SUPPLEMENT NO. 2
To MASTER FUNDING AGREEMENT
Between METROPOLITAN TRANSPORTATION COMMISSION
And CITY OF PALO ALTO
For PALO ALTO TRANSIT CENTER QUARRY ROAD CONNECTION
This Supplement No. 2 to Master Funding Agreement (“Supplement or “Agreement”) is entered into this September 1, 2025, by and between the METROPOLITAN TRANSPORTATION COMMISSION (hereafter “MTC”) and CITY OF PALO ALTO (hereafter “AGENCY”) and supplements the Master Funding Agreement, dated February 17, 2022, by and between MTC and AGENCY.
Pursuant to this Supplement, MTC agrees to reimburse an amount not to exceed one million dollars ($1,000,000) in Regional Measure 2 (RM2) funds to AGENCY to fund the Palo Alto Transit Center Quarry Road Connection (as more fully described in Annex I hereto, the “Supplement Project”).
The estimated budget and payment milestones for the Supplement Project scope of work is attached as Annex II hereto.
The Supplement Project work will commence September 1, 2025, and be completed no later than December 31, 2029.
The clauses selected below and attached as exhibits to the Master Funding Agreement shall apply to AGENCY’s performance of the applicable Supplement Project scope of work hereunder:
☒ Exhibit B-1, Additional Terms and Conditions (General), Paragraph A ☒ Exhibit B-1, Additional Terms and Conditions (General), Paragraph B ☐ E
xhibit B-2, Additional Terms and Conditions (Federally Required Clauses)* ☐ Exhibit B-3, Additional Terms and Conditions (State Required Clauses) ☐ Exhibit B-4, Additional Terms and Conditions (Prevailing Wage Rates, Apprenticeships, and Payroll Records, Non-Federally-Funded Agreements)
☐ Exhibit B-5, Additional Terms and Conditions (Prevailing Wage Rates, Apprenticeships, and Payroll Records, Federally-Funded Agreements)
☒ Exhibit B-6, Additional Terms and Conditions (Regional Toll Funds including RM1, RM2, and AB1171)
☐ Exhibit B-7, Additional Terms and Conditions (Regional Discretionary Federal Funds including STP and CMAQ)
The terms and conditions of this Supplement include the following and each is incorporated by reference herein as if fully set forth herein.
Attachment A – MTC Resolution No. 4271 Approving Project Request(s) Attachment B – MTC Resolution No. 3636, Revised
The MTC Project Manager for the Supplement Project is Michelle Go, (415) 778-6649, [email protected]
. The AGENCY Project Manager for the Supplement Project is Sylvia Star- Lack, (650) 329-2546, [email protected].
This Supplement is supplemental to the Master Funding Agreement; all terms and conditions of the Master Funding Agreement, as may be amended, remain unchanged hereby.
MTC/ City of Palo Alto
Master Funding Agreement
Supplement No. 2 – Palo Alto Transit Center Quarry Road Extension
Capitalized terms used but not defined herein shall have the respective meanings assigned to them in the Master Funding Agreement.
METROPOLITAN TRANSPORTATION
COMMISSION
CITY OF PALO ALTO
Andrew B. Fremier, Executive Director Ed Shikada, City Manager
MTC/ City of Palo Alto
Master Funding Agreement
Supplement No. 2 – Palo Alto Transit Center Quarry Road Extension
ANNEX I
Project Description and Scope of Work
Palo Alto Transit Center Quarry Road Connection
Project Description:
As envisioned in the Palo Alto Comprehensive Plan as Program T3.10.4 (2017), the proposed Quarry Road Connection Project will create a direct transit connection between the transit center bus bays and El Camino Real at the Quarry Road traffic signal, through an underused, passive portion of El Camino Park. The proposed project would allow buses that use the bus terminal to exit via Quarry Road to El Camino Real rather than to circle back through University Avenue. The bus operators have estimated savings of approximately 5-8 minutes per trip could be achieved by avoiding University Circle and directly connecting with Quarry Road at El Camino Real.
The bus route reorganization would have secondary benefits to the University Avenue and University Circle area by eliminating the need for some buses to make constrained turning movements in the corridor. Articulated buses require additional turning radii to access the transit center from University Avenue which regularly causes congestion and delays for vehicular traffic and creates additional conflict points for bicycles and pedestrians at the gateway to Downtown Palo Alto.
The project will also include multiple pedestrian and bicycle improvements within El Camino Park adjacent to or near the proposed transit connection and at the intersection of Quarry Road and El Camino Real.
Specifically, the proposed project will:
• Upgrade the crossing of El Camino Real to accommodate pedestrians and cyclists on both sides of Quarry Road, which would reduce crossing time; and
• Add safety and accessibility measures at the intersection of Quarry Road and El Camino Real (e.g., curb extensions and tighter turning radii, new pedestrian/bicycle ramps, pedestrian and bicycle refuge islands, and high visibility bicycle markings are currently being considered).
Through the above improvements, there would be enhanced visibility of the existing multi-modal path to the transit center and its connections to the existing Class 1 multi-modal path that connects to El Camino Park and into Menlo Park, through the PATC to the Embarcadero Bike Path, and to the Stanford Perimeter Trail.
These connectivity improvements will also make the active park facilities in El Camino Park more accessible for bikes, pedestrians and transit riders.
Designs for the transit connection are in the early stages, but all feasible options are under consideration, ranging from a new connection providing full access to buses between the transit center and El Camino Real to an outbound-only transit lane.
MTC/ City of Palo Alto
Master Funding Agreement
Supplement No. 2 – Palo Alto Transit Center Quarry Road Extension
The preliminary concept design includes 12.5 foot wide inbound and outbound transit travel lanes (188 feet and 163 feet in length, respectively), with six-inch curbs, separated by a landscaped median that ranges in width between 18-33 feet that would house existing utilities.
Other modifications and improvements could include, but are not limited to, wayfinding signs, additional striping and green bike lanes to help identify buffered lanes and highlight any potential conflict areas between buses, transit and bicyclists in the corridor, crosswalk striping, and refuge islands.
Scope
The services to be performed by Palo Alto staff, in partnership with Stanford University, shall consist of managing consultants/contractors to perform the services requested by the MTC Project Manager or a designated representative including, but not limited to, the following tasks:
• Preliminary Engineering and Design
o Task 1: Project Management
o Task 2: Preliminary Engineering
o Task 3: Transit Service and Operations Study
o Task 4: Traffic Operations Analysis
o Task 5: Environmental Engineering and Clearance
o Task 6: Design Engineering Evaluation Report (DEER)
o Task 7: Plans, Specifications, and Estimates (PS&E)
o Optional Tasks
Task 4.3: Transit Signal Priority Technical Memorandum Task 5.2 Preliminary Environmental Analysis Report (PEAR) Task 8: Advertising and Bid Support (fee not included) Task 9: Contingency and Other Supporting Tasks
• Construction
MTC/ City of Palo Alto
Master Funding Agreement
Supplement No. 2 – Palo Alto Transit Center Quarry Road Extension
ANNEX II
Project Schedule, Budget and Payment
COST REIMBURSEMENT
MTC will reimburse AGENCY for all expenses deemed reasonable and necessary by MTC incurred by AGENCY in the performance of this Agreement. MTC will reimburse AGENCY at a rate not to exceed 50% of costs up to a maximum of one million dollars ($1,000,000) in Regional Measure 2 (RM2) funds.
AGENCY and Stanford University will match the funds with a 25% contribution each. Excess costs beyond approved RM2 allocations will be resolved by AGENCY or Stanford University contributions, or other sources identified by AGENCY. Reimbursement is subject to funding allocations approved in Attachment A, MTC Resolution No. 4721 and future allocation approvals. Attachment A also includes the project schedule which serves as an estimated schedule by which allocations would be made.
Reimbursement shall include travel and personal expenses incurred by employees or agents of AGENCY in accordance with 48 Code of Federal Regulations Part 31 or 2 CFR Part 200, as applicable.
The estimated budget and RM2 cost share by Task for the Preliminary Engineering and Final Design and the Construction phases are described below.
#
Task Estimated
Budget
Estimated RM2
Cost Share
Preliminary Engineering and Final Design Phase
1 Project Management $111,200 $55,600
2 Preliminary Engineering $48,200 $24,100
3 Transit Service and Operations Study $29,600 $14,800
4 Traffic Operations Analysis $49,400 $24,700
5 Environmental Engineering and Clearance $6,100 $3,050 6 Design Engineering Evaluation Report (DEER) $77,900 $38,950 7 Plans, Specifications, and Estimates (PS&E) $395,100 $197,550 Direct Costs
Traffic Counts (Task 3): $4,000 $2,000
95% Plans (Task 7.1) $25,000 $12,500
Hazards Phase I Environmental Site Assessment
(Task 7.7):
$20,000 $10,000
Optional Tasks
4.3 Transit Signal Priority Technical Memorandum
(fee not included)
5.2 Preliminary Environmental Analysis Report $11,700 $5,850 8 Advertising and Bid Support (fee not included)
9 Contingency and Other Supporting Tasks $100,000 $50,000 Preliminary Engineering and Final Design Subtotal
(including optional tasks with estimates)
$878,200 $439,100
Construction Phase Subtotal $4,500,000 $560,900
Total $5,378,200 $1,000,000
MTC/ City of Palo Alto
Master Funding Agreement
Supplement No. 2 – Palo Alto Transit Center Quarry Road Extension
AGENCY shall submit invoices for services rendered on a monthly basis covering fees and expenses for a single calendar month, identifying the work for which payment is requested; the hours worked; any authorized expenses, together with receipts for such expenses; the amount requested; and the cumulative amount billed and paid under this Agreement. AGENCY shall also submit invoices through June 30th by July 31st to align with fiscal year-end processing.
MTC/ City of Palo Alto
Master Funding Agreement
Supplement No. 2 – Palo Alto Transit Center Quarry Road Extension
ANNEX III
Insurance Requirements
1. INSURANCE
A. Minimum Coverages. The insurance requirements specified in this section shall cover AGENCY’s own liability and the liability arising out of work or services performed under this Agreement by any subconsultants, subcontractors, suppliers, temporary workers, independent contractors, leased employees, or any other persons, firms or corporations that AGENCY authorizes to work under this Agreement (hereinafter referred to as “Agents.”) AGENCY shall, at its own expense, obtain and maintain in effect at all times during the life of this Agreement the following types of insurance against claims, damages and losses due to injuries to persons or damage to property or other losses that may arise in connection with the performance of work under this Agreement.
AGENCY is also required to assess the risks associated with work to be performed by Agents under subcontract and to include in every subcontract the requirement that the Agent maintain adequate insurance coverage with appropriate limits and endorsements to cover such risks. To the extent that an Agent does not procure and maintain such insurance coverage, AGENCY shall be responsible for said coverage and assume any and all costs and expenses that may be incurred in securing said coverage or in fulfilling AGENCY’s indemnity obligation as to itself or any of its Agents in the absence of coverage.
In the event AGENCY or its Agents procure excess or umbrella coverage to maintain certain requirements outlined below, these policies shall also satisfy all specified endorsements and stipulations, including provisions that AGENCY’s insurance be primary without right of contribution from MTC.
Prior to beginning work under this contract, AGENCY shall provide MTC with satisfactory evidence of compliance with the insurance requirements of this section.
The insurance listed hereunder shall be considered minimum requirements and any and all insurance proceeds in excess of the requirements shall be made available to MTC. If the AGENCY maintains broader coverage and/or higher limits than the minimum limits shown hereunder, MTC shall be entitled to the broader coverage and/or higher limits maintained by the AGENCY.
1. Workers' Compensation Insurance with Statutory limits, and Employer’s Liability Insurance with a limit of not less than $1,000,000 per employee and $1,000,000 per accident, and any and all other coverage of AGENCY’s employees as may be required by applicable law. Such policy shall contain a Waiver of Subrogation in favor of MTC. Such Workers’ Compensation & Employer’s Liability may be waived, if and only for as long as AGENCY is a sole proprietor or a corporation with stock 100% owned by officers with no employees.
2. Commercial General Liability Insurance for Bodily Injury and Property Damage liability, covering the premises and operations, and products and completed operations of AGENCY and AGENCY’s officers, agents, and employees and with limits of liability which shall not be less than $1,000,000 per occurrence with a general aggregate liability of not less than $2,000,000, a products/completed operations aggregate liability limit of not less than $2,000,000 and Personal & MTC/ City of Palo Alto
Master Funding Agreement
Supplement No. 2 – Palo Alto Transit Center Quarry Road Extension
Advertising Injury liability with a limit of not less than $1,000,000. Such policy shall contain a Waiver of Subrogation or “Waiver of Transfer of Rights of Recovery Against Others to Us” provision included in the policy language or by endorsement in favor of MTC.
Products and completed operations insurance shall be maintained for three (3) years following termination of this Agreement.
MTC and those entities listed in Part 3 of this Attachment E (if any), and their commissioners, directors, officers, representatives, and employees are to be named as additional insureds for ongoing and completed operations. The additional insured endorsements shall be at least as broad as Insurance Service Office (ISO) Form Number CG 20 38 04 13 for ongoing operations and Insurance Service Office (ISO) Form Number CG 20 37 04 13 for completed operations. Such insurance shall be primary and non-contributory, and contain a Separation of Insureds Clause as respects any claims, losses or liability arising directly or indirectly from AGENCY’s operations.
3. Business Automobile Insurance for all automobiles owned (if any), used or maintained by AGENCY and AGENCY’s officers, and employees, including but not limited to owned (if any), leased (if any), non-owned and hired automobiles, with limits of liability which shall not be less than $1,000,000 combined single limit per accident.
4. Excess or Umbrella Insurance in the amount of $9,000,000 providing excess limits over Employer’s Liability, Automobile Liability, and Commercial General Liability Insurance. Such umbrella coverage shall be following form to underlying coverage including all endorsements and additional insured requirements.
5. Errors and Omissions Professional Liability Insurance for errors and omissions and the resulting damages, including, but not limited to, economic loss to MTC and having minimum limits of $5,000,000 per claim. The policy shall provide coverage for all work performed by AGENCY and any work performed or conducted by any subcontractor/consultant working for or performing services on behalf of AGENCY. No contract or agreement between AGENCY and any subcontractor/consultant shall relieve AGENCY of the responsibility for providing this Errors & Omissions or Professional Liability coverage for all work performed by AGENCY and any subcontractor/consultant working on behalf of AGENCY on the project.
6. Property Insurance. Property Insurance covering AGENCY'S own business personal property and equipment to be used in performance of this Agreement, materials or property to be purchased and/or installed on behalf of MTC (if any), and builders risk for property in the course of construction (if applicable). Coverage shall be written on a "Special Form" policy that includes theft, but excludes earthquakes, with limits at least equal to the replacement cost of the property. Such policy shall contain a Waiver of Subrogation or “Transfer of Rights of Recovery Against Others to Us” provision included in the policy language or by endorsement in favor of MTC.
MTC/ City of Palo Alto
Master Funding Agreement
Supplement No. 2 – Palo Alto Transit Center Quarry Road Extension
7. Employee Dishonesty/Crime Insurance. An Employee Dishonesty insurance policy covering AGENCY’s employees for loss of or damage to money, securities or other property resulting from theft. The following limits of liability should apply: (a) Employee Dishonesty - $250,000; and (b) Client Property Blanket Bond - $250,000. AGENCY shall reimburse MTC for any and all losses within the deductible, for insured losses, the cost to prove the loss, accountants' fees, defense costs including attorneys’ fees and any other fees associated with a claim. In lieu of a Client Property Blanket Bond, the policy shall contain a Joint Loss Payee endorsement or other Third Party coverage naming MTC.
B. Acceptable Insurers .
All policies will be issued by insurers, generally with a Best’s Rating of A- or better with a Financial Size Category of VII or better, or an A rating from a comparable rating service.
C. Self -I nsurance. AGENCY ’s obligation hereunder may be satisfied in whole or in part by adequately funded self-insurance, upon evidence of financial capacity satisfactory to MTC.
D. Deductibles and Retentions . AGENCY shall be responsible for payment of any deductible or retention on AGENCY’s policies without right of contribution from MTC. Deductible and retention provisions shall not contain any restrictions as to how or by whom the deductible or retention is paid.
Any deductible or retention provision limiting payment to the Named Insured is unacceptable.
In the event that MTC seeks coverage as an additional insured under any AGENCY insurance policy that contains a deductible or self-insured retention, AGENCY shall satisfy such deductible or self-insured retention to the extent of loss covered by such policy, for any lawsuit arising from or connected with any alleged act of AGENCY, subconsultant, subcontractor, or any of their employees, officers or directors, even if AGENCY or subconsultant is not a named defendant in the lawsuit.
E. Claims Made Coverage. If any insurance specified above is written on a “Claims- Made” (rather than an “occurrence”) basis, then in addition to the coverage requirements above, AGENCY shall:
(1) Ensure that the Retroactive Date is shown on the policy, and such date must be before the date of this Agreement or the beginning of any work under this Agreement; (2) Maintain and provide evidence of similar insurance for at least three (3) years following project completion, including the requirement of adding all additional insureds; and
(3) If insurance is cancelled or non -renewed, and not replaced with another claims -made policy form with a Retroactive Date prior to the Agreement effective date, AGENCY shall purchase “extended reporting” coverage for a minimum of three (3) years after completion of the work.
F. Failure to Maintain Insurance. All insurance specified above shall remain in force until all work or services to be performed are satisfactorily completed, all of AGENCY’s personnel, subconsultants, subcontractors, and equipment have been removed from MTC’s property, and the work or services have been formally accepted. AGENCY must notify MTC if any of the above required MTC/ City of Palo Alto
Master Funding Agreement
Supplement No. 2 – Palo Alto Transit Center Quarry Road Extension
coverages are non-renewed or cancelled. The failure to procure or maintain required insurance and/or an adequately funded self-insurance program will constitute a material breach of this Agreement.
G. Certificates of Insurance. Prior to commencement of any work hereunder, AGENCY shall deliver to Ebix, MTC’s authorized insurance consultant, insurance documentation (including Certificates of Liability Insurance, Evidences of Property Insurance, endorsements, etc.) verifying the aforementioned coverages. Such evidence of insurance shall make reference to all provisions and endorsements referred to above and shall be signed by the authorized representative of the Insurance Company shown on the insurance documentation. The Project name shall be clearly stated on the face of each Certificate of Liability Insurance and/or Evidence of Property Insurance.
AGENCY shall submit certificates of insurance to:
Metropolitan Transportation Commission
Insurance Compliance
P.O. Box 100085-M8
Duluth, GA 30096
or
Email to [email protected]
or
Fax to 1-888-617-2309
MTC reserves the right to require copies of all required policy declarations pages or insurance policies, including endorsements, required by these specifications, at any time.
3. ADDITIONAL INSUREDS
The following entities are to be named as Additional Insureds under applicable sections of this Attachment E and as MTC Indemnified Parties, pursuant to Article 9 of the Agreement.
Metropolitan Transportation Commission (MTC)
Bay Area Toll Authority (BATA)
Alameda-Contra Costa Transit District (AC Transit)
Valley Transportation Authority (VTA)
San Mateo County Transit District (SamTrans)
Stanford University
California Department of Transportation
MTC/ City of Palo Alto
Master Funding Agreement
Supplement No. 2 – Palo Alto Transit Center Quarry Road Extension
ATTACHMENT A
MTC Resolution No. 4721
MTC/ City of Palo Alto
Master Funding Agreement
Supplement No. 2 – Palo Alto Transit Center Quarry Road Extension
ATTACHMENT B
MTC Resolution No. 3636, Revised