Objective Design Standards Checklist
The Objective Design Standards Checklist is a tool to evaluate a project’s compliance with the Zoning Ordinance (Chapter 18.24). The Checklist is not the Zoning Ordinance. Applicants shall be responsible for meeting the standards in the Zoning Ordinance. To simplify evaluation of the Zoning Ordinance, language in the Checklist may vary from the Zoning Ordinance. (Note: sf = square feet) If a standard is not applicable to applicant’s project, please write N/A in Applicant’s Justification column.
18.24.020 Public Realm/Sidewalk Character
Check Standard Sheet # Notes
(b)(1) Sidewalk Widths
(A) In the following districts, public sidewalk width (curb to back of walk) is at least:
Commercial Mixed-Use District: CN, CS, CC, CC(2), CD-C, CD-S, CD-N, PTOD: 10 ft El Camino Real: 12 ft
San Antonio Road, from Middlefield Road to East Charleston Road: 12 ft And consists of:
A101 Maintains existing sidewalk
width; Complies
Pedestrian clear path width of 8 foot minimum: 8 feet; Complies ☒
Landscape or furniture area width of 2 foot minimum: 7 feet L-100 Between 7 feet and 8 feet; Complies
☒
If the existing public sidewalk does not meet the minimum standard, a publicly accessible extension of the sidewalk, with corresponding public access easement, shall be provided.
There is adequate space in the
required setback to widen the
sidewalk; Complies
☒
(B) Public sidewalks or walkways connecting through a development parcel (e.g. on a through lot with a public access easement, leading to a commercial entry) must be at least 6 feet wide.
N/A
(C) The width of walkways designed to provide bicycle access (e.g. pathway to bike racks/lockers) must be at least 12 feet wide, consisting of: A101 Complies Pedestrian clear path width (8 feet min.): 14 feet 10 inches and approximately 8 feet L-100 Complies☒
Clear space/buffer – (2 feet min. on each side of path, ground cover is allowed): 3feet to 4 feet only on one side in some instances L-100 The entry to the bike room south of the main entrance is
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eight feet wide but provides
only 2 feet of landscaping on
one side for a total width of 10
feet, where 12 feet with 2 feet
of landscaping on each side is
required. If the Project had to
comply with this requirement,
it would lose 400 square feet,
qualifying it for a waiver.
Waiver is also needed for bike
room access from Leghorn,
where proposed bike room
access is 5'-0" wide; Waiver
requested
Check Standard Sheet # Applicant’s Justification
(B)(2) Street Trees
1. One street tree provided for every 30 linear feet of public sidewalk length and located within six feet of the sidewalk. L-100 Complies a. Length of parcel frontage/public sidewalk length: 223 feet 9 inches b. Street Trees required (i.e. frontage/30 feet): 8
☒
c. Street Trees provided: 6 in the planter strip and 4 within six feet of the sidewalk.
(B)(3) Accent Paving
Parcels abutting University Avenue between Alma Street and Webster include accent paving along the project frontages, as indicated below: N/A Brick paving at corners ☐
Brick trim mid-block
☐ Parcel abutting California Avenue between El Camino Real and Park Blvd include decorative glass accent paving along project frontages N/A (B)(4) Mobility Infrastructure
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☒
(A) On-site micromobility infrastructure (e.g. bike racks/lockers) is located within 30 feet of the primary building entry and/or on a path leading to the primary building entry; OR
A101 Complies
Pick One☐ Existing micromobility infrastructure (e.g. bike racks/lockers) is already located within 50 feet of project site and located in a public right-of-way. ☒
(B) Primary building entries shall provide at least one seating area or bench within 30 feet of building entry and/or path leading to building entry. On arterials (see Map T-5), except Downtown, seating areas or benches shall not be located between the sidewalk and the curb; OR
A101 Complies
Pick One
☐ Existing seating areas or benches that are already located in the public right-of-way within 50 feet of the building entry.
18.24.030 Site Access
Check Standard Sheet # Applicant’s Justification
(b)(1) Through Lot Connections
☐
Through lots located more than 300 feet from an intersecting street or pedestrian walkway shall provide a publicly accessible sidewalk or pedestrian walkway (with public access easements) connecting the two streets.
N/A
(b)(2) Building Entries
☒
Primary Building Entries shall be located from a public right-of-way. If there is no public right-of-way adjacent to the building, entries shall be located from a private street or Pedestrian Walkway.
A101 Complies
(b)(3) Vehicle Access
☒ (A) Vehicle access shall be located on alleys or side streets when they abut the property. A101 Complies
☒
(B) Except for driveway access and short-term loading spaces (e.g. taxi), off-street parking, off-street vehicle loading (delivery trucks), and vehicular circulation areas are prohibited between the building and primary building frontage.
A101 Complies
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(b)(4) Loading Docks and Service Areas
Loading and service areas shall be integrated into building and landscape design and located to minimize impact on the pedestrian experience as follows:
☒ (A) Loading docks and service areas shall be located on façades that do not face a primary building frontage A101 Complies
☒
(B) Loading docks and service areas located within setback areas shall be screened by a solid fence, or wall, or dense landscaping and separated from pedestrian access to the primary building entry to avoid impeding pedestrian movement/safety.
A300 Complies
18.24.040 Building Orientation and Setbacks
Check Standard Sheet # Applicant’s Justification
(b)(1) Building Corner Elements (less than 40 feet in height) Corner buildings less than 40 feet in height and end units of townhouses or other attached housing products that face the street shall include all of the following features on their secondary building frontage:
(A) height and width of corner element shall have a ratio greater than 1.2:1. For townhomes, the width would be equal to the smaller side of one unit? N/A a. Secondary building frontage height: _____ feet
b. Secondary building frontage length: _____ feet
☐
c. Secondary building frontage height to width ratio: ___ (B) minimum of 15% fenestration area.
a. Total secondary building frontage façade area: ___ sf b. Secondary building frontage façade fenestration area: ___ sf ☐
c. Percent of fenestration area _____ %
Check All
☐ (C) At least one facade modulation with a minimum depth of 18 inches and a minimum width of two feet.
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(b)(2)(A) & (B) Treatment of Buildings Corners on Corner Lots (40+ feet in height) Corner Buildings 40 feet or taller in height shall include at least one of the following special features:
A. Street wall is located at the minimum front yard setback or build-to line for a minimum aggregated length of 40 feet on both facades meeting at the corner and includes one or more of the following building features: N/A
☐ i. An entry to ground floor retail or primary building entrance located within 25 feet of the corner of the building.
☐ ii. A different material application and/or fenestration pattern from the rest of the façade.
Check One or More within
A or B
☐ iii. A change in height of at least 4 feet greater or less than the height of the adjacent/abutting primary façade.
B. An open space with a minimum dimension of 20 feet and minimum area of 450 sf. The open space shall be at least one of the following
☐ i. A publicly accessible open space/plaza.
☐ ii. A space used for outdoor seating for public dining.
Check One or
More within A or B
☐
iii. A residential Common Open Space adjacent to a common interior space (i.e. lobby, retail, etc.) and less than two feet above adjacent sidewalk grade.
Fences and railing shall be a minimum 50% open/transparent. (b)(3) Primary Building Entry
The primary building entry meets at least one of the following standards:
☒ A. Faces a public right-of-way. A101 Complies
☒ B. Faces a publicly accessible pedestrian walkway. A101 Complies C. Is visible from a public right-of-way through a forecourt or front porch that meets the following standards:
i. For residential buildings with fewer than seven units, building entry forecourts or front porch minimum dimensions of (min. 36 sf and min. dimension of 6 feet required): ___ sf and ___ ft. min. dimension Check One or More
☐
ii. For commercial buildings or residential buildings with seven or more units, building entry forecourts or front porch minimum Item 7
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dimensions of (min. 100 sf and a min. width of 8 feet required): ___ sf and ___ ft. min. width
(b)(4) Ground Floor Residential Units
A. Finished Floor Height for Ground Floor Units
☐
The finished floor of ground floor residential units, when adjacent to a public right-of- way, must be within the minimum and maximum heights according to setback distance from back of walk identified in Figure 2a and 2b of the Zoning Ordinance. Calculate minimum ground floor finished floor height: N/A, no ground floor units. ☐ Setback adjacent to public right of way: 24 feet
☐
Minimum ground floor finished floor height: _____ feet
𝒚 = ―
𝟒 𝟏𝟓 (𝒙) + 𝟏𝟔
𝟑 where 𝑥 = setback length from back of walk, in feet
and 𝑦 = ground floor finished floor height, in feet
☐ Sites with slopes greater than 2% along building façade – Average height of finished floor: _____ feet
Check All that Apply
☐ Sites located in flood zones – the minimum ground floor finished floor height shall be defined by FEMA, less flood zone elevation: _____ feet B. Setback Trees
Ground floor units with a setback greater than 15 feet must have at minimum an average of one tree per 40 linear feet of facade length, within the setback area. N/A Facade length: ______ feet
Trees required: ____ tree(s) (i.e. façade length / 40)
☐
Trees provided: ____ tree(s)
C and D. Front Setback
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☐ C. Ground floor residential entries are setback a minimum of 10 feet from the back of public sidewalk; OR N/A
Pick One☐
D. Where no minimum building setback is required, all ground floor residential units must be set back a minimum 5 feet from back of public sidewalk.
Check Standard Sheet # Applicant’s Justification
E. Unit Entry
A minimum 80% of ground floor residential units that face a public right-of-way or publicly accessible path, or open space shall have a unit entry with direct access to the sidewalk, path, or open space for minimum.
N/A
a. Total number of ground floor residential units facing a public right-of-way, publicly accessible path, or open space: ____ units
b. 80% of total units in (a): ____ units
☐
c. Subset of number of units in (a) that have a unit entry with direct access to the sidewalk, path, or open space: ____ entries
(b)(5) Front Yard Setback Character
Required setbacks provide a hardscape and/or landscaped area to create a transition between public and private space. The following standards apply, based on intended use and exclusive of areas devoted to outdoor seating, front porches, door swing of building entries, and publicly accessible open space and meet the following:
Che
ck
All
tha
t
Ap
ply☐ (A). Ground-floor retail or retail like uses have a minimum of 10% of the required setback as landscape or planters. N/A
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i. Minimum setback area (setback x frontage x 10%): ____ sf ii. Landscape or planter area in required setback: ____ sf (B). Ground-floor residential uses have a minimum of 60% landscaped area in the required setback area. L-002 Complies
i. Minimum setback area (setback x frontage x 60%): 3,222 sf☒ ii. Landscape area in required setback: 3,621 sf
(b)(6) Side Yard Setback Character
☐
(A) Each detached dwelling unit shall have at least one usable side yard, at least six feet wide, between the house and fence or other structure, to provide outdoor passage between the front and rear yards.
N/A
18.24.050 Building Massing
Check Standard Sheet # Notes
(b)(1) Upper Floor Step Backs and Daylight Planes
(A) When the height of the subject building is more than 20 feet above the average height (i.e. average of low and high roof elevations) of an adjacent building(s), an upper floor step back shall start within two vertical feet of the average height of the adjacent building. The step back shall be a minimum depth of six feet along both the façade on the primary building frontage and the façade facing the adjacent building, and the step shall occur for a minimum of 70% of each façade length.
A310
On the Leghorn side, the
required upper floor step back
extends 45% of the frontage
where 70% is required; Waiver
requested
i. Proposed building height: 84 feet and 5 inches, 90 feet to parapet ii. Average building height of the adjacent building(s): single-story ☒
iii. Building height where upper floor step back begins: 52 ft 6 in ☒ (B) Notwithstanding, subsection (A), when adjacent to a single-story building, the upper floor step back shall occur between 33 and 37 feet in height.
The north elevation provides a
44.8% step-back; the South
elevation provides a 35.5%
step-back. If the Project had to
comply with this requirement, it
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would lose 6,200 square feet;
Waiver requested
☒
(C) If a project meets the following criteria, a daylight plane with an initial height of 25 feet above grade at the property line and a 45-degree angle shall be required. This daylight plane is required if all of these criteria are met:
i. The project is not subject to a daylight plane requirement, pursuant to district regulations in Title 18; and
ii. The project proposes a building which is more than 20 feet above the average height (i.e., average of low and high roof elevations) of an adjacent building(s); and
iii. The project abuts residential units in the side or rear yard.
N/A, no residential units abut
this project.
(b)(2) Privacy and Transitions to Residential Uses
When a building abuts a residential use on an interior side and/or rear property line, the building shall break down the abutting façade and maintain privacy by meeting all of the following: N/A ☐
(A) Landscape Screening. A landscape screen that includes a row of trees with a minimum one tree per 25 linear feet and continuous shrubbery planting. This screening plant material shall be a minimum 72 inches (6 feet) in height when planted. Required trees shall be minimum 24” box size.
☐ (B) Façade Breaks. A minimum façade break of 4 feet in width, 2 feet in depth, and 32 sf of area (i.e. 8 ft tall minimum) for every 36 to 40 feet of façade length ☐
(C) Maximum Amount of Transparent Windows. Within 40 feet of an abutting structure, no more than 15% of the facing façade area shall be windows or other glazing. Additional windows are allowed in order to maintain light, if fixed and fully obscured
Check All (D) Windows. Within 30 feet of facing residential windows (except garage or common space windows) or private open space on an adjacent residential building, facing windows on the subject site shall meet the following:
(i) Window sills at and above the 2nd floor shall be at least five feet above finished floor; or
(ii) Windows shall have opaque or translucent glazing at or below five feet above finished floor; or
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(iii) Windows shall be angled up to 30 degrees (parallel to window) to face away from the adjacent privacy impacts; and
(iv) Landscape screening shall be 24-inch box size or larger and eight+ feet height at planting; 50% evergreens; and located to align with proposed second floor windows at maturity.
(E). Balconies: Within 30 feet of residential windows (except garage or common space windows) or private open space on an adjacent residential building, balconies and decks on the subject site shall be designed to prevent views:
(i) No sight lines to the adjacent property window or open space are permitted within five feet above the balcony or deck flooring and a 45- degree angle downward from balcony railing.
(ii) Submit section view of proposed balcony/deck and abutting residential windows and/or private open space.
(iii) Provide balcony/deck design measure which may include:
a. Minimum 85% solid railing
b. Obscure glass railing
c. Barrier with min. 18" horizontal depth from railing (e.g. planter) (b)(3)(A) & (B) Maximum Façade Length - facing a street or public path Buildings 70 feet in length or greater and greater than 25 feet in height For building facades 70 feet in length or greater and facing a public street, right- of-way, or publicly accessible path shall not have a continuous façade plane greater than 70% of the façade length without an upper floor modulation, of at least 2 feet in depth
Largest façade length featuring continuous plane:
Total Façade length: 202 feet 2 inches
☒
Percent of façade length without upper floor modulation (a/b) (maximum 70%): 55.2 % Complies
Buildings 250 feet in length or greater
Pick One Category
☐
(A) Buildings 250 feet in length or greater, which face a public street, right-of- way, or publicly accessible path, shall have at least one vertical façade break with a minimum area greater than 400 sf and a width greater than or equal to two times the depth
N/A
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Total Building length: _____ feet
Number of vertical façade breaks: ___ area
Width: ____ feet, Depth: ____ feet, Area: ____ sf
Buildings between 150 feet and 250 feet in length
(B) Buildings 150 to 250 feet in length, which face a public street, right-of-way, or publicly accessible path, shall have at least one vertical façade break with a minimum area greater than 64 sf and a minimum width of 8 feet and minimum depth of 4 feet.
A310 Complies
Total Building length: 202 feet 2 inches
☒
Number of vertical façade breaks: 1 area
Width: 12 feet 6 inches, Depth: 8 feet 8 inches, Area: 108 sf Check Standard Sheet # Applicant’s Justification
(b)(4) Special Conditions: Railroad Frontages
All parcels with lot lines abutting railroad rights-of-way shall meet the following standards on the railroad-abutting façade(s): N/A
☐ (A) A minimum facade break of at least 10 feet in width and six feet in depth for every 60 feet of façade length.
Check
All
☐ (B) For portions of a building 20 feet or greater in height shall not have a continuous façade length that exceeds 60 feet.
(b)(5) Diversity of Housing Types
☐
A diversity of housing types (e.g. detached units, attached rowhouses/townhouses, condominiums or apartments, mixed use) are required for projects on large lots:
Less than one acre lots: minimum 1 housing types
1 to 2-acre lots: minimum 2 housing types; or
G100 The 2-acre site provides only
one housing type.
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More than 2-acre lots: minimum 3 housing types
18.24.060 Façade Design
Check
Two or
More
Standard Sheet # Applicant’s Justification
(c)(1) Base-Middle-Top
☒
Buildings three stories or taller and on lots wider than 50 feet shall be designed to differentiate a defined base or ground floor, a middle or body, and a top, cornice, or parapet cap. Each of these elements shall be distinguished from one another for a minimum of 80% of the façade length through use of three or more of the following four techniques:
☐
i. Variation in Building Modulation: Building modulation shall extend for a minimum 80% of the façade length feet, and shall include one or more of the following building features.
☐ a. Horizontal shifts. Changes in floor plates that protrude and/or recess with a minimum dimension of 2 feet from the primary facade.
☐
b. Upper floor step backs. A horizontal step back of upper-floor façades with a minimum 5 foot step-back from the primary façade for a minimum of 80% of the length of the façade
Check one or more if
selected
☐
c. Ground floor step back. A horizontal shift of the ground floor facade with a minimum depth of 2 feet for a minimum 80% of the length of the façade.
Ground floor step backs shall not exceed the maximum setback, where stated ☒ ii. Variation in Façade Articulation: Façade articulation modulation shall include one or more of the following building features. A310 Complies
Check
one or
more if
selected
☒
a. Horizontal and/or Vertical Recesses or Projections. Recesses or projections such as a pattern of recessed grouping of windows, recessed panels, bay windows or similar strategies. The recess or projection shall be a minimum 4 inches in depth.
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☐ b. Horizontal and/or Vertical Projections. Projections such as shading, weather protection devices, decorative architectural details, or similar strategies.
☐
c. Datum Lines. Datum lines that continue the length of the building, such as parapets or cornices, with a minimum 4 inches in height or a minimum 2 inches in depth and include a change in material
☒ iii. Variation in two of the following: A310 Complies ☒ a. Fenestration Size
☒ b. Fenestration Proportion
☒ c. Fenestration Pattern
Check two if
selected
☒ d. Fenestration Depth or Projection
☒ iv. Variation in two of the following: A310 Complies
☒ a. Façade Material
☐ b. Facade Material Size
☒ c. Façade Texture and Pattern
Check two if
selected
☒ d. Façade Color
(c)(2) Façade Composition
Building facades shall use a variety of strategies including building modulation, fenestration, and façade articulation to create visual interest and express a variety of scales through a variety of strategies. All facades shall include a minimum of three of the following façade articulation strategies to create visual interest:
☒ A. Vertical and horizontal recesses such as a pattern of recessed grouping of windows or recessed panels. The recess shall be a minimum 4 inches in depth. A310 Complies ☐ B. Vertical and horizontal projections such as shading and weather protection devices or decorative architectural details. Projections shall be a minimum 4 inches in depth. ☐
C. Datum lines that continue the length of the building, such as cornices, with a minimum 4 inches in depth, or a minimum 2 inches in depth and include a change in material.
Check Three or More☒ D. Balconies, habitable projections, or Juliet balconies (every 20 to 40 feet) with a minimum 4 inches in depth. A310 Complies
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☐ E. Screening devices such as lattices, louvers, shading devices, or perforated metal screens.
☐ F. Use of fine-grained building materials, such as brick or wood shingles, not to exceed 8 inches in either height or width.
☒ G. Incorporate a minimum of three colors, materials, and/or textures across the whole building. A320 Complies
(c)(3) Compatible Rhythm and Pattern
(A) Buildings shall express a vertical rhythm and pattern that reflects the size and scale of a housing unit and/or individual rooms and spaces.
This may be achieved with building modulation to create vertically oriented façades (height greater than the width of the façade), façade articulation and fenestration repetitive vertically oriented patterns. Depending on the length of the façade, the following standards apply:
☐
i. For continuous façades less than 100 feet in length, the façade shall have vertically oriented patterns of vertical recesses or projections, façade articulation, and/or fenestration.
ii. For continuous façades 100 feet or greater in length, the façade shall include either:
☒
a. A vertical recess or change in façade plane with a minimum 2 feet deep vertical shift modulation for a minimum 4 feet in width to establish a vertical rhythm between 20 to 50 feet in width; OR
A310 Complies
Check One☐ b. A vertical recess or projection with a minimum depth of 2 feet that establishes the vertical rhythm between 10 to 16 feet in width
(B) Residential mixed-use buildings
☒ i. Vertical Patterns and Modulation: Façades shall use vertical patterns of building modulation, façade articulation, and fenestration. A310 Complies Check One or
More☐
ii. Horizontal Patterns and Modulation: Façades that use horizontal articulation and fenestration patterns shall use a vertical massing strategy with a minimum 4 feet wide and 2 feet deep vertical shift in modulation at least once every 50 feet of façade length.
(C) Storefronts
☒ Storefront uses must express a vertical rhythm not to exceed 30 to 50 feet in width. A310 Complies (c)(4) Emphasize Building Elements & Massing
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(A)(i) Building Entries within Façade Design. Primary building entries shall be scaled proportionally to the number of people served (amount of floor-area or number of units accessed). Building entries shall meet the following minimum dimensions:
☐ a. Individual residential entries: 5 feet in width
☒ b. Shared residential entry, such as mixed-use buildings: 8 feet in width A101 Complies ☐ c. Commercial building entry: 20 feet in width
Check All
☐ d. Storefront entry: 6 feet in width
(ii) Primary building entries (not inclusive of individual residential entries) shall include a façade modulation that includes at least one of the following:
☒ a. Recess or projection from the primary façade plane (minimum 2 feet). A101 Complies Check
One or
More☐ b. Weather protection that is a minimum 4 feet wide and 4 feet deep by recessing the entry, providing an awning or using a combination of these methods (c)(5) Storefront/Retail Ground Floors
A. Ground floor height shall be a minimum 14 feet floor-to-floor OR shall maintain a 2nd floor datum line of an abutting building. N/A, non-retail ground floor a. Ground floor height (minimum 14 feet): _____ feet; OR☐ b. Height of 2nd floor datum line of abutting building: 22 feet B. Transparency shall include a minimum 60% transparent glazing between 2 and 10 feet in height from sidewalk, providing unobstructed views into the commercial space. N/A a. Façade area between 2 feet and 10 feet:
b. Transparent glazing area between 2 feet and 10 feet:
☐
c. Percentage of transparent glazing (minimum 60%):
☐ C. If provided, bulkheads and solid base walls measure between 12 and 30 inches from finished grade N/A
D. Primary entries shall include weather protection by recessing the entry, providing an awning or using a combination of these methods. N/A
a. Weather protection width (minimum 6 feet): ☐
b. Weather protection depth (minimum 4 feet):
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☐ E. Awnings, canopies and weather protection: (i) When transom windows are above display windows, awnings, canopies and similar, weather protection elements shall be installed between transom and display windows. These elements should allow for light to enter the storefront through the transom windows and allow the weather protection feature to shade the display window. (ii) Awnings may be fixed or retractable N/A
(c)(6) Other Non-Residential Ground Floors
☒ (A) Ground floor height must be a minimum 14 feet floor-to-floor OR match the 2nd floor datum line of an abutting building
☐ Ground floor height (minimum 14 feet): _____ feet; OR Pick
One☒ Height of 2nd floor datum line of abutting building: 19 feet 1 inch A300 Complies (B) Minimum of 50% transparent glazing between 4 and 10 feet in height from sidewalk or terrace grade, providing unobstructed views into the commercial space A310 On the Leghorn Street
frontage, the Project does not
provide 14 foot floor-to-floor
and 50% transparency. If the
Project had to provide 50%
transparency storefront space
on the ground level with 14
feet double-height, the design
would reduce the building
area by approximately 480 SF
(assuming a 20' deep active
space); Waiver requested
Façade area between 2 feet and 10 feet:
Transparent glazing area:
☒
Percentage of transparent glazing (minimum 50%): 60% Complies (C) Primary entries include weather protection that is a minimum 6 feet wide and 4 feet deep by recessing the entry, providing an awning or using a combination of these methods.
Weather protection width (minimum 6 feet): 10 feet 9 inches and 10 feet☐ Weather protection depth (minimum 4 feet): 5 feet Complies (c)(7) Parking/Loading/Utilities
(A) Entry Size
Item 7
Attachment D - Objective Design
Standards Consistency Analysis
Item 7: Staff Report
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ATTACHMENT D: City of Palo Alto - Objective Design Standards Consistency Analysis
No more than 25% of the site frontage facing a street shall be devoted to garage openings, carports, surface parking, loading entries, or utilities access. On sites with less than 100 feet of frontage, no more than 25 feet.
A101
On the Leghorn Street
frontage, 83% of the frontage
is dedicated to garage
openings, loading entries, and
utility access; Waiver
requested
Site frontage:
Frontage devoted to garage openings, carports, surface parking, loading entries, or utilities access:
☐
Percent of frontage devoted to garage openings, carports, surface parking, loading entries, or utilities access 83%
(B) Above Ground Structured Parking
☐
Above grade structured parking levels facing a public right-of-way or publicly accessible open space/path, with the exception of vehicular alleys, must be lined with commercial or habitable uses with a minimum depth of 20 feet A101
On the Leghorn Street
frontage, the above grade
parking is not lined with
commercial or habitable uses
with a minimum depth of 20
feet; Waiver requested
(C)&(D) Partially Sub-Grade Structured Parking
☐ Partially sub-grade parking must not have an exposed façade that exceeds 5 feet in height above abutting grade at back of sidewalk. N/A
☐ Partially sub-grade parking must be screened with continuous landscaping and shrubbery with minimum height of 3 feet and be located within 10 feet of the sub-grade parking. N/A
18.24.080 Open Space
Check Standard Sheet # Applicant’s Justification
(b)(1) Private Open Space
☒
(A) Floor area includes clear space with a minimum dimension of a circle with a six- foot diameter. A103 Complies
Item 7
Attachment D - Objective Design
Standards Consistency Analysis
Item 7: Staff Report
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ATTACHMENT D: City of Palo Alto - Objective Design Standards Consistency Analysis
☒ (B) Minimum clear height dimension of 8’-6” feet. A300 Complies ☒ (C) Directly accessible from a residential unit. A103 Complies ☐ (C) Balconies are not located within the daylight plane. N/A, no daylight plane applies (b)(1)(E) Private Open Space - Ground Floor Patios
☐
(i) RM-20 and RM-30 districts: Minimum 100 sf of area, the least dimension of which is 8 feet for at least 75% of the area. N/A
☐
(ii) RM-40 districts: Minimum 80 sf of area, the least dimension of which is 6 feet for at least 75% of the area N/A
☐
(iii) Street facing private open space on the ground floor shall meet the finished floor height for ground floor residential standards in section 18.24.040(b)(4) N/A (b)(2) Common Open Space
☒ (A)&(B) Minimum 200 sf of area. Area shall include a space with a minimum dimension of a circle with a 10-foot diameter.
A201
L-002 Complies
☒ (C) A minimum of 60% of the area shall be open to the sky and free of permanent weather protection or encroachments. Trellises and similar open-air features allowed A201
L-002 Complies
☐
(D) Notwithstanding subsection (1), courtyards enclosed on four sides shall have a minimum dimension of 40 feet and have a minimum courtyard width to building height ratio of 1:1.25
N/A
☒ (E) Common open space provides seating. A201
L-002 Complies
☐ (F) Common open space has a minimum 20% of landscaping. A201 L002
The fourth-floor common open
space is 15% landscaped, and
the eighth-floor common open
space contains no planting,
where a minimum of 20% is
required. If the Project had to
comply with this requirement,
it would lose over 1,810 square
Item 7
Attachment D - Objective Design
Standards Consistency Analysis
Item 7: Staff Report
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ATTACHMENT D: City of Palo Alto - Objective Design Standards Consistency Analysis
feet of residential
floor area; Waiver
requested
☒
(G) Planting in above grade courtyards has
minimum soil depth of 12 inches for ground
cover, 20 inches for shrubs, and 36 inches for
trees.
L002 Complies
18.24.090 Materials
Check Standard Sheet # Applicant’s Justification
☒
(b)(1) Primary, secondary, and accent materials are allowed or prohibited as in the Residential and Residential Mixed-use Material List, which may be updated from time to time by the Director of Planning with a recommendation by the ARB. See webpage for list - https://www.cityofpaloalto.org/News-Articles/Planning-and-Development- Services/Multifamily-Mixed-Use-Objective-Standards
A320 Complies
18.24.100 Sustainability and Green Building Code
Check Standard Sheet # Applicant’s Justification
☒
(b) See Chapter 16.14: California Green Building Standards additional requirements for green building and sustainable design. Notwithstanding Section 18.24.010(c), these regulations may not be modified through alternative compliance.
GB-1 Complies
Item 7
Attachment D - Objective Design
Standards Consistency Analysis
Item 7: Staff Report
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560 Mission Street, Suite 1900 | San Francisco, California 94105 | T +1.415.743.6900 | F +1.415.743.6910 Holland & Knight LLP | www.hklaw.com
Genna Yarkin
+1 415-743-6990
[email protected]
Tamsen Plume
+1 415 743-6941
[email protected]
Algiers | Atlanta | Austin | Birmingham | Bogotá | Boston | Century City | Charlotte | Chattanooga Chicago | Dallas | Denver | Fort Lauderdale | Houston | Jacksonville | London | Los Angeles | Mexico City Miami | Monterrey | Nashville | Newport Beach | New York | Orlando | Philadelphia | Portland | Richmond San Francisco | Seattle | Stamford | Tallahassee | Tampa | Tysons | Washington, D.C. | West Palm Beach May 26, 2026
Palo Alto Planning & Devp.
285 Hamilton Avenue, Suite 100
Palo Alto, CA 94301
Re: Third Supplemental Letter Regarding State Density Bonus Law Application - 762 San Antonio Road
Dear Palo:
As described in our prior correspondence, this firm represents Acclaim Companies (the “Applicant”) and Globe Investments LLC (the “Property Owner”) on whose behalf we provide this letter associated with Application No. 24PLN-00120 at 762 San Antonio Road (the “Project”), in Palo Alto, California (the “City”). On May 15, 2026 the Applicant uploaded supplemental materials to the City’s portal, which included an updated Affordable Housing Compliance Plan containing new and modified State Density Bonus Law requests. We hereby provide the same requests in this letter as well, as follows:
State Density Bonus Law Requests
We hereby make the following State Density Bonus Law requests in connection with the Project, notwithstanding the fact that the Builder’s Remedy element of the Project allows such inconsistencies, in the alternative/additional to the Builder’s Remedy. We continue to reserve the right to modify these requests or make additional requests, if warranted. 1 Waivers
• Waiver from 18.24.020(b)(1)(C): Pedestrian walkways that are designed to provide access to bicycles shall have a minimum width of eight feet, with two feet of clear space on either side. The entry to the bike room south of the main entrance is eight feet wide but provides only 2 feet of landscaping on one side for a total width of 10 feet, where 12 feet with 2 feet of landscaping on each side is required. If the Project had to comply with this requirement, 1 For example, we have not yet identified any incentives/concessions, but reserve the right to do so. As a Builder’s Remedy 2.0 development, the Project is eligible for three incentives/concessions. (Govt. Code Sections 65589.5(f)(6)(C)(i), 65915(d)(2)(A)).
ATTACHMENT E
Item 7
Attachment E - Applicant’s
Project Description and
Legal Request Letter
Item 7: Staff Report
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Palo Alto Planning & Devp.
May 26, 2026
#539134338_v1
it would lose 400 square feet, qualifying it for a waiver. Waiver is also needed for bike room access from Leghorn, where p roposed bike room access is 5'- 0" wide. To meet the 12' wide path, the Project would need to relocate trash staging area inside the building and result in a building area reduction of approximately 450 SF, qualifying the Project for a waiver.
• Waiver from 18.14.020 Table 3 with regard to upper story step backs: The requirement is a step back minimum on 10’ on El Camino Real (the major street frontage). The project provides a 6’ step-back. If the Project had to comply with this requirement, it would lose 1,680 square feet on each of the top three floors and the marketability and usability of the rooms would suffer, likely resulting in a loss of several units, qualifying the Project for a waiver.
• Waiver from 18.24.050(b)(1)(B): On the side and rear elevations, the step back shall occur for a minimum of 70% of each façade length and shall occur between 33 and 37 feet in height when adjacent to one-story buildings. By contrast for the Project, the North elevation provides a 44.8% step-back; the South elevation provides a 35.5% step-back. If the Project had to comply with this requirement, it would lose 6,200 square feet, qualifying it for a waiver.
• Waiver from 18.24.050(b)(1) (A) and (B): On the Leghorn side, the required upper floor step back extends 45% of the frontage where 70% is required. (Note: for both of these, the plans dimension all the way across the building façade, however we understand the City proposed to count only the portion adjacent to each individual frontage, so that the portions of the building “behind” the 780 San Antonio parcel do not count). If the Project had to comply with this requirement, it would lose 1,800 square feet, qualifying it for a waiver.
• Waiver from 18.24.050(b)(3)(B): The Project previously requested a waiver of this standard, the redesigned Project is currently in compliance. The Applicant reserves the right to reassert this waiver if needed in the future.
• Waiver from Zoning Code Section 18.14.020 Table 3, Note b: On the Leghorn Street frontage, 83% of the frontage is dedicated to garage openings, loading entries, and utility access, where no more than 50% is allowed. If the Project had to comply with this requirement, it would lose approximately 1,800 square feet, qualifying it for a waiver.
• Waiver from 18.24.060(c)(6)(A) and (B): On the Leghorn Street frontage, the Project does not provide 14 foot floor-to-floor and 50% transparency. If the Project had to provide 50% transparency storefront space on the ground level with 14 feet double -height, the design would reduce the building area by approximately 480 SF (assuming a 2 0' deep active space).
Item 7
Attachment E - Applicant’s
Project Description and
Legal Request Letter
Item 7: Staff Report
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Palo Alto Planning & Devp.
May 26, 2026
#539134338_v1
• Waiver from 18.24.060(c)(7)(B): On the Leghorn Street frontage, the above grade parking is not lined with commercial or habitable uses with a minimum depth of 20 feet. If the Project had to comply with this requirement, it would lose 1,800 square feet, qualifying it for a waiver.
• Waiver from 18.24.080(b)(2)(F): The fourth-floor common open space is 15% landscaped, and the eighth-floor common open space contains no planting, where a minimum of 20% is required. If the Project had to comply with this requirement, it would lose over 1,810 square feet of residential floor area, qualifying it for a waiver. Notably if the vegetated stormwater areas were included in the calculation, the Project would be in excess of th e standard.
• Waiver from Special Setback for Leghorn Street: On the Leghorn Street frontage, the third through seventh floors encroach into the required 25-foot setback, and the project is instead set back 20 feet. These floors must encroach into the setback in order to satisfy the aerial fire access requirements that the building not be farther than 30 feet from the fire apparatus.
If the Project had to comply with this requirement, it would lose 875 square feet of residential floor area, qualifying it for a waiver.
While the Project is not subject to Zoning Code parking requirements due to the applicability of the Builder’s Remedy, we further note that the Project is additionally entitled to the parking maximums under the State Density Bonus Law, with which the Project complies
Sincerely,
HOLLAND & KNIGHT LLP
Genna Yarkin
Tamsen Plume
Item 7
Attachment E - Applicant’s
Project Description and
Legal Request Letter
Item 7: Staff Report
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Project Plans
In order to reduce paper consumption, a limited number of hard copy project plans are provided to City Council members 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: paloalto.gov/PermitView
2. Search for “762 San Antonio Road” and open the record by clicking on the blue dot
3. Review the record details on the left side and open the “more details” option
4. Use the “Records Info” drop down menu and select “Attachments”
5. You will find links to the project plans, environmental documents, and other important information.
Direct Link to Project Webpage:
https://www.cityofpaloalto.org/Departments/Planning-Development-Services/Current- Planning/Projects/762-San-Antonio
Item 7
Attachment F - Project Plans
and EIR Addendum
Item 7: Staff Report
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CITY COUNCIL
Staff Report
From: City Manager
Report Type: INFORMATION REPORTS
Lead Department: Planning and Development Services
Meeting Date: August 17, 2026
Report #: 2607-6521
TITLE
2100 Geng Road [24PLN-00356 & 24PLN-00357]: Determination of Impact Fees Following Fee Protest
RECOMMENDATION
This report is informational and does not require action by the City Council.
BACKGROUND
On March 16, 2026, City Council approved a Site and Design application, Conditional Use Permit, and Vesting Tentative Map for development of 145 for-sale townhome units located at 2100 Geng Road. The effective date of the approval was April 16, 2026, corresponding with the effective date of the related Park Improvement Ordinance No. 5696 for project improvements located on City park land.
A March 16, 2026, supplemental report informed the City Council that the applicant had identified a potential issue with the calculation of Parkland Dedication in-lieu fees and intended to file a fee protest pursuant to the City's fee protest procedures while staff evaluated whether recent legal developments warranted a revision to the fee calculation.
On May 13, 2026, the applicant submitted a timely fee protest pursuant to Palo Alto Municipal Code (PAMC) Sections 16.64.060 and 16.64.070 regarding the impact fees applicable to the proposed residential development, which includes 36 detached units and 109 attached units.
The fee protest requested that the impact fee calculation recognize the site’s existing baseline condition, including demolition of the existing 191,900 square feet of office gross floor area, so that the project’s park-related fee obligation reflects the net new impact generated by the proposed development (Attachment A).
ANALYSIS
Pursuant to PAMC Sections 16.64.060 and 16.64.070, an applicant may protest the imposition of an impact fee by submitting a written notice identifying the factual and legal basis for the Item A
Item A Staff Report
Item A: Staff Report
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protest. Following review of the protest, supporting evidence, and any additional information, the Director of Planning and Development Services issues a written determination establishing whether the fee should remain unchanged or be increased or decreased.
After reviewing the information provided and in consultation with the City Attorney's Office, the City accepted the fee protest and agreed that the impact fee calculation should account for the demolition of the existing 191,900 square feet of office gross floor area by applying a credit towards the Parkland Dedication fee. In addition, staff updated the fee calculations to apply the appropriate residential fees, with the single-family residential rate applied to the 36 detached units and the multi-family residential rate applied to the 109 attached units. These residential fee adjustments affected the General Government, Library, Public Safety, and Community Center impact fee categories.
The following table details the revised determination of fees applicable to the project:
FEE CATEGORY PREVIOUS FEE APPLICABLE FEE CREDIT NET FEES DUE General Government $ - $213,408.55 ($249,661.90) $ -
Library $152,061.00 $363,374.41 ($175,396.60) $187,977.81 Public Safety $ - $169,481.68 ($211,665.70) $ -
Community Center $255,759.00 $609,836.84 ($294,182.70) $315,654.14 Parkland Dedication /
Parks Impact $7,898,408.10 $9,037,636.52 ($3,781,663.92) $5,255,972.60 Public Art In-Lieu* $585,000.00 $ 585,000.00 $585,000.00 TOTAL $ 6,344,604.55
*Based on estimated construction valuation of $58.5 million, per application submitted 2/12/2026, and not included in previous total fee calculation.
Consistent with Government Code Section 65589.5, subd. (o)(2)(A), the General Government, Library, Public Safety, and Community Center impact fees and corresponding fee credits are based on the FY 2025 fee schedule in effect on July 8, 2024, the date the project's SB 330 preliminary application was submitted. The Park Dedication impact fees and associated credits are based on the FY 2026 fee schedule because those fees are adjusted annually for inflation and are not subject to SB 330 fee freeze provisions. The resulting impact fee calculations reflect application of the appropriate residential fee rates and applicable fee credits, including the proportional credit associated with demolition of the existing office building applied to the park fees. This approach carries that proportional credit through to the park fee actually being charged, so the final parks obligation more closely reflects the Project’s net new parks impact rather than treating the site as if it were being developed from a vacant baseline. This determination resolves the fee protest submitted by the applicant, incorporates staff's Item A
Item A Staff Report
Item A: Staff Report
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adjustments to apply the appropriate residential impact fee rates, and establishes the impact fees due for the project based on the information currently available to the City.
FISCAL/RESOURCE IMPACT
All associated staff costs associated with processing this application are recovered through applicant-paid fees established in the Fiscal Year 2026 Adopted Municipal Fee Schedule. The previous assumed total impact fee amount for the proposed development was $8,306,259.
With the applied credits and adjustments for the appropriate residential impact fee rates the revised total impact fee is $6,344,604.55. Staff applied the appropriate residential fee rates, including the single-family residential rate for the 36 detached units and the multi-family residential rate for the 109 attached units, and applied the applicable credits to the affected the General Government, Library, Public Safety, and Community Center impact fee categories.
STAKEHOLDER ENGAGEMENT
The proposed project went to multiple hearing bodies including the Architectural Review Board, Planning and Transportation Commission, and City Council.
ENVIRONMENTAL REVIEW
This informational report is not a project under the California Environmental Quality Act (CEQA) and does not require environmental review.
ATTACHMENTS
Attachment A: Applicant Fee Protest Letter
APPROVED BY:
Jonathan Lait, Planning and Development Services Director Item A
Item A Staff Report
Item A: Staff Report
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Ashley Weinstein-Carnes D (415) 293-6470 [email protected]
May 13, 2026 VIA E-MAIL Jonathan Lait Director of Planning and Development City of Palo Alto 250 Hamilton Avenue Palo Alto, CA 94301 [email protected]
Re: 2100-2400 Geng Road - Impact Fee Credit Dear Director Lait: We represent Strada Investment Group in connection with the approved residential project at 2100-2400 Geng Road (“Project”). We appreciate the City's continued work with the applicant team to finalize the Project's impact fee calculation. Consistent with Palo Alto Municipal Code Sections 16.64.060 and 16.64.070, this letter is submitted to document our understanding of the approach to calculating fee credits as discussed with the City Attorney's Office, and to request an updated determination from the Planning Department of the impact fees due for the Project. Project and Applicable Fee Framework The Project will replace the existing office improvements at the site with 145 new residential units, including 36 detached units and 109 attached units. The Project submitted its SB 330 preliminary application on July 8, 2024, and the requested fee determination reflects the applicable vested FY2025 fee schedule as of that date, except that, at the City Attorney’s Office’s request, the park fee credit has been calculated using the FY2026 commercial parks impact fee rate. The impact fee calculations should recognize the site's existing baseline condition, including the 191,900 square feet of existing office gross floor area to be demolished, so that the Project's park-related fee obligation reflects its actual net new impact after accounting for demolition of the existing office buildings. In practical terms, the existing office use already generated park-related demand, and the Project will remove that demand when the office buildings are demolished; that reduction should be taken into account when evaluating the new park demand attributable to the redevelopment of the site.
Item A
Attachment A - Applicant
Fee Protest Letter
Item A: Staff Report
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Jonathan Lait May 13, 2026 Page 2
This approach is consistent with the City's treatment of the Project's other impact fee categories, where Planning’s fee calculations already appropriately recognize credit for removal of the existing office space, which aligns with the broader legal framework that impact fees should be based on the Project’s net new impacts. We also want to highlight that the Project will add meaningful residential open space where none exists today and will be immediately adjacent to Baylands Athletic Center. While we acknowledge that the Project's on-site open space will be private common open space for the new residents and will not substitute for City parkland, we offer those details as further context for why it is appropriate to view the site holistically when finalizing the Project's park-related fee obligation. Requested Updated Determination Based on the approach discussed with the City Attorney's Office, Strada understands that the Project's fee calculation will include a credit of $3,781,663.92 against the Parkland Dedication fee. That credit reflects the City's published commercial parks impact fee rate of $19,706.43 per net new 1,000 square feet as applied to the 191,900 square feet of existing office space to be demolished. With that credit reflected, the Project's total net fees due are $6,404,414.03. This total is calculated by applying the FY 2025 fee schedule in effect when the Project's SB 330 preliminary application was submitted, assigning the single-family rate to the Project's 36 detached units and the multifamily rate to the remaining 109 attached units, consistent with City direction, and applying credits for the demolished office space. Process and Next Steps We respectfully request that the Director issue an updated written determination under Palo Alto Municipal Code Section 16.64.070 confirming the impact fees due for the Project consistent with the calculation above. At this time, and assuming the City is in agreement with the above calculations, we are not requesting an informal hearing. However, we are available for an informal hearing if the City determines that one is required or appropriate under Palo Alto Municipal Code Section 16.64.070. * * * Item A
Attachment A - Applicant
Fee Protest Letter
Item A: Staff Report
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Jonathan Lait May 13, 2026 Page 3
We appreciate the City’s collaborative work on the Project and this issue specifically. We believe this approach achieves the right result for both the Project and the City by recognizing the site’s existing baseline, ensuring the fee obligation is appropriately tied to the Project’s actual net new impacts, and allowing much-needed housing to move forward quickly and feasibly. Sincerely, Ashley Weinstein-Carnes Coblentz Patch Duffy & Bass LLP cc: Albert Yang, Assistant City Attorney Steven Switzer, City of Palo Alto Item A
Attachment A - Applicant
Fee Protest Letter
Item A: Staff Report
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City Council
Staff Report
From: City Manager
Report Type: INFORMATION REPORTS
Lead Department: City Clerk
Meeting Date: August 17, 2026
Report #:2607-6588
TITLE
Boards, Commissions, and Committees 2026 Mid-Year Attendance Report; CEQA Status - Not a Project
RECOMMENDATION
This is an informational report, and no action is recommended.
BACKGROUND
The Boards, Commissions, and Committees (BCC) Handbook specifies that a compilation of attendance will be submitted to the City Clerk and presented to City Council at least annually listing absences for all members. The Handbook emphasizes the significance of consistent attendance and outlines the policies surrounding absences. Regular attendance by all members is essential to ensure collaborative and efficient public participation. Members are expected to make every effort to attend all scheduled meetings. Should a member be absent from more than one-third of the BCC meetings within a calendar year, their absences will be reported to the City Council, which could result in a removal.
ANALYSIS
Staff has collaborated with the assigned administrative support to compile a report detailing the attendance and absences of the members and commissioners. The report reflects the numbers of absences, remote attendance, and total of meetings attended from January through June 2026, as well as percentage of missed meetings. Commissioners who joined mid- year or finished their terms during the reported period are indicated with an “X.” The purpose of this Mid-Year Attendance Report is to maintain transparency and determine if BCC members are on track with adhering to attendance requirements. Staff acknowledge that three BCC members between the Historic Resources Board and the Human Relations Commission have exceeded the attendance requirements, however, do not expect this to be indicative of future attendance nor elevated to a level of concern.
ATTACHMENTS
Attachment A: 2026 Mid-Year Attendance Report of Boards, Commissions, and Committees Item B
Item B Staff Report
Item B: Staff Report
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APPROVED BY:
Mahealani Ah Yun, City Clerk
Item B
Item B Staff Report
Item B: Staff Report
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Architectural Review Board Mousam Adcock Yingxi Chen David Hirsch Marton Jojarth Kendra Rosenberg 1/1/2026 Meeting Canceled Meeting Canceled Meeting Canceled Meeting Canceled Meeting Canceled 1/15/2026 Absent In Person Absent In Person In Person
2/5/2026 Meeting Canceled Meeting Canceled Meeting Canceled Meeting Canceled Meeting Canceled 2/19/2026 Meeting Canceled Meeting Canceled Meeting Canceled Meeting Canceled Meeting Canceled 3/5/2026 In Person In Person In Person In Person In Person 3/19/2026 In Person In Person In Person In Person In Person 4/2/2026 Meeting Canceled Meeting Canceled Meeting Canceled Meeting Canceled Meeting Canceled 4/16/2026 In Person In Person In Person In Person Absent 5/7/2026 In Person In Person In Person Absent In Person 5/21/2026 In Person In Person In Person In Person In Person 6/4/2026 In Person Absent In Person In Person In Person 6/18/2026 Meeting Canceled Meeting Canceled Meeting Canceled Meeting Canceled Meeting Canceled Meetings Attended In-Person 6 6 6 6 6
Meetings Attended Remote (Just
Cause) 0 0 0 0 0
Meetings Attended Remote
(Standard Brown Act) 0 0 0 0 0
Total Meetings Attended 6 6 6 6 6
Total Meeting Absent 1 1 1 1 1
Percentage of Meetings Absent 14.29% 14.29% 14.29% 14.29% 14.29% Historic Resources Board Alisa Eagleston-
Cieslewicz Christian Pease Samantha Rohman Geddes Ulinskas Caroline Willis 1/8/2026 In Person In Person In Person In Person In Person 2/12/2026 In Person In Person Absent In Person In Person 3/12/2026 In Person In Person Absent In Person In Person 4/9/2026 In Person X In Person In Person In Person
5/14/2026 Meeting Canceled X Meeting Canceled Meeting Canceled Meeting Canceled 6/11/2026 In Person X In Person In Person In Person
Meetings Attended In-Person 5 3 3 5 5
Meetings Attended Remote (Just
Cause) 0 0 0 0 0
Meetings Attended Remote
(Standard Brown Act) 0 0 0 0 0
Total Meetings Attended 5 3 3 5 5
Total Meeting Absent 0 0 2 0 0
Percentage of Meetings Absent 0.00% 0.00% 40.00% 0.00% 0.00% 2026 Mid-Year Attendance Report of Boards, Commissions, and Committees Item B
Attachment A - 2026 Mid-Year Attendance Report of Boards, Commissions, and Committees
Item B: Staff Report
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Human Relations Commission Salwa Ansari Donald Barr Katie Causey Amy Hsieh Sridhar Karnam Michelle Kraus Raizel Rosenberg Mary Kate Stimmler 1/8/2026 In Person In Person In Person In Person In Person In Person X Absent 2/12/2026 In Person In Person Absent In Person In Person In Person X Absent 3/12/2026 Meeting Canceled Meeting Canceled Meeting Canceled Meeting Canceled Meeting Canceled Meeting Canceled X Meeting Canceled 3/17/2026 In Person In Person In Person In Person Absent In Person X In Person 4/9/2026 In Person In Person In Person X Absent In Person In Person Absent 5/14/2026 In Person In Person In Person X In Person In Person In Person In Person 6/11/2026 Remote (Just Cause) In Person In Person X In Person In Person In Person In Person Meetings Attended In-Person 5 6 5 3 4 6 3 3
Meetings Attended Remote (Just
Cause) 1 0 0 0 0 0 0 0
Meetings Attended Remote
(Standard Brown Act) 0 0 0 0 0 0 0 0
Total Meetings Attended 6 6 5 3 4 6 3 3
Total Meeting Absent 0 0 1 0 2 0 0 3
Percentage of Meetings Absent 0.00% 0.00% 16.67% 0.00% 33.33% 0.00% 0.00% 50.00% Parks & Recreation Commission Nellis Freeman Bing Wei Amanda Brown Vadim Axelrod Yudy Deng Roger Smith Shani Kleinhaus 1/27/2026 In Person In Person In Person In Person In Person In Person In Person 2/13/2026 In Person In Person In Person In Person In Person In Person In Person 2/24/2026 In Person In Person In Person In Person In Person In Person In Person 3/24/2026 In Person In Person Absent In Person In Person In Person In Person 4/28/2026 In Person In Person In Person In Person In Person In Person In Person 5/26/2026 In Person In Person In Person In Person In Person In Person In Person 6/23/2026 In Person Absent Absent In Person In Person In Person In Person Meetings Attended In-Person 7 6 5 7 7 7 7
Meetings Attended Remote (Just
Cause) 0 0 0 0 0 0 0
Meetings Attended Remote
(Standard Brown Act) 0 0 0 0 0 0 0
Total Meetings Attended 7 6 5 7 7 7 7
Total Meeting Absent 0 1 2 0 0 0 0
Percentage of Meetings Absent 0.00% 14.29% 28.57% 0.00% 0.00% 0.00% 0.00% Item B
Attachment A - 2026 Mid-Year Attendance Report of Boards, Commissions, and Committees
Item B: Staff Report
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Public Art Commission Hsinya Shen Harriet Stern Robin Mullery Anjana Joshi Tara de la Garza Amber Smith Simon Tran 1/15/2026 In Person In Person In Person Absent In Person In Person In Person 2/10/2026 Retreat In Person In Person In Person In Person In Person In Person In Person 2/12/2026 In Person In Person In Person In Person In Person In Person In Person 3/19/2026 In Person In Person In Person In Person In Person In Person In Person 4/16/2026 In Person Absent In Person In Person In Person In Person In Person 5/21/2026 Meeting Canceled Meeting Canceled Meeting Canceled Meeting Canceled Meeting Canceled Meeting Canceled Meeting Canceled 6/18/2026 In Person In Person In Person In Person In Person In Person In Person Meetings Attended In-Person 6 5 6 5 6 6 6
Meetings Attended Remote (Just
Cause) 0 0 0 0 0 0 0
Meetings Attended Remote
(Standard Brown Act) 0 0 0 0 0 0 0
Total Meetings Attended 6 5 6 5 6 6 6
Total Meeting Absent 0 1 0 1 0 0 0
Percentage of Meetings Absent 0.00% 16.67% 0.00% 16.67% 0.00% 0.00% 0.00% Planning & Transportation
Commission Allen Akin Bryna Chang Bart Hechtman Todd James Kevin Ji Forest Peterson Cari Templeton 1/14/2026 In Person In Person In Person In Person In Person In Person In Person 1/28/2026 Meeting Canceled Meeting Canceled Meeting Canceled Meeting Canceled Meeting Canceled Meeting Canceled Meeting Canceled 2/11/2026 In Person In Person In Person Absent In Person In Person In Person 2/25/2026 In Person Absent In Person In Person In Person In Person In Person 3/11/2026 In Person In Person In Person Absent Absent In Person In Person 3/25/2026 In Person In Person In Person In Person In Person In Person In Person 4/8/2026 In Person
Remote (Standard
Brown Act) In Person Absent In Person Remote (Just Cause) Absent 4/29/2026 In Person In Person In Person In Person In Person In Person In Person 5/13/2026 In Person In Person Absent In Person In Person In Person In Person 5/27/2026 In Person In Person Absent In Person In Person In Person In Person 6/10/2026 In Person In Person Absent In Person In Person In Person In Person 6/24/2026 Meeting Canceled Meeting Canceled Meeting Canceled Meeting Canceled Meeting Canceled Meeting Canceled Meeting Canceled Meetings Attended In-Person 10 8 7 7 9 9 9
Meetings Attended Remote (Just
Cause) 0 0 0 0 0 1 0
Meetings Attended Remote
(Standard Brown Act) 0 1 0 0 0 0 0
Total Meetings Attended 10 9 7 7 9 10 9
Total Meeting Absent 0 1 3 3 1 0 1
Percentage of Meetings Absent 0.00% 10.00% 30.00% 30.00% 10.00% 0.00% 10.00% Item B
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Stormwater Management
Oversight Committee Hal Mickelson Catherine Perman Ambika Pajjuri Kevin Mayer Gregory Bennett Ron Owes (Vacant Position) 4/13/2026 In Person In Person In Person In Person Remote (Just Cause) In Person Meetings Attended In-Person 1 1 1 1 0 1
Meetings Attended Remote (Just
Cause) 0 0 0 0 1 0
Meetings Attended Remote
(Standard Brown Act) 0 0 0 0 0 0
Total Meetings Attended 1 1 1 1 1 1
Total Meeting Absent 0 0 0 0 0 0
Percentage of Meetings Absent 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% Utilities Advisory Commission Rachel Croft Utsav Gupta Meagan Mauter Phil Metz Robert Phillips Greg Scharff Chris Tucher 1/7/2026 In Person In Person In Person In Person In Person In Person In Person 2/4/2026 In Person In Person In Person In Person In Person In Person In Person 3/4/2026 In Person In Person In Person In Person In Person In Person In Person 3/31/2026 In Person In Person In Person In Person In Person In Person In Person 5/6/2026 In Person In Person In Person In Person In Person Remote (Just Cause) In Person 6/3/2026 In Person Absent In Person In Person Remote (Just Cause) Absent In Person Meetings Attended In-Person 6 5 6 6 5 4 6
Meetings Attended Remote (Just
Cause) 0 0 0 0 1 1 0
Meetings Attended Remote
(Standard Brown Act) 0 0 0 0 0 0 0
Total Meetings Attended 6 5 6 6 6 5 6
Total Meeting Absent 0 1 0 0 0 1 0
Percentage of Meetings Absent 0.00% 16.67% 0.00% 0.00% 0.00% 16.67% 0.00% Item B
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City Council
Staff Report
From: City Manager
Report Type: INFORMATION REPORTS
Lead Department: Administrative Services
Meeting Date: August 17, 2026
Report #:2512-5702
TITLE
Investment Activity Report for the Fourth Quarter (April – June), Fiscal Year 2026.
CEQA Status – Not a Project.
RECOMMENDATION
This is an informational report and no City Council action is required.
EXECUTIVE SUMMARY
This report is presented in accordance with California Government Code Section 53646 and the City’s Investment Policy.
As of June 30, 2026, the consolidated portfolio totaled $671.2 million (market value), including $528.5 million in investments and $142.6 million in liquid accounts. The investment portfolio was in full compliance with the City’s Investment Policy, and staff projects adequate liquidity to meet expenditure requirements for the next six months.
Attachments and links in this report provide detailed cash and investment information, including portfolio holdings, performance metrics, and related financial summaries.
BACKGROUND
The City’s Investment Policy is reviewed and approved annually by Council and establishes the framework for managing public funds in accordance with the Prudent Investor Standard under state law. The policy outlines authorized investment types, maturity and credit quality limits, diversification requirements, and reporting standards to ensure the objectives of safety, liquidity, and return.
The policy also requires the Administrative Services Department to provide the City Council with monthly and quarterly investment reports, consistent with California Government Code 53646. Monthly reports provide details on investment activity during the period, such as purchases, calls, redemptions, and maturities. This quarterly report summarizes the City’s Item C
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investment holdings, portfolio performance, and compliance with the City’s Investment Policy and California Government Code.
Beginning in FY 2026, the City transitioned from managing its investment portfolio in-house to partnering with Chandler Asset Management (Chandler) for professional investment management services, including cash flow forecasting, investment advisory and strategy, policy review, and active portfolio management.
An overview of all City cash and investment holdings, including trust and debt-related funds, is included in Attachment A. The Investment Quarterly Report is included in Attachment B. A complete list of all current and historical holdings, as well as the City’s Investment Policy, is available on the City’s website: www.paloalto.gov/investmentreporting.
ANALYSIS
As of June 30, 2026, the City’s consolidated portfolio totaled $671.2 million (market value), including $528.5 million in investments and $142.6 million in liquid accounts. The investment portfolio had an average duration of 2.54 years and an average credit quality of AA+. The duration is slightly above Chandler’s recommended positioning of 2.46 years within a one-to- five-year maturity range.
Graph 1 below illustrates the City’s portfolio by security type, reflecting how funds are allocated across permitted investment categories
Table 1 summarizes the portfolio’s maturity structure, which supports the City’s liquidity objectives and duration strategy.
U.S. Treasury
11.7%
U.S. Agency Bonds
16.4%
U.S. Municipal/ State
Bonds
28.5%Certificates of Deposits
(CD)
U.S. Corporate Bonds
9.0%
Supranational
Organizations Bonds
5.9%
Money Market Fund
0.3%
Asset-Backed
Securities (ABS/MBS)
4.5%
Liquid Accounts
21.2%
Investment by Type - $671.2 Million (Market Value)
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Investment Performance and Activity
For the quarter ended June 30, 2026, the City’s portfolio average market yield was 4.32% compared to 4.16% for the ICE BofA 1-5 Year U.S. Treasury & Agency Index benchmark. The portfolio's total return for the quarter was 0.41%, exceeding the benchmark return of 0.24%.
During the quarter, approximately $43.5 million in securities were purchased, $3.5 million were called or redeemed, and $34.0 million matured.
Table 2 summarizes key portfolio characteristics including maturity, duration, yield, and credit quality. As of June 30th, the yield for LAIF and the two-year US Treasury were 3.82% and 4.15%, respectively. While these are not direct performance benchmarks, they provide useful context for evaluating the portfolio’s positioning relative to short-term liquidity returns and broader market conditions.
Table 2: Portfolio Characteristics
Benchmark*
Portfolio as of
June 30
Portfolio as of
March 31
Average Maturity (yrs) 2.64 2.95 2.99
Average Modified Duration 2.46 2.54 2.63
Average Purchase Yield 3.17% 3.04%
Average Market Yield 4.16% 4.32% 4.06%
Average Credit Quality** AA+ AA+ AA+
*Benchmark: ICE BofA 1-5 Unsubordinated US Treasury & Agency Index **The credit quality is a weighted average calculation of the highest S&P, Moody’s and Finch Compliance and Credit Standards
The City’s Investment Policy defines general portfolio limits and controls, including a maximum stated maturity of 10 years, no more than 30% of the market value of the total portfolio in maturities beyond five years, and maintaining a market value above 95% of book value. All FY 2026 Q4 Maturities - Market Value (millions)
Up to 1
Year
1 to 2
Years
2 to 3
Years
3 to 5
Years
Over
5 Years
Portfolio
Total *
% of
Portfolio
Par
Value
U.S. Treasury 24.0 $ - $ 30.0 $ 14.9 $ 9.7 $ 78.7 $ 11.7% 79.0 $ U.S. Agency Bonds 15.9 14.2 4.5 8.2 67.4 110.3 16.4% 119.9 U.S. Municipal/ State Bonds 47.4 45.9 30.6 21.6 45.5 191.0 28.5% 196.8 Certificates of Deposits (CD) 5.5 0.5 5.2 1.4 3.4 15.9 2.4% 16.2 U.S. Corporate Bonds 9.1 - 8.4 4.2 38.5 60.2 9.0% 60.7
Supranational Organizations Bonds 5.9 - 6.0 8.6 19.1 39.7 5.9% 39.4 Money Market Fund 2.3 - - - - 2.3 0.3% 2.3
Asset-Backed Securities (ABS/MBS) - - - 14.3 16.2 30.4 4.5% 30.5 Liquid Accounts 142.6 - - - - 142.6 21.2% 142.6
(US Bank, Wells Fargo, Fidelity, LAIF)
Grand Total 252.7 $ 60.6 $ 84.7 $ 73.3 $ 199.8 $ 671.2 $ 100% 687.4 $ % of Portfolio 37.6% 9.0% 12.6% 10.9% 29.8% 100.0%
Investment Type
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marketable securities are held by a third-party custodian, and valuations are independently verified.
Specific limits also apply to each authorized investment type, covering maximum allocations, issuer exposure, credit quality, and maturity restrictions. The Investment Quarterly Report provides detailed compliance information and the portfolio’s current status relative to these limits. Downgrades below minimum credit rating thresholds are reported to the City Council in accordance with the policy. No securities experienced such downgrades during the quarter.
At quarter end, the investment portfolio’s market value was 98.3% of book value, exceeding the 95% minimum threshold, and remained in full compliance with all policy limits.
Economic Outlook
Inflation remained above the Federal Reserve’s target during the quarter, although underlying inflation showed signs of stabilizing. Higher energy prices associated with Middle East tensions contributed to elevated headline inflation earlier in the quarter. However, oil prices declined by quarter-end as concerns over supply disruptions eased.
The Federal Reserve maintained the federal funds target range at 3.50% to 3.75% while signaling a more cautious approach as inflation remained above its target. U.S. Treasury yields reflected this outlook, with short-term yields increasing modestly while longer-term yields remained relatively stable, resulting in a flatter yield curve and continued uncertainty regarding the path of future interest rates.
Cash Flow Outlook
Cash flow needs fluctuate over the course of the fiscal year as a result of cyclical revenue patterns, with larger inflows from major revenue sources such as property tax receipts occurring in the second half of the year. One-time activities, such as the annual prepayment of pension obligations and large capital expenditures, also influence these patterns. The City’s investment strategy aligns with these cycles by timing maturities and maintaining sufficient liquidity to meet ongoing needs as they occur.
The portfolio is expected to meet all expenditure needs for the next six months.
Funds Held by Fiscal Agents and Trustees
The City holds bond proceeds, reserves, and debt service funds with fiscal agents, which are invested in accordance with the respective bond indentures. The City also maintains a Section 115 Pension Trust with Public Agency Retirement Services (PARS) and Retiree Medical Funds (Other Post-Employment Benefits Trust or OPEB), governed by the City’s Retiree Benefit Funding Policy.
These funds are outside of the scope of the Chandler investment portfolio but are included in Attachment A of this report to provide a comprehensive view of City funds.
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FISCAL/RESOURCE IMPACT
This report is for informational purposes only and has no direct fiscal impact.
STAKEHOLDER ENGAGEMENT
Staff collaborated with internal teams and external financial partners to gather the information included in this report.
ENVIRONMENTAL REVIEW
This informational report is not a project under the California Environmental Quality Act (CEQA) as defined in CEQA Guidelines Section 15378, as it is presented for informational purposes only and requires no Council action.
ATTACHMENTS
Attachment A: Consolidated Report of Cash Management
Attachment B: Investment Quarterly Report (as of June 30, 2026) APPROVED BY:
Lauren Lai, Administrative Services Director
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Book Value Market Value
City Investment Portfolio 540,468,988$ 528,545,305 $ Other Liquid Accounts
Cash with Wells Fargo Bank 2,836,723 2,836,723 Cash with US Bank & Receivables 57,564,793 57,564,793 Fidelity Money Market Funds 39,210,090 39,210,090 Local Agency Investment Fund (LAIF) 42,998,482 42,998,482 Total - Other Liquid Accounts 142,610,088 142,610,088 CONSOLIDATED PORTFOLIO TOTAL (Attachment B) 683,079,076 671,155,393 Other Debt Service Funds*
Debt Service Proceeds
US Bank Trust Services **
2009 Water Revenue Bonds (Build America Bonds)
Debt Service and Reserve Funds 2,125,189 2,125,189 2011 Utility Revenue Refunding Bonds
Debt Service and Reserve Funds 593,117 593,117 2018 Capital Improvement (Golf Course & 2002B COP Refinance) (Taxable- Green Bond) Certificates of Participation
Debt Service Funds 940 940 2019 California Avenue Parking Garage Certificates of Participation (Tax-Exempt and Taxable Bonds)
Debt Service and Reserve Funds 4,167 4,167 2021 Public Safety Building Certificates of Participation Debt Service Funds 6,881 6,881 2022A & B General Obligation (Library) Bond
Cost of Issuance Funds 4,344 4,344 California Asset Management Program (CAMP) ***
2012 University Ave. Parking Refunding Bonds
Reserve Fund 3,244,271 3,244,271
Public Agencies Post-Employment Benefits Trust ****
Public Agency Retirement Services (PARS) 131,022,499 131,022,499 Total Other Funds 137,001,408 137,001,408 GRAND TOTAL 820,080,484 $ 808,156,801 $
* These funds are subject to the requirements of the underlying debt indenture. ** U.S. Bank investments are in money market mutual funds that exclusively invest in U.S. Treasury securities. *** CAMP investments are in money market mutual fund which invest in bankers acceptance, certificate of deposit, commercial paper, federal agency securities, and repurchase agreements. **** PARS investments are in moderately conservative index plus funds Attachment A
Fourth Quarter, Fiscal Year 2025-26
(Unaudited)
Consolidated Report of Cash Management
City of Palo Alto Cash and Investments
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Consolidated Report of Cash
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INVESTMENT REPORT
City of Palo Alto| As of June 30, 2026
CHANDLER ASSET MANAGEMENT | chandlerasset.com
Chandler Team:
For questions about your account, please call (800) 317-4747, or contact [email protected]
Information contained herein is confidential. We urge you to compare this statement to the one you receive from your qualified custodian. Please see Important Disclosures at the end of the statement.
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TABLE OF CONTENTS
ECONOMIC UPD ATE
ACCOUNT PROFILE
CONSOLIDATED INFORMATION
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ECONOMIC UPDATE
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Energy prices and inflation remained the primary drivers of the macro backdrop as the U.S.-Israel-Iran conflict entered its third month, disrupting global oil supply. Headline CPI accelerated at the fastest pace in more than three years, reflecting volat ility in the energy component. Crude oil, however, retraced roughly 20% from its May–early June peak as diplomatic progress between the United States and Iran pointed to a potential framework for de-escalation. The labor market remained resilient, with continued payroll growth and s ubdued jobless claims. Risk assets held firm, as equities hovered near record highs and credit spreads remained historically tight amid broadly better-than-expected corporate earnings. Taken together, the current market environment has further constrained the case for near-term monetary policy easing, leading the Chandler team to push out its expected timing for rate cuts beyond the six-month investment horizon.
The Federal Reserve’s June FOMC meeting ended with policymakers unanimously holding the target range at 3.50%–3.75%, a notable shift from the 8–4 split at April’s meeting, which marked Jerome Powell’s final session as Chair. Under new Chair Kevin Warsh, sworn in on May 22, the Committee released an unusually concise statement that referenced Middle East tensions and energy supply disruptions while removing prior forward guidance that had suggested a bias toward rate cuts. Updated projections leaned more hawkish, with 9 of 18 officials expecting at least one rate hike this year and 6 anticipating multiple increases. The shift signals that restoring price stability has reemerged as the central focus of monetary policy deliberations.
The Treasury yield curve flattened modestly in June as short-term yields responded to a more hawkish shift in Federal Reserve guidance.
The 2-year yield rose to 4.15% from 3.98% the prior month, while the 10-year yield edged down slightly to 4.44% from 4.45%. As a result, the 2s/10s spread narrowed to 29 basis points, down from roughly 47 basis points a month earlier and significantly below the 69 basis point spread at the start of the year. Meanwhile, the 3-month/10-year spread remained positive at 64 basis points. Front-end rates absorbed the bulk of the Fed’s updated rate outlook, while longer maturities were partly anchored by a late-month decline in oil prices.
ECONOMIC UPDATE
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-400
-200
0 200
400
600
800
1,000 MOM Change In Thousands (000's)
Nonfarm Payroll (000's)
Non-farm Payroll (000's)
3-month average (000's)
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
12.0%
Unemployment Rate
Underemployment Rate (U6)
Unemployment Rate (U3)
Rate (%)
Nonfarm payrolls increased by just 57,000 in June, well below the 113,000 consensus and marking a sharp slowdown from May’s pace. The unemployment rate edged down to 4.2%, though the decline was driven by a drop in labor force participation to 61.5%, its lowest level since March 2021. Revisions further weakened the report’s signal. April payrolls were revised down by 31,000 to 148,000, while May was lowered by 43,000 to 129,000, resulting in a combined two-month downward revision of 74,000.
Source: US Department of Labor Source: US Department of Labor
EMPLOYMENT
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0 2,000
4,000
6,000
8,000
10,000
12,000
14,000
Job Openings
Recession
Historical Average
In Thousands (000's)
Job openings were essentially unchanged at 7.6 million in May, remaining elevated by historical standards even as hiring momentum moderates. Gains in wholesale trade and accommodation and food services were offset by declines in health care and social assistance, as well as finance and insurance. April openings were revised down by 33,000 to 7.6 million, while hires were revised up by 99,000, highlighting ongoing churn but a broadly stable labor market backdrop.
Source: US Department of Labor
JOB OPENINGS & LABOR TURNOVER SURVEY
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Source: Bloomberg Indices Source: Bloomberg Indices
ENERGY MARKETS
Crude oil prices declined sharply in June as supply disruptions tied to the Middle East conflict began to ease. Tanker traffic through the Strait of Hormuz normalized, and signs of progress in U.S.–Iran negotiations helped unwind the geopolitical risk premium that had driven prices higher earlier in the year. West Texas Intermediate settled near $69.37 per barrel on June 30, while Brent crude closed around $72.96, both well below their recent peaks. Brent’s 21% monthly decline marked its steepest drop since March 2020, while WTI fell more than 20%, its largest monthly loss since late 2021. Beyond crude, broader energy markets also softened. Refined product cracks narrowed as gasoline and diesel demand showed signs of seasonal moderation, while U.S. natural gas prices remained range-bound amid ample storage and steady production. Taken together, the retracement in oil and broader energy prices reflects a rapid compression in geopolitical risk premia and improved near-term supply visibility, even as underlying structural risks in the region remain unresolved.
2.00 2.50
3.00 3.50
4.00 4.50
5.00 5.50
6.00 6.50
US Fuel Prices
Average Retail Price US Diesel
Average Retail Price US Gas
($) Per Gallon
40 60
80 100
120
140
160
Oil Prices
West Texas Intermediate (WTI Spot Cushing)
Dated Brent (Global Spot)
Price Per Barrel (WTI Spot)
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0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
8.0%
Personal Consumption Expenditures (PCE)
PCE Price Deflator YOY %
Change
PCE Core Deflator YOY %
Change
Fed Target
YOY (%) Change
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
8.0%
9.0%
10.0%
Consumer Price Index (CPI)
CPI YOY % Change
Core CPI YOY % Change
YOY (%) Change
Inflation firmed in May, with the Personal Consumption Expenditures (PCE) price index rising 0.4% on the month and 4.1% year over year, up from 3.8% in April and marking the highest annual rate of the current cycle. Core PCE, which excludes food and energy, increased 0.3% in May and 3.4% over the year. Energy prices remained the primary driver of the headline acceleration, reflecting supply disruptions tied to the Iranian conflict. A similar pattern was evident in the headline Consumer Price Index (CPI), which rose 0.5% on the month and 4.2% year over year, the fastest annual pace since 2023. Energy prices climbed 3.9% in May and 23.5% from a year earlier, largely due to crude oil reaching a four-year high. In contrast, core CPI rose a more modest 0.2% on the month and 2.9% year over year, indicating that inflation pressures remain concentrated in energy rather than broad-based.
Source: US Department of Labor Source: US Department of Commerce
INFLATION
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0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
Retail Sales YOY % Change
YOY (%) Change
Retail sales rose a robust 0.9% in May to $763.7 billion, nearly double the pace economists had penciled in and an acceleration from April's downwardly revised 0.4% gain. The closely watched control group, which feeds directly into gross domestic product calculations, advanced
0.7%, pointing to durable underlying demand. Gasoline station receipts rose as energy prices stayed high, while auto sales rebounded after an April pullback. The Conference Board's Consumer Confidence Index ticked up 0.6 points to 91.2 in June, though the improvement masked a further deterioration in how households view the job market, with the share calling jobs ‘hard-to-get’ climbing to a five year high.
Spending has proven more resilient than sentiment across recent months. 0 20
40 60
80 100
120
140
160
Index Level
Consumer Confidence
Recession
Source: US Department of Commerce Source: The Conference Board All time high is 144.70 (1/31/00); All time low is 25.30 (2/28/09)
CONSUMER
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-25.0%
-20.0%
-15.0%
-10.0%
-5.0%
0.0%
5.0%
10.0%
15.0%
Leading Economic Indicators (LEI)
Recession
YOY (%) Change
-1.00
-0.75
-0.50
-0.25
0.00 0.25
0.50 0.75
1.00 Chicago Fed National Activity Index (CFNAI)
Recession
3 Month Average
The Conference Board’s Leading Economic Index (LEI) edged up 0.1% in May to 99.3, following a revised 0.2% increase in April. Despite the monthly gains, the LEI’s six- and twelve-month growth rates remained negative at -0.6% and -1.5%, respectively. The advance was driven primarily by financial components, including equity prices and the interest rate spread, while consumer expectations continued to weigh on the index. The Chicago Fed National Activity Index fell to -0.10 in May from an upwardly revised 0.19 in April. Production-related and employment-related indicators each subtracted from the index, while the sales, orders, and inventories category made a small positive contribution.
Source: The Conference Board Source: Federal Reserve Bank of Chicago
LEADING INDICATORS OF ECONOMIC ACTIVITY
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0 200
400
600
800
1,000
1,200
1,400
1,600
1,800
2,000
2,200
2,400
In Thousands of Units
Annualized Housing Starts
Multi Family Housing Starts
Single Family Housing Starts
Housing starts declined sharply in May to a seasonally adjusted annual rate of 1,177,000, a 15.4% drop from a downwardly revised 1,392,000 in April. The pullback was driven primarily by multifamily construction, while single-family starts edged down a more modest
1.9% to 882,000; total multifamily starts came in at 295,000 units. The S&P CoreLogic Case-Sh iller 20-City Composite rose 1.1% year over year in April, marking its first pickup since November 2025, following an upwardly revised 0.9% gain in March. Freddie Mac’s average 30- year fixed mortgage rate increased to 6.44% in May from 6.33% in April, reinforcing ongoing affordability constraints for prospective buyers.
Source: US Department of Commerce Source: S&P
-20.0%
-16.0%
-12.0%
-8.0%
-4.0%
0.0%
4.0%
8.0%
12.0%
16.0%
20.0%
24.0%
S&P/Case-Shiller 20 City Composite Home Price Index
Recession
YOY (%) Change
HOUSING
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40 45
50 55
60 65
70 Institute of Supply Management (ISM) Surveys
ISM Manufacturing ISM Services
EXPANDING
CONTRACTING
Manufacturing activity cooled slightly in June, with the Institute for Supply Management's Manufacturing Index easing to 53.3%, down 0.7 percentage point from May but still marking a sixth consecutive month of expansion. Services activity also moderated, as the ISM Services Index eased to 54.0% from 54.5%, a twenty-fourth consecutive month in expansion territory. Business activity and new orders both slowed, though the employment component jumped to 51.2% from 47.9%, its strongest reading since late 2021 and the first expansion in services hiring in four months.
Source: Institute for Supply Management
PURCHASING MANAGERS INDEX (PMI)
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Components of GDP 6/25 9/25 12/25 3/26
1.7% 2.3% 1.3% 0.4%
-2.7% 0.0% 0.4% 1.4%
4.8% 1.6% -0.2% -0.4%
-0.4% 0.2% -1.2% 0.6%
0.3% 0.2% 0.2% 0.2%
3.8% 4.4% 0.5% 2.1%
Personal Consumption Expenditures
Gross Private Domestic Investment
Net Exports and Imports
Federal Government Expenditures
Total
State and Local (Consumption and Gross
Investment) -2.0%
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
12.0%
14.0%
Gross Domestic Product (GDP)
GDP QOQ % Change
GDP YOY % Change
Source: US Department of Commerce Source: US Department of Commerce Real gross domestic product increased at an annualized rate of 2.1% in the first quarter of 2026, according to the Bureau of Economic Analysis’ third estimate, up from 1.6% in the prior estimate and an acceleration from 0.5% in the fourth quarter of 2025. The 0.5 percentage point upward revision was driven primarily by a downward revision to imports—which subtract from GDP—partly offset by a downward revision to consumer spending.
GROSS DOMESTIC PRODUCT (GDP)
ATTACHMENT B
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Source: Federal Reserve Source: Bloomberg
0 1,000,000
2,000,000
3,000,000
4,000,000
5,000,000
6,000,000
7,000,000
8,000,000
9,000,000
10,000,000
Federal Reserve Balance Sheet Assets
Recession
In $ millions
The Federal Open Market Committee (FOMC) held the target range for the federal funds rate at 3.50% to 3.75% at its June 16–17 meeting, with a unanimous 12–0 vote. This marked a notable shift from the April meeting—Jerome Powell’s last as chair—which saw four dissents in an 8–4 decision. The return to consensus under Chair Kevin Warsh signals a clear change in tone. Minutes from the June meeting are scheduled for release in early July. The June Summary of Economic Projections reflected a more hawkish outlook. The median projection for the federal funds rate at year-end 2026 rose to 3.8%, up from 3.4% in March, before easing to 3.6% in 2027 and 3.4% in 2028. Officials also revised their inflation forecasts, with headline PCE projected at 3.6% in 2026 (from 2.7%) and core PCE at 3.3%. By contrast, median projections for real GDP growth and the unemployment rate—2.2% and 4.3%, respectively—were little changed.
FEDERAL RESERVE
0.00%
1.00%
2.00%
3.00%
4.00%
5.00%
6.00%
Effective Federal Funds Rate
Recession
Yield (%)
ATTACHMENT B
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Source: Bloomberg Source: Bloomberg
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
US Treasury Note Yields
2-Year
5-Year
10-Year
Yield (%)
2.0%
2.5%
3.0%
3.5%
4.0%
4.5%
5.0%
5.5%
US T reasury Yield Curve
Jun-26
Mar-26
Jun-25
Yield (%)
Treasury yields ended June mixed, with a modest flattening across the curve as markets digested a more hawkish Federal Reserve signal.
The 2-year yield rose to 4.15% from 3.98% at the end of May, while the 10-year yield edged down to 4.44% from 4.45%. The 2s/10s spread narrowed to 29 basis points, down from 47 basis points a month earlier. The 3-month/10-year spread remained positive at roughly 64 basis points at month-end. Relative to the 69 basis point spread at the start of 2026, the curve has flattened materially year to date, reflecting a repricing higher in front-end rates as expectations shift toward the possibility of further Fed tightening rather than easing.
BOND YIELDS
ATTACHMENT B
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30, 2026)
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ACCOUNT PROFILE
ATTACHMENT B
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30, 2026)
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OBJECTIVES
Investment Objectives
Safety of principal is the foremost objective of the investment program. The investment portfolio shall remain sufficiently liquid to meet all requirements that may be reasonably anticipated. The investment portfolio shall be designed with the objective of attaining a market rate of return throughout budgetary and economic cycles, taking into account the investment risk constraints and liquidity needs.
Chandler Asset Management Performance Objective
The performance objective for the portfolio is to earn a total rate of return through a market cycle that is equal to or above the return on the benchmark index.
Strategy
In order to achieve these objectives, the portfolio invests in high quality fixed income securities that comply with the investment policy and all regulation governing the funds.
ATTACHMENT B
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Attachment B - Investment
Quarterly Report (as of June
30, 2026)
Item C: Staff Report
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STATEMENT OF COMPLIANCE
City of Palo Alto Consolidated | Account #11465 | As of June 30, 2026 Rules Name Limit Actual Compliance
Status Notes
AGENCY MORTGAGE SECURITIES
Max % Issuer (MV) 30.0 0.7 Compliant
Max Maturity (Years) 10.0 2.6 Compliant
ASSET-BACKED SECURITIES (ABS)
Max % (MV; ABS & MBS) 20.0 3.8 Compliant
Max % Issuer (MV) 5.0 0.7 Compliant
Max Maturity (Years) 5.0 4.6 Compliant
Min Rating (AA- by 1) 0.0 0.0 Compliant
BANKERS' ACCEPTANCES
Max % (MV) 40.0 0.0 Compliant
Max % Issuer (MV) 5.0 0.0 Compliant
Max Maturity (Days) 180.0 0.0 Compliant
COLLATERALIZED BANK DEPOSITS
Max % (MV) 100.0 0.0 Compliant
COLLATERALIZED TIME DEPOSITS (NON-
NEGOTIABLE CD/TD)
Max % (MV; FDIC & Collateralized CD/TD) 20.0 0.0 Compliant Max % Issuer (MV) 10.0 0.0 Compliant
Min Rating (A-1 by 1; A- by 1 if > FDIC Limit) 0.0 0.0 Compliant
COMMERCIAL PAPER
Max % (MV) 40.0 0.0 Compliant
Max % Issuer (MV) 5.0 0.0 Compliant
Max Maturity (Days) 397.0 0.0 Compliant
Min Rating (A-1 by 1 or A- by 1) 0.0 0.0 Compliant
CORPORATE MEDIUM TERM NOTES
Max % (MV) 30.0 9.0 Compliant
Max % Issuer (MV) 5.0 0.7 Compliant
Max Maturity (Years) 5.0 4.9 Compliant
Min Rating (A- by 1) 0.0 0.0 Compliant
ATTACHMENT B
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30, 2026)
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STATEMENT OF COMPLIANCE
City of Palo Alto Consolidated | Account #11465 | As of June 30, 2026 Rules Name Limit Actual Compliance
Status Notes
FDIC INSURED TIME DEPOSITS (NON-NEGOTIABLE
CD/TD)
Max % (MV; FDIC & Collateralized CD/TD) 20.0 0.0 Compliant Max % Issuer (MV) 10.0 0.0 Compliant
Min Rating (A-1 by 1; A- by 1) 0.0 0.0 Compliant
FEDERAL AGENCIES
Max % (MV) 100.0 16.4 Compliant
Max % Issuer (MV) 30.0 5.5 Compliant
Max Callables (MV) 20.0 12.1 Compliant
Max Maturity (Years) 10.0 8.7 Compliant
GENERAL INVESTMENT GUIDELINES
Max % 5-10 Years Maturities (MV) 30.0 9.0 Compliant
Max Maturity (Years) 10.0 8.7 Compliant
LOCAL AGENCY INVESTMENT FUND (LAIF)
Max Concentration (MV) 75.0 43.0 Compliant
LOCAL GOVERNMENT INVESTMENT POOL (LGIP)
Max % (MV) 20.0 0.0 Compliant
MONEY MARKET MUTUAL FUNDS
Max % (MV) 20.0 0.3 Compliant
Max % Issuer (MV) 20.0 0.3 Compliant
Min Rating (AAA by 2) 0.0 0.0 Compliant
MORTGAGE -BACKED SECURITIES (NON-AGENCY)
Max % (MV; ABS & MBS) 20.0 3.8 Compliant
Max % Issuer (MV) 5.0 0.0 Compliant
Max Maturity (Years) 5.0 0.0 Compliant
Min Rating (AA- by 1) 0.0 0.0 Compliant
MUNICIPAL SECURITIES
Max % (MV) 30.0 0.0 Compliant
Max % Issuer (MV) 5.0 1.1 Compliant
Max Maturity (Years) 10.0 8.5 Compliant
ATTACHMENT B
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Attachment B - Investment
Quarterly Report (as of June
30, 2026)
Item C: Staff Report
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STATEMENT OF COMPLIANCE
City of Palo Alto Consolidated | Account #11465 | As of June 30, 2026 Rules Name Limit Actual Compliance
Status Notes
Min Rating (A- by 1) 0.0 0.0 Compliant
NEGOTIABLE CERTIFICATES OF DEPOSIT (NCD)
Max % (MV) 30.0 0.3 Compliant
Max % Issuer (MV) 5.0 0.0 Compliant
Max Maturity (Years) 5.0 3.8 Compliant
Min Rating (A-1 by 1 or A- by 1 if > FDIC Limit) 0.0 0.0 Compliant
REPURCHASE AGREEMENTS
Max Maturity (Years) 1.0 0.0 Compliant
SRI PROHIBITED INVESTMENTS
Prohibited Investment - Fossil Fuels 0.0 0.0 Compliant
Prohibited Investments - Firearms 0.0 0.0 Compliant
Prohibited Investments - Tobacco 0.0 0.0 Compliant
SUPRANATIONAL OBLIGATIONS
Max % (MV) 30.0 5.9 Compliant
Max % Issuer (MV) 10.0 3.7 Compliant
Max Maturity (Years) 5.0 3.7 Compliant
Min Rating (AA- by 1) 0.0 0.0 Compliant
U.S. TREASURIES
Max % (MV) 100.0 11.7 Compliant
Max Maturity (Years) 10.0 4.4 Compliant
ATTACHMENT B
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Attachment B - Investment
Quarterly Report (as of June
30, 2026)
Item C: Staff Report
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PORTFOLIO CHARACTERISTICS
Palo Alto Managed Acct | Account #11463 | As of June 30, 2026 Benchmark* 6/30/2026
Portfolio
3/31/2026
Portfolio
Average Maturity (yrs) 2.64 2.95 2.99
Average Modified Duration 2.46 2.54 2.63
Average Purchase Yield 3.17% 3.04%
Average Market Yield 4.16% 4.32% 4.06%
Average Quality** AA+ AA+ AA+
Total Market Value 528,545,305 526,367,008
*Benchmark: ICE BofA 1-5 Year Unsubordinated US Treasury & Agency Index **The credit quality is a weighted average calculation of the highest of S&P, Moody’s and Fitch.
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SECTOR DISTRIBUTION
Palo Alto Managed Acct | Account #11463 | As of June 30, 2026 Sector as a Percentage of Market Value
Sector 06/30/2026 03/31/2026
Muni Bonds 36.07% 39.41%
Agency 20.93% 21.36%
US Treasury 14.91% 14.55%
Corporate 11.38% 9.78%
Supras 7.45% 9.42%
ABS 4.88% 0.69%
CD 2.65% 2.71%
Agency CMBS 0.91% 0.92%
Money Mkt Fd 0.43% 0.69%
Neg CD 0.38% 0.47%
ATTACHMENT B
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QUALITY DISTRIBUTION
Palo Alto Managed Acct | Account #11463 | As of June 30, 2026 S&P Rating Moody’s Rating Fitch Rating
Rating 06/30/2026 03/31/2026
AAA 20.04% 19.12%
AA 54.54% 63.49%
A 4.93% 3.77%
BBB 0.19% 0.19%
A-1+ 2.35% 1.89%
NA 17.90% 11.48%
B 0.05% 0.05%
Rating 06/30/2026 03/31/2026
Aaa 20.77% 20.84%
Aa 53.46% 61.99%
A 4.97% 3.82%
P-1 2.35% 1.89%
NA 18.45% 11.45%
Rating 06/30/2026 03/31/2026
AAA 12.04% 10.04%
AA 37.71% 45.55%
A 2.28% 1.55%
BBB -- 0.05%
F1+ 2.35% 1.89%
NA 45.62% 40.91%
ATTACHMENT B
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DURATION DISTRIBUTION
Palo Alto Managed Acct | Account #11463 | As of June 30, 2026 Portfolio Compared to the Benchmark
0-.25 .25-.5 .5-1 1-2 2-3 3-4 4-5 5-7 7+
Portfolio 11.8% 3.0% 8.6% 20.4% 15.6% 17.5% 14.9% 7.6% 0.5% ICE BofA 1-5 Year Unsubordinated US Treasury &
Agency Index 0.0% 0.0% 2.5% 36.2% 28.4% 20.6% 12.3% 0.0% 0.0%
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INVESTMENT PERFORMANCE
Palo Alto Managed Acct | Account #11463 | As of June 30, 2026 Total Rate of Return: Inception | 09/01/2025
TOTAL RATE OF RETURN* 3 Months 12 Months 2 Years 3 Years 5 Years 10 Years Since Inception Palo Alto Managed Acct 0.41%
Benchmark 0.24%
*Periods over 1 year are annualized.
Total rate of return: A measure of a portfolio’s performance over time. It is the internal rate of return, which equates the beginning value of the portfolio with the ending market value; it includes interest earnings, realized and unrealized gains and losses in the portfolio.
Benchmark: ICE BofA 1-5 Year Unsubordinated US Treasury & Agency Index
ATTACHMENT B
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PORTFOLIO CHARACTERISTICS
City of Palo Alto Reporting | Account #11464 | As of June 30, 2026 6/30/2026
Portfolio
3/31/2026
Portfolio
Average Maturity (yrs) 0.00 0.00
Average Modified Duration 0.00 0.00
Average Purchase Yield 2.33% 1.95%
Average Market Yield 2.33% 1.95%
Average Quality** AAA AAA
Total Market Value 142,610,088 145,024,434
*Benchmark: NO BENCHMARK REQUIRED
**The credit quality is a weighted average calculation of the highest of S&P, Moody’s and Fitch.
ATTACHMENT B
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SECTOR DISTRIBUTION
City of Palo Alto Reporting | Account #11464 | As of June 30, 2026 Sector as a Percentage of Market Value
Sector 06/30/2026 03/31/2026
Cash 69.85% 63.78%
LAIF 30.15% 36.22%
ATTACHMENT B
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CONSOLIDATED INFORMATION
ATTACHMENT B
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30, 2026)
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PORTFOLIO CHARACTERISTICS
City of Palo Alto Consolidated | Account #11465 | As of June 30, 2026 6/30/2026
Portfolio
3/31/2026
Portfolio
Average Maturity (yrs) 2.32 2.34
Average Modified Duration 2.00 2.06
Average Purchase Yield 2.99% 2.81%
Average Market Yield 3.90% 3.60%
Average Quality** AA+ AA+
Total Market Value 671,155,393 671,391,442
*Benchmark: NO BENCHMARK REQUIRED
**The credit quality is a weighted average calculation of the highest of S&P, Moody’s and Fitch.
ATTACHMENT B
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Quarterly Report (as of June
30, 2026)
Item C: Staff Report
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SECTOR DISTRIBUTION
City of Palo Alto Consolidated | Account #11465 | As of June 30, 2026 Sector as a Percentage of Market Value
Sector 06/30/2026 03/31/2026
Muni Bonds 28.36% 30.85%
Agency 16.46% 16.72%
Cash 14.94% 13.86%
US Treasury 11.72% 11.39%
Corporate 8.95% 7.66%
LAIF 6.45% 7.86%
Supras 5.86% 7.37%
ABS 3.84% 0.54%
CD 2.08% 2.12%
Agency CMBS 0.71% 0.72%
Money Mkt Fd 0.34% 0.54%
Neg CD 0.30% 0.37%
ATTACHMENT B
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ISSUERS
City of Palo Alto Consolidated | Account #11465 | As of June 30, 2026 Issuer Investment Type % Portfolio
United States US Treasury 11.72%
US Bank Cash 8.55%
LAIF LAIF 6.45%
Fidelity Cash 5.88%
Federal Home Loan Banks Agency 5.47%
Federal Agricultural Mortgage Corp Agency 5.00%
International Bank for Recon and Dev Supras 3.71%
Farm Credit System Agency 2.92%
Federal Home Loan Mortgage Corp Agency 2.61%
Inter-American Development Bank Supras 1.70%
State of Hawaii Muni Bonds 1.09%
City of Oakland, California Muni Bonds 0.99%
San Francisco California City & Coun Muni Bonds 0.87%
State of Georgia Muni Bonds 0.86%
Commonwealth of Massachusetts Muni Bonds 0.83%
San Francisco City & County of Muni Bonds 0.77%
City of Los Angeles, California Muni Bonds 0.76%
Santa Monica Community College Distr Muni Bonds 0.76%
State of Oregon Muni Bonds 0.76%
Stanford University Corporate 0.73%
Federal Home Loan Mortgage Corp Agency CMBS 0.71%
Los Angeles Community College Distri Muni Bonds 0.70%
Alphabet Inc. Corporate 0.70%
Hyundai Auto Lease Sec Trust ABS 0.66%
San Bernardino Community College Dis Muni Bonds 0.64%
Solano California Community College Muni Bonds 0.62%
Apple Inc. Corporate 0.62%
Honda Auto Receivables Owner Trust ABS 0.58%
Toyota Motor Corporation Corporate 0.58%
Mercedes-Benz Auto Receivables Trust ABS 0.56%
ATTACHMENT B
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Item C: Staff Report
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ISSUERS
City of Palo Alto Consolidated | Account #11465 | As of June 30, 2026 Issuer Investment Type % Portfolio
Andrew W. Mellon Foundation, The Corporate 0.56%
Contra Costa Community College Dist Muni Bonds 0.56%
San Mateo Union High School District Muni Bonds 0.56%
Marin California Community College D Muni Bonds 0.55%
BMW Vehicle Lease Trust ABS 0.50%
Palo Alto Unified School District Muni Bonds 0.50%
San Diego Unified School District Muni Bonds 0.47%
Federal National Mortgage Assoc Agency 0.46%
The University of Chicago Corporate 0.46%
International Finance Corporation Supras 0.45%
County of Alameda, California Muni Bonds 0.44%
Hyundai Motor Company ABS 0.44%
Ohlone Community College District Muni Bonds 0.44%
State of Mississippi Muni Bonds 0.43%
Wells Fargo & Company Cash 0.43%
City of Manhattan Beach, California Muni Bonds 0.42%
Amazon.com, Inc. Corporate 0.41%
San Diego Community College District Muni Bonds 0.40%
City of Corona Muni Bonds 0.40%
State of New York Muni Bonds 0.38%
U.S. Bancorp Corporate 0.38%
Morgan Stanley Corporate 0.38%
Deere & Company Corporate 0.38%
Qualcomm Incorporated Corporate 0.37%
Northwestern Mutual Global Funding Corporate 0.37%
JPMorgan Chase & Co. Corporate 0.37%
Eli Lilly and Company Corporate 0.37%
Meta Platforms, Inc. Corporate 0.37%
New York Life Insurance Company Corporate 0.37%
Guardian Life Global Funding Corporate 0.37%
ATTACHMENT B
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Quarterly Report (as of June
30, 2026)
Item C: Staff Report
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ISSUERS
City of Palo Alto Consolidated | Account #11465 | As of June 30, 2026 Issuer Investment Type % Portfolio
Simon Property Group, Inc. Corporate 0.37%
Santa Clara VY California Water Dist Muni Bonds 0.36%
Bank of America Corporation Corporate 0.35%
San Ramon Valley Unified School Dist Muni Bonds 0.34%
First American Govt Oblig Fund Money Mkt Fd 0.34%
Santa Monica-Malibu Unified School D Muni Bonds 0.33%
Texas Public Finance Authority Muni Bonds 0.32%
Redwood City School District Muni Bonds 0.31%
State of Rhode Island Muni Bonds 0.30%
Riverside Community College District Muni Bonds 0.30%
City of Fairfield, California Muni Bonds 0.30%
Cabrillo California Cmmnty College Muni Bonds 0.29%
San Jose Unified School District Muni Bonds 0.29%
Los Angeles Department of Water and Muni Bonds 0.29%
Toyota Auto Receivables Owner Trust ABS 0.29%
Microsoft Corporation Corporate 0.28%
T-Mobile Us Trust 2026-1 ABS 0.28%
City of Santa Ana, California Muni Bonds 0.27%
John Deere Owner Trust ABS 0.26%
GM Financial Auto Leasing Trust ABS 0.26%
City of Glendora, California Muni Bonds 0.25%
Antelope Valley Cmnty College Dist Muni Bonds 0.24%
Yosemite Community California Colleg Muni Bonds 0.22%
Glendale California Unified School D Muni Bonds 0.22%
San Diego County Water Authority Muni Bonds 0.21%
State of Colorado Muni Bonds 0.21%
Fullerton School District, Californi Muni Bonds 0.20%
South Pasadena Unified School Distri Muni Bonds 0.20%
Palomar California Community College Muni Bonds 0.20%
The Regents of the University of Cal Muni Bonds 0.20%
ATTACHMENT B
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ISSUERS
City of Palo Alto Consolidated | Account #11465 | As of June 30, 2026 Issuer Investment Type % Portfolio
City of Chula Vista, California Muni Bonds 0.20%
Redondo Beach California Unified Sch Muni Bonds 0.20%
City of Covina Muni Bonds 0.20%
Tustin Unified School District Schoo Muni Bonds 0.19%
San Dieguito Union High School Distr Muni Bonds 0.19%
Calleguas California Municipal Water Muni Bonds 0.19%
Minnesota Housing Finance Agency Muni Bonds 0.19%
Santa Clarita California Community C Muni Bonds 0.19%
State of Texas Muni Bonds 0.18%
Sequoia Union High School District Muni Bonds 0.18%
Salesforce, Inc. Corporate 0.17%
Mountain View Whisman School Distric Muni Bonds 0.17%
Desert Community College District Muni Bonds 0.16%
Maryland Dep of Housing & Com Muni Bonds 0.16%
San Jose Evergreen California Commun Muni Bonds 0.16%
State of Tennessee Muni Bonds 0.15%
Burbank California City Unified SD Muni Bonds 0.15%
State of Alabama Muni Bonds 0.15%
Sierra Joint Community College Distr Muni Bonds 0.15%
Menlo Park California City School Di Muni Bonds 0.15%
The New York State Urban Development Muni Bonds 0.15%
Santa Cruz Metropolitan Transit Dist Muni Bonds 0.15%
Mount San Antonio California Communi Muni Bonds 0.14%
Los Angeles County California Public Muni Bonds 0.14%
City of La Habra, California Muni Bonds 0.14%
Beverly Hills Unified School Dist Muni Bonds 0.14%
Placentia-Yorba Linda California Uni Muni Bonds 0.13%
Desert Sands Unified School District Muni Bonds 0.13%
City of El Segundo Muni Bonds 0.13%
San Francisco Bay Area Rapid Transit Muni Bonds 0.12%
ATTACHMENT B
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Quarterly Report (as of June
30, 2026)
Item C: Staff Report
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ISSUERS
City of Palo Alto Consolidated | Account #11465 | As of June 30, 2026 Issuer Investment Type % Portfolio
California Dep of Water Resources Muni Bonds 0.11%
Huntington Beach CA Pub Fin Auth Muni Bonds 0.11%
California Infrastructure & Economic Muni Bonds 0.10%
Auburn California Muni Bonds 0.10%
Rancho Santiago Community College Di Muni Bonds 0.09%
City of Buena Park, California Muni Bonds 0.09%
Rancho Water District Financing Auth Muni Bonds 0.09%
City of Ontario, California Muni Bonds 0.09%
Milpitas Unified School District Muni Bonds 0.09%
San Mateo-Foster City School Distric Muni Bonds 0.09%
Temecula Valley Unified School Distr Muni Bonds 0.09%
Pasadena Public Financing Authority, Muni Bonds 0.08%
Cash Cash 0.08%
San Juan Unified School District Muni Bonds 0.08%
Santa Clara County Muni Bonds 0.08%
State of Ohio Muni Bonds 0.08%
Liberty Union High School District Muni Bonds 0.07%
Oxnard Union High School District Muni Bonds 0.07%
Chabot-Las Positas Community College Muni Bonds 0.07%
City of Monterey Park, California Muni Bonds 0.07%
Beverly Hills Cali Public Finance Muni Bonds 0.07%
Tracy Joint Unified School District Muni Bonds 0.07%
Campbell California Union HS Muni Bonds 0.07%
Santa Maria Joint Union High School Muni Bonds 0.07%
Santa Barbara Unified School Distric Muni Bonds 0.07%
Roseville California Finance Authori Muni Bonds 0.06%
Torrance California Joint Powers Fin Muni Bonds 0.06%
San Jose, California Muni Bonds 0.05%
City of San Ramon, California Muni Bonds 0.05%
Carlsbad Unified School District Muni Bonds 0.05%
ATTACHMENT B
35 Item C
Attachment B - Investment
Quarterly Report (as of June
30, 2026)
Item C: Staff Report
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ISSUERS
City of Palo Alto Consolidated | Account #11465 | As of June 30, 2026 Issuer Investment Type % Portfolio
Chaffey Community College District Muni Bonds 0.04%
Santa Cruz County Capital Financing Muni Bonds 0.04%
Sunnyvale School District, Californi Muni Bonds 0.04%
Ledyard National Bank CD 0.04%
Alliant Credit Union CD 0.04%
Global Federal Credit Union CD 0.04%
American Express Company Neg CD 0.04%
The Peoples Bank Co. CD 0.04%
Austin Telco Federal Credit Union CD 0.04%
First Southwest Bank CD 0.04%
The Bippus State Bank CD 0.04%
CNB Bank, Inc. CD 0.04%
Baxter Credit Union CD 0.04%
UBS Bank USA, National Association Neg CD 0.04%
Capital Funding Bancorp, Inc. CD 0.04%
General Electric Credit Union CD 0.04%
Morgan Stanley Neg CD 0.04%
Signature Federal Credit Union CD 0.04%
First Guaranty Bancshares, Inc. CD 0.04%
County Schools Federal Credit Union CD 0.04%
SPCO Credit Union CD 0.04%
The Pitney Bowes Bank Inc. CD 0.04%
Workers Federal Credit Union CD 0.04%
First Technology Federal Credit Unio CD 0.04%
Truist Bank Neg CD 0.04%
Healthcare Systems Fed Credit Union CD 0.04%
Diversified Members Credit Union CD 0.04%
Enterprise Bank CD 0.04%
Mutual Savings Association CD 0.04%
Public Service Credit Union CD 0.04%
ATTACHMENT B
36 Item C
Attachment B - Investment
Quarterly Report (as of June
30, 2026)
Item C: Staff Report
Pg.
42 Packet Pg. 249 of 253
ISSUERS
City of Palo Alto Consolidated | Account #11465 | As of June 30, 2026 Issuer Investment Type % Portfolio
Amazon.com, Inc. CD 0.04%
Eaglemark Savings Bank CD 0.04%
Ally Bank Neg CD 0.04%
Toyota Financial Savings Bank Neg CD 0.04%
GreenState Credit Union CD 0.04%
Instit for Savings in Newburyport CD 0.04%
Southern Bank CD 0.04%
Synchrony Bank CD 0.04%
Pentagon Federal Credit Union CD 0.04%
Coöperatieve Rabobank U.A. NY CD 0.04%
Ponce Bank, National Association CD 0.04%
County of Riverside, California Muni Bonds 0.04%
Capital One Financial Corporation Neg CD 0.04%
Beal Financial Corporation CD 0.04%
Monet Bank CD 0.04%
Connexus Credit Union CD 0.04%
Decorah Bank and Trust Company CD 0.04%
Delta National Bank and Trust Comp CD 0.04%
First Oklahoma Bank CD 0.04%
First National Bank of America CD 0.04%
First Community Credit Union of Belo CD 0.04%
BankFirst CD 0.04%
Cinfed Federal Credit Union CD 0.04%
Encore Bank CD 0.04%
Kennett Trust Bank CD 0.04%
Live Oak Banking Company CD 0.04%
Silicon Valley Clean Water Muni Bonds 0.04%
Gesa Credit Union CD 0.04%
Jonesboro State Bank CD 0.04%
Sunwest Bank CD 0.04%
ATTACHMENT B
37 Item C
Attachment B - Investment
Quarterly Report (as of June
30, 2026)
Item C: Staff Report
Pg.
43 Packet Pg. 250 of 253
ISSUERS
City of Palo Alto Consolidated | Account #11465 | As of June 30, 2026 Issuer Investment Type % Portfolio
Bank of Montreal Neg CD 0.03%
Minnwest Bank CD 0.03%
Legacy Bank & Trust Company CD 0.03%
Farmers and Merchants State Bank CD 0.03%
The Farmers & Merchants Bank CD 0.03%
Central Bank CD 0.03%
Country Club Bank CD 0.03%
Berkeley California Unified SD Muni Bonds 0.03%
Peoples Bank CD 0.03%
Pony Express Bank CD 0.03%
USF Federal Credit Union CD 0.03%
Fremont Union High School District Muni Bonds 0.03%
City of Downey Muni Bonds 0.02%
Sonoma County California Junior Coll Muni Bonds 0.02%
Orchard California School District Muni Bonds 0.01%
TOTAL 100.00%
ATTACHMENT B
38 Item C
Attachment B - Investment
Quarterly Report (as of June
30, 2026)
Item C: Staff Report
Pg.
44 Packet Pg. 251 of 253
IMPORTANT DISCLOSURES
2026 Chandler Asset Management, Inc, An Independent Registered Investment Adviser.
Information contained herein is confidential. Prices are provided by ICE Data Services Inc (“IDS”), an independent pricing source. In the event IDS does not provide a price or if the price provided is not reflective of fair market value, Chandler will obtain pricing from an alternative approved third party pricing source in accordance with our written valuation policy and procedures. Our valuation procedures are also disclosed in Item 5 of our Form ADV Part 2A.
Performance results are presented gross-of-advisory fees and represent the client’s Total Return. The deduction of advisory fees lowers performance results. These results include the reinvestment of dividends and other earnings. Past performance may not be indicative of future results. Therefore, clients should not assume that future performance of any specific investment or investment strategy will be profitable or equal to past performance levels. All investment strategies have the potential for profit or loss. Economic factors, market conditions or changes in investment strategies, contributions or withdrawals may materially alter the performance and results of your portfolio.
Index returns assume reinvestment of all distributions. Historical performance results for investment indexes generally do not reflect the deduction of transaction and/or custodial charges or the deduction of an investment management fee, the incurrence of which would have the effect of decreasing historical performance results. It is not possible to invest directly in an index.
Source ICE Data Indices, LLC (“ICE”), used with permission. ICE permits use of the ICE indices and related data on an “as is” basis; ICE, its affiliates and their respective third party suppliers disclaim any and all warranties and representations, express and/or implied, including any warranties of merchantability or fitness for a particular purpose or use, including the indices, index data and any data included in, related to, or derived therefrom. Neither ICE data, its affiliates or their respective third party providers guarantee the quality, adequacy, accuracy, timeliness or completeness of the indices or the index data or any component thereof, and the indices and index data and all components thereof are provided on an “as is” basis and licensee’s use it at licensee’s own risk. ICE data, its affiliates and their respective third party do not sponsor, endorse, or recommend chandler asset management, or any of its products or services.
This report is provided for informational purposes only and should not be construed as a specific investment or legal advice. The information contained herein was obtained from sources believed to be reliable as of the date of publication, but may become outdated or superseded at any time without notice. Any opinions or views expressed are based on current market conditions and are subject to change. This report may contain forecasts and forward-looking statements which are inherently limited and should not be relied upon as indicator of future results. Past performance is not indicative of future results. This report is not intended to constitute an offer, solicitation, recommendation or advice regarding any securities or investment strategy and should not be regarded by recipients as a substitute for the exercise of their own judgment.
Fixed income investments are subject to interest, credit and market risk. Interest rate risk: the value of fixed income investments will decline as interest rates rise. Credit risk: the possibility that the borrower may not be able to repay interest and principal. Low rated bonds generally have to pay higher interest rates to attract investors willing to take on greater risk. Market risk: the bond market in general could decline due to economic conditions, especially during periods of rising interest rates.
Ratings information have been provided by Moody’s, S&P and Fitch through data feeds we believe to be reliable as of the date of this statement, however we cannot guarantee its accuracy.
Security level ratings for U.S. Agency issued mortgage-backed securities (“MBS”) reflect the issuer rating because the securities themselves are not rated. The issuing U.S. Agency guarantees the full and timely payment of both principal and interest.
LGIP Yields: Reported yields for local government investment pools may be presented as either the 30-day yield or the monthly distribution yield, as applicable. For certain funds, the 30-day yield is calculated using reported daily yield data. Yield calculations are subject to change and may not be directly comparable across funds.
LAIF Yields: Additional Disclosure for CA Clients - As a result of a reporting lag from the Local Agency Investment Fund (LAIF), reported LAIF yields represent the most recently available Daily Effective Yield and may reflect data from approximately 7–10 days prior to month-end.
ATTACHMENT B
39 Item C
Attachment B - Investment
Quarterly Report (as of June
30, 2026)
Item C: Staff Report
Pg.
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BENCHMARK DISCLOSURES
Benchmark Disclosure
ICE BofA 1-5 Yr Unsubordinated US
Treasury & Agency Index
The ICE BofA 1-5 Year Unsubordinated US Treasury & Agency Index tracks the performance of US dollar denominated US Treasury and nonsubordinated US agency debt issued in the US domestic market. Qualifyi ng securities must have an investment grade rating (based on an average of Moody’s, S&P and Fitch). Qualifying securities must have at least one year remaining term to final maturity and l ess than five years remaining term to final maturity, at least 18 months to maturity at time of issuance, a fixed coupon schedule, and a minimum amount outstanding of $1 billion for sovereigns and $250 million for agencies.
ATTACHMENT B
40 Item C
Attachment B - Investment
Quarterly Report (as of June
30, 2026)
Item C: Staff Report
Pg.
46 Packet Pg. 253 of 253