TMA Funding Agreement
September 2023 1
FUNDING AGREEMENT
BY AND BETWEEN THE CITY OF PALO ALTO
AND THE PALO ALTO TRANSPORTATION MANAGEMENT ASSOCIATION
FOR TRANSPORTATION DEMAND MANAGEMENT SERVICES
This Agreement to provide funding for transportation demand management services (this "Agreement") is made and entered as of June 15, 2026, by and between the City of Palo Alto, a California chartered municipal corporation (“City”), and the Palo Alto Transportation Management Association, a California nonprofit public benefit corporation (“PATMA”), on the following terms and conditions.
RECITALS
1. Since 2013, the City has been actively engaged in developing Transportation Demand Management (TDM) strategies to encourage alternatives to solo driving to address Palo Alto’s growing traffic and parking concerns.
2. The City engaged a consultant group with significant experience designing Bay Area Transportation Management Associations (TMAs), to assist in forming a TMA, and the result of that effort was the incorporation of the Palo Alto Transportation Management Association (PATMA) on January 1, 2016.
3. The City has an interest in the success of PATMA and made funding available for technical support during the start-up phase of the organization. In the initial years, the City also provided funding for an annual survey of Downtown employee commute patterns.
4. In addition to the support of the City, PATMA has sought and intends to continue seeking funding from public and private foundations, private businesses, public agencies and other financial supporters.
5. PATMA’s mission statement is “better commutes for everyone” and its core values describe how the non-profit improves life for the workers and residents of Palo Alto:
• Traffic and parking – reduce traffic congestion and demand for parking • Climate change – transition to a zero-emission transportation system • Equity – fair outcomes, treatment and opportunities for all • Local businesses – help local businesses attract and retain employees • Health – encourage community health
PATMA also serves as a one-stop transportation information resource and is an active voice in local and regional transportation issues. While the initial primary focus of PATMA was the Downtown population whose travel choices have the highest impacts, PATMA’s programs and services have now expanded to include commercial areas along California Avenue, El Camino Real, the Stanford Mall, Midtown, San Antonio, and along Highway 101. Council may also allocate funds to the TMA for transportation programs that target resident travel behavior.
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6. On June 20, 2016, the City entered into an agreement with PATMA and PATMA’s then-fiscal agent Silicon Valley Community Foundation (SVCF) to provide $100,000 in funding for pilot programs of PATMA aimed at testing the effectiveness of PATMA incentives and programs to reduce commuting to Downtown by SOVs. On February 13, 2017, this initial funding agreement was amended to provide for an additional $200,000 in funding from the City to PATMA over two years, with half paid in FY 2017 and the balance paid in FY 2018.
7. In September 2017, the City, PATMA and SVCF entered into an amended and restated agreement for continued funding and services through Fiscal Year 2020 (ending June 30, 2020), as funds were appropriated by the City Council through the annual budget process. The agreement was several times amended to reflect additional funding appropriated by the City Council in subsequent years of the agreement.
8. Prior to the 2020 pandemic, PATMA pilot programs were successful, providing transit passes to 180 - 240 low-income workers per month and encouraging carpool use by other workers, for an estimated reduction of over 300 vehicles per day, lowering SOV commute trips Downtown to 52% of all trips by any mode of travel. During and after the pandemic, PATMA programs supported essential workers in the Downtown and California Avenue areas. As employees continue to return to work in Palo Alto, PATMA is now serving over 200 workers per month by subsidizing transit use and afterhours Lyft rides and providing a bicycle incentive program, for an estimated reduction of 220 vehicles per day, lowering SOV commute trips to 55% for Downtown and California Ave of all trips by any mode of travel.
9. After focusing on the Downtown in the first years of its existence, from March through October 2019, PATMA implemented a pilot program in the California Avenue Business District with $100,000 in private funding. The successful program quickly surpassed its goal of distributing 50 transit passes per month, demonstrating demand for TMA programs in this area.
10. The City and PATMA wish to extend the reach of PATMA and expand its programs to achieve a greater reduction in SOV commute trips. To this end, the City Council appropriated additional funds for FY 2021 and allowed expenditure of City funds by PATMA in the California Avenue Business District as well as the Downtown. For FY 2024, in addition to the funds appropriated for Downtown and the California Avenue Business District, Council allowed expenditure of a limited amount of City funds to be used citywide to further reduce SOV commute trips.
11. In FY 2027, PATMA will expand its target audience to include low-income residents, senior residents, and residents with disabilities. With $200,000 of parking funds set aside for its current program goals in the commercial parking districts, and $200,000 of General Funds designated for citywide efforts, an additional $100,000 of funding in FY 27 (totaling $500,000), PATMA will offer to these additional groups transit passes (Caltrain GoPasses, and VTA, SamTrans or AC Transit bus passes), bike subsidies (Bike Love rewards and refurbished bikes), Transportation Network Company vouchers for specific purposes, and transportation information for the purpose of reducing the number of single-occupancy vehicles in traffic and seeking parking spaces.
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12. Thr ough t his Agreement the City will continue funding PATMA, and PATMA will continue the programs that it undertook under the prior funding agreements. The Parties agree to enter into this Agreement to provide additional funding to support the development and facilitate the effectiveness of PATMA, through the expansion of pilot programs to reduce SOV trips by workers in Palo Alto, and to establish terms and conditions for the use of these funds.
AGREEMENT
NOW, THEREFORE, for good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the Parties hereby agree as follows:
1. Recitals. The recitals set forth above are true and correct and are hereby incorporated into this Agreement in their entirety.
2. Term and Termination. The term of this Agreement shall be from July 1, 2026 through June 30, 2029.
This Agreement may be terminated by the City or PATMA by providing at least thirty (30) days’ written notice to the other party. Within three (3) months of termination, PATMA shall return to the City any funds paid by the City that remain unexpended as of the date of termination.
3. City Funds. In City Fiscal Year 2027 (FY27), the City shall transfer the sum of Five Hundred Thousand Dollars $500,000 (“City Funds”) to PATMA for use for the purposes described in this Agreement.
For FY27, the City shall transfer the City Funds on a quarterly basis in equal amounts of One Hundred Twenty-Five Thousand Dollars $125,000, upon receipt of an invoice submitted quarterly by PATMA.
City may transfer additional funds for the final two years of the Agreement subject to the appropriation of funds by the City Council through City’s annual budget process. Should additional funds be appropriated, the parties will amend this Agreement prior to any transfer of funds to PATMA. The City Manager is authorized to execute such an amendment for City.
4. Use of City Funds. PATMA shall use the City Funds for “pilot projects” intended to reduce single occupancy vehicle trips by commercial business district area workers and residents, as mutually agreed upon by the City Manager and PATMA. For each FY27, FY 28, FY 29, $200,000 of parking funds will be utilized to reduce single occupancy vehicle trips in the appropriate commercial parking districts, and $300,000 of City Funds may be used to reduce single occupancy vehicle trips anywhere in Palo Alto. Pilot projects may include purchase and distribution of transit passes, active commute rewards, support for carpooling and vanpooling, Green Lyft credits, and other measures to address first mile and last mile connections. If PATMA uses City Funds to purchase transit passes to give away free-of-charge, the free transit passes shall be provided to residents and low-income workers.
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5. Strategic Planning Session, Strategic Plan and Budget. PATMA shall: (a) conduct an annual strategic planning session producing 3-year goals and objectives and funding requirements, and prepare an annual budget with projected metrics (cost per mode shift, ROI, etc.), and (b) annually provide to the City a detailed, updated strategic plan and budget. The strategic plan may utilize scenarios to illustrate the return on investment associated with different funding levels. The strategic plan shall identify the projects proposed to be funded with the City Funds for the City Manager’s review and approval.
6. Reporting Requirement. PATMA shall provide the City with quarterly written reports on the implementation and effectiveness of pilot programs funded by the City, including quantitative measures of SOV trip reduction and mode shift achieved, metrics used, cost per employee mode shift, and how the City Funds were expended. PATMA shall submit the reports at the same time that PATMA submits the quarterly invoice to the City.
7. Survey. PATMA shall conduct a robust survey of commercial area employee commute patterns on an annual basis. Additional areas of Palo Alto where the TMA has been active may be included in the survey. PATMA shall submit the survey results and report to the City by December 15
th of each year or on another date upon mutual agreement of the parties.
8. Public Meeting Requirement. The funding is expressly contingent on PATMA’s agreement to provide 72 hours written advance notice to the public of all Board of Director meetings and to allow members of the public to attend all such Board of Director meetings.
9. Work Product. PATMA shall ensure any written document or other work product developed with funds received through this Agreement is made available to the public to the extent not otherwise prohibited by law.
10. Audits. PATMA will make available all financial records related to the City Funds and the use of the City Funds during the term of this Agreement and for three (3) years thereafter. PATMA further agrees to maintain and retain such records for at least three (3) years after the expiration or earlier termination of this Agreement.
11. Indemnity. To the fullest extent permitted by law, PATMA shall protect, indemnify, defend and hold harmless CITY and each of CITY’s elected and appointed officials, officers, employees and agents (each an “Indemnified Party”) from and against any and all demands, claims, or liability of any nature, including death or injury to any person, property damage or any other loss, including all costs and expenses of whatever nature including attorney’s fees, experts fees, court costs and disbursements (“Claims”) resulting from, arising out of or in any manner related to performance or nonperformance by PATMA, its officers, employees, agents or contractors under this Agreement, regardless of whether or not it is caused in part by an Indemnified Party.
Notwithstanding the above, nothing in this section shall be construed to require PATMA to indemnify an Indemnified Party from Claims arising from the active negligence, sole negligence or willful misconduct of an Indemnified Party.
The provisions of this section shall survive the expiration or early termination of this Agreement.
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12. Insurance. PATMA, at its sole cost and expense, shall obtain and maintain, in full force and effect during the term of this Agreement, the insurance coverage described in Exhibit "A".
PATMA and its contractors, if any, shall obtain a policy endorsement naming CITY as an additional insured under any general liability or automobile policy or policies.
All insurance coverage required hereunder shall be provided through carriers with AM Best’s Key Rating Guide ratings of A-:VII or higher which are licensed or authorized to transact insurance business in the State of California. Any and all contractors of PATMA retained to perform Services under this Agreement will obtain and maintain, in full force and effect during the term of this Agreement, identical insurance coverage, naming CITY as an additional insured under such policies as required above.
13. Other Provisions:
(a) Performance Monitoring. The City may implement its own performance monitoring of City funded programs to determine effectiveness of provided funds. (b) Additional Use Restrictions. The City Funds will not be used for anything other than project management and program costs of the agreed-to projects until the funds are expired. Up to thirty percent (30%) of City Funds provided may be used for administration costs and purposes:
reports, meetings, and finances.
(c) Board Members. The City may request that the PATMA Board be expanded to include additional members, possibly including residents and additional City representation. (d) Fundraising. PATMA shall undertake significant efforts to raise funds from sources other than the City, including but not limited to membership fees, grants and donations, to implement programs to achieve reductions in SOV commute trips by workers in Palo Alto’s commercial areas and among its residents. The Parties expect that, assuming City funding remains constant over the term of the Agreement (which it may not), the amounts raised from other funding sources will represent a proportionately greater share of PATMA’s total funding in the final two years of this Agreement.
14. Notices.
All notices hereunder will be given in writing and mailed, postage prepaid, by certified mail, addressed as follows:
To CITY:
Office of the City Clerk
City of Palo Alto
Post Office Box 10250
Palo Alto, CA 94303
With a copy to the Chief Transportation Official
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Ria Hutabarat Lo
Chief Transportation Official
Office of Transportation
City of Palo Alto
250 Hamilton Ave
Palo Alto, CA 94301
To PATMA:
Justine Burt
Executive Director
Palo Alto Transportation Management Association
855 El Camino Real, #13A-200
Palo Alto, CA 94301
15. Authority to Bind. The individuals executing this Agreement represent and warrant that they have the legal capacity and authority to do so on behalf of their respective legal entities.
16. Counterpart Signatures. This Agreement may be signed in multiple counterparts, which shall, when executed by all the parties, constitute a single binding agreement.
17. Waiver. No delay or omission by either party to exercise any right occurring upon any noncompliance or default by the other party with respect to any of the terms of this Agreement shall impair any such right or power or be construed as a waiver thereof. A waiver by either of the parties of any of the covenants, conditions or agreements to be performed by the other party shall not be construed to be a waiver of any succeeding breach thereof or of any covenant, condition or agreement herein contained.
18. Applicable Law. This Agreement will be governed by the laws of the State of California.
19. Venue. In the event that an action is brought, the parties agree that trial of such action will be vested exclusively in the state courts of California in the County of Santa Clara, State of California.
20. Amendments. This document represents the entire and integrated agreement between the parties and supersedes all prior negotiations, representations, and contracts, either written or oral.
This document may be amended only by a written instrument, which is signed by the parties.
21. Severability. If a court of competent jurisdiction finds or rules that any provision of this Agreement or any amendment thereto is void or unenforceable, the unaffected provisions of this Agreement and any amendments thereto will remain in full force and effect.
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[Signatures appear on the following page]
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IN WITNESS WHEREOF, the Parties have executed this Agreement the day and year first written above.
PALO ALTO TRANSPORTATION MANAGEMENT ASSOCIATION:
________________________________
Rob George
President, Board of Directors
CITY OF PALO ALTO:
________________________________
Ed Shikada
City Manager
APPROVED:
________________________________
Chief Transportation Official
APPROVED AS TO FORM:
________________________________
City Attorney or designee
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TMA Funding Agreement
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EXHIBIT “A”
INSURANCE REQUIREMENTS
CONTRACTORS TO THE CITY OF PALO ALTO (CITY), AT THEIR SOLE EXPENSE, SHALL FOR THE TERM OF THE CONTRACT
OBTAIN AND MAINTAIN INSURANCE IN THE AMOUNTS FOR THE COVERAGE SPECIFIED BELOW, AFFORDED BY COMPANIES WITH AM BEST’S KEY RATING OF A-:VII, OR HIGHER, LICENSED OR AUTHORIZED TO TRANSACT INSURANCE BUSINESS IN THE STATE OF CALIFORNIA.
AWARD IS CONTINGENT ON COMPLIANCE WITH CITY’S INSURANCE REQUIREMENTS, AS SPECIFIED, BELOW:
REQUIRED TYPE OF COVERAGE REQUIREMENT
MINIMUM LIMITS
EACH
OCCURRENCE AGGREGATE
YES
YES
WORKER’S COMPENSATION
EMPLOYER’S LIABILITY
STATUTORY
STATUTORY
YES
GENERAL LIABILITY, INCLUDING
PERSONAL INJURY, BROAD FORM
PROPERTY DAMAGE BLANKET
CONTRACTUAL, AND FIRE LEGAL
LIABILITY
BODILY INJURY
PROPERTY DAMAGE
BODILY INJURY & PROPERTY DAMAGE
COMBINED.
$1,000,000
$1,000,000
$1,000,000
$1,000,000
$1,000,000
$1,000,000
YES AUTOMOBILE LIABILITY, INCLUDING
ALL OWNED, HIRED, NON-OWNED
BODILY INJURY
- EACH PERSON
- EACH OCCURRENCE
PROPERTY DAMAGE
BODILY INJURY AND PROPERTY
DAMAGE, COMBINED
$1,000,000
$1,000,000
$1,000,000
$1,000,000
$1,000,000
$1,000,000
$1,000,000
$1,000,000
$1,000,000
$1,000,000
YES
PROFESSIONAL LIABILITY, INCLUDING,
ERRORS AND OMISSIONS,
MALPRACTICE (WHEN APPLICABLE),
AND NEGLIGENT PERFORMANCE
ALL DAMAGES $1,000,000
YES THE CITY OF PALO ALTO IS TO BE NAMED AS AN ADDITIONAL INSURED: CONTRACTOR, AT ITS SOLE COST AND EXPENSE,
SHALL OBTAIN AND MAINTAIN, IN FULL FORCE AND EFFECT THROUGHOUT THE ENTIRE TERM OF ANY RESULTANT
AGREEMENT, THE INSURANCE COVERAGE HEREIN DESCRIBED, INSURING NOT ONLY CONTRACTOR AND ITS SUBCONSULTANTS, IF ANY, BUT ALSO, WITH THE EXCEPTION OF WORKERS’ COMPENSATION, EMPLOYER’S LIABILITY AND
PROFESSIONAL INSURANCE, NAMING AS ADDITIONAL INSUREDS CITY, ITS COUNCIL MEMBERS, OFFICERS, AGENTS, AND EMPLOYEES.
I. INSURANCE COVERAGE MUST INCLUDE:
A. A PROVISION FOR A WRITTEN THIRTY (30) DAY ADVANCE NOTICE TO CITY OF CHANGE IN COVERAGE OR OF COVERAGE CANCELLATION; AND
B. A CONTRACTUAL LIABILITY ENDORSEMENT PROVIDING INSURANCE COVERAGE FOR CONTRACTOR’S AGREEMENT TO INDEMNIFY CITY.
C. DEDUCTIBLE AMOUNTS IN EXCESS OF $5,000 REQUIRE CITY’S PRIOR APPROVAL.
II. CONTACTOR MUST SUBMIT CERTIFICATES(S) OF INSURANCE EVIDENCING REQUIRED COVERAGE.
III. ENDORSEMENT PROVISIONS, WITH RESPECT TO THE INSURANCE AFFORDED TO “ADDITIONAL INSUREDS”
A. PRIMARY COVERAGE
WITH RESPECT TO CLAIMS ARISING OUT OF THE OPERATIONS OF THE NAMED INSURED, INSURANCE AS
AFFORDED BY THIS POLICY IS PRIMARY AND IS NOT ADDITIONAL TO OR CONTRIBUTING WITH ANY OTHER INSURANCE CARRIED BY OR FOR THE BENEFIT OF THE ADDITIONAL INSUREDS.
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B. CROSS LIABILITY
THE NAMING OF MORE THAN ONE PERSON, FIRM, OR CORPORATION AS INSUREDS UNDER THE POLICY SHALL
NOT, FOR THAT REASON ALONE, EXTINGUISH ANY RIGHTS OF THE INSURED AGAINST ANOTHER, BUT THIS
ENDORSEMENT, AND THE NAMING OF MULTIPLE INSUREDS, SHALL NOT INCREASE THE TOTAL LIABILITY OF THE COMPANY UNDER THIS POLICY.
C. NOTICE OF CANCELLATION
1. IF THE POLICY IS CANCELED BEFORE ITS EXPIRATION DATE FOR ANY REASON
OTHER THAN THE NON-PAYMENT OF PREMIUM, THE ISSUING COMPANY SHALL PROVIDE CITY AT LEAST A THIRTY (30) DAY WRITTEN NOTICE BEFORE THE EFFECTIVE DATE OF CANCELLATION.
2. IF THE POLICY IS CANCELED BEFORE ITS EXPIRATION DATE FOR THE NON-PAYMENT OF PREMIUM, THE ISSUING COMPANY SHALL PROVIDE CITY AT LEAST A TEN (10) DAY WRITTEN NOTICE BEFORE THE EFFECTIVE DATE OF CANCELLATION.
NOTICES SHALL BE MAILED TO:
PURCHASING AND CONTRACT ADMINISTRATION
CITY OF PALO ALTO
P.O. BOX 10250
PALO ALTO, CA 94303
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