pursuant to Section 3.04, certain Wholesale Customers may also be required to purchase Temporary Modified Minimum Annual Purchase Quantities, set out in Attachment E-1, from San Francisco. Attachment E will be updated pursuant to Section 3.04 to reflect any reduction in existing Minimum Annual Purchase Quantities and any addition of new Minimum Annual Purchase Quantities when Temporary Modified Minimum Annual Purchase Quantities expire and are removed from Attachment E-1; Individual Water Sales Contracts between San Francisco and any Wholesale Customers who are participants in a transfer under Section 3.04 will similarly be amended, as necessary.

1. Annual Notice. After the end of each fiscal year, the SFPUC will send a written notice to each Wholesale Customer with a Minimum Annual Purchase Quantity, or a Temporary Modified Minimum Annual Purchase Quantity with a copy to BAWSCA. The notice will include:

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(a) the quantity of water
delivered to each of those Wholesale Customers individually and all of the Original Minimum Purchase Customers colle
ctively during the previous fiscal year;
(b) each Wh
olesale Customer’s individual Minimum Annual Purchase Quantity or Temporary Modified Minimum Ann
ual Purchase Quantity (as adjusted for a Rebound Year,
if applicab
le, under Section 3.07.C.2);
(c) whether or not each
Wholesale Customer met its individual Minimum Annual Purchase Quantity or Temporary Modified Minimum Ann
ual Purchase Quantity (as adjusted for a
Rebound Year, if applica
ble);
(d) whether or not the Original Minimum
Purchase Customers collectively purchased a
volume of water from Sa
n Francisco that is equal to or greater than the sum of their four Minimu
m Annual Purchase Quantities (as adjusted for a Rebound Year, if applicable); (e) any Imputed Sales charged to th
e Wholesale Customers; and
(f) the status of any Temporary Modified Minimum Annual Purchase Quantities of the Wholesale Customers.

2. Waiver and Rebound Year. The minimum annual purchase requirements set out in Attachments E and E-1 will be waived during a Drought or other period of water shortage if the water San Francisco makes available to these Wholesale Customers is less than their Minimum Annual Purchase Quantities or Temporary Modified Minimum Annual Purchase Quantities, and may be waived during a state of emergency declared by the Governor of California that impacts water supply use or deliveries from the Regional Water System. Once the waiver is no longer in effect, each of the minimum annual purchase requirements set out in Attachments E and E-1 shall be temporarily set, for one full fiscal year (referred to as the Rebound Year), to the midpoint between (1) the Wholesale Customer’s actual San Francisco purchases for the final year in which the waiver was in effect, up to a maximum of the Customer’s Minimum Annual Purchase Quantity or Temporary Modified Minimum Annual Purchase Quantity, and (2) the Wholesale Customer’s Minimum Annual Purchase Quantity or Temporary Modified Minimum Annual Purchase Quantity set out in Attachment E or Attachment E-1, as applicable. Any fiscal year in which a Wholesale Customer meets its Rebound Year-adjusted Temporary Modified Minimum Annual Purchase Quantity, but not its standard Temporary Modified Minimum Annual Purchase Quantity, will not count as a fiscal year in which the Wholesale Customer has met or exceeded its Temporary Modified Minimum Purchase Quantity for the purposes of Section 3.04.C(4)(a).

Minimum Annual Purchase Quantity Reset. As shown on Attachment E, in Fiscal Item 17
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Year 2025-26, the Parties reset the t
hen-existing Minimum Annual Purchase Quantities of the
Original Minimum Purchase Customers to 80% of the average San Francisco purchases of each Customer over the four most recent non-drought years preceding Fiscal Year 2024-25, effective for Fiscal Year 2024-25. If the Parties extend the Term of this Agreement beyond June 30, 2034 pursuant to Section 2.02, the Parties will review the Minimum Annual Purchase Quantities of the Original Minimum Purchase Customers again ten years after the Fiscal Year 2025-26 reset. If the Original Minimum Purchase Customers, or San Francisco, want to propose a reset of the Minimum Annual Purchase Quantities for Fiscal Year 2035-36, they will provide written notice on or before June 30, 2034. The Parties will meet and confer promptly to evaluate written reset proposals. By November 30, 2035, if the Parties have come to an agreement, the SFPUC will calculate the revised Minimum Annual Purchase Quantities based on the agreed upon methodology and provide written notice to the Original Minimum Purchase Customers and BAWSCA. The Original Minimum Purchase Customers will have at least 15 business days to review and meet and confer with the SFPUC with any questions or concerns before the revised quantities are finalized. If the Parties are unable to come to an agreement, the then-existing Minimum Annual Purchase Quantities will remain unchanged. Any changes to the Minimum Annual Purchase Quantities under this Section

Collective Minimum Annual Purchase Quantities Considered Before Application of Imputed Sales. Imputed Sales will not apply to any of the individual Original Minimum Purchase Customers in a particular fiscal year if those Customers have collectively purchased a volume of water from San Francisco that is equal to or greater than the sum of their four Minimum Annual Purchase Quantities shown in Attachment E (or adjusted for a Rebound Year pursuant to Section

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Proposed 2025 Amended and Restated Water Supply Agreement: Sections 2.03, 3.09, and

9.07, and Attachment A Definitions.

2.03. Amendments .

C. Amendments to Attachments. The following attachments may be amended with the written concurrence of San Francisco and BAWSCA on behalf of the Wholesale Customers:

Attachment Name

C Individual Supply Guarantees (amendments reflecting Section

3.04 transfers only)
E Minimum Annual Purchase Quantities (amendments reflecting Section 3.04 transfers and Section 3.07 resets only)
E-1
Temporary Modified Minimum Annual Purchase Quantities
G
Water Quality Notification and Communications Plan
(as may be amended)
J Water Use Measurement and Tabulation
L-1
Identification of WSIP Projects as Regional/Retail
N-1
Balancing Account/Rate Setting Calculation Table
N-2
Wholesale Revenue Requirement Schedules
N-3
Schedule of Projected Water Sales, Wholesale Revenue
Requirement and Wholesale Rates
P Management Representation Letter
R Classification of Existing System Assets (subject to Section

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3.09. Completion of WSIP
San Francisco will comp
lete construction of the physical facilities in the WSIP by June 30, 2032. The SFPUC agrees to provide for full public review and comment by local and state interests of any proposed changes that delay previously adopted project completion dates or that delete projects. The SFPUC shall meet and consult with BAWSCA before proposing to the Commission any changes in the scope of WSIP projects which reduce their capacity or ability to achieve adopted Level of Service Goals and Objectives. The SFPUC retains discretion to determine whether to approve the physical facilities in the WSIP until after it completes the CEQA process as set forth in Section 4.07.

9.07. City of Brisbane, Guadalupe Valley Municipal Improvement District, Town of Hillsborough
A. The parties acknowledge that San Francisco has heretofore provided certain quantities of
water to the City of Brisbane (“Brisbane”), Guadalupe Valley Municipal Improvement District (“Guadalupe”) and the Town of Hillsborough (“Hillsborough”) at specified rates or without charge pursuant to obligations arising out of agreements between the predecessors of San Francisco and these parties, which agreements are referred to in judicial orders, resolutions of the SFPUC and/or the 1960 contracts between San Francisco and Brisbane, Guadalupe and Hillsborough. The parties intend to continue those arrangements and accordingly agree as follows:

1. Nothing in this Agreement is intended to alter, amend or modify the terms of SFPUC Resolution No
. 74-0053 or the indenture of July 18, 1908 between the Guadalupe Development Company and the Spring Valley Water Company.

2. Nothing in this Agreement is intended to alter, amend or modify the Findings of
Fact and Conclusions of Law and Judgment dated May 25, 1961 in that certain action entitled City and County of San Francisco v. Town of Hillsborough in the Superior Court of the State of California in and for the County of Marin, No. 23282, as modified by the Satisfaction of Judgment filed October 23, 1961 and the Compromise and Release between Hillsborough and San Francisco dated August 22, 1961. The rights and obligations of Hillsborough under these documents shall continue as therein set forth.

3. Nothing in this Agreement is intended to affect or prejudice any claims, rights or re
medies of Guadalupe or of Crocker Estate Company, a corporation, or of Crocker Item 17
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Land Company, a corporation, or of San Francisco, or of their successors and assigns, respectively, with respect to or arising out of that certain deed dated May 22, 1884, from Charles Crocker to Spring Valley Water Works, a corporation, recorded on May 24, 1884, in Book 37 of Deeds at page 356, Records of San Mateo County, California, as amended by that certain Deed of Exchange of Easements in Real Property and Agreement for Trade in Connection Therewith, dated July 29, 1954, recorded on August 4, 1954, in Book 2628, at page 298, Official Records of said San Mateo County, or with respect to or arising out of that certain action involving the validity or enforceability of certain provisions of said deed entitled City and County of San Francisco v. Crocker Estate Company, in the Superior Court of the State of California in and for the County of Marin, No. 23281.

Attachment A - Definitions

“Imputed Sales” apply when a Wholesale Customer does not meet the minimum annual purchase requirements of Section 3.07.C, as shown on Attachment E and Attachment E-1, except in fiscal years in which a waiver of these requirements is in effect. Imputed Sales are calculated as the difference between (1) a Wholesale Customer’s metered water purchases during a fiscal year, from July 1 to June 30, and (2) the larger of (a) or (b) as follows: (a) the Wholesale Customer’s Minimum Annual Purchase Quantity, as specified in Attachment E and may be adjusted pursuant to Section 3.07.C.2, or (b) the Wholesale Customer’s Temporary Modified Minimum Annual Purchase Quantity, as specified in Attachment E-1 and may be adjusted pursuant to Section 3.07.C.2. If a Wholesale Customer has more than one Temporary Modified Minimum Annual Purchase Quantity, the largest quantity is used for calculating Imputed Sales. Imputed Sales are considered wholesale water usage for the purposes of calculating the Proportional Annual Use, and any fees charged for Imputed Sales are considered wholesale revenues.

“Level of Service Goals and Objectives” refers to the “Phased WSIP Goals and Objectives” adopted by the Commission in Resolution No. 08-0200 dated October 30, 2008 as part of the approval of the WSIP, as updated and expanded by the "2023 Amended and Updated Water Enterprise Level of Service Goals and Objectives," adopted by the Commission in Resolution No. 23-0210 dated November 28, 2023, and any amendments that may be adopted by the Commission.

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ATTACHMENT E

MINIMUM ANNUAL PURCHASE QUANTITIES
(Section 3.07.C)

AGENCY MINIMUM ANNUAL PURCHASE QUANTITY
(IN MGD)1
Alameda County Water District 6.682
City of Milpitas 4.371
City of Mountain View 6.047
City of Sunnyvale 7.412
1 In Fiscal Year (FY) 2025-26, the then-existing Minimum Annual Purchase Quantities for Alameda County Water District and the Cities of Milpitas, Mountain View, and Sunnyvale were reset to 80% of each of those four customers’ average San Francisco purchases over the four non-drought years preceding FY 2024-25 (FY 2017-18, FY 2018-19, FY 2019-20, and FY 2020-21), effective FY 2024-25. Prior to this reset, from the effective date of this Agreement (July 1, 2009) through FY 2023-24, those four customers had the following Minimum Annual Purchase Quantities:

1. Alameda County Water District: 7.648 MGD

2. City of Milpitas: 5.341 MGD

3. City of Mountai n View: 8.930 MGD

4. City of Sunnyvale: 8.930 MGD
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ATTACHMENT E-3
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ATTACHMENT E-3
Illustrations of Imputed Sales Considering Collective Regional Water System Use by Original Minimum Purchase Customers Compared to Sum of Minimum Annual Purchase Quantities Pursuant to Section 3.07.E
Scenario 1: Collective Purchases Equal to or Greater Than Sum of MAPQs1 (No Imputed Sales)2 Line
# Wholesale Customer

A B C D
E = (D[LINE #]
/ D5) × (B5 -
A5)
MAPQ
RWS3
Use
(mgd)
RWS
Over
MAPQ
(mgd)
RWS
Under
MAPQ
(mgd)
Proportion of
Use Under
Total MAPQ
(mgd)
1 Alameda County Water District 6.682 7.682 1.00 N/A
2 City of Milpitas 4.371 3.871 -0.50 N/A
3 City of Mountain View 6.047 5.047 -1.00 N/A
4 City of Sunnyvale 7.412 7.912 0.50 N/A
5 Total 24.512 24.512 1.50 -1.50 N/A
Scenario 2: Collective Purchases Less Than Sum of MAPQs (by 1.0 mgd) (Imputed Sales)4 Line
# Wholesale Customer

A B C D
E = (D[LINE #]
/ D5) × (B5 -
A5)
MAPQ
RWS
Use
(mgd)
RWS
Over
MAPQ
(mgd)
RWS
Under
MAPQ
(mgd)
Proportion of
Use Under
Total MAPQ
(mgd)
1 Alameda County Water District 6.682 7.182 0.50 N/A
2 City of Milpitas 4.371 3.871 -0.50 -0.25
3 City of Mountain View 6.047 4.547 -1.50 -0.75
4 City of Sunnyvale 7.412 7.912 0.50 N/A
5 Total 24.512 23.512 1.00 -2.00 -1.0
1 Minimum Annual Purchase Quantity (MAPQ)
2 In Scenario 1, the Original Minimum Purchase Customers’ collective purchases from San Francisco in a particular fiscal year (Line 5B) are equal to the sum of their Minimum Annual Purchase Quantities (Line 5A). Therefore, no Imputed Sales are applied to individual Original Minimum Purchase Customers that purchased less than their individual Minimum Annual Purchase Quantities (in this scenario, Milpitas and Mountain View). 3 Regional Water System (RWS)
4 In Scenario 2, the Original Minimum Purchase Customers’ collective purchases from San Francisco in a particular fiscal year (Line 5B) are 1.0 mgd less than the sum of their Minimum Annual Purchase Quantities (Line 5A).

Therefore, Imputed Sales are applied proportionally to any individual Original Minimum Purchase Customer that purchased less than its individual Minimum Annual Purchase Quantity (in this scenario, Milpitas and Mountain View), so that customer is responsible for its share of the difference between the sum of all Minimum Annual Purchase Quantities (Line 5A) and the collective amount of RWS use (Line 5B). In this scenario, Mountain View is responsible for 75% and Milpitas is responsible for 25% of the 1.0 mgd difference between Line 5A and Line 5B.

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Scenario 3: Collective Purchases Equal to or Greater Than Sum of MAPQs – with Rebound Year-Adjusted MAPQs (No Imputed Sales)5 Line # Wholesale Custome r
A B
C = A -
((A[LINE #] -
B[LINE #]) / 2) D E F
G = (F[LINE #] /
F5) × (D5 - C5)
MAPQ
RWS Use
in Waiver’s
Final Year
Rebound
Year-Adjusted
MAPQ
RWS Use
(mgd)
RWS Over
Rebound
Year-
Adjusted
MAPQ (mgd)
RWS Under
Rebound
Year-
Adjusted
MAPQ (mgd)
Proportion of
Use Under
Total Rebound
Year-Adjusted
MAPQ (mgd)
1 Alameda County Water District 6.682 5.682 6.182 7.512 1.33 N/A 2 City of Milpitas 4.371 3.371 3.871 3.591 -0.28 N/A 3 City of Mountain View 6.047 5. 047 5.547 4.847 -0.70 N/A 4 City of Sunnyvale 7.412 6.412 6.912 7.782 0.87 N/A 5 Total 24.512 20.512 22.5 12 23.732 2.20 -0.98 N/A

5 In Scenario 3, the Original Minimum Purchase Customers’ collective purchases from San Francisco in a particular fiscal year (Line 5D) are greater than the sum of their Rebound Year-adjusted Minimum Annual Purchase Quantities that are currently in effect pursuant to Section 3.07.C.2 (Line 5C). Therefore, no Imputed Sales are applied to individual Original Minimum Purchase Customers that purchased less than their individual Rebound Year-adjusted Minimum Annual Purchase Quantities (in this scenario, Milpitas and Mountain View).

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ATT

ACHMENT H

WATER SHORTAGE ALLOCATION PLAN
This Water Shortage Allocation Plan (“Plan”), also known as the Tier 1 Shortage Plan, describes the method for allocating water between the San Francisco Public Utilities Commission (“SFPUC”), on the one hand, and the Wholesale Customers collectively, on the other, during shortages caused by drought.

The Plan also implements a method for allocating water among the individual Wholesale Customers, known as the Tier 2 Drought Response Implementation Plan (“Tier 2 Plan”), which has separately been adopted by the Wholesale Customers and does not include the SFPUC. The Plan includes provisions for transfers, banking, and excess use charges. The Plan applies only when the SFPUC determines that a system-wide water shortage due to drought exists, and all references to “shortages” and “water shortages” are to be so understood. This Plan was initially adopted pursuant to Section 7.03(a) of the 1984 Settlement Agreement and Master Water Sales Contract and has been incorporated and updated to correspond to the terminology used in the 2009 Water Supply Agreement between the City and County of San Francisco and Wholesale Customers in Alameda County, San Mateo County and Santa Clara County (“Agreement”), as amended and restated from time to time.

SECTION 1. SHORTAGE CONDITIONS

1.2 Projected SFPUC Customer Purchases. The SFPUC will utilize purchase data, including volumes of water purchased by the Wholesale Customers and by Retail Customers (as those terms are used in the Agreement) in the year immediately prior to the drought, along with other available relevant information, as a basis for determining projected system-wide water purchases from the SFPUC for the upcoming Supply Year (defined as the period from July 1 through June 30).

1.3. Shortage Conditions. The SFPUC will compare the projected available water supply (Section 1.1) with projected system-wide water purchases (Section 1.2). A shortage condition exists if the SFPUC determines that the projected available water supply is less than projected system-wide water purchases in the upcoming Supply Year. When a shortage condition exists, SFPUC will determine whether voluntary or mandatory actions will be required to reduce purchases of SFPUC water to required levels.

1.3.1 Voluntary Response. If the SFPUC determines that voluntary actions will be sufficient to accomplish the necessary reduction in water use throughout its service area, the SFPUC and the Wholesale Customers will make good faith efforts to reduce their water purchases to stay within their annual Tier 1 and Tier 2 allocations as applicable (see Section 2 of this Attachment H) and associated monthly water use budgets. The SFPUC will not impose excess use charges during periods of voluntary rationing, but may suspend the prospective accumulation of water bank credits, or impose a ceiling on further accumulation of bank credits, consistent with Section 3.2.1 of this Plan.

1.4. Period of Shortage. A shortage period commences when the SFPUC determines that a water shortage exists, as set forth in a declaration of water shortage emergency issued by the SFPUC pursuant to Item 17
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California Water Code Sections 350 et seq. Termination of the water shortage emergency will be declared by resolution of the SFPUC.

SECTION 2. SHORTAGE ALLOCATIONS

Level of System Wide
Reduction in Water Use
Required
Share of Available Water
SFPUC Share Wholesale Customers Share

5% or less
6% through 10%
11% through 15%
16% through 20%

35.5%

36.0%

37.0%

37.5%

64.5%

64.0%

63.0%

The parties agree to reevaluate the percentages of the available water supply allocated to Retail and Wholesale Customers by May 1, 2028.

2.2 Annual Tier 2 Allocations among the Wholesale Customers. The annual water supply allocated to the Wholesale Customers collectively during system wide shortages of 20 percent or less (i.e., the Wholesale Customers’ Tier 1 allocation) will be apportioned among them based on a methodology, known as the Tier 2 Plan, that has been separately adopted by all of the Wholesale Customers, and not the SFPUC, as described in Section 3.11(C) of the Agreement. In any year for which the methodology must be applied, the Bay Area Water Supply and Conservation Agency (“BAWSCA”) will calculate each Wholesale Customer’s individual percentage share of the amount of water allocated to the Wholesale Customers collectively pursuant to Section 2.1. Following the declaration or reconfirmation of a water shortage emergency by the SFPUC, BAWSCA will deliver to the SFPUC General Manager a list, signed by the President of BAWSCA’s Board of Directors and its General Manager, showing each Wholesale Customer together with its percentage share and stating that the list has been prepared in accordance with the methodology adopted by the Wholesale Customers. The SFPUC shall allocate water to each Wholesale Customer, as specified in the list. The shortage allocations so established (known as Tier 2 allocations) may be transferred as provided in Section 2.5 of this Plan. If BAWSCA or all Wholesale Customers do not provide the SFPUC with individual allocations, the SFPUC may make a final allocation decision after first meeting and discussing allocations with BAWSCA and the Wholesale Customers.

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The Tier 2 Plan methodology adopted by the Wholesale Customers utilizes the rolling average of each individual Wholesale Customer’s purchases from the SFPUC during the three immediately preceding Supply Years. The SFPUC agrees to provide BAWSCA by November 1 of each year a list showing the amount of water purchased by each Wholesale Customer during the immediately preceding Supply Year.

2.3. Limited Applicability of Plan to System Wide Shortages Greater Than Twenty Percent. The Tier 1 allocations of water between the SFPUC and the Wholesale Customers collectively, provided for in Section 2.1, apply only to shortages of 20 percent or less. The SFPUC and Wholesale Customers recognize the possibility of a drought occurring which could create system-wide shortages greater than 20 percent despite actions taken by the SFPUC aimed at reducing the probability and severity of water shortages in the SFPUC service area. If the SFPUC determines that a system wide water shortage greater than 20 percent exists, the SFPUC and the Wholesale Customers agree to meet within 10 days and discuss whether a change is required to the allocation set forth in Section 2.1 in order to mitigate undue hardships that might otherwise be experienced by individual Wholesale Customers or Retail Customers. Following these discussions, the Tier 1 allocations set forth in Section 2.1 of this Plan, or a modified version thereof, may be adopted by mutual written consent of the SFPUC and the Wholesale Customers. If the SFPUC and Wholesale Customers meet and cannot agree on an appropriate Tier 1 allocation within 30 days of the SFPUC’s determination of water shortage greater than 20 percent, then (1) the provisions of Section

3.11(C) of the Agreement will apply, unless (2) all of the Wholesale Customers direct in writing that a Tier 2 allocation methodology agreed to by them be used to apportion the water to be made available to the Wholesale Customers collectively, in lieu of the provisions of Section 3.11(C).

2.4. Monthly Water Budgets. Within 10 days after adopting a declaration of water shortage emergency, the SFPUC will determine the amount of Tier 1 water allocated to the Wholesale Customers collectively pursuant to Section 2.1. The SFPUC General Manager, using the Tier 2 allocation percentages shown on the list delivered by BAWSCA pursuant to Section 2.2, will calculate each Wholesale Customer’s individual annual Tier 2 allocation. The SFPUC General Manager, or his designee, will then provide each Wholesale Customer with a proposed schedule of monthly water budgets based on the pattern of monthly water purchases during the Supply Year immediately preceding the declaration of shortage (the “Default Schedule”). Each Wholesale Customer may, within two weeks of receiving its Default Schedule, provide the SFPUC with an alternative monthly water budget that reschedules its annual Tier 2 allocation over the course of the succeeding Supply Year. If a Wholesale Customer does not deliver an alternative monthly water budget to the SFPUC within two weeks of its receipt of the Default Schedule, then its monthly budget for the ensuing Supply Year shall be the Default Schedule proposed by the SFPUC.

2.5. Transfers of Shortage Allocations. Voluntary transfers of shortage allocations between the SFPUC and any Wholesale Customers, and between any Wholesale Customers, will be permitted using the same procedure as that for transfers of banked water set forth in Section 3.4. The SFPUC and BAWSCA shall be notified of each transfer. Transfers of shortage allocations shall be deemed to be an emergency transfer and shall become effective on the third business day after notice of the transfer has been delivered to the SFPUC. Transfers of shortage allocations shall be in compliance with Section 3.05 of the Item 17
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Agreement. The transferring parties will meet with the SFPUC, if requested, to discuss any effect the transfer may have on its operations.

SECTION 3. SHORTAGE WATER BANKING

3.3. Account Debits. Each month, monthly purchases will be compared to the budget for that month.

Extraordinary costs shall be calculated in accordance with the procedures in the Agreement and shall be subject to the disclosure and auditing requirements in the Agreement. In the case of transfers between Wholesale Customers, such extraordinary costs shall be considered to be expenses chargeable solely to individual Wholesale Customers and shall be borne equally by the parties to the transfer. In the case of transfers between the SFPUC and a Wholesale Customer, the SFPUC’s share of any extraordinary transfer costs shall not be added to the Wholesale Revenue Requirement.

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SECTION 4. WHOLESALE EXCESS USE CHARGES

SECTION 5. GENERAL PROVISIONS GOVERNING WATER SHORTAGE

ALLOCATION PLAN

5.2. Governing Law. This Plan is made under and shall be governed by the laws of the State of California.

The provisions of this Plan are intended to implement Section 3.11(C) of the Agreement and do not affect, change or modify any other section, term or condition of the Agreement.

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5.4. Inapplicability of Plan to Allocation of SFPUC System Water During Non-Shortage Periods.

5.5. Termination. This Plan shall expire at the end of the Term of the Agreement. The SFPUC and the Wholesale Customers can mutually agree to revise or terminate this Plan prior to that date due to changes in the water delivery capability of the SFPUC system, the acquisition of new water supplies, and other factors affecting the availability of water from the SFPUC system during times of shortage.

SECTION 6. ALLOCATION CALENDAR

6.1. Annual Schedule. The annual schedule for the shortage allocation process is shown below. This schedule may be changed by the SFPUC to facilitate implementation.

6.1.1 In All Years Target Dates

1. SFPUC delivers list of annual purchases by each Wholesale Customer during the immediately preceding Supply Year
November 1

2. SFPUC meets with the Wholesale Customers and presents water supply forecast for the following Supply Year
February

3. SFPUC issues initial estimate of available water supply February 1

4. SFPUC announces potential first year of drought (if applicable) February 1

5. SFPUC and Wholesale Customers meet upon request to exchange information concerning water availability and projected system- wide purchases
February 1-May 31

6. SFPUC issues revised estimate of available water supply, and confirms continued potential shortage conditions, if applicable March 1

In Drought Years Target Dates

9. SFPUC formally declares the existence of water shortage emergency (or end of water shortage emergency, if applicable) under Water Code Sections 350 et. seq.

April 15-30

10. SFPUC declares the need for a voluntary or mandatory response April 15-30

11. BAWSCA submits calculation to SFPUC of individual Wholesale Customers’ percentage shares of water allocated to Wholesale Customers collectively
April 15- 30
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12. SFPUC determines individual shortage allocations, based on BAWSCA’s submittal of individual agency percentage shares to SFPUC, and monthly water budgets (Default Schedule)
April 25—May 10

13. Wholesale Customers submit alternative monthly water budgets (optional)
May 8-May 24

14. Final drought shortage allocations are issued for the Supply Year beginning July 1 through June 30
June 1

15. Monthly water budgets become effective July 1

16. Excess use charges indicated on monthly Suburban bills August 1 (of the beginning year) through June 30 (of the
succeeding year)

17. Excess use charges paid by Wholesale Customers for prior year August of the succeeding year

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City Council
Staff Report
From: City Manager
Report Type: INFORMATION REPORTS
Lead Department: City Manager
Meeting Date: August 11, 2025
Report #:2507-4979
TITLE
City Council Summer Recess Report

RECOMMENDATION
Informational report only.

EXECUTIVE SUMMARY
This informational report provides a brief update on notable activities and work throughout the City Council’s July recess.

BACKGROUND
The annual Summer Recess Report shares updates, organized by department, on activities accomplished during the City Council recess. This report is not an exhaustive list of staff activities. The updates are to inform the City Council and public about items completed since the last City Council meeting of the fiscal year and other efforts underway.

ANALYSIS
Administrative Services Department
End of Fiscal Year and New Fiscal Year Activities
Staff focused on transitioning into the next fiscal year. Closing FY 2025 is underway. The annual inventory of both warehouses, the Municipal Services Center and Regional Water Quality Control Plant, are complete.

The Office of Management and Budget published the FY 2026 Municipal Fee Schedule and both the FY 2026 Adopted Operating and Capital Budget books.

Recruitment & Employee Recognition
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A key department recruitment for the role of Finance Manager was completed with new staff starting mid-July. An ASD Employee Recognition event was held, awarding six employees with 5- and 10-year service certificates.

Procurement
Staff closed year-end purchase orders and began encumbrances for FY26. The monthly purchasing and contracts training series continued with a focus on construction contract solicitation and administration.

Real Estate
Due diligence is underway as a precursor to finalizing purchase of the 2575 E. Bayshore Rd. property. We are in negotiations with La Comida for a license agreement. Staff continue the inter-departmental partnership to advance the Cubberley Project.

Roth Building
The official completion of the Roth Building construction was memorialized with the filing of the Notice of Completion (NOC) with the Santa Clara County Clerk-Recorder in July. The City issued a formal letter of acceptance for the project bringing the construction phase to a close.

The City and museum are meeting to coordinate opening the community rooms and museum spaces in the coming months.

CalPERS Update
Staff anticipate transmitting the June 30, 2024, CalPERS valuations of the City's pension plans to the Finance Committee this fall. CalPERS completes valuations using member data two years in arrears and issues annual reporting each August. As of July 2025, CalPERS provided the following preliminary investment returns as compared to a 6.8% target:
5.8% for the period ending June 30, 2023 (impact in FY 2026) 9.3% for the period ending June 30, 2024 (impact in FY 2027) 11.6% for the period ending June 30, 2025 (impact in FY 2028) Consistent with past practice, staff will incorporate these results in financial planning, including the Long-Range Financial Forecast (LRFF) and annual budget development. Additionally, staff continue to use a lower discount rate than the 6.8% used by CalPERS to calculate the employer's normal cost and transmit the difference as an additional contribution to the City's Pension Trust. As part of the FY 2026 Adopted Budget, the City Council approved continuing to use a discount rate of 5.3% in FY 2026. CalPERS preliminary investment returns for the period ending June 30, 2025, were announced on July 14, 2025.

City Manager’s Office
Palo Alto Homekey Progress
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Homekey Palo Alto made steady progress with initial modular unit setting in late June, followed by other construction tasks such as stair and decking installation through the summer. The project team is estimating construction completion by early 2026, following impacts with construction delays, navigating unique challenges associated with modular construction. A strategic shift in modular production from a planned facility in Tracy, CA to subcontractor VBC’s main manufacturing factory in Berwick, PA was made to prioritize quality. This adjustment, while slowing progress, resulted in enhanced quality. Staff worked closely with the California Department of Housing and Community Development (HCD) to minimize impacts related to state timing regulations on funding.

Point-in-Time (PIT) Count
In late June, the County released preliminary data (City-specific data is expected later this summer) from the January 2025 point-in-time (PIT) count of people experiencing homelessness.

The PIT count provides a snapshot of the number of people experiencing homelessness, as observed by volunteers, on a particular day. Preliminary numbers show an 8.2% overall increase of individuals experiencing homelessness in Santa Clara County, rising to approximately 10,711 people. The total number of unsheltered people experiencing homelessness remained relatively steady, with an increase of 71 people, about 1% change. In contrast, the sheltered population saw a notable rise, with over 700 more individuals counted in emergency shelters and temporary housing compared to the 2023 count. This preliminary data is not surprising--- although countywide advancement continues in both housing people and homelessness prevention1, more people are entering homelessness than exiting.

Oversized Vehicles Discussion Planned for Policy and Services Committee in August.

Staff are finalizing a staff report to support the August 25 Policy and Services Committee discussion on prioritizing options related to reducing the health and safety impacts of oversized vehicles in the community.

Annual Community Survey
Staff finalized the annual Community Survey to be conducted by Polco/National Research Center starting in August. Survey goals include gaining insight on resident perspectives about community services and existing programs and unmet service needs. Consistent with previous years, the survey will initially be mailed to a statistically significant population and offered in English, Spanish, and Chinese. The survey will then open for all residents in September, and results anticipated to be presented to Council this winter.

Community Services Department
Summer Camps
1 Between the January 2023 and January 2025 count, more than 8,000 people were housed. There was a net increase of 364 shelter beds, and 2,500 households were reached annually by the Homelessness Prevention System.

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This summer, Community Services offered a total of 323 camps. There are 3,889 campers enrolled out of 5,576 available spots, with 2,640 on waitlists for various camps. Total revenue as of July 21: $1,805,454. Summer Camp 2025 season ends August 8. The highest demand camps this year include Zoo Camp, The Art of European Baking & What's for Brunch?, Two- Week Theatre Academy, Ceramics for Kids, and a newly introduced Woodworking Outdoor Camp.

Recreation
The 4th of July Chili Cook Off was held showcasing community connection and chili tasting. Nine teams, four returning and five new, competed for several prizes including People’s Choice, Best Vegetarian Chili, Best Decorations, and Most Spirit; the Palo Alto Firefighters took the top prize.

Judges voted for first, second, and third place awards. Staff and volunteers gave out about 2,000 chili stamp cards and over 1,000 attendees voted for their favorite chili in the People’s Choice category, a 50% increase of people who voted last year.

Human Services
Staff is working to finalize contracts with 21 organizations that were awarded two-year Human Services Resource Allocation Process (HSRAP) funding. These organizations will provide a range of essential programs and services for Palo Alto residents. Services include support for the unhoused, programs and services for children and adults with disabilities, mental health support, and health services for individuals and families.

Public Art Program
King Artist-in-Residence Aleo Landeta installed their sculpture, Toward the Then and There, on King Plaza. A community celebration was held on June 26 featuring a live DJ and drag performances. The sculpture features images and audio clips of community members who participated in the project. The sculpture is expected to remain in place into 2026. The next artist residency launched with Kiana Honarmand, who is focusing on Black, Indigenous, and People of Color (BIPOC) and immigrant members of the community.

Staff received concept sketches from the three artist teams creating projection mapping artworks for the plaza facade of City Hall during Code:ART this October and are moving forward with their design development.

Cubberley Artist Studio Program
While the Council was on recess, artists-in-residence with the Cubberley Artist Studio Program were busy engaging the community by offering 10 free events, workshops, and art history talks hosted at Cubberley, local libraries, and the Art Center, drawing over 250 participants.

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Palo Alto Art Center
The Art Center’s summer camps welcomed 638 campers, generating $226,645 in revenue, with 81 Counselors in Training and 14 Lead Counselors in Training.

Forming Function: Ceramics with a Purpose is this year’s summer exhibition and launches the year-long Centering: Clay and Community initiative celebrating the Art Center’s role as a resource for ceramic art and education. This juried exhibition features several Art Center teaching artists and current and former students. The Art Center also has eight interns and fellows supporting camps and other programs from colleges throughout the country.

The Association of Clay and Glass Artists brought the Clay and Glass Festival to the Art Center for another successful celebration on July 12 and 13, drawing well over 10,000 people.

The Capital Improvement Project to enhance the Center’s ceramic facility was completed, enhancing safety and access to kilns for both the adult studio program and the kids and teens program. This project involved the creation of newly accessible weatherproofing structures for the electric kilns along with equipment to support these programs.

The Art Center’s Studio Program Director Fanny Retsek and Studio Technician Rick Stoner are both retiring after a collective 30-plus years of service to the City of Palo Alto. Fanny Retsek oversaw the Adult Studio Program for ten years, helping to expand class offerings (now every single day of the week) and staffing capacity for the studios. Rick Stoner contributed more than two decades to the Art Center in his role to support studio facilities, staffing evening classes and helping to keep our kilns running.

Children’s Theater
The Summer Hot Dog Series produced Dragons Love Tacos and the upcoming Hansel & Gretel.

The sold-out productions served more than 6,000 community members, and each production included a Magical Series Spectrum Friendly and ASL-Interpreted performances. In July, the theatre started rehearsals for the third Summer Hot Dog production, Honk Jr., with performances beginning in September.

The Children’s Theatre formed an agreement with the Palo Alto Unified School District to bring Joy of Singing and Joy of Musical Theatre classes to all twelve elementary schools during the 2025-2026 school year. This program will serve an estimated 2,717 students and will be part of a sequential performing arts education program.

The Teen Arts Council closed out the school year with WaveFest, an outdoor music and art festival for teens, held in Mitchell Park on June 6. This year’s festival included teen bands, dance companies, student vendors and clubs, local community groups, plus Palo Alto’s Teen Item A
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Library Advisory Board (TLAB) and Art Center Teen Leadership. More than 250 teens attended the event.

The Twilight Concert Series kicked off in June. This year’s concerts include Heartless (June 21), Petty Theft (June 28) at Mitchell Park and The Sun Kings (July 5), Mads Tolling (July 12), Boys of Summer (July 19), Lydia Pense and Cold Blood (July 26) in Rinconada Park.

Palo Alto Junior Museum & Zoo (JMZ)
JMZ camps hosted 903 campers in nine science camps. Thanks to donations from the Friends of the Palo Alto Junior Museum & Zoo, 43 campers received a scholarship to cover the full cost of participation. Thirty-seven (37) middle and high school interns, three JFCS (Jewish Family and Children Services) high school interns, and one Palo Alto High School Intern support these camps through the JMZ Science Camp Assistant Program.

A new flamingo chick was born on June 22 to parents Ruby and Sal. Flamingos hatch gray-white and gain their pink color over 2–3 years from their diet. The flock has been quieter during feedings, but activity is picking up as the chick grows. Staff are preparing to attend the annual Association of Zoos and Aquariums (AZA) Conference this September for the JMZ’s accreditation hearing. If approved, the JMZ will join 237 accredited facilities worldwide, gaining streamlined access to animals, easier permitting, and stronger connections to field experts. AZA accreditation, valid for five years, reflects the highest standards in animal care, safety, ethics, and education. The birthday party booking process was streamlined to allows guests to see availability in real time, reserve a date and time, and pay directly through Enjoy Online.

Additionally, the design and fabrication of interpretive signage is complete and will be installed along two miles of foot trails and the boardwalk of the Lucy Evans Nature Interpretive Center in the Baylands Preserve in September. Deemed “the Friendship Trail,” this project will connect Cooley Landing in East Palo Alto to the Lucy Evans Baylands Interpretive Center and Sea Scout Building (Environmental Volunteers educational center) in the Palo Alto Baylands.

Therapeutic Recreation & Accessibility
The full-time Therapeutic Recreation & Accessibility Coordinator position recruitment began in late July. This full-time, dedicated role will allow the City to provide expanded accommodation support for program participants, implement department-wide inclusion trainings, and launch new therapeutic recreation programming.

Beginning August 1, a new pilot program launched in partnership with AbilityPath and Magical Bridge. The Magical Day Program Series will support adults with disabilities in meaningful weekly volunteer roles at City facilities through December 2025.

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Staff supported 17 accommodation requests for summer camp participants, helping ensure inclusive access and participation across CSD programs.

Open Space
Staff are in the process of filling the full-time Ranger position at the Baylands, with the other full-time position open for recruitment through July 27. Fire fuel mitigation efforts have been completed in our Open Space Preserves.

Parks
The Stanford Palo Alto Community Playing Fields Turf Replacement project is underway and scheduled to wrap up by the end of the calendar year. The parking lot will be closed throughout the duration of the project. Other project updates include Greer Park Basketball Court resurfacing project was completed in July and resurfacing of the Mitchell Park splash pad was completed on July 2. The Fred Eyerly Tower Well Park Ribbon Cutting was held on June 18, with impressive attendance from City Council, Parks and Recreation Commissioners, community partners and members, and dedicated City staff. At the event, a newly designed park sign was debuted. Community garden plots have reopened, and staff are working through contacting residents on the waitlist.

In July, City staff completed focus groups with Parks and Recreation Commission Ad Hoc Playing Fields, El Camino Park user groups, and the Sierra Club. The draft Turf Study will be available for public comment from August 11-31 and will be presented to the Parks and Recreation Commission on August 26, prior to coming to the City Council in October.

Our Summer Intern has been leading an initiative to catalog memorial benches across the City’s Parks and Open Space Preserves. This work will support the development of a public facing GIS mapping tool, launching soon, to enhance community access and streamline internal operations related to bench management and requests.

Cubberley Community Center Project
Following the second community meeting on June 12, staff conducted a summer outreach effort to share project updates, conceptual plans, and gather input from City boards and commissions. Plus, a community update was shared to recap the June meeting and provides a digital opportunity to participate in the activity conducted at the meeting. Public Art Commission – June 19
Parks and Recreation Commission – June 24
Planning and Transportation Commission – July 9 (with Concordia) Architectural Review Board – July 17 (with Concordia)
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Staff are actively collecting feedback from key stakeholders on the Strategic Activation Plan for the Cubberley site, which included a dedicated session with Cubberley tenants. The revised Activation Plan will be reviewed by the City Council Cubberley Ad Hoc Committee on August 5.

Human Resources Department
The City successfully negotiated successor bargaining agreements with the Palo Alto Peace Officers Association (PAPOA) and Police Management Association (PMA). These agreements were negotiated in alignment with the City's current fiscal conditions. All agreements are for the term of July 1, 2025-June 30, 2028.

Library Department
The Children’s Library underwent a successful renovation, with the branch closed from February to June to install a new Automated Materials Handling (AMH) system and to replace carpeting throughout the building. The interior was also repainted in bright new colors, with other new aesthetic design improvements.

The Library launched its annual Summer Reading for a Cause program on June 1. This summer’s challenge is for all participants to read 2,000 hours, and the Library will donate $2,000 to Pupcycled, through the Friends of the Palo Alto Library. Under the theme "Book A Trip," the Library encourages all participants to read or listen daily, whether it's books, articles, audiobooks, or storytimes. The Library participated at the City’s annual Open House at the Municipal Service Center again this year. Activities included a plinko game and coloring craft, in addition to promoting library services and events. Plus, similar activities were provided at the July 3rdThursday on Cal Ave.

A brand new library mobile app was launched. Now, patrons don’t have to worry about remembering their library cards – the mobile app includes an e-card that can be used to check out materials. Additionally, the app can be used to do all the things patrons can do from the library website.

The Library hosted a delegation of 20 educators from Jeollanamdo Office of Education from the Republic of Korea exploring AI-based digital education and strategies for building sustainable digital learning environments on July 29.

Office of Transportation
Staff launched a public awareness effort in July in response to the State’s daylighting law which went into effect on January 1, 2025, making it illegal to park a vehicle within 20 feet of a crosswalk (marked or unmarked) or within 15 feet of a crosswalk with a curb extension or bulb- out. Parking in these areas is illegal statewide regardless of whether the curb is painted red. The law aims to enhance safety by improving visibility at intersections.

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Safety improvements at specific intersections will be evaluated throughout the year. Office of Transportation staff are prioritizing crossing locations for potential changes and enforcement emphasis, with evaluation based on locations with injury collision history along pedestrian and bicycle corridors included in the newly adopted Safe Streets for All Action Plan. The Palo Alto Police Department is handling enforcement as community reports are shared with education as the primary focus and warning citations issued initially. Drivers can play a major role by yielding to pedestrians and parking at least 20 feet from the approach side of an intersection. Learn more and report issues here.

Caltrans El Camino Real Pavement Rehabilitation & ADA Improvements Caltrans continues to make progress on its El Camino Real Pavement Rehabilitation & ADA Improvements project. Striping is 95% complete, with August completion anticipated, along with the ramp between Encina and Wells. Delineators were installed. Permanent No Parking signs are 85% complete with the remaining anticipated for completion in August.

Raising/adjusting manholes and valves will be complete in September.

For project questions, contact Caltrans Public Information Officer, Victor Gauthier or email: [email protected].

Quiet Zones
Palo Alto Avenue Crossing
The City’s Public Works Department awarded a construction contract to install necessary improvements for implementing a Quiet Zone at the Palo Alto Avenue crossing. Once construction is complete, staff will coordinate with Caltrain and the Federal Railroad Administration to issue the notice of implementation and officially activate the Quiet Zone. The construction schedule is being finalized.

Churchill Avenue, Meadow Drive, and Charleston Road Crossings Staff will present the study findings and proposed Quiet Zone alternatives to the Rail Committee for review and to receive directions on next steps in September.

Rail Grade Separation
City and Caltrain staff are collaborating on developing refined conceptual plans for the Churchill Avenue, Meadow Drive, and Charleston Road crossings to move the Preliminary Engineering and Environmental Documentation phase forward. Staff will present to the Rail Committee in September 2025 and host two community meetings tentatively for October to gain feedback on conceptual plans.

Plus, the City launched a new website for the Rail Grade Separation project for the community to track progress updates, upcoming engagement opportunities, and project resources and documents. Bookmark: www.paloalto.gov/GradeSeparation.

Office of Emergency Services
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Wildfire Table-Top Exercise
OES staff co-hosted a wildfire table-top exercise with Utilities on June 25 focused on water services. Participants included members of the water, gas, wastewater, electric, and administrative divisions who discussed their response in a wildfire scenario. This event also included an overview of the LA fires by Pasadena Water executive manager.

Support at Stanford Events
The Mobile Emergency Operation Center (MEOC) command vehicle was deployed to support the Stanford Department of Public Safety for the Major League Soccer game on June 28 held at Stanford Stadium. This was the third MEOC deployment in support of stadium events in June 2025.
2025 Community Wildfire Protection Plan/Foothills Fire Management Plan In June, the 2025 Community Wildfire Protection Plan / Foothills Fire Management Plan was published to the City’s website. The Plan identifies risks, assesses vulnerabilities, and in the long-term is key to breaking the cycle of disaster damage, reconstruction, and repeated damage.
4th of July Safety Watch
The City lead the 4th of July Safety Watch, an annual event involving public safety agencies such as CAL FIRE, California Highway Patrol, open space rangers, and Emergency Services Volunteers. The goals of the event are to coordinate resources and facilitate readiness in case of a wildland fire, major crime, or other significant safety event during the Independence Day holiday. Palo Alto OES is the lead agency for the Safety Watch.

Planning & Development Services Department
Lehigh Permanente Quarry Reclamation Plan Amendment
On June 12, Santa Clara County released a Notice of Preparation (NOP) for a Subsequent Environmental Impact Report (SEIR) for Lehigh Permanente Quarry’s proposed 2023 Reclamation Plan Amendment. After the public comment period ended on July 14, the County proceeded to prepare the SEIR. City staff is in communication with the County regarding the environmental review and the 2023 Major Reclamation Plan Amendment entitlement processing, given that the two western parcels of the quarry lie within City limits and are zoned as Open Space (OS).

Downtown Housing Plan Workshop and Citizen’s Advisory Committee meeting The City held a second Community Workshop for the Downtown Housing Plan on June 18.

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project’s Citizen’s Advisory Committee also held a meeting on July 1 to discuss feedback received at the workshops and next steps. The project team is refining the feasibility analysis prepared as a part of the assessment. The findings will be presented to the City Council with preliminary recommendations anticipated in fall 2025.
400 Mitchell Lane review by Planning & Transportation Commission (PTC) On June 17, the City received a request for hearing on a Conditional Use Permit (CUP) tentative approval at 400 Mitchell Lane. The CUP request would allow Stanford University to use the existing building for private educational purposes, including field education services and storage for a portion of the Geoscience Specimen Collection. The hearing request did not specify any concerns with the project other than requesting a public hearing. The PTC considered the request at its July 30 meeting.

Mountain View Multi-Family Development Standards
As part of coordination with adjacent agencies, staff received an update from the City of Mountain View on new development standards that affect future development adjacent to Palo Alto. On June 24, the Mountain View City Council directed its staff to proceed with new development standards, including an increase to the density in many of the City’s multi-family residential districts. Currently proposed is an increase to densities of 50-110 dwelling units per acre in the Del Medio area, which is west of Alma Street and north of San Antonio Road, directly adjacent to the Palo Alto neighborhood of Monroe Park. Other density increases are proposed throughout the city. Mountain View Planning staff is currently studying additional density in two areas (California/Ortega and California/Latham/Rengstorff) per direction from its City Council.
3150 El Camino Real Major ARB Application Approved
In July, based on the recommendation of the Architectural Review Board (ARB), staff approved the Major ARB application for a 368-unit apartment building at 3150 El Camino Real the former site of the old Fish Market and McDonalds buildings. 74 units will be deed restricted to tenants who qualify at a low-income AMI.

The Vesting Tentative Map for the project is on the August 11 Council Consent calendar. The applicant is interested in breaking ground for deconstruction and site/grading work by this October.

San Antonio Road Area Plan Community Advisory Group (CAG) Formation On June 25, the City Manager selected the 14 members of the San Antonio Road Area Plan CAG.

The CAG represents various sectors of the community, including residents, commercial property owners, businesses, services, and advocacy groups. The CAG will have its first meeting on August 19.
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On August 7, the ARB is scheduled to conduct their first review of a Builder’s Remedy proposal for 197 housing units (20% deed restricted to below-market rates) in a seven-story building. 20% of the units will be deed restricted to below-market rates.

Police Department
Recruitment
Over the summer, three new police officer trainees graduated the basic police academy and began the field training program.

National Night Out
The Police Department has been planning the annual National Night Out at Bol Park, occurring on Tuesday, August 5. There are games, emergency vehicles on display, and public safety staff to chat with residents. Consistent with prior years, staff are visiting resident-hosted block parties around town.

Coffee with A Cop
On Monday, July 1, the Police Department hosted a Coffee with Cop event, in conjunction with Gregorys Coffee at Stanford Shopping Center. Dozens of community members stopped in to chat with officers and enjoy the warm weather.

Rivian Patrol Vehicle
The nation’s first ever marked Rivian patrol vehicle has now been fully outfitted and will be hitting the streets in August, with a sneak preview during National Night Out.

Public Works Services Department
Newell Road Bridge, Fire Station #4 and Hamilton Avenue System Upgrade Project Updates The contracts have been signed for Newell Road Bridge and staff issued the notice to proceed to the contractor to start pre-construction activities on September 1 including surveying, preparing submittals, and tree trimming and removal. The remaining concrete sitework, paving, and striping was completed for the Churchill Avenue/Alma Street Railroad Crossing Safety Improvements in July. Both Fire Station #4 and Hamilton Avenue System Upgrade Projects Invitation for Bids were issued and are due in mid-August and early September, respectively.

Upon review of the bids, staff will bring these contracts to Council for approval. 445 Bryant HVAC Replacement and Space Renovation
The renovation of the former Form Fitness site located at 445 Bryant has commenced. The project involves replacing seven gas package HVAC units with seven electric heat pump units, with an expected completion date in mid-August 2025. An architect is currently working on the Use & Occupancy permit application for the new space use and designing plans for the initial Item A
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Phase 1 interior space renovations. The construction contract for Phase 1 is being finalized, with construction anticipated to be completed by the end of October 2025.

Palo Alto Airport Hosts Fully Electric Aircraft in Partnership with H55 In June, the Palo Alto Airport had the unique opportunity to host a fully electric aircraft in collaboration with H55, a leading developer of electric propulsion systems for aviation. As part of a nationwide tour, the aircraft made a special stop in Palo Alto to showcase the future of sustainable aviation. Over the course of two weeks, the airport facilitated a series of small outreach events for local flight schools, pilots, and aviation enthusiasts. These sessions provided attendees with an up-close look at the aircraft’s electric systems, performance capabilities, and the environmental benefits of electric-powered flight. The visit highlighted Palo Alto Airport’s ongoing commitment to innovation and sustainability, while giving the local aviation community a glimpse into the next generation of aircraft technology.

Regional Water Quality Control Plant (RWQCP) Joint Interceptor Sewer Rehabilitation Project The Joint Interceptor Sewer Rehabilitation (Phase 1) Project addresses 2,364 feet of the 9,000- foot Joint Intercepting Sewer, built in 1972, which conveys over half of the influent flow to the RWQCP. Over the summer, major pipelining work was completed. Additional bypass rerouting and evaluation of a critical junction structure are expected to be completed in the coming months. Construction of the project is anticipated to be complete by fall 2025.

Local Advanced Water Purification System
This project improves the quality of recycled water by membrane filtration followed by reverse osmosis to reduce the level of total dissolved solids. Following Council’s approval of the construction contract with Anderson Pacific Engineering Construction, Inc. on May 19, construction began this summer, focusing on installing a new odor control system and relocating an existing sewer main—two key preliminary components before main construction.

Site preparation and grading will follow. Construction is anticipated to be completed by spring 2028.

Zero Waste City Facility Audit Project
A comprehensive review of 43 City facilities occurred in July to support the City’s Zero Waste requirements and enhance staff awareness of responsible waste practices. The facilities inspections were conducted by a Zero Waste summer intern who reviewed all common areas (break rooms, lobbies, conference rooms, shared office spaces) to ensure each location had properly color-coded complete waste stations with containers and signage for recycling, compost, and landfill. The audit also included verifying correct material sorting inside each container and use of approved liners. All facilities and work areas received educational materials, fliers, stickers, posters, and information including photos, missing requirements, and what needed to be updated. The project was set up as a friendly competition between workgroups, with a trophy to be presented to the winning workgroup in August.

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Utilities Department
Electric Grid Modernization Project Update
The electric grid modernization project pilot phase is complete. Now, 908 homes are served with upgraded facilities that include the replacement of 70 wood utility poles, 106 new transformers, and 22,650 feet of new low-voltage wire. The cost to complete the pilot area was just over $10 million with contracted labor being the largest cost. Based on lessons learned from the pilot, staff are reassessing the next phase of the project to determine how to reduce construction costs, increase capacity at substations, and build in areas where there is higher interest in home electrification.

Advanced Metering Infrastructure (AMI)
Utilities, Office of Emergency Services, and Police staff are coordinating to add a new AMI base station on the rooftop of City Hall to enhance connectivity and transmission of AMI meter data for downtown businesses, Stanford campus, and the Oak Creek apartments. After the new base station is installed, Utilities can convert approximately 3,000 electric meters. Staff are finalizing the voluntary residential electric time-of-use rate and developing the January 1, 2026 implementation plan. The time-of-use rate can reduce demand on the electrical grid during peak times and lead to lower electric bills if customers shift usage to off-peak hours.

H.R. 1 Bill Cuts to Clean Energy Incentives
H.R. 1 was signed into law on July 4, bringing with it significant cuts to clean energy and decarbonization incentives. Staff are working with the American Public Power Association (APPA), Northern California Power Agency (NCPA) and the California Municipal Utilities Association (CMUA) to understand its impacts as it relates to customer support for clean energy programs and utility-scale implications of increased costs for energy procurement and energy production development. H.R. 1 rapidly phases out or ends federal tax credits for residential and commercial energy efficiency, renewable energy projects, home improvements, and electric vehicles. The City will likely see increased energy prices within the next few years as less generation is slated to come online, and new energy projects will be more expensive. In July, staff began public outreach to utilities customers sharing incentives details before they are set to expire.

Upcoming Residential Customer Satisfaction Surveys
The California Municipal Utilities Association (CMUA) is conducting a statewide utility customer satisfaction survey in July and August. The survey fields responses from municipal and investor- owned utilities customers across the state, followed by an “oversample” survey of Palo Alto residents to gain greater insight into specific areas of interest for Palo Alto. This semi-annual survey allows the utilities department to measure satisfaction with and perspectives on Item A
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customer service, reliability, safety, rates, communication, and customer programs. Results will be provided to the Utilities Advisory Commission and City Council in fall 2025.

Municipal Service Center (MSC) Open House
The City hosted its annual open house at the Municipal Service Center (MSC) on Saturday, July 26 to showcase some of the “behind the scenes” work that we do for the community with nearly 1,000 people attending. Several City department’s staffed booths with demonstrations and displays, with attending food trucks, free ice cream, and other activities.

Annual Consumer Confidence Report
As required by the state, the annual consumer confidence report on water quality conditions for calendar year 2024 was posted online in English, Spanish and Chinese.

FISCAL/RESOURCE IMPACT
This report is informational only and items will be brought to the City Council independently, should they need additional fiscal or policy considerations.

STAKEHOLDER ENGAGEMENT
Community engagement continues. Work is underway planning for the next Neighborhood Town Hall meeting set for August 20 for the neighborhoods of Downtown North, University South/Professorville and Sand Hill Corridor and upcoming surveys to gain input on key topic areas.

Website statistics for January – June 2025 include:
- 1,598,022 total page views and470,040 users
- Top 10 Visited Web Pages
oHome page
oContent search landing page
oUtilities Department
oCareers
oRegister for Activities & Classes
oMeeting Agendas & Minutes
oPalo Alto Children’s Theatre
oCreek Monitor & Camera
oEnjoy! Online
oPalo Alto Art Center
Other communications shared during the Council recess include:
- Climate Action Blog: Stay Chill & Save the Planet this Summer - Joyful July Events
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- Celebrate Safely, Leave the Fireworks to the Professionals - Act Fast to Save on a Heat Pump Water Heater
- Fire Preparedness in Palo Alto: Safety Tips for You & Your Pets - Improving Cubberley Together: What We Heard & What’s Next - Climate Action Blog: Be Cool this Summer & Switch from Gas to Electric - Progress on Key Community Projects – July 2025
- Summer Adventures Continue in August

ENVIRONMENTAL REVIEW
This report is for informational purposes only with no action required by the Council and is therefore not a project subject to CEQA review.

ATTACHMENTS
No attachments.

APPROVED BY:

Ed Shikada, City Manager
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City Council
Staff Report
Report Type: INFORMATION REPORTS
Lead Department: Administrative Services
Meeting Date: August 11, 2025
Report #:2412-3893
TITLE
City of Palo Alto Monthly Investment Activity Report for May 2025 (Unaudited)

ATTACHMENTS
Attachment A - May 2025 Monthly Investment Activity Report APPROVED BY:

Lauren Lai, Administrative Services Director
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CITY OF PALO ALTO
MONTHLY INVESTMENT ACTIVITY REPORT
May 2025 (Unaudited)

TO: Honorable City Council
Report Posted at the City’s Website: www.cityofpaloalto.org/investmentreporting Above Link on Council Agenda of August 4, 2025
______________________________________________________________________

The City’s Investment Policy1 (Policy) and California Government Code Section 53607 requires that a report of transactions (investments, reinvestment, sold, and exchanged securities) be made available to the Council on a monthly basis.

The attached list of transactions (Attachment A) also includes, though not required by the Policy or the government code, security maturities and cash movement activity in the City’s two liquid operating cash pool accounts (Local Agency Investment Fund or LAIF and Fidelity accounts). Liquid cash are available on a daily basis but are invested by the two entities in a range of securities (e.g., treasuries, federal agencies, commercial paper, corporate bonds, time deposits, loans, and certificate of deposits/bank notes).

This reporting requirement is separate and distinct from the quarterly investment report submitted under California Government Code Section 53646 that includes portfolio composition, a detailed list of all securities, performance compared to the Policy, overall compliance with the Policy, and the City’s ability to meet expenditure requirements over the next six months.

Prepared by:

_______________________
Tarun Narayan
Mgr. Treasury, Debt &
Investments

________________
Date
Approved by:

_______________________
Christine Paras
Asst. Director ASD

_________________
Date

______________________
Lauren Lai
Chief Financial Officer

_________________
Date

1 https://www.cityofpaloalto.org/files/assets/public/v/1/administrative‐services/investment‐policies/adopted‐investment‐policy‐1‐39‐asd.pdf Docusign Envelope ID: BD1BBA03-41B6-4333-9B8D-93B80E53B903 6/10/2025
6/10/2025
6/11/2025
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Monthly Investment Activity
Report

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City of Palo Alto
Activity Report
City of Palo Alto
Administration Svcs. Dept.
250 Hamilton Ave., 4th Floor
Palo Alto, CA 94301
(650)329-2362
Sorted By Safekeeper
May 1, 2025 - May 31, 2025
Current
Rate
Transaction
Date Balance
Beginning
Balance
Ending
Par Value
Percent
of Portfolio
Par Value
CUSIP Investment # Issuer
Purchases or
Deposits
Redemptions or
Withdrawals
Safekeeper: U.S. Bank
Negotiable Certificates of Deposits
Mountain America FD Credit Uni2719 NCD 0.004.850 05/09/2025 249,000.0062384RAR7 Lafayette Federal Credit Union2879 NCD 0.003.100 05/27/2025 249,000.0050625LBG7 Huntington National Bank2891 NCD 0.004.800 05/05/2025 249,000.00446438SB0 MI Bank2960 NCD 0.004.750 05/01/2025 249,000.0059319LAS4 Intracoastal Bank2995 NCD 0.005.000 05/06/2025 249,000.0046117YAC2 1,245,000.0030,565,000.00 29,320,000.00Subtotal and Balance 0.00 Corporate Medium Term Bonds
Apple, Inc.3129 MTN 550,000.003.350 05/01/2025 0.00037833CJ7

0.0031,300,000.00 31,850,000.00Subtotal and Balance 550,000.00 Federal Agency Bonds
Federal National Mortgage Asso3056 Call 0.005.100 05/10/2025 1,500,000.003135GAWG2 Federal Home Loan Bank3128 1,660,000.004.375 05/01/2025 0.003130AV5P3 1,500,000.00205,649,000.00 205,809,000.00Subtotal and Balance 1,660,000.00 Treasury Securities (Notes)
4,500,000.00 4,500,000.00Subtotal and Balance
Municipal Bonds
University of California2077 MUN 0.003.050 05/15/2025 1,500,000.0091412GQG3 University of California2095 MUN 0.003.050 05/15/2025 1,000,000.0091412GQG3 San Diego Cnty Wtr Authority2600 MUN 0.000.743 05/01/2025 210,000.00797412DM2 State of Wisconsin 22822 MUN 0.005.700 05/01/2025 305,000.00977100AC0 San Diego Cnty Wtr Authority3024 MUN 0.000.743 05/01/2025 745,000.00797412DM2 3,760,000.00247,273,741.43 243,513,741.43Subtotal and Balance 0.00 Supranationals (World Bank) Bonds
Intl Bk Recon & Development3130 IBRD 2,000,000.005.170 05/01/2025 0.0045906M5H0

0.0068,884,000.00 70,884,000.00Subtotal and Balance 2,000,000.00 4,210,000.00 6,505,000.00588,171,741.43 585,876,741.4389.792%Safekeeper Subtotal Portfolio CPA
AP
Run Date: 06/10/2025 - 05:22 DA (PRF_DA) 7.3.11
Report Ver. 7.3.11
Attachment A
Docusign Envelope ID: BD1BBA03-41B6-4333-9B8D-93B80E53B903 Item B
Attachment A - May 2025 Monthly
Investment Activity Report

Item B: Staff Report
Pg.
3 Packet Pg. 612 of 627

Current
Rate
Transaction
Date Balance
Beginning
Balance
Ending
Par Value

Page 2 ends

Palo Alto City CouncilAugust 11, 2025

Palo Alto City Council
August 11, 2025