Pismo Beach City Council
March 1, 2022

AGENDA
Pismo Beach City Council
Tuesday, March 1, 2022
Zoom Meeting ID: 848 2371 5585 - Phone Number (669) 900-6833 Zoom Meeting Link https://us02web.zoom.us/j/84823715585 In-person access: Council Chamber, City Hall, 760 Mattie Road, Pismo Beach, 93449

0.HYBRID MEETING INSTRUCTIONS:

To continue conducting the people’s business within San Luis Obispo County, State of California, and CDC health and safety guidelines, this meeting is being conducted in a hybrid format with both in-person and virtual public participation. Ways to watch this meeting and submit public comment are provided below.

Watch and participate in person:
•Visit the Council Chamber at City Hall, 760 Mattie Road, Pismo Beach, CA 93449. Please note that face coverings are required for individuals who are not fully vaccinated; by entering the facility without a mask, you attest that you are fully vaccinated.
•To make public comment, please submit an optional blue “speaker slip” to staff; the Mayor will ask you to approach the lectern to speak during the public comment period on your item of interest.

Watch and participate via Zoom:
•Click this link on any computer or mobile device: https://us02web.zoom.us/j/84823715585 . This URL may also be typed into a web browser.
•To make public comment, press the “raise your hand” button when the comment period for your item of interest begins. You will be notified when you’ve been unmuted and it’s your turn to speak.

Listen and participate via telephone:
•Call 1-669-900-6833 to join by telephone audio only. Enter Meeting ID 848 2371 5585 when prompted. •To make public comment, press *9 to “raise your hand” when the comment period on your item of interest begins. You will be notified when you’ve been unmuted and it’s your turn to speak.

Watch online:
•Visit www.pismobeach.org/agenda and scroll to “Upcoming Events.” When the live broadcast begins, an “In Progress” link will appear; click this link to watch the livestream.

Watch on Channel 20:
•Tune to local cable channel 20 in Pismo Beach; the meeting will be broadcast live. Meetings are also replayed at 9:00 a.m., 6:00 p.m., and 1:00 a.m. each day the following week.

Submit written comment:
•In advance of the meeting, written comments may be emailed to [email protected] or mailed or delivered to the City Clerk’s Office, 760 Mattie Road, Pismo Beach, CA 93449. During the meeting no later than the start of the comment period for your item of interest, written comment may be emailed to [email protected] or hand-delivered to staff in the Council Chamber.

Submit voicemail comment:
•Call 805-773-7005 and leave a voicemail before the meeting; or during the meeting no later than the start of the comment period for your item of interest. This phone number is an automated voicemail line only and will not be answered or monitored for other purposes.

Please note:
•Meetings may begin a few minutes after the scheduled start time. •Meetings will be recorded; these recordings are public record. •Phone numbers of call-in participants may be visible to other meeting participants, or in meeting recordings; Members of the public may create free Zoom accounts in order to change their screen names via the Zoom software when joining the virtual call.
•Phone numbers of voicemail commenters may be visible in the public record along with transcripts. •Public commenters wishing to display written comment or pictorial exhibit during a comment period must email the materials ahead of the comment period in order to permit display of the materials.

Please contact City Clerk Erica Inderlied at [email protected] with questions.

Pismo Beach City Council Agenda March 1, 2022

Regular Meeting—5:30 p.m.

Council Chamber, City Hall, 760 Mattie Road, Pismo Beach, CA 93449 Zoom Meeting ID: 848 2371 5585 – Phone Number (669) 900-6833

CALL TO ORDER: Mayor Waage

1. ROLL CALL:

Mayor: Waage
Mayor Pro Tem: Reiss
Council Members: Blake, Guthrie, Newton

2. PLEDGE OF ALLEGIANCE

3. ACCEPTANCE OF AGENDA

4. PRESENTATIONS

None.

5. PUBLIC COMMENT PERIOD
At this time, members of the public may comment on any item NOT appearing on the agenda. For items appearing on the agenda, including the Consent Calendar, the public will be invited to make comments during Council consideration of the item. In accordance with state law, matters raised as part of this comment period cannot be discussed or acted upon by the City Council at this time.

However, in response to a matter raised as part of this comment period, the Council may, during Item 13, City Council Comments and Requests, direct staff to assist a speaker, or schedule the matter for consideration on a future agenda.

Please adhere to the following procedures when addressing the Council:
• Please limit your comments to 3 minutes or less.
• Unduly disruptive behavior will not be permitted.

Documents submitted to the Council become public record unless otherwise exempt from disclosure.

6. CITY MANAGER’S REPORT

7. CITY ATTORNEY’S REPORT / CLOSED SESSION REPORT

Pismo Beach City Council Agenda March 1, 2022

8. COUNCIL COMMITTEE REPORTS

1. Air Pollution Control District, SLO County (Waage/Newton)

2. California Coastal Coalition Board (Reiss/Blake)

3. California Joint Powers Insurance Authority Board (Reiss)

4. Central Coast Community Energy Policy Board (Mayor)

5. Chapman Estate Foundation Liaison (Reiss)

6. Coastal Cities Group, League of CA Cities (Waage)

7. CAPSLO Board of Directors (Reiss)

8. Conference and Visitors Bureau Board Liaison (Newton)

9. Friends of Price House Liaison (Waage)

10. Hazard Mitigation & Fire Safety (Blake/Waage)

11. Homeless Services Oversight Council (Guthrie)

12. Integrated Waste Management Authority (Newton)

13. Mobile Hom e Rent Stabilization Subcommittee (Blake/Waage)

14. REACH (formerly EVC) (Blake)

15. Regional Transit Authority, SLO (Waage/Reiss)

16. Shell Beach Improvement Group Liaison (Newton/Reiss)

17. SLOCOG (Waage/Reiss)

18. South County Chambers of Commerce Gov’t Affairs (Blake)

19. Visit SLO CAL Advisory Committee (Newton)

20. Water Resources Advisory Committee, SLO (Guthrie)

21. Zone 3 Water Advisory Comm ittee, SLO (Guthrie)
(Govt Code Section 53232.3)

9. CONSENT CALENDAR
All Consent Calendar items will be acted upon by a single action of the City Council unless otherwise requested by an individual Council Member for separate consideration. Public comment on Consent Calendar items will be invited prior to action on the Calendar.

Item 9.A: Adoption of Meeting Minutes (Inderlied)

Recommendation:

Adopt Minutes of the February 15, 2022 Regular Meeting.

Item 9.B: Payroll Register and Register of Demands (Feeser)

Recommendation:

1. Approve the Summary of Payroll Register for February 13, 2022;

2. Approve the Register of Demands for February 18, 2022.

Item 9.C: Monthly Investment Transaction Report of the City’s Cash and Investments for January 2022 of FY 2021-2022 (Feeser)

Recommendation:

No action required; information only.

Item 9.D: Notice of Completion and Acceptance of Public Improvements for Tract 3100, Shell Beach Townhomes (Fine)

Recommendation:

1. Accept the public improvements for Tract 3100 as complete and authorize the release of the improvement securities; and

2. Authorize the City Manager to sign, and the City Clerk to record, a Notice of Completion.

Pismo Beach City Council Agenda March 1, 2022

Item 9.E: Clean California Maintenance Agreement with Caltrans for State Highways in Pismo Beach (Fine)

Recommendation:

Adopt a Resolution authorizing the City Manager to execute a maintenance agreement with the California Department of Transportation for maintenance services on State Highways within Pismo Beach city limits.

Item 9.F: Adoption (Second Reading) of Ordinances Effectuating a Local Coastal Plan Amendment and Adding Chapter 17.119 to Title 17 (1983 Coastal Zoning Code) and Section 17.38.145 to Chapter 38 of Title 17 (1988 Non- Coastal Zoning Code) of the Pismo Beach Municipal Code Regulating Two-Unit Residential Development and Urban Lot Splits in Compliance with Senate Bill 9 and Make a Determination of Exemption Under the California Environmental Quality Act (Inderlied)

Recommendation:

1. Adopt an Ordinance adding Chapter 17.119 Two-Unit Residential Development and Urban Lot Splits to Title 17 (1983 Coastal Zoning Code) of the City of Pismo Beach Municipal Code, relating to urban lot splits and two-unit residential development built in accordance with Senate Bill 9 and making a determination of exemption under the California Environmental Quality Act (CEQA);

2. Adopt an Ordinance adding section 17.38.145 Two-Unit Residential Development and Urban Lot Splits to Chapter 38 of Title 17 (1998 Non- Coastal Zoning Code) of the City of Pismo Beach Municipal Code, relating to urban lot splits and two-unit residential development built in accordance with Senate Bill 9 and making a determination of exemption under the California Environmental Quality Act (CEQA); and

3. Direct staff to forward the Coastal Zoning ordinance to the California Coastal Commission to certify an amendment to the Certified Local Coastal Program.

Item 9.G: Traffic Safety Committee Recommendations to City Council (Fine)

Recommendation:

1. Receive a report on the items considered at the most recent Traffic Safety Committee meeting;

2. Adopt a Resolution authorizing the installation of “No-Parking” signs on Baxter Lane from Shaffer Lane to the end of Baxter Lane.

Pismo Beach City Council Agenda March 1, 2022

Item 9.H: Adoption of Findings Relating to AB 361 (Virtual Meetings) (Inderlied)

Recommendation:

Adoption of the following findings with respect to the City of Pismo Beach’s utilization of the provisions of Assembly Bill 361, relating to Brown Act teleconferences:

1. The City Council has reconsidered the circumstances of the state of emergency created by the coronavirus pandemic.

2. The following circumstances exist:
• State or local officials continue to impose or recommend measures to promote social distancing.

10. ITEMS PULLED FROM CONSENT CALENDAR

11. PUBLIC HEARINGS No earlier than 6:00 p.m.

GENERAL PROCEDURES FOR PUBLIC HEARINGS (Mayor/Presiding Officer reserves discretion to set speaking allowances):

1. City staff will present the staff report and recommendation, and respond to technical/clarifying questions from Council;

2. Mayor will open the public hearing, and invite the project applicant, or representative, to present the project (Limited to 10 mins);

3. In an Appeal Hearing, the Mayor will then invite the appellant, or representative, to present their appeal (Limited to 10 mins);

4. Mayor will then ask other interested persons to testify regarding the project (Limited to 3 mins per speaker);

5. Mayor will invite the project applicant, or representative, to make a rebuttal if desired (Limited to 5 mins);

6. In an Appeal Hearing, the Mayor will then invite the appellant, or representative, to make a rebuttal if desired (Limited to 5 mins);

7. Mayor will close the public hearing, following which the Council will deliberate and act on the matter.

Item 11.A: Public Hearing to Receive Community Requests and Recommendations on the County of San Luis Obispo 2021-2023 Consolidated Plan and 2022 Action Plan, Including Community Development Block Grant Funds (Downing)

Recommendation:

Adopt a Resolution making final recommendations to the County of San Luis Obispo for the 2022 Action Plan for Community Development Block Grant funding.

12. BUSINESS ITEMS May be reordered and heard prior to Public Hearings

Item 12.A: Capital Improvement Program Semi-Annual Report (Fine)

Recommendation:

No action required; information only.

Item 12.B: Bello Street Sports Courts Location Analysis (Fine)

Recommendation:

Provide staff with direction on how to proceed with the Bello Street Sports Courts Relocation.

Pismo Beach City Council Agenda March 1, 2022

Item 12.C: Central Coast Blue Cost-Sharing Agreement and Clean Water State Revolving Fund Loan Authorizing Resolution (Fine)

Recommendation:

1. Adopt a Resolution authorizing the City Manager to enter into a cost- sharing agreement with the Cities of Arroyo Grande and Grover Beach for the Central Coast Blue project;

2. Adopt a Resolution authorizing the City Manager to file a financial assistance application with the Clean Water State Revolving Fund for the Central Coast Blue project.

Item 12.D: Sole-Source Contract for Program Management, Permitting, and Final Design Services for Central Coast Blue with Water Systems Consulting, Inc. (WSC) (Fine)

Recommendation:

Adopt a Resolution authorizing the City Manager to execute an agreement with Water Systems Consulting, Inc. for Program Management, Permitting, and Final Design Services for Central Coast Blue in the amount of $6,342,072 and appropriating related budget adjustments in fiscal year 2022.

13. CITY COUNCIL COMMENTS AND REQUESTS

14. ADJOURNMENT
To the following meeting(s). Special and Closed Session times may be subject to change, as noticed. Meetings will be held in a hybrid virtual format unless otherwise noted:

Meeting Time Date Location
Regular Meeting 5:30 p.m. Tuesday, March 15, 2022 Council Chamber, City Hall Regular Council meetings will adjourn by 11:00 p.m. unless four-fifths of the Council votes to continue past that time. If the meeting is adjourned at 11:00 p.m., any remaining agenda items will be continued to the next regular meeting (R-97-04).

AFFIDAVIT OF POSTING
I, Erica Inderlied, City Clerk for the City of Pismo Beach, declare under penalty of perjury that the foregoing agenda for the March 1, 2022 meeting(s) of the Pismo Beach City Council was posted on February 24, 2022, at City Hall, located at 760 Mattie Road, Pismo Beach, CA, as well as on the City’s website.

Erica Inderlied, City Clerk

Meeting Schedule: The City Council of Pismo Beach regularly meets on the first and third Tuesdays of each month at 5:30 p.m., unless otherwise noticed. Closed and Special sessions will be duly noticed as needed.

Council Agendas: Agendas for Regular Meetings are available for public review on the City’s website at pismobeach.org/agenda and upon request from the City Clerk’s Office, typically by 4:00 p.m. on the Thursday prior to the meeting, but no later than 72 hours prior to the meeting. Agendas for Closed Sessions and other Special meetings are made available at least 72 hours prior to the meeting when possible, but no later than 24 hours prior to the meeting.

Related Materials: All materials submitted to the Council relating to items on this agenda are open for public inspection unless otherwise exempt by law. Staff reports and attachments published as part of this agenda packet, as well as

Pismo Beach City Council Agenda March 1, 2022

copies of correspondence received relating to these agenda items and materials distributed at the meeting, may be obtained 1) in the consolidated online Agenda Center at pismobeach.org/agenda, 2) in the Access Pismo public records portal at pismobeach.org/accesspismo, 3) by request from the City Clerk at [email protected], or 4) in person at the City Clerk's Office, City Hall, 760 Mattie Road, Pismo Beach, Mon–-Fri 8:00 a.m.–-5:00 p.m. Please call (805) 773-7003 with any questions.

Broadcasting: Regular (televised) City Council meetings are available for viewing 24/7 at pismobeach.org/agenda, broadcast live on Channel 20, and re-broadcast during the week following the meeting on Channel 20 at 9:00 a.m., 6:00 p.m., and 1:00 a.m. each day.

Use of Equipment: Please contact the City Clerk’s Office if requesting to use the chamber equipment during public comment or as part of a scheduled presentation, 24 hours prior to the meeting at (805) 773-7003.

Notice Regarding Americans with Disabilities Act
In compliance with the Americans with Disabilities Act, if you need special assistance to participate in this meeting or if you need agenda documents provided in an alternative format, please contact the City Clerk’s Office at 773-7003 as soon as possible prior to the meeting to ensure that reasonable arrangements can be made (28CFR 35.102-

35.104 ADA Title II).

PISMO BEACH COUNCIL AGENDA REPORT
Agenda Item #9.A
`
SUBJECT/TITLE:

ADOPTION OF MEETING MINUTES
RECOMMENDATION:

Adopt Minutes of the February 15, 2022 Regular Meeting.

BACKGROUND:

Attached for the Council’s consideration are the draft minutes of the subject meetings for review and adoption.

FISCAL IMPACT:

There is no fiscal impact associated with the preparation or adoption of meeting minutes.

ALTERNATIVES:

1. Adopt the minutes with revisions.

2. Decline to adopt the minutes; provide direction or request additional information.

ATTACHMENTS:

1. Draft Minutes from February 15, 2022
Submitted by: Erica Inderlied, City Clerk Meeting Date: March 1, 2022 City Manager Approval:

9.A-1Council Agenda 3-1-2022

DRAFT MINUTES
Pismo Beach City Council
Tuesday, February 15, 2022

Regular Meeting—5:30 p.m.

Meeting Held Virtually

The City Council of the City of Pismo Beach met this date in a regular session with Mayor Waage presiding.

CALL TO ORDER: 5:39 p.m.

1. ROLL CALL:

Present: Absent:

Mayor Ed Waage (via teleconference) None
Mayor Pro Tem Mary Ann Reiss (via teleconference)
Council Member Sheila Blake (via teleconference)
Council Member Marcia Guthrie (via teleconference)
Council Member Scott Newton (via teleconference)

Staff Present:

Matt Downing, Community Development Director (via teleconference) Nadia Feeser, Administrative Services Director (via teleconference) Benjamin Fine, Public Works Director/City Engineer (via teleconference) David Fleishman, City Attorney (via teleconference)
Jorge Garcia, Assistant City Manager (via teleconference) Erica Inderlied, City Clerk (via teleconference)
Gordon Jackson, Director of Tourism and Events (via teleconference) Paul Lee, Battalion Chief (via teleconference)
James R. Lewis, City Manager (via teleconference)
Jeff Smith, Chief of Police (via teleconference)
Other staff present as noted below

2. PLEDGE OF ALLEGIANCE

The Pledge of Allegiance was not conducted.

3. ACCEPTANCE OF AGENDA

No requests to reorder the agenda.

9.A-2Council Agenda 3-1-2022
Attachment 1

4. PRESENTATIONS

None.

5. PUBLIC COMMENT PERIOD

Call for public comment:

Staff noted public comment received via email from Mark Naftal and Jennifer Jozwiak.

The following commented:

Mark Naftal

6. CITY MANAGER’S REPORT

City Manager Lewis commented on various topics.

7. CITY ATTORNEY’S REPORT / CLOSED SESSION REPORT

City Attorney Fleishman reported that the Council had taken no reportable action during its 12:00 p.m. Closed Session on February 14, 2022.

8. COUNCIL COMMITTEE REPORTS

The Council reported on recent and upcoming meetings of various external bodies:

Council Member Newton: San Luis Obispo County Integrated Waste Management Authority (IWMA) Board.

Mayor Waage: Central Coast Community Energy (3CE) Policy Board.

9. CONSENT CALENDAR

Call for public comment: No comment.

Action: Adopt Consent Calendar.

Motion: Blake
Second: Newton

Vote: The motion passed on the following vote (Items 9.A through 9.F):

Ayes: 5 Blake, Newton, Guthrie, Reiss, Waage
Noes: 0

Absent: 0
Abstain: 0
Recused: 0

9.A-3Council Agenda 3-1-2022
Attachment 1

Item 9.A: Adoption of Meeting Minutes (Inderlied)

Recommendation:

Adopt Minutes of the February 1, 2022 Closed and Regular Meeting.

Item 9.B: Payroll Register and Register of Demands (Feeser)

Recommendation:

1. Approve the Summary of Payroll Register for January 30, 2022;

2. Approve the Register of Demands for January 28, 2022 and February 4, 2022.

Item 9.C: Department Activity Reports for January 2022 (All)

Recommendation:

Receive reports as information only.

Item 9.D: Termination of the August 11, 2021 Emergency Proclamation; Update on March 16, 2020 and January 12, 2017 Emergency Proclamations (Inderlied)

Recommendation:

1. Adopt a Resolution:

1. Terminating the local emergency confirmed by City Council on August 12, 2021, and rescinding R-2021-070; and

2. Ratifying expenditures in the amount of $69,849.67 and $327,405.63 to Pacific Petroleum and R. Baker, Inc.,
respectively; and

3. Appropriating related budget adjustments in fiscal year 2022.

2. Receive a report on the remaining active emergency
proclamations.

Legislative Record: Resolution R-2022-007 adopted.

Item 9.E: Bello Bridge Project Budget Appropriations (Fine)

Recommendation:

Adopt a Resolution accepting additional grant funds in the amount of $983,826, and appropriating revenues and expenditures in FY 2022 for the Bello Bridge Project.

Legislative Record: Resolution R-2022-008 adopted.

9.A-4Council Agenda 3-1-2022
Attachment 1

Item 9.F: Adoption of Findings Relating to AB 361 (Virtual Meetings) (Inderlied)

Recommendation:

Adopt the following findings with respect to the City of Pismo Beach’s utilization of the provisions of Assembly Bill 361, relating to Brown Act teleconferences:

1. The City Council has reconsidered the circumstances of the state of emergency created by the coronavirus pandemic.

2. The following circumstances exist:
• The state of emergency continues to directly impact the ability of the Council Members to meet safely in person.
• State or local officials continue to impose or recommend measures to promote social distancing.

10. ITEMS PULLED FROM CONSENT

None.

12. BUSINESS ITEMS

By consensus, this item was reordered and heard prior to Item 11.A.

Item 12.A: Direction on James Way Beautification Project (Fine)

Recommendation: Provide staff with direction on how to proceed with a James Way Beautification Project.

Presenting staff:

Benjamin Fine, Public Works Director/City Engineer
James R. Lewis, City Manager

Guest presenters:

Bianca Koenig, BEK Collective

Call for public comment:

Staff noted public comment received via email from John Sherwood.

The following commented:

Alaina Stahlman
Earlene Craver Leijonhufvud

9.A-5Council Agenda 3-1-2022
Attachment 1

Action: Direct staff as follows:

1. Pursue the James Way Beautification Project landscaping option that includes Evergreen Pear trees, Jade plants, Myers Asparagus, and Blue Chalk Sticks as presented in the renderings in staff’s report;

2. Return with a cost estimate for repairing the damaged tree wells on the opposite (inland) side of James Way for consideration as a potential project component.

Motion: Guthrie
Second: Newton

Vote: The motion passed on the following vote:

Ayes: 5 Guthrie, Newton, Blake, Reiss, Waage
Noes: 0

Absent: 0
Abstain: 0
Recused: 0

11. PUBLIC HEARINGS

Item 11A: Introduction (First Reading) of Ordinances Effectuating a Local Coastal Plan Amendment and Adding Chapter 17.119 to Title 17 (1983 Coastal Zoning Code) and Section 17.38.145 to Chapter 38 of Title 17 (1998 Non-Coastal Zoning Code) of the Pismo Beach Municipal Code Regulating Two-Unit Residential Development and Urban Lot Splits in Compliance with Senate Bill 9 and Make a Determination of Exemption Under the California Environmental Quality Act (Downing)

Recommendation:

1. Introduce an Ordinance adding Chapter 17.119 Two-Unit Residential Development and Urban Lot Splits to Title 17 (1983 Coastal Zoning Code) of the City of Pismo Beach Municipal Code, relating to urban lot splits and two-unit residential development built in accordance with Senate Bill 9 and making a determination of exemption under the California Environmental Quality Act (CEQA);

2. Introduce an Ordinance adding section 17.38.145 Two-Unit Residential Development and Urban Lot Splits to Chapter 38 of Title 17 (1998 Non- Coastal Zoning Code) of the City of Pismo Beach Municipal Code, relating to urban lot splits and two-unit residential development built in accordance with Senate Bill 9 and making a determination of exemption under the California Environmental Quality Act (CEQA).

Presenting staff:

Matt Downing, Community Development Director
James R. Lewis, City Manager

9.A-6Council Agenda 3-1-2022
Attachment 1

Public Hearing / Call for public comment: No comment.

Action: Introduce an Ordinance adding Chapter 17.119 Two-Unit Residential Development and Urban Lot Splits to Title 17 (1983 Coastal Zoning Code) of the City of Pismo Beach Municipal Code, relating to urban lot splits and two-unit residential development built in accordance with Senate Bill 9 and making a determination of exemption under the California Environmental Quality Act (CEQA).

Motion: Blake
Second: Guthrie

Vote: The motion passed on the following vote:

Ayes: 5 Blake, Guthrie, Newton, Reiss, Waage
Noes: 0

Absent: 0
Abstain: 0
Recused: 0

Legislative Record: Ordinance O-2022-XXX introduced.

Action: Introduce an Ordinance adding section 17.38.145 Two-Unit Residential Development and Urban Lot Splits to Chapter 38 of Title 17 (1998 Non-Coastal Zoning Code) of the City of Pismo Beach Municipal Code, relating to urban lot splits and two-unit residential development built in accordance with Senate Bill 9 and making a determination of exemption under the California Environmental Quality Act (CEQA).

Motion: Blake
Second: Guthrie

Vote: The motion passed on the following vote:

Ayes: 5 Blake, Guthrie, Newton, Reiss, Waage
Noes: 0

Absent: 0
Abstain: 0
Recused: 0

Legislative Record: Ordinance O-2022-XXX introduced.

12. BUSINESS ITEMS

Item 12.A: Direction on James Way Beautification Project (Fine)

By consensus, this item was reordered and heard prior to Item 11.A.

9.A-7Council Agenda 3-1-2022
Attachment 1

Item 12.B: Risk Management Annual Report (Garcia)

Recommendation: Receive the 2021 Risk Management Annual Report as information.

Presenting staff:

Jorge Garcia, Assistant City Manager
James R. Lewis, City Manager

Guest presenters:

Tim Karcz, California Joint Powers Insurance Authority

Call for public comment: No comment.

Action: No action.

Item 12.C: Consideration of Options for Professional Services Related to Chapman Estate Accessibility and Waterproofing Improvements (Fine)

Recommendation: Consider options and provide direction on the Chapman Estate accessibility and waterproofing improvements.

Presenting staff:

Benjamin Fine, Public Works Director/City Engineer
James R. Lewis, City Manager

Call for public comment: No comment.

Action:

1. Adopt a Resolution Authorizing the City Manager to Execute Amendment #1 to the Existing Professional Services Agreement with Hunter Smith & Associates, Inc. for Design, Development and Construction Administration for Chapman Estate Improvements in the Amount of $63,750; and Appropriating Related Budget Adjustments;

2. Authorize the City Manager to pursue obtaining a geotechnical analysis of the seawall, bluffs, and sea caves beneath the estate while preparatory work is begun under the Hunter Smith & Associates contract, and return the results to the City Council for consideration before physical construction work is begun.

Motion: Reiss
Second: Blake

Vote: The motion passed on the following vote:

Ayes: 5 Reiss, Blake, Guthrie, Newton, Waage
Noes: 0

9.A-8Council Agenda 3-1-2022
Attachment 1

Absent: 0
Abstain: 0
Recused: 0

Legislative Record: Resolution R-2022-009 adopted.

Item 12.D: Remove Censure of Council Member Marcia Guthrie (Waage)

Recommendation: Approve a motion to remove the censure of Council Member Marcia Guthrie and other restrictions and restore her Committee Assignments.

Presenting:

Ed Waage, Mayor

Call for public comment: No comment.

Action: Remove the censure of Council Member Marcia Guthrie and other restrictions and restore Council Member Guthrie’s Committee Assignments.

Motion: Waage
Second: Newton

Vote: The motion passed on the following vote:

Ayes: 4 Waage, Newton, Blake, Reiss
Noes: 0

Absent: 0
Abstain: 1 Guthrie
Recused: 0

13. CITY COUNCIL COMMENTS AND REQUESTS

No requests.

14. ADJOURNMENT

At 7:36 p.m.

APPROVED: ATTEST:

________________________________ ________________________________ Ed Waage, Mayor Erica Inderlied, City Clerk

9.A-9Council Agenda 3-1-2022
Attachment 1

PISMO BEACH COUNCIL AGENDA REPORT
Agenda Item #9.B
SUBJECT/TITLE:

PAYROLL REGISTER AND REGISTER OF DEMANDS
RECOMMENDATION:

1. Approve the Summary of Payroll Register for February 13, 2022;

2. Approve the Register of Demands for February 18, 2022.

BACKGROUND:

Attached are the Summary of Payroll Register(s) and Register(s) of Demands (Check Registers) noted above, provided for Council approval.

FISCAL IMPACT:

As demonstrated in the attached payroll and check registers.

ALTERNATIVES:

1. Request additional information from staff.

ATTACHMENTS:

1. Payroll Summary

2. Register of Demands
Submitted by: Meeting Date: March 1, 2022
Nadia Feeser, Administrative Services Director / City Treasurer City Manager Approval:

9.B-1Council Agenda 3-1-2022

FORPERIODENDING02/13/22
CHECKSDATED02/18/22
PAYROLLCHECKSANDDIRECTDEPOSITTRANSACTIONS
Checks556774Ͳ556777 4 ACH 116
EARNINGS
REGULAR 315,865.19
HOLIDAY 4,470.97
OVERTIME(IncludesCompTimePayouts) 16,810.09 Administration Ͳ
Building Ͳ
Conference&VisitorsBureau Ͳ PoliceDepartment 13,256.40
ParkingͲ
Engineering Ͳ
Fire Ͳ
Recreation Ͳ
PublicWorks Ͳ
Water 2,408.26
Wastewater 1,145.43
MotorVehicles
SubtotalͲOvertime 16,810.09$
SALARYADJUSTMENTS 492.56 TRAINING/UNIFORMALLOWANCE 1,180.00 OTHEREARNINGS 20,501.27 $359,320.08
LESSAUTHORIZEDPAYROLLDEDUCTIONS
FEDERALWITHHOLDINGTAX 35,359.05
FICA&MEDICARE 27,859.17
STATEINCOMETAX 12,365.95
STATEDISABILITYINSURANCE 4,219.57
GARNISHMENTS 0.00
HEALTH 1,657.96
SUPPLEMENTALDISABILITY 1,709.96
SECTION125 2,557.72
PERS 29,351.99
DEFERREDCOMPENSATION 9,037.91
ADDITIONALLIFEINSURANCE 284.40
UNIONDUES 2,125.40
PISMOATHLETICCLUB 218.50
OTHER
NETPAYROLL $232,572.50
DIRECTDEPOSITDEDUCTION 230,320.69
NETPAYROLLAFTERACHDEPOSIT 2,251.81
SUMMARYPAYROLLREGISTER

9.B-2Council Agenda 3-1-2022
Attachment 1

City of Pismo Beach
Final Disbursement List Check Date 02/18/2022

US BANK
ACH/ Vendor Check Check
Check# Number Payee Date Amount Description
ACH 10002 Internal Revenue Service 02/18/2022 91,077.39$ Federal Income Tax PD 02/18/22 ACH 11224 Richards, Watson, Gershon Attorneys At Law 02/18/2022 2,459.75 Professional Legal Services Dec 2022 ACH 11305 Public Employees Retirement System 02/18/2022 61,932.84 PERS Retirement EE & ER PD 02/18/22 ACH 12260 dba: Mission Square ICMA Retirement Trust - 457 02/18/2022 19,061.58 ICMA 457 Deferred Comp PD 02/18/22 ACH 12305 Franchise Tax Board 02/18/2022 16,585.52 SDI & State Income Tax PD 02/18/22 ACH 12360 CalPERS 457 Plan 02/18/2022 187.50 PERS 457 Deferred Comp ER PD 02/18/22 ACH 12708 dba: Mission Square ICMA Retirement Trust-Roth IRA 02/18/2022 395.00 ICMA Roth IRA PD 02/18/22 ACH 12944 Leaf 02/18/2022 1,231.19 City Wide Copier Lease Feb 2022 ACH 13455 Wex 02/18/2022 1,636.53 Fuel for City Vehicles 1/8/22 - 02/07/22 ACH 14257 Igoe Administrative Services 02/18/2022 2,871.10 Igoe FSA & DDS Reimbursement 121485 10434 Abalone Coast Analytical Inc 02/18/2022 168.00 Water Analysis 121486 10446 Achievement House, Inc. 02/18/2022 6,854.55 Litter Removal & Clean Up Services Nov 2021 121487 12275 Airgas West Inc 02/18/2022 198.93 Cylinder Rental Jan 2022 121488 11382 Applied Technology Group, Inc. 02/18/2022 495.00 Vehicle Maintenance & FCC Renewal - Public Safety 121489 11096 Arroyo Grande Chevrolet 02/18/2022 233.85 Vehicle Maintenance 121490 12623 AT&T 9391012188 02/18/2022 2,517.29 Phone Bill - 01/10/22 - 02/09/22 121491 13278 AT&T 9391059148 02/18/2022 1,448.78 Phone Bill - 01/10/22 - 02/09/22 121492 11326 Bartel Associates, LLC 02/18/2022 1,560.00 Actuarial Consulting Services - 2021 OPEB Valuation - Dec 2021 121493 14119 Boone Printing & Graphics, Inc. 02/18/2022 1,259.98 Business Card Printing 121494 12346 Broyhill Manufacturing Company 02/18/2022 137.61 Equipment Maintenance 121495 10269 Carquest Auto Parts 02/18/2022 24.29 Vehicle Maintenance 121496 10799 Lindsay Carter Coates 02/18/2022 624.00 Instructor Pay: Yoga w/ Lindsay Jan 2022 #10822 121497 11451 Channel Islands Technology Integrators' Group 02/18/2022 74,439.63 Professional IT Services 121498 11169 Coast Riders Powersport Sales 02/18/2022 267.63 Equipment Maintenance 121499 11231 Coastal Peaks Coffee 02/18/2022 133.00 Coffee Supplies 121500 14146 Pamela Ann Coslick 02/18/2022 88.00 Instructor Pay: Tae Kwon Do Jan 2022 # 10831 121501 11893 CRS West, Inc-SLO 02/18/2022 3,032.39 Plan Printing 121502 11986 Culligan/Central Coast Water 02/18/2022 95.00 Soft Water Tank Rental Feb 2022 121503 14179 Deckard Technologies, Inc. 02/18/2022 5,500.00 STR Monitoring Services 121504 12628 Dell Marketing LP 02/18/2022 979.72 Computer Monitors 121505 14217 Deltina Coffee Roasters 02/18/2022 62.50 Coffee Supplies 121506 13050 Environmental Systems Research Institute, Inc ESRI 02/18/2022 2,300.00 ArcGIS Annual Licenses 4/1/22 - 3/31/23 121507 12123 Farm Supply 02/18/2022 23.79 Water Well Maintenance Supplies 121508 13874 Full Spectrum Powder Coating 02/18/2022 1,250.00 James Way Benches Powder Coating 121509 13575 Jorge Garcia 02/18/2022 498.61 M&IE: PARMA Risk Mgmt Conf 2/27/22-3/2/22 J. Garcia 121510 10398 Liliana Graham 02/18/2022 609.60 Instructor Pay: Ballroom Dance Jan 2022 #10821 121511 12235 Granicus, LLC 02/18/2022 2,865.08 Campaign Docs & Disclosure Docs Subscription 121512 12144 CLA-VAL Griswold Industries 02/18/2022 993.89 Equipment Maintenance 121513 10751 Haaker Equipment Company 02/18/2022 243.50 Equipment Maintenance 121514 10149 Heacock Trailers & Truck 02/18/2022 396.11 Equipment Maintenance 121515 12018 Erica Inderlied 02/18/2022 109.49 Reimbursement: Document Recording 326 Ocean Blvd 121516 10474 Joseph Wolosz 02/18/2022 5,500.00 Wolosz Parking Lot Lease - March 2022 121517 13736 Justin Jackson's Plumbing Services, Inc 02/18/2022 5,285.00 Happy Time Preschool - Emergency Sewer Line Replacement 121518 12220 Randall Lee Kendall 02/18/2022 900.00 Relocate Gazebo from Margo Dodd Park 121519 11833 Keylock Security Specialists 02/18/2022 65.03 Key Box Keys 121520 12096 Lee Wilson Electric Co Inc 02/18/2022 356.83 Signal Light Maintenance Dec 2021 121521 12019 James Lewis 02/18/2022 28.66 Reimb: Transportation to lunch mtg @ City Mgr Conf 2/1/22 - 2/4 121522 10175 Life-Assist, Inc. 02/18/2022 856.00 Medical Supplies - Fire 121523 UB*00855 ANTHONY & JESSICA MARKIEWICZ 02/18/2022 113.31 Refund Check 018513-000, 2920 SHELL BEACH 121524 12279 McMaster Carr 02/18/2022 49.12 WWTP Safety Supplies 121525 10097 Miners Hardware 02/18/2022 626.17 Maintenance Supplies 121526 13894 Leah Moss 02/18/2022 38.95 Reimbursement: Canva Pro- Dec 2021 - Feb 2022 121527 11172 Mullahey Ford 02/18/2022 1,602.96 Vehicle Maintenance 121528 10039 New Times 02/18/2022 688.00 Legal Notice Advertising 121529 11294 Claire Nguyen 02/18/2022 2,000.00 Childcare Assistance Scholarship Award 121530 12199 Noble Saw, Inc 02/18/2022 9.83 Maintenance Supplies 121531 12270 Office Depot 02/18/2022 506.65 Office Supplies 121532 10138 Online Solutions LLC 02/18/2022 17,100.00 Citizenserve Annual Renewal 121533 12315 Pacific Gas & Electric Company 02/18/2022 2,958.75 Electricity 01/05/22 - 02/03/22 121534 11122 Dean Pericic 02/18/2022 1,000.00 Release bond for encroachment permit - 116 Seacliff 121535 12022 Pismo Beach Police Officer's Association 02/18/2022 1,452.27 POA Dues PD 02/18/22 121536 12335 Procare Janitorial Supply Inc 02/18/2022 1,001.36 Janitorial Supplies 121537 10863 PVP Communications Inc 02/18/2022 2,197.52 PD Motor Equipment 121538 12613 Quinn Company 02/18/2022 6,628.37 Equipment Maintenance 121539 10240 R & T Embroidery, Inc. 02/18/2022 2,223.37 75th Anniversary Shirts - Streets, Parks & Engineering 121540 12348 Rayne Water Conditioning 02/18/2022 102.90 Soft Water - Station 63 & 64 Feb 2022 121541 13796 ReadyRefresh by Nestle 02/18/2022 833.03 Drinking Water Jan 2022 121542 11796 San Luis Powerhouse, Inc. 02/18/2022 450.20 Equipment Maintenance - City Hall Generator 121543 12108 Santa Maria Tire, Inc. 02/18/2022 3,007.81 Vehicle Maintenance 121544 13994 SBRK Finance Holdings, Inc. 02/18/2022 7,099.50 CivicPay IVR Transaction Fees Jan 2022 121545 11208 SEIU Local 620 AFL/CIO 02/18/2022 673.13 SEIU Dues PD 02/18/22 121546 14198 Ian Tyler Smith 02/18/2022 656.00 M&IE: SWAT School- I. Smith 2/21-2/26/22 & 3/1-3/5/22 121547 14099 Jeffrey Smith 02/18/2022 133.00 M&IE: CPOA Conf- 2/28-3/2/22 121548 12031 Stanley Convergent Security Solutions 02/18/2022 735.32 Monthly Security & Fire Monitoring 121549 12290 State Of California- EDD 02/18/2022 845.00 Unemployment Insurance 4th Qtr 2021 121550 12171 State Water Resources Control Board 02/18/2022 623,906.08 CWSRF C-06-4793-120 C# 04805-550-0 Principal & Interest Debt Service 121551 11549 Tech Time Communications 02/18/2022 168.00 Station 63 Alarm Monitoring Attachment 2

9.B-3Council Agenda 3-1-20221

City of Pismo Beach
Final Disbursement List Check Date 02/18/2022

US BANK
ACH/ Vendor Check Check
Check# Number Payee Date Amount Description
121552 12991 TransUnion Risk and Alternative 02/18/2022 150.00 Investigative Services- 1/1/22 - 1/31/22 121553 12622 USA Bluebook Acct: 82507 02/18/2022 569.67 WWTP Supplies 121554 10507 V & V Manufacturing 02/18/2022 133.94 PD Badge 121555 14034 Vital Records Holdings, LLC 02/18/2022 119.95 Document Storage/Compliance Reporting Feb 2022 121556 12527 Water Systems Consulting Inc 02/18/2022 160.00 2020 UWMP - Jan 2022 121557 12132 White Flag Pest Control Inc 02/18/2022 270.00 Pest Control 121558 13326 Williams Cleaning Systems LLC 02/18/2022 1,014.88 Car Wash Pump Replacement 121559 12614 Winema Industrial & Safety Supply 02/18/2022 1,783.24 Safety Equipment & Supplies 121560 UB*00854 FELIX YAP (T) 02/18/2022 21.58 Refund Check 017424-000, 106 JOYCE 121561 UB*00856 MATT ZEREGA (T) 02/18/2022 143.48 Refund Check 018340-000, 369 HINDS (IRRIGATION) Total 1,003,013.48
Attachment 2

9.B-4Council Agenda 3-1-20222

PISMO BEACH COUNCIL AGENDA REPORT
Agenda Item #9.C
SUBJECT/TITLE:

MONTHLY INVESTMENT TRANSACTION REPORT OF THE CITY’S CASH AND INVESTMENTS FOR JANUARY 2022 OF FY 2021-2022
RECOMMENDATION:

No action required; information only.

EXECUTIVE SUMMARY:

This report updates the City Council on the City of Pismo Beach’s monthly transactions of the City’s investment portfolio for the month ending January 31, 2022. California State Government Code Section 53607 states that if the authority of the legislative body to invest or reinvest funds for the City is delegated to the City Treasurer, the City Treasurer shall make a monthly report of those transactions to the legislative body.

The attached report includes all transactions of the City’s investments managed by the City, including funds invested in various securities and the City’s pooled funds invested in various financial instruments.
•Attachment 1 provides a summary of the City’s cash, investments, and monthly interest earnings based on book value as of January 31, 2022. •Attachment 2 provides details on the investment transactions for the General Fund Reserve and City Pooled Funds A (for deferred capital projects), including: purchases or deposits; sales, maturities, calls or withdrawals; and interest earnings. •Attachment 3 provides details of the monthly transactions by fund for City Pooled Funds B (for current year expenditures) for the month ending January 31, 2022.

FISCAL IMPACT:

No fiscal impact from the report itself—information only.

ALTERNATIVES:

1.No Council action is proposed, other than to receive the information.

ATTACHMENTS:

1.Summary Table for ALL Funds, including Book Values and Earnings Data for Investments in Other Financial Instruments

2.For the General Fund Reserve and City Pooled Funds A—Transactions on Investments in Securities

3.For City Pooled Funds B—Summary of monthly transactions by fund Prepared by: Vanessa Garris, Finance Manager Meeting Date: March 1, 2022 Submitted by: Nadia Feeser, Administrative Services Director / City Treasurer City Manager Approval:

9.C-1Council Agenda 3-1-2022

City of Pismo Beach
Investment Name Name of Institution Type of Investment
Current
Earnings
Rate Book Value
Actual Interest
Earned January
2022
Actual Year-to-
Date Interest
Earned Ending
1/31/2022 * Data Sources
General Fund
Reserves
US Bank CDs/GASs/Corp/
Muni Bonds

1.78% avg 7,308,013 5,121$ 62,907$ 1 City Pooled Funds - A US Bank CDs/GASs/Corp/
Muni Bonds

1.65% avg 21,888,579 18,664 178,291 1 Total All Securities 29,196,592$ 23,784$ 241,197$ City Pooled Funds - B US Bank Custody 0.00%-$ 0$ 6$ 1 City Pooled Funds - B Local Agency Invest.

Fund
State Investment
Pool

0.23%19,278,941 - 22,818 2 City Pooled Funds - B US Bank Checking 0.00%22,392,840 95 530 3 City Pooled Funds - B 41,671,781$ 95$ 23,355$ City Pooled Funds total A + B 63,560,360$ 18,759$ 201,645$ Funds Held with Fiscal
Agent
Bond funds:

Wilmington Trust
2017 Pier Project 4$ -$ 4$ 4 Funds Held with Fiscal
Agent
Bond funds:

Wilmington Trust
2017 CREB's
Project
6$ -$ 3$ 4 CalPERS Benefit Trust
OPEB Trust Account CalPERS Benefit
Trust Account
Various managed
by CalPERS
4,956,606$ -$ 210,859$ 5 TOTAL, Cash and Investments at January 31, 2022:75,824,988$ 23,880$ 475,418$ TOTAL for City Managed Portfolio, Cash and Investments:70,868,373$ 23,880$ 264,552$ Notes:
* Data Sources for Book Values and Actual Interest Earned:
1 = Monthly Customer Statement from US Bank
2 = Monthly statement from Local Agency Investment Fund 3 = Monthly reconciled bank statement from US Bank
4 = Monthly statement from Wilmington Trust
5 = Monthly statement from CalPERS Benefit Trust Account Attachment 1: Summary Table for All Funds,
including Book Values and Earnings Data for Investments in Other Financial Instruments

9.C-2Council Agenda 3-1-2022
Attachment 1

CITY OF PISMO BEACH
Attachment 2: For the General Fund Reserve and City Pooled Funds A Transactions on Investments in Securities
January 31, 2022

INVESTMENT ACTIVITY

PURCHAS ES OR DEPOSITS
01/07/22 Purchase Department of Commerce FCU 245,000$
01/26/22 Purchase Bank New York Mellon 749,363
Total 994,363$

SALES, MATURITIES, CALLS OR WITHDRAWALS
01/20/22 Matured First National Bank 245,000$
01/31/22 Matured Keesler Federal Credit Union 245,000
Total 490,000$
ACTIVITY TOTAL 504,363$

INTEREST REVENUE

GENERAL FUND RESERVE INVESTMENTS
Interest Earned on Investments 5,121$

POOLED INVESTMENTS
Interest Earned on Investments 18,664$
TOTAL INTEREST EARNED 23,784$
Data Source: Monthly Download of Transactions from US Bank

9.C-3Council Agenda 3-1-2022
Attachment 2

Attachment 3: For City Pooled Funds B - Summary of monthly transactions by fund City of Pismo Beach - Bank Account Proof of Cash for the month ending:1/31/2022 Bank Account Description Bank ID
Beginning
Balance Cash Receipts Disbursements Transfers-In
Transfers-
Out
Ending
Balance
General Checking US Bank 21,753,070$ 4,906,556$ (3,786,207)$ 513,785$ (994,363)$ 22,392,841$ LAIF LAIF 19,267,848 11,092 - - - 19,278,941 Total all Bank Accounts 41,020,918$ 4,917,648$ (3,786,207)$ 513,785$ (994,363)$ 41,671,781$ Fund Description Fund #
Beginning
Balance Cash Receipts Disbursements Transfers-In
Transfers-
Out
Ending
Balance
General Fund
General Fund 1001-10101 13,655,630 2,379,727 (1,257,980) - - 14,777,377 General Fund-Reserve 1001-10105 126,934 (16,813) - - - 110,120.83 Half Cent Sales Tax Fund 1002 3,148,057 (172,054) - - - 2,976,004 Special Revenue Funds
Gas Tax Fund 2001 1,074 13,346 - - - 14,421 LTF - Streets 2002 497,354 (39,548) (5,000) - - 452,805 PEG Access Fund 2003 137,475 - - - - 137,475 Police Grant Fund 2004 248,269 (13,396) - - - 234,872 Housing In Lieu Fund 2005 3,012,493 745 (819,813) - - 2,193,425 LBID Fund 2006 1,813,896 172,845 (174,172) - - 1,812,570 Chapman House 2007 389,871 1,079 (5,800) - - 385,150 Capital Projects Funds
Capital Projects Fund 3001 (1,438,752) 730,858 (416,247) - - (1,124,141) Public Facilities Fund 3002 868 - - - - 868 Park Development Fund 3003 442,263 (392) (30,226) - - 411,645 Circulation Fund 3101 252,918 447 - - - 253,366 Development Impact Fee Fund 3102 498,504 26,294 - - - 524,799 Developer Impact Fee Fund 3103 165,210 - - - - 165,210 Underground Utility Fund 3201 16,333 - - - - 16,333

9.C-4Council Agenda 3-1-2022
Attachment 3

Attachment 3: For City Pooled Funds B - Summary of monthly transactions by fund City of Pismo Beach - Bank Account Proof of Cash for the month ending:1/31/2022 Fund Description Fund #
Beginning
Balance Cash Receipts Disbursements Transfers-In
Transfers-
Out
Ending
Balance
Debt Service Funds
Public Finance Authority Fund 4001 - - - - - - Public Finance Authority Fund 4002 - - - - - - Freeway Foothills AD Fund 4101 756 - - - - 756 Spyglass AD Fund 4102 12,581 - - - - 12,581 Indio-El Portal AD Fund 4112 731 - - - - 731 Visalia Street AD Fund 4113 99,906 - - - - 99,906 Enterprise Funds
Water Enterprise/Tax Fund 6101/6102 3,823,348 264,925 (261,628) - - 3,826,646 Water Tax - Gragg Fund 6102-10102 100 - - - - 100 Water Construction Fund 6103 580,389 16,066 (261,054) - - 335,400 Water Expansion Fund 6104 1,125,388 3,308 - - - 1,128,696 Wastewater Enterprise Fund 6201 3,404,871 344,162 (144,295) - - 3,604,737 Wastewater Construction Fund 6202 1,233,176 144,053 (144,053) - - 1,233,176 Wastewater Expansion Fund 6203 1,858,801 8,269 - - - 1,867,069 LTF - Transit Fund 6301 29,242 (72) - - - 29,170 Pier Operations Fund 6401 15,389 5,166 (3,074) - - 17,481 Parking Fund 6501 3,012,276 181,947 (53,477) - - 3,140,747 Internal Service Funds
Technology Service Fund 7101 88,198 84,084 (22,008) - - 150,274 Motor Vehicle Fund 7201 1,909,927 111,450 (45,366) - - 1,976,012 Trust & Agency Funds
SLO County TMD 8201 156,768 134,566 (156,846) - - 134,489 Control Funds
Payroll Control Fund 9301 483,010 2,737 54,331 - - 540,077 Interest Control Fund 9302 12,161 11,187 - - - 23,349 Utility Billing Control Fund 9304 202,821 5,266 - - - 208,086 M/R Control Fund 9305 - - - - - - Total all cash funds 41,018,236 4,400,253 (3,746,708) - - 41,671,781

9.C-5Council Agenda 3-1-2022
Attachment 3

Attachment 3: For City Pooled Funds B - Summary of monthly transactions by fund City of Pismo Beach - Bank Account Proof of Cash for the month ending:1/31/2022 Fund Description Fund #
Beginning
Balance Cash Receipts Disbursements Transfers-In
Transfers-
Out
Ending
Balance

INVESTMENTS
General Fund
General Fund Money Mrkt Csh 1001-10108 0 - - - - 0 General Fund - CD's 1001-10404 4,588,000 - - - - 4,588,000 General Fund - Fed Agency 1001-10405 3,799,000 - - - - 3,799,000 GF - Half Cent Sales Tax CD's 1002-10404 1,225,000 - - - - 1,225,000 GF - Half Cent Sales Tax 1002-10405 - - - - - - GF - Half Cent Sales Tax Mny M 1002-10108 0 - - - - 0 GF Reserve Money Mkt Cash 1001-10109 0 - - - - 0 GF Reserve - CD's 1001-10403 3,097,000 245,000 - - - 3,342,000 GF Reserve - Fed Agency 1001-10402 1,453,000 - - - - 1,453,000 GF Reserve - Building 1001-10406 447,000 - - - - 447,000 GF Reserve - Building - Federal A1001-10146 53,000 - - - - 53,000 GF Reserve - Risk Mgmt - CD's 1001-10407 150,000 - - - - 150,000 GF Reserve - Risk Mgmt - Fed A 1001-10140 50,000 - - - - 50,000 GF Corp Bond - Pooled 1001-10141 529,143 - - - - 529,143 GF Corp Bond - Reserve 1001-10145 500,000 - - - - 500,000 GF Municipal Bonds Pooled 1001-10142 435,101 - - - - 435,101 GF Municipal Bonds Reserve 1001-10143 1,263,013 - - - - 1,263,013 Risk Mgmt Muni Bonds Reserve 1001-10144 50,000 - - - - 50,000 Half Cent Sales Tax - Pooled 1002-10141 499,685 - - - - 499,685 Half Cent Sales Tax - Muni Bond 1002-10142 571,288 - - - - 571,288 GF CREB's Fiscal Agent 1001-10515 (0) - - - - (0) Special Revenue Funds
Housing In Lieu - Mny Mkt Csh 2005-10108 (0) - - - - (0) Housing In Lieu Fund 2005-10404 875,000 - - - - 875,000 Housing In-Lieu Fed Agencies 2005-10405 140,000 - - - - 140,000 Capital Projects Funds
Park Develop. Fund Mny Mkt 3003-10108 - - - - - - Park Development Fund 3003-10404 - - - - - - Park Develop Federal Agencies 3003-10405 - - - - - - Circulation Fees Mny Mkt 3101-10108 - - - - - - Circulation Fees 3101-10404 245,000 - - - - 245,000 Develop. Impact Fee Mny Mkt 3102-10108 0 - - - - 0 Development Impact Fee Fund 3102-10404 490,000 - - - - 490,000 Impact Fees Federal Agencies 3102-10405 - - - - - -

9.C-6Council Agenda 3-1-2022
Attachment 3

Attachment 3: For City Pooled Funds B - Summary of monthly transactions by fund City of Pismo Beach - Bank Account Proof of Cash for the month ending:1/31/2022 Fund Description Fund #
Beginning
Balance Cash Receipts Disbursements Transfers-In
Transfers-
Out
Ending
Balance

INVESTMENTS
Debt Service Funds
Public Fin Fiscal Agent-Pier 4002-10510 4 - - - - 4 Public Fin Fiscal Agent-CREBs 4002-10515 6 - - - - 6 Enterprise Funds
Water Fund Money Mrkt Csh 6101-10108 0 - - - - 0 Water Fund CD's 6101-10404 590,000 - - - - 590,000 Wtr Fund Federal Agencies 6101-10405 2,155,000 - - - - 2,155,000 Wtr Fund Corp Bond - Pooled 6101-10141 - - - - - - Water Construction Money Mkt 6103-10108 (0) - - - - (0) Water Construction 6103-10404 490,000 259,363 - - - 749,363 Wastewater Fund Money Market 6201-10108 0 - - - - 0 Wastewater Fund CD's 6201-10404 245,000 - - - - 245,000 Wastewater Fund Fed Agencies 6201-10405 2,100,000 - - - - 2,100,000 WWtr Fund Corp Bond - Pooled 6201-10141 1,062,000 - - - - 1,062,000 Parking Enterprise Money Mrkt 6501-10108 (0) - - - - (0) Parking Enterprise 6501-10404 490,000 - - - - 490,000 Parking Fund Federal Agencies 6501-10405 1,000,000 - - - - 1,000,000 Internal Service Funds
MVR Fund Money Mrkt Csh 7201-10108 0 - - - - 0 MVR Fund CD's 7201-10404 100,000 - - - - 100,000 MVR Fund Federal Agencies 7201-10405 0 - - - - 0 CalPers Benefit Trust
OPEB Trust Account 8101-10408 4,956,606 - - - - 4,956,606 Total all Investments 33,648,845$ 504,363$ -$ -$ -$ 34,153,207$ Total all Funds 74,667,081$ 4,904,616$ (3,746,708)$ -$ -$ 75,824,988$

9.C-7Council Agenda 3-1-2022
Attachment 3

PISMO BEACH COUNCIL AGENDA REPORT
Agenda Item #9.D

SUBJECT/TITLE:

NOTICE OF COMPLETION AND ACCEPTANCE OF PUBLIC IMPROVEMENTS FOR TRACT 3100, SHELL BEACH TOWNHOMES

RECOMMENDATION:

1. Accept the public improvements for Tract 3100 as complete and authorize the release of the improvement securities; and

2. Authorize the City Manager to sign, and the City Clerk to record, a Notice of Completion.

BACKGROUND:

Tract 3100, also known as Shell Beach Townhomes, is a 14-lot subdivision consisting of townhouse lots (vicinity map included as Attachment 2). The Subdivision Improvement Agreement and Final Tract Map were previously approved by City Council on December 17, 2019 (R-2019-096).

As required by the Subdivision Improvement Agreement, the owner provided improvement securities to guarantee completion of the improvements, payment for labor and materials, and installation of the tract survey monuments. Since the public improvements are complete and survey monuments have been set, release of the improvement securities is warranted.

Conclusion and Recommendation
Staff recommends the City Council accept as complete the public Improvements for Tract 3100, authorize the release of the improvement securities, and authorize the City Manager to execute the Notice of Completion (Attachment 1).

FISCAL IMPACT:

There are no immediate fiscal impacts associated with acceptance of the improvements.

Staff time for the project was paid by the Developer’s land development fees.

ALTERNATIVES:

1. Do not accept the public improvement; do not approve the Notice of Completion and provide staff with direction.

ATTACHMENTS:

1. Notice of Completion.

2. Vicinity Map.

Prepared by: Meeting Date: March 1, 2022
Erin Olsen, Management Analyst

9.D-1Council Agenda 3-1-2022

Submitted by: Benjamin A. Fine, P.E., Director of Public Works/City Engineer City Manager Approval:

9.D-2Council Agenda 3-1-2022

RECORDING REQUESTED BY:

WHEN RECORDED, RETURN TO:

CITY CLERK

CITY OF PISMO BEACH
760 MATTIE ROAD
PISMO BEACH, CA 93449

NO TRANSFERORS

This document is recorded for the benefit of the City of Pismo Beach, a Municipal Corporation, and is exempt from fee per Government Code Section 27383.

NOTICE OF COMPLETION AND ACCEPTANCE
FOR TRACT 3100

NOTICE IS HEREBY GIVEN by the City of Pismo Beach in the County of San Luis Obispo, State of California, as follows:

1. That on the 1st of March 2022, the project hereunder described was considered completed and accepted by the City Council of the City of Pismo Beach.

2. That the description of said project is the construction of public improvements associated with Tract 3100, for the City of Pismo Beach.

3. That the name of the political subdivision controlling said project, and the owner of the land upon which the project was constructed, is the City of Pismo Beach, in the County of San Luis Obispo, State of California, whose address is 760 Mattie Road, Pismo Beach, CA 93449.

4. That the name of the owner/contractor on said project is Lot A, LLC, 4915 North Wishon Court, Fresno, CA 93704.

5. The name of the Surety on the project is Harco National Insurance Company, 702 Oberlin Road, Raleigh, NC 27605.

Date:

James R. Lewis, City Manager

Attest:

Erica Inderlied, City Clerk

9.D-3Council Agenda 3-1-2022
Attachment 1

Vicinity Map

9.D-4Council Agenda 3-1-2022
Attachment 2

PISMO BEACH COUNCIL AGENDA REPORT
Agenda Item #9.E

SUBJECT/TITLE:

CLEAN CALIFORNIA MAINTENANCE AGREEMENT WITH CALTRANS FOR STATE

HIGHWAYS IN PISMO BEACH

RECOMMENDATION:

Adopt a Resolution authorizing the City Manager to execute a maintenance agreement with the California Department of Transportation for maintenance services on State Highways within Pismo Beach City limits.

BACKGROUND:

Highway 1, which includes the entirety of Dolliver Street and the portion of Price Street from Dolliver Street to Mattie Road, and Mattie Road from Price Street to the NB Highway 101 onramp, is the main north/south route through Downtown Pismo Beach. Highway 1 is a state highway owned, maintained, and controlled by the California Department of Transportation (Caltrans).

According to the state, Caltrans is investing in removing litter, creating jobs, educating the public and engaging the community to transform unsightly roadsides into spaces of pride for all Californians through its “Clean California” program. As part of this program, and in order to expedite those cleanup activities, interested agencies are being invited to take on cleanup efforts along State Highways in their jurisdictions by entering into a “Clean California” Maintenance Agreement. This allows for the local agency to provide maintenance work in their jurisdiction, and request reimbursement from Caltrans after the fact.

City staff and Caltrans have been in discussions and the proposed agreement (Attachment 1.A) would allow the City of Pismo Beach to perform routine maintenance activities such as cleanup of litter, debris, graffiti, etc. along Highway 1 within the city limits. The proposed agreement also allows for that work to be reimbursed by Caltrans.

If and when the City takes over the Highway 1 right-of-way, these activities will become the responsibility of the City and Caltrans will no longer reimburse the City for maintenance along this corridor.

Conclusion and Recommendation
In order to expedite cleanup activities along Highway 1 and keep the high standard of cleanliness desired by the City of Pismo Beach, staff recommends the Council adopt a Resolution (Attachment 1) authorizing the City Manager to execute a maintenance agreement with Caltrans for maintenance services on State Highways within the City limits.

Council Agenda 3-1-2022 9.E-1

FISCAL IMPACT:

There is no direct fiscal impact related to this action. The City will be reimbursed for work performed.

ALTERNATIVES:

1. Do not authorize the agreement and provide staff with direction.

ATTACHMENTS:

1. Resolution

1.A. Exhibit to Resolution: Clean California Maintenance Agreement Prepared by: Meeting Date: March 1, 2022
Erin Olsen, Management Analyst
Submitted by: Benjamin A. Fine, P.E., Director of Public Works/City Engineer City Manager Approval:

Council Agenda 3-1-2022 9.E-2

RESOLUTION NO. R-2022-XXX

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PISMO BEACH,

CALIFORNIA AUTHORIZING THE CITY MANAGER TO EXECUTE A MAINTENANCE

AGREEMENT WITH THE CALIFORNIA DEPARTMENT OF TRANSPORTATION FOR

MAINTENANCE SERVICES ON STATE HIGHWAYS WITHIN PISMO BEACH CITY LIMITS
WHEREAS, Highway 1, which includes the entirety of Dolliver Street and the portion of Price Street from Dolliver Street to Mattie Road, and Mattie Road from Price Street to the NB Highway 101 onramp is a state highway owned, maintained, and controlled by the California Department of Transportation (Caltrans); and WHEREAS, as part of the Clean California program, interested agencies are taking on cleanup efforts along State Highways in their jurisdictions; and WHEREAS, this allows for expedited cleanup activities and for the local agency to request reimbursement from Caltrans for those activities; and
WHEREAS, the proposed agreement would allow the City of Pismo Beach to perform routine maintenance activities such as cleanup of litter, debris, graffiti, etc. along Highway 1 within the city limits.

NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Pismo Beach hereby authorizes the City Manager to execute a maintenance agreement (Exhibit A) with the California Department of Transportation for maintenance services on State Highways within the Pismo Beach city limits.

UPON MOTION OF Council Member , seconded by Council Member , the foregoing resolution was adopted by the City Council of the City of Pismo Beach this 1st day of March 2022, by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:

RECUSED:

Approved: Attest:
________________________ ________________________
Ed Waage, Mayor Erica Inderlied, City Clerk
Attachment 1
Council Agenda 3-1-2022 9.E-3

CLEAN CALIFORNIA MAINTENANCE AGREEMENT

WITH THE CITY OF PISMO BEACH

This CLEAN CALIFORNIA MAINTENANCE AGREEMENT (“AGREEMENT”) is made by and between the State of California, acting by and through the Department of Transportation (“STATE”), and the City of Pismo Beach (“LOCAL AGENCY”); each may be referred to individually as a “PARTY” and jointly as “PARTIES”.

RECITALS

1. This AGREEMENT will identify the specific maintenance functions STATE requests LOCAL AGENCY to perform in the STATE right of way situated within LOCAL AGENCY’S jurisdictional limits as authorized in Streets and Highways Code Section 130.

2. Pursuant to the “Clean California Beautification Program of 2021,” the PARTIES desire to identify specific mission-critical maintenance services LOCAL AGENCY will perform on and around STATE right of way situated within LOCAL AGENCY’s jurisdictional limits.

OPERATIVE PROVISIONS

1. Maintenance Services. LOCAL AGENCY shall perform litter and debris removal and associated traffic control, at the State Route(s) (SR), post miles (PM) and approximate mile lengths (STATE Right of Way) set forth in Exhibit A.

LOCAL AGENCY shall sweep, remove and discard litter and debris, including, but not limited to: furniture, appliances, tire casings, bulky and large items, automobile wreckage, auto components, clothing, beverage containers, food packages and garbage.

2. Maintenance Standards. LOCAL AGENCY shall perform all maintenance services in compliance with the provisions of Streets and Highways Code section 27, and in accordance with California and federal laws and regulations and STATE policies, procedures and specifications in effect and as amended, and applicable municipal ordinances.

3. Prior Maintenance Agreements. The PARTIES agree that this AGREEMENT does not supersede the PARTIES’ existing Delegated Maintenance Agreement or other maintenance agreements, if any.

4. Maintenance Areas. LOCAL AGENCY shall perform maintenance services in the STATE Right of Way locations and areas described in Exhibit A and listed in Exhibit B.

Attachment 1.A
Council Agenda 3-1-2022 9.E-4

5. Amendment to Agreement. Changes to LOCAL AGENCY’s maintenance services covered in this AGREEMENT may be made by each PARTY executing amended Exhibits A and B and/or executing additional pages to Exhibits A and B that shall be attached to this AGREEMENT and will supersede the original Exhibits A and B. Otherwise, this AGREEMENT may only be amended by a written agreement executed by both PARTIES. STATE’s District Maintenance Agreement Coordinator (DMAC) must obtain prior written approval of any amendments from the District 5 Deputy Director of Maintenance before such amendments may become effective and enforceable under this AGREEMENT.

6. Party Representatives and Notices.

LOCAL AGENCY’s Project Manager is:______________________ STATE’s DMAC is Michael Britton

All notices, document submittals and invoices required under this AGREEMENT shall be deemed to have been fully given when made in writing and received by the PARTIES at their respective addresses as follows:

LOCAL AGENCY
Attn: Name of Project Manager:___________________________ Address:__________________________________________________ City, Zip:__________________________________________________

STATE
Attn: Ashley Johnson, Resource Manager
Address: 50 Higuera Street
San Luis Obispo, CA 93401

7. Excluded Maintenance Activities.

7.1 Unsheltered Encampment Relocation. LOCAL AGENCY shall not engage in any activities to relocate any persons experiencing homelessness who are situated within STATE Right of Way. LOCAL AGENCY shall comply with the processes and procedures set forth in STATE’s “Interim Guidance on Encampments, Prioritizing and Addressing Encampments on Caltrans- owned Property,” dated July 2021, and as may be amended during the term of this AGREEMENT (Interim Guidance).

7.2 Abandoned Encampments. If LOCAL AGENCY encounters abandoned homeless encampments at or within STATE Right of Way, LOCAL AGENCY shall comply with the processes and procedures set forth in Attachment 1.A
Council Agenda 3-1-2022 9.E-5

STATE’s Interim Guidance, including but not limited to coordination with STATE and the local California Highway Patrol.

7.3 Hazardous Material Clean up. LOCAL AGENCY shall not engage in any hazardous material clean-up activities. If LOCAL AGENCY encounters any hazardous materials, including but not limited to bloodborne pathogens, biological waste, feces, syringes, needles, sharp objects or unknown substances during maintenance services performed under this AGREEMENT, LOCAL AGENCY shall immediately contact STATE’s District Hazardous Material manager for appropriate action.

7.4 Weed Abatement. LOCAL AGENCY shall not perform any weed abatement, remove overgrown brush, trees, grass and limbs or conduct any spraying, grading, mowing or discing for any maintenance services within STATE Right of Way.

8. Graffiti Removal. LOCAL AGENCY’s graffiti removal shall be limited to removal of text only in accordance with Streets and Highway Code Section

96. Any graffiti that in any way resembles a mural, artwork, paintings, or other similar elements may not be removed. LOCAL AGENCY shall discuss such possible art with STATE’s District 5 Transportation Art Coordinator ( ) before conducting any graffiti removal or
remediation. STATE shall pay the actual cost of LOCAL AGENCY’s graffiti removal as specified in Section 11 of this AGREEMENT.

9. Maintenance Service Schedule. LOCAL AGENCY shall provide STATE’s District 5 Area Maintenance Superintendent, Cindy Knoeck, at least twenty-four (24) hours prior telephone or email notice before performing any maintenance services under this AGREEMENT. Her email and phone number are:
or (805) 922-1987. LOCAL AGENCY shall provide
the RESOURCE MANAGER identified in this AGREEMENT with a litter, debris and graffiti removal schedule. Maintenance services shall be provided at a minimum biweekly basis. Maintenance services shall be performed between the hours of 6:00 am and 6:00 pm and may be performed on weekends and holidays if necessary. LOCAL AGENCY must request prior written approval from STATE’s District Maintenance Superintendent prior to performing any maintenance services before 6:00 am or after 6:00 pm

10. Authorized Reimbursement. The functions and levels of maintenance services delegated to LOCAL AGENCY in the attached Exhibits A and B and amounts appropriated to State pursuant to the Clean California Beautification Program of 2021 have been considered in setting authorized total dollar amounts. LOCAL AGENCY may perform additional work if desired, but STATE will not reimburse LOCAL AGENCY for any work in excess of the authorized dollar limits established herein.

Attachment 1.A
Council Agenda 3-1-2022 9.E-6

11. Cost Reimbursement. STATE shall reimburse LOCAL AGENCY for LOCAL AGENCY’s actual and necessary costs incurred to perform the maintenance services under this AGREEMENT; provided, however, that STATE’s reimbursement shall not exceed the maximum authorized expenditures listed in Exhibit B.

11.1 Amendment to Approved Expenditures. Upon LOCAL AGENCY’s written request, the expenditures per route for maintenance services set forth in Exhibits A and B may be increased, decreased, or redistributed between routes pursuant to the PARTIES executing an appropriate amendment in accordance with section 5 above. All such adjustments must be authorized in writing by the District Director or his/her authorized representative.

11.2 Term of Expenditures. Additional expenditures or an adjustment of expenditures once authorized shall apply only for the term of this AGREEMENT and shall not be deemed to permanently modify or change the basic maximum expenditures per route as specified in Exhibits A and B. Any expenditure adjustments shall not affect or alter any other terms of this AGREEMENT.

12. Billing, Payment and Reporting.

12.1 Billing Date. LOCAL AGENCY shall submit billing invoices to STATE’s RESOURCE MANAGER each month beginning after the first month LOCAL AGENCY has performed maintenance services under this AGREEMENT. LOCAL AGENCY shall not submit billing invoices for reimbursement of costs less than $500 more than once each quarter. LOCAL AGENCY shall also submit billing invoices promptly following the close of STATE’s fiscal year on each June 30th.

12.2 Billing Submission Format. Each billing invoice shall include all of the following:

(a) STATE’s Clean California Program Code: CLEANCADMA; (b) AGREEMENT number: CCMA 05-22-ST04 ;
(c) Date(s) of services;
(d) Location of services;
(e) Number of hours and hourly rates;
(f) Receipts for trash disposal;
(g) Receipts for equipment, materials and supplies; and (h) LOCAL AGENCY’s maintenance services report that includes the information required under section 15 of this AGREEMENT.

Attachment 1.A
Council Agenda 3-1-2022 9.E-7

STATE shall pay LOCAL AGENCY for the maintenance services satisfactorily performed in accordance with the rates and schedules in Exhibits A and B.

13. Successors. This AGREEMENT shall be binding upon and inure to the benefit of each of the PARTIES’ successors-in-interest, including, but not limited to any public entity to whom any part of the STATE right of way covered under this AGREEMENT may be relinquished and any subsequently incorporated city or other municipality established within the LOCAL AGENCY’s jurisdictional limits.

14. Encroachment Permits. Before LOCAL AGENCY may enter STATE right of way to perform any maintenance services in the areas covered by this AGREEMENT, STATE’s District 5 Encroachment Permit Office must issue an initial encroachment permit at no cost to LOCAL AGENCY. LOCAL AGENCY must obtain additional encroachment permits, if necessary, to enter or perform any work within STATE right of way not covered by this AGREEMENT.

STATE will issue these additional encroachment permits at no cost to LOCAL AGENCY. LOCAL AGENCY’s contractors and sub-contractors must apply for and be issued separate encroachment permits before they may enter STATE right of way to perform any maintenance or work under this AGREEMENT.

15. Performance Monitoring. LOCAL AGENCY shall prepare a Performance Report to record and report the quantity and description of litter and debris removed and maintenance services performed at each clean-up site and location set forth in Exhibits A and B. This Performance Report shall include dated and executed documents demonstrating the weight and/or amount of litter and debris removed, including disposal receipts from authorized disposal sites and/or landfills. The RESOURCE MANAGER may also request that LOCAL AGENCY provide photographs of the sites taken before and after LOCAL AGENCY’s maintenance services are performed.

16. Legal Disposal of Litter Collected. LOCAL AGENCY shall make its own arrangements for the legal disposal of litter or debris materials to authorized disposal sites. LOCAL AGENCY shall not leave any filled litter bags, litter piles or other groups of litter assembled during its maintenance services along or in STATE Right of Way. Such litter groupings shall be removed out of STATE Right of Way each day LOCAL AGENCY performs the maintenance services in this AGREEMENT.

17. Safety and Worker Compliance. LOCAL AGENCY shall be solely responsible for crew pay, workers compensation and any other benefits required by state and federal law. Subcontractors and crew members are not considered Attachment 1.A
Council Agenda 3-1-2022 9.E-8

STATE’s employees at any time. LOCAL AGENCY shall comply with all applicable State and Federal statutes and regulations governing worker and public safety, including but not limited to compliance with CAL-OSHA regulations and guidelines. LOCAL AGENCY shall notify the STATE’s District 5 Area Maintenance Superintendent no later than Tuesday of the prior week when traffic controls, flags, signs, or lane closures are necessary to safely perform any maintenance services and must receive prior approval for any such lane and/or shoulder closures.

18. Equipment and Supplies. LOCAL AGENCY shall provide the necessary equipment, tools, personal protective equipment, materials, supplies and products necessary to perform the maintenance services under this AGREEMENT. STATE shall reimburse LOCAL AGENCY for the reasonable costs of such equipment and supplies not to exceed the authorized expenditures set forth in Exhibits A and B.

19. Legal Relations and Responsibilities.

19.1 No Third-party Beneficiaries. This AGREEMENT is not intended to create duties, obligations, or rights of third parties beyond the PARTIES to this AGREEMENT. Nor does this AGREEMENT affect a PARTY’s legal liability by imposing any standard of care for the maintenance of STATE highways different from the standard of care imposed by law.

19.2 Indemnification. Neither STATE nor any of its officers or employees is responsible for any injury, damage or liability occurring by reason of anything done or omitted to be done by LOCAL AGENCY in connection with any work, authority or jurisdiction conferred upon LOCAL AGENCY under this AGREEMENT. LOCAL AGENCY shall fully defend, indemnify, and save harmless STATE and its officers and employees from all claims, suits, or actions of every kind occurring by reason of anything done or omitted to be done by LOCAL AGENCY, its contractors, sub-contractors and/or its agents pursuant to this AGREEMENT.

Neither LOCAL AGENCY nor any of its officers or employees is responsible for any injury, damage or liability occurring by reason of anything done or omitted to be done by STATE, in connection with any work, authority or jurisdiction conferred upon STATE under this Agreement. STATE shall fully defend, indemnify, and save harmless LOCAL AGENCY and its officers and employees from all claims, suits, or actions of every kind occurring by reason of anything done or omitted to be done by STATE under this Agreement.

Attachment 1.A
Council Agenda 3-1-2022 9.E-9

19.3 Work-related Injuries. If a LOCAL AGENCY-assigned crew member is injured while performing maintenance services under this AGREEMENT, LOCAL AGENCY or its designated subcontractor shall be responsible for ensuring the crew member is given prompt medical care and treatment and, if necessary, transportation to a medical facility. LOCAL AGENCY or its designated subcontractor shall administer any injury and workers compensation claims. LOCAL AGENCY shall notify the STATE’s Area Maintenance Superintendent within twenty-four (24) hours when any such incident has occurred.

20. Prevailing Wages and Labor Compliance. LOCAL AGENCY shall comply with any and all applicable labor and prevailing wage requirements in Labor Code Sections 1720 through 1815 and implementing regulations for public works or maintenance contracts and subcontracts executed for the LOCAL AGENCY’s maintenance services under this AGREEMENT.

21. Insurance.

Self-Insured. LOCAL AGENCY is self-insured. LOCAL AGENCY shall deliver evidence of self-insured coverage providing general liability insurance, coverage of bodily injury and property damage liability, in an amount of $1 million per occurrence and $2 million in aggregate and $5 million in excess by delivering a Letter Certifying Self-Insurance. The Letter of Self-Insurance must be substantially in the form of Exhibit C and identify the AGREEMENT number, and location as depicted in Exhibits A and B. LOCAL AGENCY shall provide the original Letter Certifying Self-Insurance as a condition to STATE’s execution of this AGREEMENT. A copy of the original letter shall be attached to this AGREEMENT as Exhibit C.

Self-Insured using Contractor. If the work performed under this AGREEMENT is done by LOCAL AGENCY‘s contractor(s), LOCAL AGENCY shall require its contractor(s) to maintain in force, during the term of this AGREEMENT, a policy of general liability insurance, including coverage of bodily injury and property damage liability, naming STATE, its officers, agents and employees as the additional insured in an amount of $1 million per occurrence and $2 million in aggregate and $5 million in excess. LOCAL AGENCY shall provide a certificate of insurance evidencing this insurance in a form satisfactory to STATE.

22. Budget Contingency. STATE’s payments to LOCAL AGENCY are contingent upon the Legislature appropriating sufficient funds under the Budget Act, the allocation of funding by the Clean California State Beautification Program of 2021 as appropriate, and the encumbrance of funding to STATE’s District Office.

Attachment 1.A
Council Agenda 3-1-2022 9.E-10

23. Termination. This AGREEMENT may be terminated by the mutual written consent of each PARTY. STATE may terminate this AGREEMENT for convenience or for cause upon thirty (30) days’ prior written notice to LOCAL AGENCY. LOCAL AGENCY may terminate this AGREEMENT upon thirty (30) days’ prior written notice to STATE.

24. Term of Agreement. This AGREEMENT shall become effective on the last of the dates each PARTY’s authorized representative has executed this AGREEMENT and shall expire on June 30, 2024, unless terminated or amended.

25. Authority. Each individual executing this AGREEMENT on behalf of each PARTY represents and warrants that he/she is duly authorized to execute this AGREEMENT as authorized under Streets and Highways Code Sections 114 and 130. LOCAL AGENCY represents and certifies that it has, through its regular political process, authorized the execution of this AGREEMENT by appropriate resolution, delegation, or plenary authority as required.

26. Counterparts. This AGREEMENT may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same document.

Attachment 1.A
Council Agenda 3-1-2022 9.E-11

27. Electronic Signatures. Electronic signatures of the PARTIES, whether digital or encrypted, are intended to authenticate this written AGREEMENT, and shall have the same force and effect as manual signatures for this AGREEMENT.

THE LOCAL AGENCY OF

STATE OF CALIFORNIA

DEPARTMENT OF TRANSPORTATION

Dated:

Mayor
INITIATED AND APPROVED:

Dated: Dated:

City Manager

Deputy District Director
Maintenance District 5
Dated:

City Clerk

APPROVED AS TO FORM
Dated:

City Attorney

Attachment 1.A
Council Agenda 3-1-2022 9.E-12

EXHIBIT A

Route
No.

Length
Miles
Description of Routing Program Code
1 2.11 PM 14.62 to 16.73
From the northerly end of the Monarch
Butterfly Grove to Price Street, Price St from
Cabrillo Hwy to Mattie Rd, and Mattie Rd
from Price St to the northbound on-ramp of
State Route 101

CLEANCADMA

Attachment 1.A
Council Agenda 3-1-2022 9.E-13

EXHIBIT B

BREAKDOWN & LISTING OF MAINTENANCE TASKS

Rte
No.

Post
Miles
Litter
per
Bag
(CY)
Large
Items
Graffiti

Traffic
Control
Other
(CY)
Maximum Authorized
Expenditures
1 14.62
to

16.73 X X X X X Actual Cost
TOTAL MAXIMUM AUTHORIZED EXPENDITURES: $60,000

Attachment 1.A
Council Agenda 3-1-2022 9.E-14

EXHIBIT C
LETTER CERTIFYING CITY’S SELF-INSURED STATUS (TEMPLATE) On Local Agency letterhead
Caltrans – District 5 ________________, 20___
ATTN: Michael Britton
Re: Statement of Self-Insurance for CITY of Pismo Beach for Clean California Maintenance Agreement No. CCMA 05-221-ST04 with California Department of Transportation for the Litter and Debris Removal along SR 1 within the Pismo Beach City Limits

Dear Mike:

This letter certifies that the CITY of Pismo Beach is self-insured and self-funded covering third-party claims arising out of its general operations (i.e.; commercial general liability and automobile liability insurance). Further, the CITY is self- insured covering workers’ compensation claims and has received the consent of the State Department of Industrial Relations to do so.

Each fiscal year, as a part of its budgetary process, the CITY appropriates funds specifically to satisfy valid third-party claims and workers’ compensation claims, which may be brought against the CITY.

The CITY certifies its self-insured, general liability coverage for bodily injury and property damage liability, meets the required coverage amounts in section 21 (Insurance) of the Clean California Maintenance Agreement, specifically general liability insurance, coverage of bodily injury and property damage liability in an amount of $1 million per occurrence and $2 million in aggregate and $5 million in excess.

If you need any additional information regarding this letter, please direct those inquiries through my office.

Sincerely,

Finance Manager/Risk Manager/Authorized Representative’s Title Attachment 1.A
Council Agenda 3-1-2022 9.E-15

PISMO BEACH COUNCIL AGENDA REPORT
Agenda Item #9.F

SUBJECT/TITLE:

ADOPTION (SECOND READING) OF ORDINANCES EFFECTUATING A LOCAL COASTAL PLAN AMENDMENT AND ADDING CHAPTER 17.119 TO TITLE 17 (1983 COASTAL ZONING CODE) AND SECTION 17.38.145 TO CHAPTER 38 OF TITLE 17 (1998 NON-COASTAL ZONING CODE) OF THE PISMO BEACH MUNICIPAL CODE

REGULATING TWO-UNIT RESIDENTIAL DEVELOPMENT AND URBAN LOT SPLITS IN COMPLIANCE WITH SENATE BILL 9 AND MAKE A DETERMINATION OF

EXEMPTION UNDER THE CALIFORNIA ENVIRONMENTAL QUALITY ACT

RECOMMENDATION:

1. Adopt an Ordinance adding Chapter 17.119 Two-Unit Residential Development and Urban Lot Splits to Title 17 (1983 Coastal Zoning Code) of the City of Pismo Beach Municipal Code, relating to urban lot splits and two-unit residential development built in accordance with Senate Bill 9 and making a determination of exemption under the California Environmental Quality Act (CEQA);

2. Adopt an Ordinance adding section 17.38.145 Two-Unit Residential Development and Urban Lot Splits to Chapter 38 of Title 17 (1998 Non-Coastal Zoning Code) of the City of Pismo Beach Municipal Code, relating to urban lot splits and two-unit residential development built in accordance with Senate Bill 9 and making a determination of exemption under the California Environmental Quality Act (CEQA); and

3. Direct staff to forward the Coastal Zoning ordinance to the California Coastal Commission to certify an amendment to the Certified Local Coastal Program.

BACKGROUND:

On February 15, 2022, the City Council introduced two ordinances (Attachments 1 and 2) amending both the Coastal (1983) Zoning Code and Non-Coastal (1998) Zoning Code to establish regulations for two-unit residential development and urban lot splits in order to address the provisions of Senate Bill 9 (Atkins).

The ordinances are now being returned to the Council for second reading and adoption.

The agenda report for the February 15, 2022 agenda item, which includes background and analysis, is provided as Attachment 3.

Recommendation
Staff recommends that the City Council adopt two ordinances (Attachments 1 and 2) establishing Coastal and Non-Coastal zoning regulations, respectively, for two-unit residential development and urban lot splits in order to address the provisions of Senate Bill 9 (Atkins). Staff also recommends that the Council direct staff to forward the adopted 1983 Coastal Zoning ordinance to the California Coastal Commission to certify an amendment to the Certified Local Coastal Program.

Council Agenda 3-1-2022 9.F-1

If the Council acts to adopt the ordinances as recommended, they will become effective by statute on March 31, 2022. The Coastal Zoning ordinance will be implemented and codified following ratification by the Coastal Commission.

FISCAL IMPACT:

There are no immediate fiscal impacts as a result of the proposed ordinances.

ALTERNATIVES:

1. Pismo Beach Municipal Code 2.04.340 automatically waives full readings of Ordinances unless the Council directs otherwise; the Council may opt to have staff conduct a second reading in full, and then take action on the Ordinance.

2. Amend the Ordinance and return it for another first reading and introduction.

3. Decline to adopt the Ordinance.

ATTACHMENTS:

1. Senate Bill 9 Ordinance (1983 Zoning Code)

2. Senate Bill 9 Ordinance (1998 Zoning Code)

3. February 15, 2022 agenda report (ordinance attachments omitted) Submitted by: Erica Inderlied, City Clerk Meeting Date: March 1, 2022 City Manager Approval:

Council Agenda 3-1-2022 9.F-2

ORDINANCE NO. O-2022-XXX

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF PISMO BEACH, CALIFORNIA ADDING CHAPTER 17.119 TWO-UNIT RESIDENTIAL DEVELOPMENT AND URBAN LOT SPLITS TO TITLE 17 (1983 COASTAL ZONING CODE) OF THE

CITY OF PISMO BEACH MUNICIPAL CODE, RELATING TO URBAN LOT SPLITS

AND TWO-UNIT RESIDENTIAL DEVELOPMENT BUILT IN ACCORDANCE WITH SENATE BILL 9 AND MAKING A DETERMINATION OF EXEMPTION UNDER THE

CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA)
WHEREAS, on September 16, 2021 California Governor Gavin Newsom signed SB 9, entitled the “California Home Act,” into law, which establishes a series of new regulations to allow for ministerial approval of two units on parcels located in single-family residential zones as outlined in California Government Code Section 65852.21 and 66411.7; SB 9 took effect on January 1, 2022; and
WHEREAS, SB 9 requires cities to ministerially approve a parcel map for an urban lot split and/or a proposed housing development containing a maximum of two residential units within a single-family residential zone, if the two-unit or subdivision project meets certain statutory criteria; SB 9 specifies, subject to certain exceptions, that proposed projects and subdivisions cannot be proposed in prohibited locations under California Government Code Section 65913.4(a)(6)(B)-(K), such as in an earthquake fault zone, lands under conservation easement, a federally designated flood plain, and high fire hazard severity zones as defined under state law and that SB 9 shall not be construed to supersede or in any way alter or lessen the effect or application of the California Coastal Act; and
WHEREAS, SB 9 further restricts the standards and regulations that local agencies may impose on qualifying two-unit or subdivision projects; In addition, SB 9 permits a local agency to deny a proposed two-unit or subdivision project only if the agency makes a written finding based on preponderance of the evidence that the proposed project would have a specific, adverse impact upon public health and safety or the physical environment, which is a very high standard for municipalities to meet under the statute; and
WHEREAS, some parcels within the city of Pismo Beach are also within the Coastal Zone, others are in locations where increased density may cause safety concerns due to limited ingress and egress from the neighborhood; The City has substantial interests in protecting the coastal access and promoting safety in development projects; Unregulated or disorderly development represents an ever-increasing and true threat to the health, welfare, and safety of the community; and
WHEREAS, SB 9 specifically authorizes local agencies to impose objective zoning, subdivision, and design standards consistent with the bill’s provisions, and to adopt an ordinance to implement its provisions; The default standards contained in the new state Attachment 1
Council Agenda 3-1-2022 9.F-3

law lack sufficient objective zoning, subdivision, and design standards to preserve the health, welfare and safety of the community; The City of Pismo Beach desires to clarify the objective zoning and design standards that will apply to the ministerial review of qualifying urban lot splits and residential developments in the City’s single-family residential zones; and

WHEREAS, the City Council finds that under the City’s current zoning standards and current general plan policies, the approval of qualifying urban lot splits and residential developments pursuant to SB 9 might cause a disproportionate public health, safety, and welfare impact to the city of Pismo Beach community and to its residents—including potential detrimental impacts on coastal resources and access, safety, and emergency response in high fire zones—without compensating benefits to the community; and

WHEREAS, the City Council finds it necessary to impose additional objective standards consistent with SB 9 to ensure coastal access and address potential safety concerns; and

WHEREAS, the Planning Commission held a duly noticed public hearing on January 25, 2022, at which time it heard public input, considered the drafted amendments to the City’s regulations, and recommended the City Council approve the amendments.

NOW, THEREFORE, the City Council of the City of Pismo Beach does ordain as follows:

SECTION 1.

The foregoing recitals are adopted as findings of fact in support of this ordinance.

SECTION 2.

The Pismo Beach Municipal Code is revised to add a new Chapter 17.119 to read as follows:

Chapter 17.119 TWO-UNIT RESIDENTIAL DEVELOPMENT AND URBAN LOT SPLITS

17.119.010 Purpose and intent.

This chapter is intended to:

A. Preserve, protect, and enhance the character of the city’s different residential neighborhoods;

B. Provide for and regulate urban lot splits and two-unit residential development in a manner consistent with the requirements of Senate Bill 9;

C. Continue to protect coastal resources and allow and protect coastal access;

Attachment 1
Council Agenda 3-1-2022 9.F-4

D. Promote and ensure safe development in high fire zones.

17.119.020 Definitions.

For the purposes of this chapter, terms shall be defined as follows:

A. “Accessory dwelling unit” has the same meaning ascribed in Section

17.117.030(A).

B. “Coastal Zone unit” means a unit developed pursuant to SB 9 and this chapter on property located in the coastal zone and meeting all of the following criteria:

1. Property is located within the Coastal Zone;

2. Property is located west of U.S. Route 101; and

3. Located within one-quarter mile (1,320 feet) walking distance of one of the following:

a. A vertical access point to the beach;

b. A segment of the California Coastal Trail;

c. A coastal park; or

d. A coastal view area.

C. “Junior accessory dwelling unit” has the same meaning ascribed in Section

17.117.030(J).

D. “Existing structure” means an original dwelling on the property.

E. “SB 9” or “Senate Bill 9” means the state law approved by the Governor on September 16, 2021, amending California Government Code Section 66452.6 and adding California Government Code Section 65852.21 and 66411.7.

F. “Two-residential unit development” means a housing development containing no more than two (2) residential units within a single-family residential zone permitted pursuant to the regulations set forth in SB 9.

G. “Unit” means any dwelling unit or units created pursuant to California Government Code Section 66452.21, an existing structure, a primary dwelling unit, an accessory dwelling unit or a junior accessory dwelling unit.

Attachment 1
Council Agenda 3-1-2022 9.F-5

H. “Urban lot split” means a parcel map subdivision permitted pursuant to the regulations set forth in SB 9 that creates no more than two (2) parcels of approximately equal size.

17.119.030 Applicability; Ministerial compliance review.

A. This chapter shall apply to all two-residential unit developments and urban lot splits proposed for lots in R1 (Single Family Residential) zones pursuant to the regulations set forth in SB 9. Except as expressly provided in this chapter or SB 9, all other regulations of the underlying zone of a property developed pursuant to SB 9, including all applicable regulations from the Pismo Beach Municipal Code, shall apply.

B. Required Approvals.

1. All two-residential unit developments and urban lot splits outside the Coastal Zone shall be required to obtain zoning clearance and a building permit and shall be subject to ministerial review by the Community Development Director or designee to determine whether the criteria for approval have been met. An urban lot split shall be processed as a parcel map, but no discretionary review or public hearing shall be conducted if all required criteria have been met.

2. Projects in the Coastal Appeal Zone shall be required to obtain a coastal development permit and a building permit. The requirement for public hearing is hereby waived. An urban lot split shall be processed as a parcel map, but no discretionary review or public hearing shall be conducted if all required criteria have been met.

Action on a project is final, unless appealed to the California Coastal Commission within ten (10) days of the Coastal Commission’s receipt of the notice of final action.

3. Projects in the Coastal Zone, Non-Appealable, shall be required to obtain a coastal development permit and a building permit. The requirement for public hearing is hereby waived. An urban lot split shall be processed as a parcel map, but no discretionary review or public hearing shall be conducted if all required criteria have been met.

4. For two-residential unit developments and urban lot splits in the Coastal Zone, Appealable or Non-Appealable, for which a public hearing requirement has been waived pursuant to this subsection, at least ten (10) calendar days prior to the issuance of a coastal development permit, the City shall provide notice by first class mail of the pending application for development. This notice shall be provided to the persons, and contain the information, identified in Attachment 1
Council Agenda 3-1-2022 9.F-6

Section 17.124.090 for appealable and non-appealable
developments, as applicable.

C. All applicants for a two-residential unit development or an urban lot split shall submit an application including:

1. A sworn statement affirming eligibility under SB 9 regulations;

2. All materials required by the Community Development Director;

3. Applicants for an urban lot split shall, in addition, sign an affidavit stating that the owner intends to occupy one of the housing units as their principal residence for at least three (3) years from the date of the approval of the urban lot split. Provided, however, this provision shall not apply to an owner that is a community land trust or qualified nonprofit corporation as those terms are defined and described in California Revenue and Taxation Code Sections 402.1 and 214.15, respectively;

D. The City may, at the applicant’s expense, conduct independent inquiries and investigation to ascertain the veracity of any or all portions of the sworn statement.

17.119.040 General requirements.

An applicant seeking approval of a two-residential unit development or urban lot split shall:

A. Comply with SB 9; all objective requirements of other applicable state law including the Subdivision Map Act; the Pismo Beach Municipal Code, including Title 17 and Title 16, except as expressly provided in SB 9, or in this chapter; and all objective standards of this chapter.

B. Execute and record a covenant, supplied by the City and subject to the approval of the City Attorney or designee, that contains the following provisions:

1. Non-residential uses are prohibited on the property subject to development under SB 9 and this chapter;

2. Rental or leasing of any unit or units on the property for a period of thirty (30) days or less is prohibited;

3. Ongoing compliance with SB 9 requirements and restrictions is required;

Attachment 1
Council Agenda 3-1-2022 9.F-7

4. Access to the public right-of-way shall be maintained in perpetuity;

5. All required parking shall be maintained;

6. If the applicant is seeking approval of an urban lot split, any subsequent urban lot split of the property is prohibited.

17.119.050 Parking.

All two-residential unit developments and urban lot splits shall comply with the following objective standards for parking:

A. One (1) enclosed or partially enclosed parking space is required for each unit created pursuant to the regulations in SB 9 and this chapter and such parking space shall be located on the same parcel as the unit.

B. Parking required for a unit created pursuant to SB 9 and this chapter is in addition to any parking required for the existing structure, should it remain on the property. If an existing garage, carport, or other parking is converted or demolished in order to construct the new unit, the required parking space(s) that are displaced shall be replaced on the same property to satisfy the parking requirements of the existing structure.

C. Exceptions. Additional parking spaces required under subsection

17.119.050.A shall not be required for units developed pursuant to SB 9 and this chapter if the property upon which the unit is created meets one or more of the following criteria:

1. Is within one-half (1/2) mile walking distance of a high-quality transit corridor, as defined in California Public Resources Code Section 21155e, or a major transit stop, as defined in California Public Resources Code Section 21064.3, or

2. There is a car share vehicle located within one (1) block of the project.

D. Parking in the Coastal Zone.

1. For Coastal Zone units, the following additional requirements apply due to the number of individuals that visit the Pismo Beach coast and to ensure adequate public access to coastal resources in compliance with California Public Resources Code Section 30001.5(c) and the California Coastal Act:

a. Subsection 17.119.050A shall not apply, and the total number of off-street parking spaces required for a unit shall meet the Attachment 1
Council Agenda 3-1-2022 9.F-8

minimum off-street parking requirements in PBMC Section

17.108.020 and be on the same parcel as the unit.

b. The parking exceptions identified in subsection 17.119.050.C of this chapter do not apply.

E. Required off-street parking may be provided as tandem parking on an existing driveway provided all requirements in subsection 17.108.030.A.7.a are met.

F. Each required parking space shall meet the following standards:

1. Each parking space shall have minimum dimensions of nine (9) feet by twenty (20) feet.

2. All parking spaces shall be located behind existing or future sidewalk, or other public right-of-way.

3. All parking spaces shall be located on an all-weather surface as approved by the City Engineer or designee (e.g., hardscape, gravel) and be accessed by a driveway apron or curb cut.

17.119.060 Development standards.

All two-residential development units and urban lot splits shall comply with the following objective development standards:

A. Driveways.

1. A driveway may be shared by not more than two (2) units and no more than two (2) lots.

2. More than one (1) driveway per lot is prohibited on lots with less than 60 feet of public street frontage.

B. Setback Requirements. All units in a two-residential unit development and/or on an urban lot split shall comply with the setback standards for R1 zones and be subject to environmental buffers and constraints under the Coastal Act. Provided, however, no setback shall be required for an existing structure or structure constructed in the same location and to the same dimensions as the existing structure, unless otherwise identified in the City’s Local Coastal Plan in order to protect coastal resources.

C. Occupancy.

1. Non-residential uses on the property subject to a two-residential unit development or an urban lot split are prohibited.

Attachment 1
Council Agenda 3-1-2022 9.F-9

2. Short-Term Rental Prohibited. A short-term rental use of thirty days or less shall not be permitted in units developed pursuant to SB 9 and this chapter. Units developed pursuant to SB 9 and this chapter shall be occupied for terms longer than thirty (30) days.

D. Height. Height of a unit developed pursuant to SB 9 and the chapter shall be no greater than permitted in R1 zones and shall be consistent with the City’s Local Coastal Plan in order to protect coastal resources.

E. Lot Coverage and Maximum Building Areas. Lot coverage and maximum building areas shall comply with the applicable standard for R1 zones, except as provided in Section 17.119.070.

F. No accessory dwelling unit or junior accessory dwelling unit shall be permitted on a parcel subject to an urban lot split under this chapter and also improved with a two-residential unit development under this chapter.

G. Two-residential unit developments and urban lot splits are not permitted on parcels located in the R-1 zone above the intersection of Longview Avenue and Stratford Street in the Pismo Heights planning area due to being in very high fire hazard severity zones, as determined by the California Department of Forestry and Fire Protection pursuant to California Government Code Section 51178, or within a high or very high fire hazard severity zone as indicated on maps adopted by the California Department of Forestry and Fire Protection pursuant to California Public Resources Code Section 4202 and is coextensive with traffic flow and public safety concerns as this area has only one ingress and egress.

H. More than twenty-five (25) percent of the exterior structural walls of the existing structure shall not be demolished if the existing structure has been occupied by a tenant in the three (3) years prior to the submission of an SB 9 Development Project application.

I. An urban lot split shall comply with SB 9 and the following standards:

1. No lot resulting from an urban lot split shall be smaller than one thousand two hundred (1,200) square feet.

2. No lot resulting from an urban lot split shall have more than two (2) residential units inclusive of any accessory dwelling unit or junior accessory dwelling unit.

3. The two lots resulting from an urban lot split shall be approximately equal, and no smaller than forty (40) percent or larger than sixty (60) percent of the lot area of the original parcel.

Attachment 1
Council Agenda 3-1-2022 9.F-10

4. No flag lots shall be created as a result of an urban lot split if the subject property is adjacent to an alley, located on a corner, or on a through lot.

5. The width of any lot resulting from an urban lot split shall not be less than twenty (20) feet wide.

6. The proposed parcel map shall demonstrate ability to access the public right-of-way in perpetuity.

J. Two-residential unit developments and urban lot splits are not permitted on parcels located in the R-1 zone in areas determined by the Community Development Director to be vulnerable to sea level rise unless such urban lot split or two-residential unit development is consistent with applicable provisions of the Coastal Act and meets the following criteria:

1. The two-residential unit development or urban lot split is designed to minimize risks to life and property in areas of geologic and flood hazard;

2. The two-residential unit development or urban lot split is designed to assure stability and structural integrity, and neither create nor contribute significantly to erosion, geologic instability, or destruction of the site or surrounding area;

3. The two-residential unit development or urban lot split does not require the construction of protective devices that would substantially alter natural landforms along bluffs and cliffs;

4. The two-residential unit development or urban lot split is sited and designed to prevent significant degradation of adjacent sensitive habitats and recreation areas;

5. The two-residential unit development or urban lot split is sited and designed to maintain coastal resources and public access to coastal resources.

17.119.070 Exceptions.

The Community Development Director shall approve an exception to any of the standards specified in this chapter, other than those required for compliance with the Coastal Act, upon determining that complying with the standards would physically preclude the construction of up to two (2) residential units per lot or would physically preclude either of the two residential units from being eight hundred (800) square feet in floor area.

Attachment 1
Council Agenda 3-1-2022 9.F-11

17.119.080 Denial.

The Building Official or Community Development Director may deny an application for a two-residential unit development or an urban lot split upon making both the following findings in writing based on a preponderance of the evidence:

A. The proposal would have a specific, adverse impact upon the public health and safety or the physical environment as defined and determined in California Government Code Section 65589.5(d)(2).

B. There is no feasible method to satisfactorily mitigate or avoid the specific, adverse impact.

SECTION 3.

This Ordinance/Local Coastal Plan Amendment shall be carried out in a manner fully in conformity with the Coastal Act consistent with California Public Resources Code Section 30510.

SECTION 4.

Under the provisions of the California Environmental Quality Act (CEQA) Guidelines Section 15061(b)(3), this ordinance is covered by the general rule that CEQA applies only to projects which have the potential for causing a significant effect on the environment.

Where it can be seen with certainty that there is no possibility that the activity in question may have a significant effect on the environment, such as the adoption of the regulations contained herein, the activity is not subject to CEQA. Furthermore, this ordinance is exempt from CEQA pursuant to Government Code Section 65852.21(j) effective January 1, 2022.

SECTION 5.

This ordinance shall not be interpreted in any manner to conflict with controlling provisions of state or federal law, including, without limitation, the Constitution of the State of California. If any section, subsection, or clause of this ordinance shall be deemed to be unconstitutional or otherwise invalid, the validity of the remaining sections, subsections and clauses shall not be affected thereby. If this ordinance, or any section, subsection or clause of this ordinance shall be deemed unconstitutional or invalid as applied to a particular appeal, the validity of this ordinance and its sections, subsections, and clauses in regard to other contracts shall not be affected.

SECTION 6.

This ordinance shall become effective automatically upon final certification by the California Coastal Commission (CCC), unless the CCC proposes suggested modifications to the proposed ordinance. In this case, the ordinance shall become Attachment 1
Council Agenda 3-1-2022 9.F-12

effective on the date the CCC concurs that the City Council properly accepted the modified ordinance with suggested modifications.

SECTION 7.

The City Clerk shall certify to the passage and adoption of this Ordinance, shall enter the same in the book of original ordinances of the City and shall make a minute of the passage and adoption thereof in the records of the meeting at which the same is passed and adopted.

Before the expiration of fifteen (15) days after the passage of this Ordinance, the City Clerk shall cause the same to be posted in three public places within the City of Pismo Beach, to wit: 1) City Hall, 760 Mattie Road, Pismo Beach, 2) U.S. Post Office, Shell Beach Road, Pismo Beach, 3) U.S. Post Office, Crest Drive, Pismo Beach.

INTRODUCED at a regular meeting of the City Council held this 15th day of February, 2022, on motion of Council Member Blake, seconded by Council Member Guthrie, and on the following roll call vote, to wit:

AYES: 5 Blake, Guthrie, Newton, Reiss, Waage
NOES: 0
ABSENT: 0
ABSTAIN: 0
RECUSED: 0

Approved: Attest:

________________________ ________________________
Ed Waage, Mayor Erica Inderlied, City Clerk

ADOPTED at a regular meeting of the City Council held this th day of , 2022, on motion of Council Member , seconded by Council Member , and on the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:

RECUSED:

Approved: Attest:

________________________ ________________________
Ed Waage, Mayor Erica Inderlied, City Clerk

Attachment 1
Council Agenda 3-1-2022 9.F-13

APPROVED AS TO FORM:

______________________________
David M. Fleishman, City Attorney
Attachment 1
Council Agenda 3-1-2022 9.F-14

ORDINANCE NO. O-2022-XXX

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF PISMO BEACH, CALIFORNIA ADDING SECTION 17.38.145 TWO-UNIT RESIDENTIAL DEVELOPMENT AND URBAN LOT SPLITS TO CHAPTER 38 OF TITLE 17 (1998

NON-COASTAL ZONING CODE) OF THE CITY OF PISMO BEACH MUNICIPAL

CODE, RELATING TO URBAN LOT SPLITS AND TWO-UNIT RESIDENTIAL DEVELOPMENT BUILT IN ACCORDANCE WITH SENATE BILL 9 AND MAKING A

DETERMINATION OF EXEMPTION UNDER THE CALIFORNIA ENVIRONMENTAL

QUALITY ACT (CEQA)

WHEREAS, on September 16, 2021 California Governor Gavin Newsom signed SB 9, entitled the “California Home Act,” into law, which establishes a series of new regulations to allow for ministerial approval of two units on parcels located in single-family residential zones as outlined in California Government Code Section 65852.21 and 66411.7; SB 9 took effect on January 1, 2022; and

WHEREAS, SB 9 requires cities to ministerially approve a parcel map for an urban lot split and/or a proposed housing development containing a maximum of two residential units within a single-family residential zone, if the two-unit or subdivision project meets certain statutory criteria; SB 9 specifies, subject to certain exceptions, that proposed projects and subdivisions cannot be proposed in prohibited locations under California Government Code Section 65913.4(a)(6)(B)-(K), such as in an earthquake fault zone, lands under conservation easement, a federally designated flood plain, and high fire hazard severity zones as defined under state law and that SB 9 shall not be construed to supersede or in any way alter or lessen the effect or application of the California Coastal Act; and

WHEREAS, SB 9 further restricts the standards and regulations that local agencies may impose on qualifying two-unit or subdivision projects; In addition, SB 9 permits a local agency to deny a proposed two-unit or subdivision project only if the agency makes a written finding based on preponderance of the evidence that the proposed project would have a specific, adverse impact upon public health and safety or the physical environment, which is a very high standard for municipalities to meet under the statute; and

WHEREAS, some parcels within the city of Pismo Beach are also within the Coastal Zone; others are in locations where increased density may cause safety concerns due to limited ingress and egress from the neighborhood; The City has substantial interests in protecting the coastal access and promoting safety in development projects; Unregulated or disorderly development represents an ever-increasing and true threat to the health, welfare, and safety of the community; and

WHEREAS, SB 9 specifically authorizes local agencies to impose objective zoning, subdivision, and design standards consistent with the bill’s provisions, and to adopt an Attachment 2
Council Agenda 3-1-2022 9.F-15

ordinance to implement its provisions; The default standards contained in the new state law lack sufficient objective zoning, subdivision, and design standards to preserve the health, welfare, and safety of the community; The City of Pismo Beach desires to clarify the objective zoning and design standards that will apply to the ministerial review of qualifying urban lot splits and residential developments in the city’s single-family residential zones; and

WHEREAS, the City Council finds that under the City’s current zoning standards and current general plan policies, the approval of qualifying urban lot splits and residential developments pursuant to SB 9 might cause a disproportionate public health, safety, and welfare impact to the city of Pismo Beach community and to its residents—including access, safety, and emergency response in high fire zones—without compensating benefits to the community; and

WHEREAS, the City Council finds it necessary to impose additional objective standards consistent with SB 9 to address potential safety concerns; and

WHEREAS, the Planning Commission held a duly noticed public hearing on January 25, 2022, at which time it heard public input, considered the drafted amendments to the City’s regulations, and recommended the City Council approve the amendments.

NOW, THEREFORE, the City Council of the City of Pismo Beach does ordain as follows:

SECTION 1.

The foregoing recitals are adopted as findings of fact in support of this ordinance.

SECTION 2.

The Pismo Beach Municipal Code is revised to add a new Section 17.38.145 to read as follows:

17.38.145 Two-Unit Residential Development and Urban Lot Splits.

A. Purpose and intent. This section is intended to:

1. Preserve, protect, and enhance the character of the city’s different residential neighborhoods;

2. Provide for and regulate urban lot splits and two-unit residential development in a manner consistent with the requirements of Senate Bill 9;

3. Promote and ensure safe development in high fire zones.

Attachment 2
Council Agenda 3-1-2022 9.F-16

B. Definitions. For the purposes of this section, terms shall be defined as follows:

1. “Accessory dwelling unit” has the same meaning ascribed in Section

17.38.155.C.1.

2. “Junior accessory dwelling unit” has the same meaning ascribed in Section 17.38.155.C.10.

3. “Existing structure” means an original dwelling on the property.

4. “SB 9” or “Senate Bill 9” means the state law approved by the Governor on September 16, 2021, amending California Government Code Section 66452.6 and adding California Government Code Section 65852.21 and 66411.7.

5. “Two-residential unit development” means a housing development containing no more than two (2) residential units within a single- family residential zone permitted pursuant to the regulations set forth in SB 9.

6. “Unit” means any dwelling unit or units created pursuant to California Government Code Section 66452.21, an existing structure, a primary dwelling unit, an accessory dwelling unit, or a junior accessory dwelling unit.

7. “Urban lot split” means a parcel map subdivision permitted pursuant to the regulations set forth in SB 9 that creates no more than two (2) parcels of approximately equal size.

C. Applicability; Ministerial compliance review.

1. This section shall apply to all two-residential unit developments and urban lot splits proposed for lots in RSL (Single-Family Low Density Residential) zones pursuant to the regulations set forth in SB 9.

Except as expressly provided in this section or SB 9, all other regulations of the underlying zone of a property developed pursuant to SB 9, including all applicable regulations from the Pismo Beach Municipal Code, shall apply.

2. Required Approvals.

a. All two-residential unit developments and urban lot splits outside the Coastal Zone shall be required to obtain zoning clearance and a building permit and shall be subject to ministerial review by the Community Development Director or Attachment 2
Council Agenda 3-1-2022 9.F-17

designee to determine whether the criteria for approval have been met. An urban lot split shall be processed as a parcel map, but no discretionary review or public hearing shall be conducted if all required criteria have been met.

b. Projects in the Coastal Appeal Zone shall be required to obtain a coastal development permit and a building permit.

The requirement for public hearing is hereby waived. An urban lot split shall be processed as a parcel map, but no discretionary review or public hearing shall be conducted if all required criteria have been met. Action on a project is final, unless appealed to the California Coastal Commission within ten (10) days of the Coastal Commission’s receipt of the notice of final action.

c. Projects in the Coastal Zone, Non-Appealable, shall be required to obtain a coastal development permit and a
building permit. The requirement for public hearing is hereby waived. An urban lot split shall be processed as a parcel map, but no discretionary review or public hearing shall be
conducted if all required criteria have been met.

d. For two-residential unit developments and urban lot splits in the Coastal Zone, Appealable or Non-Appealable, for which a public hearing requirement has been waived pursuant to this subsection, at least ten (10) calendar days prior to the issuance of a coastal development permit, the City shall provide notice by first class mail of the pending application for development. This notice shall be provided to the persons, and contain the information, identified in Section 17.124.090 for appealable and non-appealable developments as
applicable.

3. All applicants for a two-residential unit development or an urban lot split shall submit an application including:

a. A sworn statement affirming eligibility under SB 9 regulations;

b. All materials required by the Community Development
Director;

c. Applicants for an urban lot split shall, in addition, sign an affidavit stating that the owner intends to occupy one of the housing units as their principal residence for at least three (3) years from the date of the approval of the urban lot split.

Provided, however, this provision shall not apply to an owner Attachment 2
Council Agenda 3-1-2022 9.F-18

that is a community land trust or qualified nonprofit
corporation as those terms are defined and described in California Revenue and Taxation Code Sections 402.1 and 214.15, respectively;

4. The City may, at the applicant’s expense, conduct independent inquiries and investigation to ascertain the veracity of any or all portions of the sworn statement.

D. General requirements. An applicant seeking approval of a two-residential unit development or urban lot split shall:

1. Comply with SB 9; all objective requirements of other applicable state law including the Subdivision Map Act; the Pismo Beach Municipal Code, including Title 17 and Title 16, except as expressly provided in SB 9 or in this section; and all objective standards of this section.

2. Execute and record a covenant, supplied by the City and subject to the approval of the City Attorney or designee, that contains the following provisions:

a. Non-residential uses are prohibited on the property subject to development under SB 9 and this section;

b. Rental or leasing of any unit or units on the property for a period of thirty (30) days or less is prohibited;

c. Ongoing compliance with SB 9 requirements and restrictions is required;

d. Access to the public right-of-way shall be maintained in perpetuity;

e. All required parking shall be maintained;

f. If the applicant is seeking approval of an urban lot split, any subsequent urban lot split of the property is prohibited.

E. Parking. All two-residential unit developments and urban lot splits shall comply with the following objective standards for parking:

1. One (1) enclosed or partially enclosed parking space is required for each unit created pursuant to the regulations in SB 9 and this section and such parking space shall be located on the same parcel as the unit.

Attachment 2
Council Agenda 3-1-2022 9.F-19

2. Parking required for a unit created pursuant to SB 9 and this section is in addition to any parking required for the existing structure, should it remain on the property. If an existing garage, carport, or other parking is converted or demolished in order to construct the new unit, the required parking space(s) that are displaced shall be replaced on the same property to satisfy the parking requirements of the existing structure.

3. Exceptions. Additional parking spaces required under subsection

17.38.145.E.1 shall not be required for units developed pursuant to SB 9 and this section if the property upon which the unit is created meets one or more of the following criteria:

a. Is within one-half (1/2) mile walking distance of a high-quality transit corridor, as defined in California Public Resources Code Section 21155, or a major transit stop, as defined in California Public Resources Code Section 21064.3, or

b. There is a car share vehicle located within one (1) block of the project.

4. Required off-street parking may be provided as tandem parking on an existing driveway provided all requirements in subsection

17.34.070.A.5.a are met.

5. Each required parking space shall meet the following standards:

a. Each parking space shall have minimum dimensions of nine (9) feet by twenty (20) feet.

b. All parking spaces shall be located behind existing or future sidewalk, or other public right-of-way.

c. All parking spaces shall be located on an all-weather surface as approved by the City Engineer or designee (e.g.,
hardscape, gravel) and be accessed by a driveway apron or curb cut.

F. Development standards. All two-residential developments units and urban lot splits shall comply with the following objective development standards:

1. Driveways.

a. A driveway may be shared by not more than two (2) units and no more than two (2) lots.

Attachment 2
Council Agenda 3-1-2022 9.F-20

b. More than one (1) driveway per lot is prohibited on lots with less than sixty (60) feet of public street frontage.

2. Setback Requirements. All units in a two-residential unit development and/or on an urban lot split shall comply with the setback standards for RSL zones. Provided, however, no setback shall be required for an existing structure or structure constructed in the same location and to the same dimensions as the existing structure.

3. Occupancy.

a. Non-residential uses on the property subject to a two- residential unit development or an urban lot split are
prohibited.

b. Short-Term Rental Prohibited. A short-term rental use of thirty (30) days or less shall not be permitted in units developed pursuant to SB 9 and this section. Units developed pursuant to SB 9 and this section shall be occupied for terms longer than thirty (30) days.

4. Height. Height of a unit developed pursuant to SB 9 and the section shall be no greater than permitted in RSL zones.

5. Lot Coverage and Maximum Building Areas. Lot coverage and maximum building areas shall comply with the applicable standard for RSL zones, except as provided in Section 17.38.145.G.

6. No accessory dwelling unit or junior accessory dwelling unit shall be permitted on a parcel subject to an urban lot split under this section and also improved with a two-residential unit development under this section.

7. Two-residential unit developments and urban lot splits are not permitted on parcels located in the R-1 and RSL zones above the intersection of Longview Avenue and Stratford Street in the Pismo Heights planning area due to being in very high fire hazard severity zones, as determined by the California Department of Forestry and Fire Protection pursuant to California Government Code Section 51178, or within a high or very high fire hazard severity zone as indicated on maps adopted by the California Department of Forestry and Fire Protection pursuant to California Public Resources Code Section 4202 and is coextensive with traffic flow and public safety concerns as this area has only one ingress and egress.

Attachment 2
Council Agenda 3-1-2022 9.F-21

8. More than twenty-five (25) percent of the exterior structural walls of the existing structure shall not be demolished if the existing structure has been occupied by a tenant in the three (3) years prior to the submission of an SB 9 Development Project application.

9. An urban lot split shall comply with SB 9 and the following standards:

a. No lot resulting from an urban lot split shall be smaller than one thousand two hundred (1,200) square feet.

b. No lot resulting from an urban lot split shall have more than two (2) residential units inclusive of any accessory dwelling unit or junior accessory dwelling unit.

c. The two (2) lots resulting from an urban lot split shall be approximately equal, and no smaller than forty (40) percent or larger than sixty (60) percent of the lot area of the original parcel.

d. No flag lots shall be created as a result of an urban lot split if the subject property is adjacent to an alley, located on a corner, or on a through lot.

e. The width of any lot resulting from an urban lot split shall not be less than twenty (20) feet wide.

f. The proposed parcel map shall demonstrate ability to access the public right-of-way in perpetuity.

G. Exceptions. The Community Development Director shall approve an exception to any of the standards specified in this section upon determining that complying with the standards would physically preclude the construction of up to two (2) residential units per lot or would physically preclude either of the two residential units from being eight hundred (800) square feet in floor area.

H. Denial. The Building Official or Community Development Director may deny an application for a two-residential unit development or an urban lot split upon making both the following findings in writing based on a preponderance of the evidence:

1. The proposal would have a specific, adverse impact upon the public health and safety or the physical environment as defined and determined in California Government Code Section 65589.5(d)(2).

Attachment 2
Council Agenda 3-1-2022 9.F-22

2. There is no feasible method to satisfactorily mitigate or avoid the specific, adverse impact.

SECTION 3.

Under the provisions of the California Environmental Quality Act (CEQA) Guidelines Section 15061(b) (3), this ordinance is covered by the general rule that CEQA applies only to projects which have the potential for causing a significant effect on the environment. Where it can be seen with certainty that there is no possibility that the activity in question may have a significant effect on the environment, such as the adoption of the regulations contained herein, the activity is not subject to CEQA. Furthermore, this ordinance is exempt from CEQA pursuant to Government Code Section 65852.21(j) effective January 1, 2022.

SECTION 4.

This ordinance shall not be interpreted in any manner to conflict with controlling provisions of state or federal law, including, without limitation, the Constitution of the State of California. If any section, subsection, or clause of this ordinance shall be deemed to be unconstitutional or otherwise invalid, the validity of the remaining sections, subsections and clauses shall not be affected thereby. If this ordinance, or any section, subsection or clause of this ordinance shall be deemed unconstitutional or invalid as applied to a particular appeal, the validity of this ordinance and its sections, subsections, and clauses in regard to other contracts shall not be affected.

SECTION 5.

This ordinance shall become effective on the thirtieth (30th) day following passage and adoption hereof.

SECTION 6.

The City Clerk shall certify to the passage and adoption of this Ordinance, shall enter the same in the book of original ordinances of the City and shall make a minute of the passage and adoption thereof in the records of the meeting at which the same is passed and adopted.

Before the expiration of fifteen (15) days after the passage of this Ordinance, the City Clerk shall cause the same to be posted in three public places within the City of Pismo Beach, to wit: 1) City Hall, 760 Mattie Road, Pismo Beach, 2) U.S. Post Office, Shell Beach Road, Pismo Beach, 3) U.S. Post Office, Crest Drive, Pismo Beach.

INTRODUCED at a regular meeting of the City Council held this 15th day of February, 2022, on motion of Council Member Blake, seconded by Council Member Guthrie, and on the following roll call vote, to wit:

Attachment 2
Council Agenda 3-1-2022 9.F-23

AYES: 5 Blake, Guthrie, Newton, Reiss, Waage
NOES: 0
ABSENT: 0
ABSTAIN: 0
RECUSED: 0

Approved: Attest:

________________________ ________________________
Ed Waage, Mayor Erica Inderlied, City Clerk

ADOPTED at a regular meeting of the City Council held this th day of , 2022, on motion of Council Member , seconded by Council Member , and on the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:

RECUSED:

Approved: Attest:

________________________ ________________________
Ed Waage, Mayor Erica Inderlied, City Clerk

APPROVED AS TO FORM:

______________________________
David M. Fleishman, City Attorney
Attachment 2
Council Agenda 3-1-2022 9.F-24

PISMO BEACH COUNCIL AGENDA REPORT
Agenda Item #11.A

SUBJECT/TITLE:

INTRODUCTION (FIRST READING) OF ORDINANCES EFFECTUATING A LOCAL COASTAL PLAN AMENDMENT AND ADDING CHAPTER 17.119 TO TITLE 17 (1983 COASTAL ZONING CODE) AND SECTION 17.38.145 TO CHAPTER 38 OF TITLE 17 (1998 NON-COASTAL ZONING CODE) OF THE PISMO BEACH MUNICIPAL CODE

REGULATING TWO-UNIT RESIDENTIAL DEVELOPMENT AND URBAN LOT SPLITS IN COMPLIANCE WITH SENATE BILL 9 AND MAKE A DETERMINATION OF

EXEMPTION UNDER THE CALIFORNIA ENVIRONMENTAL QUALITY ACT

RECOMMENDATION:

1. Introduce an Ordinance adding Chapter 17.119 Two-Unit Residential Development and Urban Lot Splits To Title 17 (1983 Coastal Zoning Code) of the City of Pismo Beach Municipal Code, relating to urban lot splits and two-unit residential development built in accordance with Senate Bill 9 and making a determination of exemption under the California Environmental Quality Act (CEQA);

2. Introduce an Ordinance adding section 17.38.145 Two-Unit Residential Development and Urban Lot Splits to Chapter 38 of Title 17 (1998 Non-Coastal Zoning Code) of the City of Pismo Beach Municipal Code, relating to urban lot splits and two-unit residential development built in accordance with Senate Bill 9 and making a determination of exemption under the California Environmental Quality Act (CEQA).

BACKGROUND:

On September 16, 2021, Governor Newsom signed into law Senate Bill (SB) 9 (Atkins).

The bill requires that the City ministerially approve, without discretionary review or public hearing, the subdivision of a parcel zoned single-family residential into two approximately equal parcels no less than 1,200 square feet each (unless the local agency provides for a smaller minimum lot size), as well as ministerially approve no more than two units on each of the new parcels or other lots zoned single-family residential. The new units could be primary units with accessory dwelling units or two primary units, so long as remaining development standards are met. In other words, this bill has the potential to allow the converting of a single-family zoned parcel with one single-family residence into two lots and four dwelling units.

SB 9 authorizes local agencies to impose objective zoning, subdivision and design review standards that do not conflict with the requirements of SB 9 but prohibits imposition of any other requirements. On December 21, 2021, the City Council directed staff to prepare appropriate ordinances establishing such objective standards and addressing the provisions of SB 9. On January 25, 2022, the Planning Commission reviewed the prepared ordinances, recommending the City Council adopt the regulations.

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Exceptions
There are several exceptions built into the bill. The bill prohibits the demolition or alteration of an existing rent-restricted housing unit, a unit subject to an Ellis Act eviction in the past 15 years, or, importantly, a unit that has been occupied by a tenant in the last three years.

This would not, however, affect residences occupied by the owner. Additionally, the bill does not allow for the demolition of more than 25% of the existing exterior structural walls unless the City allows for said demolition or the site has not been occupied by a tenant in the last three years. The bill also precludes the subdivision of a parcel that has previously been subdivided in accordance with Senate Bill 9, which would be memorialized through a deed restriction on the parcels created and through City records.

Exclusions
There are several location-based exclusions to SB 9, as identified in Government Code Section 65913.4(a)(6)(B)–(K). Included in these are wetlands; areas located within a very high fire hazard severity zone unless the site complies with all fire-hazard mitigation measures required by existing building standards; a hazardous waste site not cleared for residential use; areas within a delineated earthquake fault zone unless all development complies with seismic protections; areas within a 100-year flood hazard area or a regulatory floodway, with specific exceptions; and land specified for habitat and similar conservation purposes.

Based on the very high fire hazard severity zone maps developed by Cal Fire, significant portions of the City, including areas along El Portal and Bluff Drives, most parcels along Mattie Road on the inland side of Highway 101, the Pismo Heights above Bay Street, and portions of the neighborhood between the Price Historical Park and Highland Drive and Valley View Drive fall into high fire hazard severity zones. A map of these zones is included as Attachment 3 and an interactive map can be found at https://egis.fire.ca.gov/FHSZ/ to better demonstrate the areas exempt from SB 9. These areas have been excluded from SB 9 development.

Parking
For SB 9 compliant applications, the bill prohibits the City from requiring more than one parking space per unit for a proposed duplex or a proposed lot split. The bill also prohibits the requirement of any parking if the property is located within one-half mile walking distance of either a high-quality transit corridor or a major transit stop. Section 21155 of the Public Resources Code defines a high-quality transit corridor as a corridor with fixed route bus service with service intervals no longer than 15 minutes during peak commute hours. Section 21064.3 of the Public Resources Code defines a major transit stop as a site containing an existing rail or bus rapid transit station, a ferry terminal, or the intersection of two or more major bus routes with a frequency of service interval of 15 minutes or less during the morning and afternoon peak commute periods.

While the City does have numerous bus stops and the transit center on 5 Cities Drive, these routes run hourly and would not meet either of these definitions. Therefore, the City would be subject to limitations on parking of one space per unit. However, SB 9 provides that “nothing in [SB 9 as codified] shall be construed to supersede or in any way alter or Council Agenda 2-15-2022 11.A-2
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Council Agenda 3-1-2022 9.F-26

lessen the effect or application of the [California Coastal Act], except that the local agency shall not be required to hold public hearings for coastal development permit applications for an [SB 9] housing development.” See Government Code Sections 65852.21(k), 66411.7(o). Therefore, similar to the accessory dwelling unit ordinance, the SB 9 ordinance for the Coastal Zone contains a nuanced approach to continue to require parking in order to maintain coastal access.

Coastal Commission
On January 21, 2022, the Coastal Commission Executive Director released a guidance document regarding implementation of SB 9 in compliance with the Coastal Act (Attachment 4). Staff believes that the prepared Coastal Ordinance was generally consistent with the guidance, but additional language was necessary to address SB 9 development in areas potentially vulnerable to sea level rise. Subsection 17.119.060.J. was added in response to this guidance, as recommended by the Planning Commission, which prohibits SB 9 development in these areas unless the specific criteria are met.

Environmental Review
In accordance with Sections 65852.21(j) and 66411.7(n) of the Government Code, Section 21080 of the Public Resources Code, and Section 15060(c)(3) of the CEQA Guidelines, ordinances adopted by a city or county to implement the provisions of Government Code Sections 65852.21 and 66411.7 relating to urban lot splits and two- unit residential development built in accordance with Senate Bill 9 are exempt from review under CEQA. Furthermore, it can be seen with certainty that there is no possibility that the activity in question may have a significant effect on the environment and therefore the ordinances are exempt from review under CEQA pursuant to Section 15061(b)(3) of the CEQA Guidelines.

Public Notification
A notice of public hearing was posted at City Hall, on the City’s website, and published in the newspaper. The meeting agenda was posted at City Hall and on the City’s website in accordance with Government Code Section 54954.2. As of the writing of this report, no correspondence has been received.

Conclusion and Recommendation
The prepared ordinances (Attachments 1 and 2) are a thoughtful approach to implementing SB 9 in the City, while maintaining obligations to coastal resources as required by the Coastal Act. Staff recommends that the City Council introduce these Ordinances, including approval of a Categorical Exemption under CEQA. If the Council acts to introduce the ordinances as recommended, they will be returned for adoption at the next available meeting.

FISCAL IMPACT:

None.

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ALTERNATIVES:

1. Modify and introduce the prepared Ordinances.

2. Provide alternative direction to staff.

ATTACHMENTS:

1. Senate Bill 9 Ordinance (1983 Zoning Code)

2. Senate Bill 9 Ordinance (1998 Zoning Code)

3. Map of Very High Fire Hazard Severity Zones

4. John Ainsworth, Executive Director, California Coastal Commission, Memorandum – Implementation of New SB 9 Housing Laws in Sea Level Rise Vulnerable Areas (January 21, 2022)
Submitted by: Meeting Date: February 15, 2022
Matthew Downing, Community Development Director
City Manager Approval:

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1 To: Planning Directors of Coastal Cities and Counties From: John Ainsworth, Executive Director, California Coastal Commission Date: January 21, 2022
Re: Implementation of New SB 9 Housing Laws in Sea Level Rise Vulnerable Areas ______________________________________________________________________________ As of January 1, 2022, SB 9 (Atkins) changed the way that local governments can regulate new residential development and lot splits in single-family residential zones within designated urban areas, with the goal of increasing housing density in those areas. The new housing laws added by SB 9, Government Code Sections 65852.21 and 66411.7, contain Coastal Act savings clauses.

This means that, except for public hearing requirements, the Coastal Act continues to apply in full force in the coastal zone. Accordingly, certified Local Coastal Program (LCP) provisions continue to apply but, in most places, will need to be updated to conform with SB 9 to the greatest extent possible while still complying with the Coastal Act. This memorandum focuses on how to harmonize the new SB 9 requirements with LCP and Coastal Act policies in areas that are vulnerable to sea level rise because increasing residential density in these areas presents unique challenges and risks. When updating LCPs, local governments should keep in mind that LCP provisions must continue to be consistent with all applicable Coastal Act policies in all areas.

I. Housing in the Coastal Zone
The State of California is experiencing a critical shortage of affordable housing. In recognition of this critical shortage, the state Legislature passed numerous laws in recent years aimed at increasing construction of additional housing units, and preferably affordable units. Many of these measures, including SB 9, state that they do not supersede or lessen the application of the Coastal Act. The Coastal Commission (Commission) recognizes the particularly critical shortage of affordable housing in the coastal zone and has strongly supported strategies to increase access to affordable housing near the coast. To address housing shortages in the coastal zone over the long-term, new residential development must be built in locations and with designs that ensure it will be safe from hazards, have access to adequate public services, and will minimize coastal resource impacts.

Importantly, siting new housing in areas projected to be impacted by sea level rise, without planning for adaptation, will not address the housing crisis over the long-term and will instead put more residences and lives at risk and exacerbate housing shortages. The hazards and other impacts associated with sea level rise require local governments to plan carefully to ensure that 67$7(2)&$/,)251,$±&$/,)251,$1$785$/5(6285&(6$*(1&< &$/,)251,$&2$67$/&200,66,21
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2 new housing is safe both now and for future generations. Likewise, effective January 1, 2022, a new section was added to the Coastal Act that explicitly requires the Commission to “take into account the effects of sea level rise in coastal resources planning and management policies and activities in order to identify, assess, and, to the extent feasible, avoid and mitigate the adverse effects of sea level rise.” (Pub. Res. Code § 30270.) While the Commission has considered sea level rise in its planning, policies, and activities for many decades, the new section of the Coastal Act further emphasizes the importance of accounting for sea level rise.

New residential development in the coastal zone must be consistent with Coastal Act and LCP policies, including requirements relating to protection of coastal resources and hazards, such as Coastal Act Sections 30250, 30253, 30235 and 30240, as discussed further below. In addition to these requirements, a variety of other provisions in the Coastal Act relate to housing in the coastal zone. As relevant here, the Coastal Act does not exempt local governments from complying with state and federal law “with respect to providing low- and moderate-income housing, replacement housing, relocation benefits, or any other obligation related to housing imposed by existing law or any other law hereafter enacted.” (Pub. Res. Code § 30007.) The Coastal Act also requires the Commission to encourage housing opportunities for low- and moderate-income households (Pub. Res. Code § 30604(f)), but states that “[n]o local coastal program shall be required to include housing policies and programs.” (Pub. Res. Code § 30500.1.) Lastly, the Coastal Act regulates where new development can be sited. New residential development must be “located within, contiguous with, or in close proximity to, existing developed areas able to accommodate it” or in other areas where development will not have significant adverse effects, either individually or cumulatively, on coastal resources. (Pub.

Res. Code § 30250(a).) Land divisions, other than leases for agricultural uses, are permitted outside existing developed areas “only where 50 percent of the usable parcels in the area have been developed and the created parcels would be no smaller than the average size of surrounding parcels.” (Pub. Res. Code § 30250(a).)
II.Overview of New Legislation
As of January 1, 2022, SB 9 adds Government Code Sections 65852.21 and 66411.7, and amends Government Code Section 66452.6. The new laws apply only to parcels located in: (a) a city that includes some portion of either an urbanized area or urban cluster, as designated by the United States Census Bureau, within the city’s boundaries; or (b) an unincorporated area, and the parcel is located entirely within either an urbanized area or urban cluster, as designated by the United States Census Bureau. (Gov. Code §§ 65852.21(a)(1), 66411.7(a)(3)(B).) Currently certified LCPs are not superseded by the new laws and continue to apply until an LCP amendment is adopted.

The new legislation makes two primary changes to existing law:

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3 a.Ministerial consideration of proposals to develop two or fewer residential units in urban areas

For projects outside the coastal zone, local governments must now ministerially consider, without discretionary review, proposals to develop two or fewer residential units in a single- family residential zone in designated urban areas when certain criteria are met. (Gov. Code § 65852.21.) Proposals to construct two new residential units and proposals to add one new unit to a parcel with an existing unit are both covered by this section. (Gov. Code § 65852.21(i)(1).) For ministerial consideration of proposed residential development to be required, proposals must meet the many criteria set forth in the statute, including that rental of any new unit created is for a term longer than 30 days. (See Gov. Code § 65852.21(a), (d)-(g).) Although discretionary review is prohibited in these circumstances, local governments are free to adopt objective zoning, subdivision, and design review standards for development of residential units that do not conflict with Government Code Section 65852.21. (Gov. Code § 65852.21(b)-(c).) This new section of the Government Code does not supersede or in any way alter application of the Coastal Act, except that local governments are not required to hold public hearings for coastal development permit (CDP) applications. (Gov. Code § 65852.21(k).) This means that, aside from CDP public hearing requirements, Government Code Section 65852.21 does not override the Coastal Act or LCP policies implementing the Coastal Act, which may involve the application of discretion. Therefore, local governments should adopt LCP amendments with standards that harmonize with SB 9 requirements as much as is feasible and that also ensure such new development is consistent with the Coastal Act and any applicable LCP policies, including requirements relating to notice of local decisions to the public and the Commission.

b.Ministerial approval of urban lot splits

For projects outside the coastal zone, local governments must now ministerially approve lot splits that create no more than two new lots in single-family residential zones in designated urban areas when certain criteria are met, (Gov. Code § 66411.7). However, as with the new requirements regarding residential development, this section of the Government Code does not supersede or in any way alter application of the Coastal Act, except that local governments are not required to hold public hearings for coastal development permit (CDP) applications. (Gov. Code § 66411.7(o).) Accordingly, for projects in the coastal zone, review for consistency with Coastal Act and applicable LCP policies is still required, and that may involve the application of discretion. For ministerial approval to be required outside the coastal zone, proposals must meet the many criteria set forth in the statute, including that no more than two new lots are created, and that rental of any new unit created is for a term longer than 30 days. (See Gov. Code § 66411.7.) Although discretionary review is prohibited in these circumstances in non-coastal zone areas, local governments are free to adopt objective zoning standards, objective subdivision standards, and objective design review standards applicable to urban lot splits that do not conflict with Government Code § 66411.7. (Gov. Code § 66411.7(c), (e).) Council Agenda 2-15-2022 11.A-30
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4 Although the new laws do not supersede the Coastal Act, and the requirement for ministerial approval does not automatically apply in the coastal zone, the laws should be harmonized with the Coastal Act as much as feasible. This could be accomplished, for example, by updating LCPs to create a checklist of objective standards for qualifying projects so that little or no discretion is involved when considering them. Overall, local governments should adopt LCP amendments with standards to ensure that such new development is consistent with the Coastal Act and any applicable LCP policies, including requirements relating to notice of local decisions to the public and the Commission.1

III.SB 9 Application to Coastal Act Policies Generally Local governments should consider how to amend their LCPs to comply with SB 9 to the greatest extent possible, while continuing to be consistent with the Coastal Act. Approval of the types of lot split and residential development projects contemplated by SB 9 is likely to increase residential density in urban areas, both in terms of the overall number of residential units and in terms of the nature of the built environment itself. In some areas, this increase in density may be able to be accommodated with limited coastal resource impacts. However, in other areas, there may be cases where such projects cause significant adverse impacts to coastal resources such as public access, sensitive habitats, and recreation areas. (See Pub. Res. Code § 30250.) For example, approval of new residential development projects and lot splits pursuant to SB 9 would not be consistent with the Coastal Act if the projects are adjacent to environmentally sensitive areas (ESHA) and are not sited and designed to prevent impacts which would significantly degrade those areas, or are incompatible with the continuance of those habitat and recreation areas. (Pub. Res. Code § 30240.) Residential areas in the coastal zone are often intertwined with significant coastal resource areas, such as along the immediate shoreline, between the first public road and the sea, near LCP-designated scenic areas, and near sensitive habitat areas. LCPs generally include a myriad of provisions protecting these coastal resources; LCP provisions designed to implement SB 9 should not conflict with or inappropriately diminish any such LCP protections that already apply. At the same time, SB 9’s focus on ensuring that applicable standards are objective and processed ministerially means that local governments should consider ways to evaluate the potential for coastal resource impacts at the LCP planning stage, such as by using checklists or other such ministerial tools that can be employed at the CDP application stage as much as possible. Local governments are encouraged to coordinate with Commission staff as they develop LCP provisions to implement SB 9.

1 SB 9 also amends Government Code § 66452.6 to allow local governments to provide by ordinance an additional 24-month time period before an approved or conditionally approved tentative subdivision map expires.

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5 IV. SB 9 Application in Sea Level Rise Vulnerable Areas As described in Chapter 3 of the Coastal Commission’s 2018 Update to the Sea Level Rise Policy Guidance (SLR Guidance), as sea levels rise, tidal and groundwater inundation, flooding, wave impacts, bluff and beach erosion, saltwater intrusion, and other impacts are projected to worsen and further threaten residential development and coastal resources in the coastal zone.

The applicability of SB 9 in areas vulnerable to the impacts associated with sea level rise is thus a critical concern.
a.Development of two or fewer residential units in sea level rise vulnerable areas In many cases, increasing density in areas subject to sea level rise impacts without including appropriate siting, design, and mitigation features will not be consistent with Coastal Act policies. Proposals to develop two or fewer residential units pursuant to Government Code Section 65852.21 may be permitted in sea level rise-vulnerable areas if they can be developed in such a way as to be found consistent with the Coastal Act and LCP provisions, and can be designed and sited to be safe from hazards for the expected life of the structures. Proposed projects to construct two or fewer residential units pursuant to Government Code Section 65852.21 typically qualify as “development” under the Coastal Act because such projects usually involve “the placement or erection of any solid material or structure,” and/or a “change in the density or intensity of use of land. . . .” (Pub. Res. Code § 30106.)2 As new development, the new units must minimize risks to life and property in areas of geologic and flood hazard; assure stability and structural integrity, and neither create nor contribute significantly to erosion, geologic instability, or destruction of the site or surrounding area; and not in any way require the construction of protective devices that would substantially alter natural landforms along bluffs and cliffs. (Pub. Res. Code §§ 30253, 30270; see also corresponding LCP provisions.) New residential development must be consistent with the Chapter 3 policies of the Coastal Act and any relevant LCP policies, including that they must be sited and designed to prevent significant degradation of adjacent sensitive habitats and recreation areas and to allow the continuance of those areas into the future (Pub. Res. Code § 30240(b)).

In some areas vulnerable to sea level rise, the risk of hazards during the anticipated life of the structure may be too great to permit development of two residential units on one lot if the new unit(s) cannot be sited and designed safely and consistent with relevant Coastal Act and LCP provisions. In other vulnerable areas, development may be permitted where adaptation strategies and special conditions can minimize hazard risks and avoid impacts on coastal

2 As discussed in the Updates Regarding the Implementation of New ADU Laws Memorandum (Jan. 2022), conversion of existing habitable space within a single-family residence into another residential unit may not qualify as development if there are no major structural changes (e.g., changes to roofs, exterior walls, foundations, etc.) and no change to the size or intensity of use of the existing structure. (See Pub. Res. Code § 30106.)
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6 resources. Local governments and applicants should refer to the Commission’s SLR Guidance when determining whether construction of residential units pursuant to Government Code Section 65852.21 in vulnerable areas is consistent with the Coastal Act and LCP policies.

Chapter 7 of the SLR Guidance describes some of the adaptation strategies to consider when planning for development in sea level rise vulnerable areas. Some adaptation strategies may require land use plans or proposed projects to anticipate long-term impacts now. Other strategies may build adaptive capacity into the plan or project itself, such as special conditions that require elevation or removal of structures when certain triggers are met, so that future changes in hazard risks can be effectively addressed while ensuring long-term resource protection.
b.Lot splits in sea level rise vulnerable areas

As discussed above, Government Code Section 66411.7 requires ministerial consideration of urban lot splits in single-family residential zones in designated areas outside the coastal zone when certain criteria are met. “[S]ubdivision . . . and any other division of land, including lot splits,” qualify as “development” under the Coastal Act, thereby triggering the need for a CDP or other appropriate authorization. (Pub. Res. Code § 30106.) Lot splits also qualify as development because they constitute a “change in the density or intensity of use of land.” (Id.) As new development, proposals to subdivide land must:

(a) Minimize risks to life and property in areas of high geologic, flood, and fire hazard. (b) Assure stability and structural integrity, and neither create nor contribute significantly to erosion, geologic instability, or destruction of the site or surrounding area or in any way require the construction of protective devices that would substantially alter natural landforms along bluffs and cliffs. (Pub. Res. Code § 30253.) New development must also be sited and designed to prevent significant degradation of adjacent sensitive habitats and recreation areas and to allow the continuance of those areas in the future. (Pub. Res. Code § 30240(b).) In addition, new development must be consistent with all Chapter 3 policies of the Coastal Act, including Sections 30210 through 30224 protecting public access and recreational opportunities; Sections 30230 and 30231 protecting marine habitats and water quality; Section 30250 requiring development to have adequate public services; and Section 30251 protecting visual resources.

Subdivisions in areas with certified LCPs must also be consistent with corresponding, relevant LCP provisions. The Commission must also consider the effects of sea level rise in its coastal resources planning and management policies and activities, including those relating to new residential development. (Pub. Res. Code § 30270.)

The Commission’s SLR Guidance states that to comply with Section 30253 of the Coastal Act or the equivalent LCP section, projects will need to be planned, located, designed, and engineered Council Agenda 2-15-2022 11.A-33
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7 for the changing water levels and associated impacts that might occur over the life of the development. In addition, Chapter 7 of the SLR Guidance recommends concentrating development away from hazardous areas and limiting subdivisions in areas vulnerable to sea level rise. To be consistent with the Coastal Act, including how it is interpreted through the SLR Guidance, proposals to subdivide land in areas vulnerable to sea level rise should be considered very carefully for several reasons.

First, subdividing land projected to be negatively impacted by sea level rise in the foreseeable future is not a sound way to minimize risks to life and property in areas with high flood and geologic hazards. (See Pub. Res. Code § 30253.) Instead, subdivision in these areas is likely to increase risks to life and property by allowing for increased density and intensity of use of sites that are projected to be exposed to hazards such as tidal and groundwater inundation, flooding, wave impacts, bluff and beach erosion, and saltwater intrusion. Under SB 9, a lot currently zoned for a single-family residence could support many additional residential units. For example, a lot could be subdivided pursuant to Government Code Section 66411.7, and then two residential structures could be built on each of the newly divided lots pursuant to Government Code Section 65852.21. This scenario would result in four residences on a lot that, prior to SB 9, could only support one residence. When considering the circumstances in which residentially zoned lot splits (pursuant to SB 9 or otherwise) should be allowed in the coastal zone, local governments should consider whether each of the new lots would have a buildable area that is safe from coastal hazards for the foreseeable future without relying on shoreline armoring and could be developed in conformance with relevant coastal resource protection policies of the LCP and Coastal Act.

Second, it is important to analyze the safety of proposed lot splits over the longest feasible timeframe. Hazard analyses typically evaluate potential hazards for the expected life of the development. Unlike the development of residential structures that may only need to be safe for approximately 75-100 years, land divisions tend to be permanent and have little to no adaptive capacity. Although the SLR Guidance does not suggest a specific timeframe for the hazard analysis of proposed lot splits, it does note that projects that are expected to last indefinitely should consider time frames of 100 years or more, and this is also consistent with past Commission action. For example, Commission staff recently recommended denial of a proposal to subdivide property in Orange County that was particularly vulnerable to sea level rise because, among other reasons, the project did not minimize risks to life and property and could not assure stability and structural integrity of the project, as Section 30253 of the Coastal Act requires. (Staff Report, Application Nos. 5-18-0907 & 5-18-0908, August 29, 2019.) The staff report found that the proposed subdivision could last in perpetuity, potentially long beyond the anticipated life of the proposed residential structure, and that both new lots would likely be subject to sea level rise impacts after the anticipated life of the residential structure. (Id.) After some deliberation with the Commission at the public hearing, the applicant withdrew its application and submitted a new proposal to build two single-family residences on the lot Council Agenda 2-15-2022 11.A-34
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8 without subdivision. The Commission approved the new application with the condition that the property cannot be subdivided now or in the future, among other conditions addressing the property’s sea level rise vulnerabilities. (Staff Report, Application No. 5-20-0646, May 21, 2021.) In the zoning context, the Commission denied a request by the County of Santa Barbara to amend its Land Use Plan (LUP) to rezone a single oceanfront property from recreation/open space to single-family residential because the property was projected to be impacted by hazards in the foreseeable future, among other reasons. The Commission found that the hazards analysis for a proposed land use designation change should consider hazards for the foreseeable future because “[u]nlike residential structural development, where the Commission generally analyzes whether the structure will be stable and safe for its expected life of 75 to 100 years, the land use designation change of a parcel would be more or less permanent.” (Staff Report, Application No. LCP-4-STB-18-0039-1- Part D, July 10, 2019, p. 16.) Land divisions, like land use designation changes, may last in perpetuity. Thus, the Commission’s past guidance and actions demonstrate that, in most circumstances, a hazard analysis for a lot split proposal should consider the longest time frame feasible.

Third, subdivision may limit the adaptation strategies available to individuals and communities as sea levels rise. Unlike structural development, which can be designed to incorporate adaptive elements like waterproofing, elevation, or relocation, subdivisions have little to no adaptive capacity; thus, it is not always feasible to mitigate the impacts created by subdivisions.

Subdividing a parcel can also limit the opportunities to adapt to sea level rise on that land by decreasing the land available on a lot for existing development to be moved landward, or for new development to be sited in a more landward or higher elevation location. Land divisions also increase the number of property interests in a site. This can add cost and logistical complexity to community-scale adaptation strategies, making it harder to form and manage geological hazard abatement districts, negotiate buyouts, and implement conservation easements, and making it more difficult to minimize hazards and protect coastal resources in the future.

Lastly, allowing subdivisions in vulnerable areas may negatively impact coastal resources and public access. Coastal resources such as beaches and wetlands will migrate and naturally adapt due to future coastal erosion and sea level rise conditions. Increased residential density and intensity of use along the shoreline and in vulnerable areas may impact coastal resources through, for example, “coastal squeeze” where shoreline development prevents beaches and bluffs from migrating inland, which causes the narrowing and eventual loss of beaches, dunes, and other shoreline habitats as well as the loss of offshore recreational areas. Having fewer structures on relatively larger lots may allow more opportunities for those structures to adapt—for example, by being moved to other parts of the lot that are safer. Depending on the geography and other site-specific conditions, creating additional, smaller lots with more structures may reduce this adaptive capacity.

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9 In light of the potential hazards and coastal resource impacts associated with subdivision in areas vulnerable to sea level rise, many local governments have avoided such land divisions. For example, Policy 7-2 of the City of Half Moon Bay’s Local Coastal LUP limits “subdivisions in areas vulnerable to environmental hazards, including as may be exacerbated by climate change, by prohibiting any new land divisions, including subdivisions, lot splits, and lot line adjustments that create new building sites unless specific criteria [are] met that ensure that when the subject lots are developed, the development will not be exposed to hazards, pose any risks to protection of coastal resources, or create or contribute to geologic instability.” Likewise, San Mateo County’s LCP Implementation Plan (IP) requires applications for proposed subdivisions to include a development footprint analysis that comprehensively evaluates site development constraints and potential impacts, including sea level rise impacts, prior to approval of subdivision parcel maps. These LCP policies allow lot splits, such as those authorized by Government Code § 66411.7, but only when consistent with the Coastal Act.

c. Identifying areas vulnerable to sea level rise
The best available, up-to-date scientific information about coastal hazards and sea level rise should be used to determine whether proposals for lot splits and new residential units in areas vulnerable to sea level rise are consistent with the Coastal Act and LCP provisions. Local governments and applicants should refer to the SLR Guidance when conducting this analysis.

Step 1: Identify sea level rise projections. First, identify the best available, locally-relevant sea level rise projections. In line with statewide guidance, the Commission currently recognizes the Ocean Protection Council’s 2018 State Sea-Level Rise Guidance as the best available science on sea level rise projections for California.
xTide gauges. Appendix G of the SLR Guidance includes sea level rise projections for every 10 years from 2030 to 2150 for 12 tide gauges along the California coast; the projections from the closest tide gauge to the project site should be used. xPlanning horizon. Hazard analyses typically evaluate potential hazards for the expected life of the development. Some LCPs include a specified design life for new types of development. If no specified time frame is provided, a time frame may be chosen based on the type of development. For proposed development of new residential units, it is generally appropriate to analyze sea level rise impacts for at least the expected life of the proposed structure(s), often 75-100 years for residential structures, as described in Chapter 6 of the SLR Guidance. Although situations may vary, local governments and applicants should typically use a longer planning horizon of at least 100 years for lot splits because, as described in subsection (b), land divisions are expected to be permanent, unlike many other kinds of development, and have a limited ability to adapt.
xRisk aversion scenario. Evaluate impacts from the “medium-high risk aversion” scenario, as described in Chapters 5 and 6 of the SLR Guidance. The SLR Guidance recommends Council Agenda 2-15-2022 11.A-36
Attachment 4
Attachment 3
Council Agenda 3-1-2022 9.F-38

10 that all communities evaluate the impacts from the “medium-high risk aversion” scenario (p. 76), and that residential structures and projects with greater consequences and/or a lower ability to adapt use this projection scenario (p. 102). In addition, impacts under other risk aversion scenarios may be helpful to analyze.

Step 2: Analyze the physical effects of sea level rise. Analyze the following hazards under the medium-high risk aversion scenario: erosion of beaches, bluffs, cliffs, and other landforms; tidal inundation of shoreline areas; flooding (wave run-up and storm impacts); and saltwater intrusion and groundwater impacts, consistent with the SLR Guidance and Coastal Act and LCP requirements.

Step 3: Assess impacts to future development and coastal resources. Determine whether the proposed residential units and/or potential building sites on new parcels are vulnerable to sea level rise impacts.

Step 4: Determine whether proposed development is appropriate. Lastly, determine whether the proposed development is consistent with the LCP and Coastal Act as proposed, or can be made consistent with design modifications, adaptive strategies, or other conditions.

Development of new residential units in areas projected to be impacted by sea level rise may be inconsistent with the Coastal Act or LCPs if adaptive strategies cannot minimize the risk of hazards and protect coastal resources, as discussed in subsection (a). Lot splits may be inconsistent with the Coastal Act or LCP policies if they occur in areas projected to be impacted by the hazards associated with sea level rise over the next 100+ years under the medium-high risk aversion scenario, as discussed in subsection (b). As described in the SLR Guidance, local governments should consider whether to “[p]rohibit any new land divisions, including subdivisions [and] lot splits . . . that create new beachfront or blufftop lots unless the lots can meet specific criteria that ensure that when the lots are developed, the development will not be exposed to hazards or pose any risks to protection of coastal resources.” (SLR Guidance, p. 130.) A lot split may be appropriate if the project site is not projected to be impacted by sea level rise hazards for the longest time frame feasible, typically at least 100 years, and is otherwise consistent with the LCP and Coastal Act.

V.Local Government Application of SB 9 in the Coastal Zone a.Update applicable LCP provisions
Local governments in the coastal zone are required to comply with both the Coastal Act and, to the extent they do not conflict with Coastal Act requirements, the new SB 9 requirements.

Currently certified provisions of LCPs are not superseded by Government Code Sections 65852.21 and 66411.7 and continue to apply to CDP applications until an LCP amendment is adopted. Where LCP provisions directly conflict with the new Government Code provisions or require refinement to be consistent with the new laws, those LCP provisions should be updated to be consistent with SB 9 to the greatest extent feasible while still complying with Coastal Act Council Agenda 2-15-2022 11.A-37
Attachment 4
Attachment 3
Council Agenda 3-1-2022 9.F-39

11 requirements. As discussed above, when updating LCP policies to account for SB 9, local governments should also consider how proposed lot splits and residential development might impact public access, sensitive habitats, recreation areas, and other coastal resources. Local governments should also consider new LCP provisions that limit or prohibit subdivisions in areas vulnerable to sea level rise, and that appropriately account for coastal hazards and coastal resource impacts, including as exacerbated or associated with sea level rise, for new residential development.

Although a public hearing is not required under SB 9, public notice requirements still apply. LCP amendment applications should specify how local and Coastal Act public notice requirements will be fulfilled, including the notice requirements for: (a) pending action to interested parties prior to a local decision, and (b) notice of final action to the Commission and those who have requested such notice after a local decision. LCP amendment applications should specify the procedures for issuing a Final Local Action Notice (FLAN) for local decisions on applications for development that are appealable to the Commission. Some LCP amendments may qualify for streamlined review as minor or de minimis amendments. (Pub. Res. Code § 30514(d); Cal. Code Regs., tit. 14, § 13554.)
b.Review SB 9 applications consistent with the Coastal Act/LCP and SB 9 Local governments should generally follow the below process when considering proposed SB 9 projects outside of areas that are potentially vulnerable to sea level rise.

Review Prior CDP History. First, determine whether a CDP or other form of Coastal Act authorization was previously issued for development of the site and whether that CDP and/or authorization limits, or requires a CDP or CDP amendment for, changes to the approved development or for future development or uses of the site. The applicant should contact the appropriate Commission district office if a Commission-issued CDP and/or authorization limits the applicant’s ability to apply to construct two or fewer residential units or split the lot.

Consider Possible Expedited Permitting Processes. Second, and only if an application proposes to undertake development in an area where it will be consistent with LCP and Coastal Act hazard and coastal resource protection policies, consider whether any expedited permitting processes, such as waivers or administrative permits, are available. If a local government’s LCP includes a waiver provision, and the proposed lot split and/or residential unit development proposal meets the criteria for a CDP waiver, the local government may issue a CDP waiver in place of a CDP. The Commission has generally allowed a CDP waiver only when the Executive Director determines that the proposed development is de minimis (i.e., it is development that has no potential for any individual or cumulative adverse effect on coastal resources and is consistent with all Chapter 3 policies of the Coastal Act). Such a finding can typically be made when the proposed project has been sited, designed, and limited in such a way as to ensure any potential impacts to coastal resources are avoided (such as through habitat and/or hazards setbacks, provision of adequate off-street parking to ensure that public access to the coast is Council Agenda 2-15-2022 11.A-38
Attachment 4
Attachment 3
Council Agenda 3-1-2022 9.F-40

12 not impacted, etc.). (See Pub. Res. Code § 30624.7.) Projects that qualify for a CDP waiver typically allow for a substantially reduced evaluation process and streamlined approval.

It may be appropriate for local governments to use waivers to approve applications in both appealable and non-appealable areas to streamline permitting.3 Local governments interested in exploring this option should consult with Commission staff. LCP amendment applications that propose to allow waivers in appealable areas should ensure that there are proper procedures for notifying the public and the Commission of approvals for individual, appealable waivers (such as Final Local Action Notices) so that the proper appeal period can be set, and any appeals received are properly considered.4
Require and Review a CDP Application. Lastly, if a proposal is not eligible for a waiver or similar expedited process authorized by the Coastal Act and the certified LCP, including because it is located in an area potentially subject to coastal hazards and/or future sea level rise hazards, it requires a CDP. (Pub. Res. Code § 30600.) The CDP must be consistent with the requirements of the certified LCP and any relevant policies of the Coastal Act. Local governments must provide all required public notice for any CDP applications for development covered by SB 9 and process the application pursuant to LCP requirements, but local governments are not required to hold public hearings. (Gov. Code §§ 65852.21(k); 66411.7(o).) Once the local government has made a CDP decision, it must send the required final local action notice of that decision to the appropriate Commission district office. If the CDP decision on the proposed project is appealable, a local government action to approve a CDP for the proposed project may be appealed to the Commission. (Pub. Res. Code § 30603.)

3 Most, if not all, LCPs with CDP waiver provisions do not allow for waivers in areas where local CDP decisions are appealable to the Coastal Commission. There have been a variety of reasons for this in the past, including that the Commission’s regulations require that local governments hold a public hearing for all applications for appealable development (14 Cal. Code Regs § 13566), and also that development in such areas tends to raise more coastal resource concerns and that waivers may therefore not be appropriate. However, under SB 9 provisions, public hearings are not required for qualifying development. Because of this, the above-described public hearing issue would not be a concern, so it could be appropriate for LCPs to allow CDP waivers in both appealable and non-appealable areas at least related to this criterion. Local governments should consult with Commission staff should they consider proposing CDP waiver provisions in their LCP.
4 The development authorized by SB 9—specifically, residential lot splits and development of new residential units that change the intensity of use—are not types of development that the Commission has typically found to be exempt from CDP requirements as improvements to single-family residences. (See Pub. Res. Code § 30610; Cal. Code Regs., tit. 14, § 13250(a).) In addition, any development that is not designated as the principal permitted use under the approved zoning ordinance or zoning district map—such as lot splits—is appealable to the Commission. (Pub. Res. Code § 30603(a)(4).) Council Agenda 2-15-2022 11.A-39
Attachment 4
Attachment 3
Council Agenda 3-1-2022 9.F-41

13 VI.Conclusion
The Commission strongly supports increased access to affordable housing and increased residential density in the coastal zone. For new housing to be a long-term solution to the housing shortage, it must be sited and designed to be safe from hazards, such as sea level rise, and to not have significant adverse effects on coastal resources. Local governments should review their LCPs to determine what changes are necessary to implement SB 9 in a manner that is consistent with the Coastal Act and appropriate for local geography, and prepare and submit LCP amendments to the Commission as soon as is feasible.

This document was developed using federal financial assistance provided by the Coastal Zone Management Act, as amended, under award NA19NOS4190073, administered by the Office for Coastal Management, National Oceanic and Atmospheric Administration, U.S. Department of Commerce. The statements, findings, conclusions, and recommendations are those of the author and do not necessarily reflect the views of the National Oceanic and Atmospheric Administration or the U.S. Department of Commerce.

Council Agenda 2-15-2022 11.A-40
Attachment 4
Attachment 3
Council Agenda 3-1-2022 9.F-42

PISMO BEACH COUNCIL AGENDA REPORT
Agenda Item #9.G

SUBJECT/TITLE:

TRAFFIC SAFETY COMMITTEE RECOMMENDATIONS TO CITY COUNCIL

RECOMMENDATION:

1. Receive a report on the items considered at the most recent Traffic Safety Committee meeting;

2. Adopt a Resolution authorizing the installation of “No-Parking” signs on Baxter Lane from Shaffer Lane to the end of Baxter Lane.

BACKGROUND:

The Traffic Safety Committee (TSC) met on February 10, 2022, and the following summary outlines the results of this meeting. The Public Works Department will implement the Traffic Safety Committee recommendations, unless otherwise directed by the City Council.

Item 1 – No Parking on Stub End of Baxter Lane

The TSC reviewed a request from a resident to install no parking on the stub end of Baxter Lane.

TSC Recommendation:

A local resident was present to give her input on the need for no parking signage at the stub end of Baxter Lane. The resident shared that she has witnessed many delivery trucks that have a hard time turning around and have to back out of the area, and thatwhen vehicles are parking on the street it makes it even more challenging.

The TSC Community Member made a site visit prior to the meeting and agreed with the idea of no parking on Baxter Lane. The City’s Battalion Chief noted that this roadway has been difficult for emergency vehicles to get into and out of and he would be in support of no-parking this road.

A motion was made to install “no parking” signs on Baxter Lane from Shaffer Lane to the end of Baxter Lane.

Motion by Jim Lewis seconded by Ben Fine, to approve the TSC recommendation.

Passed: 6/0/0
Ayes: Jim Lewis, Ben Fine, Matt Downing, Chris Trimble, Paul Lee, Dave Daguerre Noes: None

Absent: None

Staff recommends that the City Council approve the TSC’s recommendation by adoption of a Resolution (Attachment 1). An exhibit is provided as Attachment 2.

9.G-1Council Agenda 3-1-2022

Item 2 – Skateboarding prohibited on Longview Avenue

The TSC reviewed a request from City staff to discuss prohibiting skateboarding on Longview Avenue.

TSC Recommendation:

The Police Commander spoke saying that skateboarders receive citations for being a pedestrian in the roadway and that prohibiting skateboarding on certain streets and posting signs would help with enforcement. Rancho Pismo Drive is the most frequent complaint received for skateboarding, as well as Longview and Wadsworth Avenues. The Police Commander recommended an ordinance, or amendment to an existing ordinance, prohibiting skateboarding on problem streets.

The Director of Public Works recommended surveying the grades on the roads to determine a threshold for a skateboarding-prohibiting ordinance in the city. The TSC Community Member noted that he believes this would be a difficult ordinance for Police to enforce.

A motion was made to defer this matter to the City Engineer and Police Chief for a recommendation and to bring it back at the next TSC meeting.

Motion by Jim Lewis seconded by Matt Downing, to approve the TSC recommendation.

Passed: 5/1/0
Ayes: Jim Lewis, Ben Fine, Matt Downing, Chris Trimble, Paul Lee Noes: Dave Daguerre

Absent: None

No action is required by City Council.

Item 3 – Public Comment Section

Motion was made to include public comment at the beginning of the TSC agenda and a committee comment section at the end of the TSC agenda.

Motion by Ben Fine seconded by Dave Daguerre, to approve the TSC recommendation.

Passed: 6/0/0
Ayes: Jim Lewis, Ben Fine, Matt Downing, Chris Trimble, Paul Lee, Dave Daguerre Noes: None

Absent: None

No action is required by City Council on this item.

Conclusion and Recommendation
Staff recommends that the Council adopt the Resolution provided as Attachment 1.

9.G-2Council Agenda 3-1-2022

FISCAL IMPACT:

There is no fiscal impact associated with receiving this report or implementing the Committee’s recommendation.

ALTERNATIVES:

1. Do not adopt the Resolution and provide alternative direction to staff.

ATTACHMENTS:

1. Resolution

2. Baxter Lane Exhibit
Prepared by: Meeting Date: March 1, 2022
Madeline Kacsinta, Engineering Technician
Submitted by: Benjamin A. Fine, P.E., Director of Public Works/City Engineer City Manager Approval:

9.G-3Council Agenda 3-1-2022

RESOLUTION NO. R-2022-XXX

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PISMO BEACH, CALIFORNIA AUTHORIZING THE INSTALLATION OF “NO-PARKING” SIGNS ON

BAXTER LANE FROM SHAFFER LANE TO THE END OF BAXTER LANE WHEREAS, Baxter Lane is a narrow dead-end street; and
WHEREAS, delivery trucks are unable to turn around and have to back out of the area; and
WHEREAS, when cars are parked on the street it makes it even more challenging to turn around and exit the area; and
WHEREAS, emergency vehicles have difficulty entering and exiting this area, which supports the installation of “No Parking” signs.

NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Pismo Beach hereby authorizes the installation of “No Parking” signs on Baxter Lane from Shaffer Lane to the end of Baxter Lane.

UPON MOTION OF Council Member , seconded by Council Member , the foregoing resolution was adopted by the City Council of the City of Pismo Beach this 1st day of March 2022, by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:

RECUSED:

Approved: Attest:
________________________ ________________________
Ed Waage, Mayor Erica Inderlied, City Clerk

9.G-4Council Agenda 3-1-2022
Attachment 1

Baxter Lane
2/10/2022 Exhibit C.1C11

9.G-5Council Agenda 3-1-2022
Attachment 2

PISMO BEACH COUNCIL AGENDA REPORT
Agenda Item #9.H

SUBJECT/TITLE:

ADOPTION OF FINDINGS RELATING TO AB 361 (VIRTUAL MEETINGS)

RECOMMENDATION:

Adopt the following findings with respect to the City of Pismo Beach’s utilization of the provisions of Assembly Bill 361, relating to Brown Act teleconferences:

1. The City Council has reconsidered the circumstances of the state of emergency created by the coronavirus pandemic.

2. The following circumstances exist:
• State or local officials continue to impose or recommend measures to promote social distancing.

BACKGROUND:

Assembly Bill 361 (Rivas, 2021) amends and codifies the relaxed Brown Act provisions that were originally implemented by Executive Orders of the Governor in response to the coronavirus pandemic. Among the provisions of the Brown Act that were relaxed by the Governor’s Orders were provisions for participation in legislative meetings by teleconference (phone, or virtual platform such as Zoom). Prior Brown Act provisions required that, in the event any legislative body member(s) wished to participate in a meeting remotely, the exact address of the remote location(s) be published in advance on the meeting agenda, the remote location(s) be disabled-accessible, and the public be provided the opportunity to observe the meeting and make public comment at the remote location(s).

Governor’s Orders N-29-20 and N-08-21 effectively suspended all of these provisions for health and safety reasons, making it possible for legislative body members to join a meeting virtually without the need for conducting advance noticing or providing direct public access to the location. AB 361, effective October 1, 2021, functionally codifies these provisions through January 2024, allowing agencies to avail themselves of the continued teleconferencing option if desired, provided that the legislative body makes certain findings as outlined below (Government Code Section 54953(e)(3)):

(3) If a state of emergency remains active, or state or local officials have imposed or recommended measures to promote social distancing, in order to continue to teleconference without compliance with paragraph (3) of subdivision (b), the legislative body shall, not later than 30 days after teleconferencing for the first time pursuant to subparagraph (A), (B), or (C) of paragraph (1), and every 30 days thereafter, make the following findings by majority vote:
(A) The legislative body has reconsidered the circumstances of the state of emergency.
(B) Any of the following circumstances exist:
(i) The state of emergency continues to directly impact the ability of the members to meet safely in person.

9.H-1Council Agenda 3-1-2022

(ii) State or local officials continue to impose or recommend measures to promote social distancing.

The City Council inaugurated its use of AB 361 provisions by holding a totally teleconferenced meeting via Zoom on October 5, 2021, and then adopted the recommended findings at each of its regular meetings since October 19, 2021. Following the state’s removal of the indoor mask mandate for vaccinated individuals on February 16, 2022, the City Council will now transition to fully hybrid meetings for the foreseeable future, where the legislative body members, staff, and the public may attend the meeting either in person, or virtually.

Procedural Flexibility
The circumstances surrounding the impact of the coronavirus pandemic are continually evolving, and the progression of the pandemic, along with accompanying governmental health and safety directives, are difficult to foresee. While the Council has determined to transition to hybrid City Council meetings with a certain level of in-person participation, staff recommends that the adoption of these findings, as recommended, remain on the Council’s consent agenda for the foreseeable future, until such time that the Council determines that it can no longer make the findings due to a change in circumstance.

Adoption of the recommended findings at each meeting will provide continued flexibility should the Council need or desire to make a change to its meeting practices at any point in the future. Adoption of the findings in no way commits the City to holding virtual or hybrid meeting proceedings, providing full flexibility under uncertain circumstances.

Other Provisions of AB 361
AB 361 also requires that the public be given the opportunity to address the legislative body with their comments in real time, which the City has provided continuously since the start of the pandemic, and will continue to. In addition, the bill requires that meeting proceedings be stopped in the event that the public’s virtual access to a meeting is disrupted, for example due to an internet outage. When holding a hybrid meeting with some or all members participating in person, and some or all of the public participating virtually, staff will monitor the virtual meeting to component to assure that public access is not interrupted, and pause meeting proceedings in the event of a disruption.

Conclusion and Recommendation
In order to provide both legal compliance and practical flexibility during ongoing uncertain circumstances, staff recommends that, by minute order, the City Council make the following findings with respect to the City of Pismo Beach’s utilization of the provisions of Assembly Bill 361, relating to Brown Act teleconferences:

1. The City Council has reconsidered the circumstances of the state of emergency created by the coronavirus pandemic.

2. The following circumstances exist:
• State or local officials continue to impose or recommend measures to promote social distancing.

9.H-2Council Agenda 3-1-2022

FISCAL IMPACT:

There is no fiscal impact associated with adoption of the recommended findings.

ALTERNATIVES:

1.Do not adopt the findings; provide other direction to staff.

ATTACHMENTS:

None.

Submitted by: Meeting Date: March 1, 2022
Erica Inderlied, City Clerk
City Manager Approval:

9.H-3Council Agenda 3-1-2022

PISMO BEACH COUNCIL AGENDA REPORT
Agenda Item #11.A

SUBJECT/TITLE:

PUBLIC HEARING TO RECEIVE COMMUNITY REQUESTS AND
RECOMMENDATIONS ON THE COUNTY OF SAN LUIS OBISPO 2021–2023 CONSOLIDATED PLAN AND 2022 ACTION PLAN, INCLUDING COMMUNITY

DEVELOPMENT BLOCK GRANT FUNDS

RECOMMENDATION:

Adopt a Resolution making final recommendations to the County of San Luis Obispo for the 2022 Action Plan for Community Development Block Grant funding.

BACKGROUND:

The purpose of this public hearing is for the Council to provide the public with an opportunity to comment on the Urban County of San Luis Obispo 2021–2023 Consolidated Plan (Plan) that includes the 2022 Action Plan for Community Development Block Grant (CDBG) funding. The draft Plan may be downloaded from the County Planning and Building Department’s website at www.slocounty.ca.gov/planning .

To comply with federal Department of Housing and Urban Development (HUD) requirements, the County prepares the Plan, which identifies funding policies and objectives for the annual allocations of HUD grant programs, including the CDBG program.

On December 7, 2021, the City Council adopted Resolution R-2021-095 (Attachment 2), making its draft recommendation to the Board of Supervisors for the use of the City’s 2022 CDBG funds, estimated at $34,966. These funds include $4,546 for County administrative costs, for a net amount available estimated to be $30,420 (including the City’s administrative costs of $2,448). This number must be considered an estimate because HUD has not released the final 2022 allocation amounts. The County will make the appropriate adjustments once the final amount is received. The Council’s recommendation consisted of $5,245 being allocated to the 5 Cities Homeless Coalition (5CHC) for the Subsistence Payments for Eviction Prevention and Security Deposits program and $25,175 to the City of Pismo Beach Barrier Removal Project. At that meeting, the Council also directed the funding of the CAPSLO Minor Home Repair program with $25,000 of Housing In-Lieu Fee Funds as an application was not submitted by CAPSLO for CDBG funds. That funding was allocated at the mid-year budget as part of Resolution No. R-2021-103.

More information regarding each of the programs proposed for funding can be reviewed in the December 7, 2021 staff report, available from the Access Pismo public records portal at www.pismobeach.org/accesspismo.1

1 Full URL:
https://accesspismo.pismobeach.org/WebLink/DocView.aspx?id=366195&dbid=0&repo=Laserfiche

11.A-1Council Agenda 3-1-2022

Conclusion and Recommendation
In accordance with the City’s commitment to participating in the Urban Counties Program, staff recommends that the City Council hold a public hearing to give the community the opportunity to speak on the Plan and the 2022 Action Plan and then adopt a Resolution (Attachment 1) confirming its final recommendation for use of the funds.

FISCAL IMPACT:

The total estimated amount of CDBG funding is $34,966 and includes $4,546 for County administrative costs and $5,245 for City administrative costs. At its December 7, 2021, meeting, the City Council allocated the City’s administrative cost amount to 5CHC for the Subsistence Payments for Eviction Prevention and Security Deposits program. The remaining CDBG funding of $25,175 will be allocated to the City’s Capital Projects Fund as part of the City’s FY 2022 Paving project to support improvements associated with the Pismo Beach Barrier Removal Project. If this is approved by the San Luis Obispo County Board of Supervisors in April 2022, staff will come back to Council to appropriate funds to reflect this CDBG funding.

ALTERNATIVES:

1. Provide alternative direction to staff.

ATTACHMENTS:

1. Resolution

2. R-2021-095 making draft recommendations
Prepared by: Meeting Date: March 1, 2022
Megan Martin, Planning Manager
Submitted by: Matthew Downing, Community Development Director City Manager Approval:

11.A-2Council Agenda 3-1-2022

RESOLUTION NO. R-2022-XXX

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PISMO BEACH,

CALIFORNIA MAKING FINAL RECOMMENDATIONS TO THE COUNTY OF SAN LUIS OBISPO FOR THE 2022 ACTION PLAN FOR COMMUNITY DEVELOPMENT

BLOCK GRANT FUNDING
WHEREAS, on May 5, 2020, the City Council entered into a Cooperative Agreement with San Luis Obispo County to implement the Housing and Community Development Act of 1974 federal legislation relating to housing and community development activities administered by the Department of Housing and Urban Development; and WHEREAS, on December 7, 2021 the City Council held a duly-noticed public hearing, considered testimony for the allocation of Community Development Block Grant (CDBG) Funds for inclusion in the San Luis Obispo County Draft 2022 Action Plan, adopted Resolution R-2021-095 making its draft recommendations, and forwarded those draft recommendations to the County Board of Supervisors; and WHEREAS, on March 1, 2022, the City Council held a public hearing to provide the public the opportunity to comment on the Urban County of San Luis Obispo 2021-2023 Consolidated Plan, including the 2022 Action Plan; and
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Pismo Beach hereby that the City Council of the City of Pismo Beach hereby recommends the County of San Luis Obispo include the following programs for disbursement of the City’s CDBG funds as part of the Urban County of San Luis Obispo 2021–2023 Consolidated Plan and 2022 Action Plan:

1.5 Cities Homeless Coalition Subsistence Payments Program: ($5,245)

2.City of Pismo Beach Barrier Removal Project ($25,175) BE IT FURTHER RESOLVED that the City Council of the City of Pismo Beach hereby authorizes the City Manager to forward the above recommendations to the County of San Luis Obispo.

UPON MOTION OF Council Member , seconded by Council Member , the foregoing resolution was adopted by the City Council of the City of Pismo Beach this 1st day of March 2022, by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:

RECUSED:

11.A-3Council Agenda 3-1-2022
Attachment 1

Approved: Attest:
________________________ ________________________
Ed Waage, Mayor Erica Inderlied, City Clerk

11.A-4Council Agenda 3-1-2022
Attachment 1

RESOLUTION NO. R-2021-095

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PISMO BEACH,

CALIFORNIA IDENTIFYING DRAFT RECOMMENDATIONS TO THE COUNTY OF SAN LUIS OBISPO FOR INCLUSION IN THE 2022 COMMUNITY DEVELOPMENT

BLOCK GRANT ACTION PLAN
WHEREAS, on July 7, 2020, the City of Pismo Beach entered into a Cooperative Agreement with San Lui s Obispo County to implement the Housing and Community Development Act of 197 4 federal legislation relating to housing and community development activities administered by the Department of Housing and Urban Development; and
WHEREAS, on December 7, 2021, the City Council of the City of Pismo Beach in a duly­ noticed public hearing considered testimony for the allocation of Community Development Block Grant Funds for inclusion in the San Luis Obispo County Draft 2022 Action Plan.

NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Pismo Beach hereby recommends the County of San Luis Obispo include the following program(s) for funding in the Draft 2022 Action Plan:

1.5 Cities Homeless Coalition Subsistence Payments Program: ($5,245)

2.Peoples' Self-Help Housing: (None)

3.City of Pismo Beach Barrier Removal Project ($25,176) UPON MOTION OF Mayor Pro Tern Reiss, seconded by Council Member Newton, the foregoing resolution was adopted by the City Council of the City of Pismo Beach this 7th day of December 2021, by the following vote:

AYES: 4
NOES: 0
ABSENT: 1
ABSTAIN: 0
RECUSED: 0
Reiss, Newton, Blake, Waage
Guthrie
Attest: Approved: zJ l.0��
Ed Waage, Mayor ica lnde�
R-2021-095

11.A-5Council Agenda 3-1-2022
Attachment 2

PISMO BEACH COUNCIL AGENDA REPORT
Agenda Item #12.A

SUBJECT/TITLE:

CAPITAL IMPROVEMENT PROGRAM SEMI-ANNUAL REPORT
RECOMMENDATION:

No action required; information only.

BACKGROUND:

The City's Engineering Division consists of five full-time staff members: the Director of Public Works/City Engineer, Senior Engineer, Engineer, Engineering Technician, and Management Analyst. The Engineering Division remains busy with capital improvement projects, development review, and administering the City's water conservation programs.

The City Council met on February 12, 2021 to establish new goals to guide capital improvements, investments, and initiatives for the City for the next two years. Additionally, due to the duration of certain projects, some projects that staff is working on reflect direction from the City Council’s previous goals. The Council’s current goals are:

1. Water Supply, Conservation and Central Coast Blue

2. Public Safety

3. Traffic, Circulation, and Parking

4. Community Character and Quality of Life for Residents In the past, the semi-annual CIP update has been a tool to update the City Council and the community on the progress of current capital projects and Council Goals. In recent months the City has seen a significant increase in construction prices and delays due to supply chain issues and labor shortages associated with the COVID-19 pandemic, so the Council directed staff to provide revised budget and construction timeline estimates for some of the larger capital projects.

When discussing project estimates, it is important to understand the project development and estimating process. Capital projects are typically developed during the drafting of each 10-year CIP update, which happens every two years in conjunction with the city’s budget. Projects that are included in the 10-year CIP and city budget come from a variety of sources, including the City Council, Planning Commission, Parks, Recreation and Beautification Commission, the Traffic Safety Committee, the Parking Advisory Committee, City staff and the community.

Once a project is identified, a project description and scope is developed to help staff form a Level 2 to Level 3 construction estimate. When developing cost estimates, there are five levels of estimates ranging from Level 1 to Level 5 with Level 1 being the most general and Level 5 being the most accurate.

12.A-1Council Agenda 3-1-2022

The five levels of cost estimates are defined below:
 Level 1 – Order of Magnitude
The Order of Magnitude estimation is an extremely rough estimate created before the project is well-defined. It is based on expert judgement and previous costs of similar projects. The typical accuracy range in this level is from 25%–75%.

 Level 2 – Intermediate/Feasibility Estimate
The primary purpose of the intermediate estimate is to determine project feasibility from the concept of the general project.

 Level 3 – Preliminary Estimate
This estimate uses a somewhat detailed scope to consolidate unit costs. It is accurate enough to be used as a basis for project funding/financing.

 Level 4 – Substantive Estimate
The substantive estimate is based on estimated unit costs. The estimate is created by analyzing reasonably finalized projection designs, objectives and deliverables that are established by the organization.

 Level 5 – Definitive Estimate
This estimate is the most accurate and reliable because it occurs when costs are known. It used to create bids and cost baselines.

Completed

Shell Beach Tennis Court Rehab – This project replaced a tennis court with pickleball court, reseal and restripe all courts, including the basketball court.  Original Estimate – $43,000
 Updated Cost – $43,408

Price Canyon Road Slope Repair – A section of Price Canyon Road just west of the City limits experienced damage during the 2017 winter storms. The project includes repair of a damaged section of slope along the south side of Price Canyon Road near the Pismo Beach city limit. This project is funded through Federal Emergency Relief funding through FHWA and Caltrans Local Assistance (LA), 88.53% of which is reimbursed by FHWA/Caltrans LA and 11.47% would be supported by a City match.

A contract was awarded to S. Chaves Construction on August 17, 2021, and construction began on September 23, 2021. Construction of the project has been completed and three- month plant establishment period began on January 25, 2022. A notice of completion will come to the City Council in May 2022.
 Original Estimate – $1,191,395
 Updated Cost – $900,000
 Original Timeline – 70 working days
 Updated Timeline – 100 working days

12.A-2Council Agenda 3-1-2022

Dinosaur Caves/Price House Restroom Project – This project includes the relocation of the existing restroom at Dinosaur Caves Park to the Price Historical Park and installation of a new restroom purchased through Public Restroom Company at Dinosaur Caves Park. A contract was awarded to JJ Fisher Construction on August 17, 2021, and construction began the week of October 4, 2021, with clearing and grubbing at the Price Historical Park restroom site. Work at both sites is complete and JJ Fisher Construction is working to address last remaining items identified during Building Department final inspections. Both restrooms are anticipated to be open to public the week of February 28, 2022.
 Original Estimate – $377,000
 Updated Cost – $380,000
 Original Timeline – 70 working days
 Updated Timeline – 100 working days

Under Construction

Council Goal – Traffic, Circulation, and Parking

Bello Bridge Replacement – A contract was awarded to Papich Construction by City Council on April 21, 2020, for construction of the Bello Bridge Project. Construction started in early June 2020. The project was stopped on October 31, 2020 per the permit requirements with the California State Water Resources Control Board (Water Board).

Construction resumed on June 15, 2021 and is nearing completion. The post-construction re-vegetation contract was awarded and that work, which includes a five-year plant establishment period, will begin upon completion of the bridge construction. This project is expected to be completed by mid-March 2022.
 Original Estimate – $6.5 M
 Updated Cost – $8 M
 Original Estimated Completion Date – January 2022
 Updated Estimated Completion Date – March 2022

2021-22 Paving Project – In Fall 2020, the City entered into a contract with Pavement Engineering Incorporated (PEI) to develop an update to the City’s Pavement Management Plan. In April 2021, the City Council approved the recommended 5-year plan. On May 18, 2021, the City Council awarded a contract to PEI for evaluation and development of plans and specifications for the 2021-22 Paving Project which includes light rehabilitation to Mattie Road and Ocean Boulevard, light to heavy maintenance to Highland and Ventana Drives north of James Way and residential roads in the neighborhood joining those two collector roads, residential roads north of James Way in the vicinity of New Life Community Church and Wadsworth Avenue from Price Street to the end. The project also includes adding a section of sidewalk along Spyglass Drive from Shell Beach Road to Mattie Road that passes under US 101 and a bike lane for pedestrian and bicyclist safety. Construction is estimated to begin in late Spring 2022. The original project was expected to cost $6 million and would be the largest paving project the City had undertaken. Since that time, the Council has directed staff to expand the project to include Price Street from Dolliver Street/Highway 1 to the US 101 onramp with new paver

12.A-3Council Agenda 3-1-2022

median and parking meters, the Bluff trail at end of Indio Drive, City Hall Parking lot, and additional streets in the neighborhoods northeast of James Way. Further, there is consideration of the rehabilitation of Solar Way. The current estimated project cost including construction ($13 million), construction management services, engineering services during construction and contingency is approximately $17 million based on updated plans and an updated engineer’s estimate received from the City’s design consultant in February. The project will be advertised with a base bid and multiple bid alternates to provide the Council with options on what portions of work to award. Staff put the project out to bid on February 24, 2022 with bids due on March 31, 2022. Staff will provide a full update to the City Council and Community on this project when a contract is brought back to award in April 2022.
 Original Estimate – $6 M plus soft costs (design, engineering services during construction)
 Updated Estimate – $13 M plus soft costs
 Original Timeline – 500 working days, estimated completion date June 2024  Updated Timeline – unknown until construction starts

Sidewalk Under US 101
 Original Estimate – $300 K
 Updated Cost – $270 K
 Original Estimated Completion Date – Winter 2023
 Updated Estimated Completion Date – won’t know until construction starts

Other Projects

Wastewater Treatment Plant Improvements Project – The project includes:
 Rehabilitation of the existing:
o Belt Filter Press – Completed
o Dissolved Air Flotation Tank – Completed by staff
o Clarifiers – Going to bid fall 2022
o Digester #2 – Soliciting quotes fall 2021
 Cleaning of the oxidation ditches – Will be performed by staff once the new bypass pump is received.
 Demolition of Digester #1 – Going to bid spring 2022.  Construction of a new 60-foot by 60-foot steel building – Waiting for demo of digester #1.
 Construction of a new dump station and retaining wall – Staff will complete as time allows.
 Repaving of the corporation yard lot after completion of construction of the various improvements – Waiting for completion of Corp Yard Admin Building.

Shell Beach Reservoir I Replacement – This project involves the removal and replacement of a one-million-gallon water storage tank (Shell Beach Tank #1). Upgrades include piping, electrical components, tank appurtenances, seismic, and safety features.

12.A-4Council Agenda 3-1-2022

Construction began September 15, 2021, and to date, the existing tank has been demolished, site preparation has been completed, and the new tank is being constructed.

This project is anticipated to be completed by May 20, 2022, which is 21 days past the project extended completion date. Staff will be seeking liquidated damages from the contractor in the amount of $1,000 per day past the extended project completion date of April 29, 2022.
 Original Estimate – $1.7 M
 Updated Cost – $1.7 M
 Original Timeline – 170 working days
 Updated Timeline – 190 working days

Corporation Yard Facilities Building/City Hall Improvements Project – This project includes a remodel and addition to the Corporation Yard facilities building and a remodel to City Hall. The focus of the remodels is to enhance employee safety and customer service to the public. A contract was awarded to Quincon Inc., for the project on May 18, 2021. Construction began in two phases, with the Corporation Yard portion starting on July 6, 2021, and the City Hall portion on August 2, 2021. Staff estimates completion of the City Hall portion the week of March 7, 2022 with the contractor moving items back into City Hall downstairs that has been temporarily stored in the storage container in the City Hall parking lot. The Corporation Yard portion of the project is estimated to be complete in April 2022.
 Original Estimate – $1.7 M
 Updated Cost – $2.0 M
 Original Timeline – 160 working days (Corp Yard), 80 working days (City Hall)  Updated Timeline – 219 working days (Corp Yard), 138 working days (City Hall)

Price Historical Park Sign Plan – This project will install the Price Historical Park driveway monument sign and entrance circle sign as established by the Price Historical Park Master Signage Plan, approved by Friends of Price House and the Parks, Recreation and Beautification Commission. Construction of the foundations and stone facing for each of the new signs was completed via change order to JJ Fisher Construction’s contract for the Dinosaur Caves and Price House Restroom Project. Foundations and stone facing for both signs are complete, Southpaw Sign Company has delivered and installed the entry way sign, and delivery and installation of the parking lot sign is anticipated week of February 28, 2022.
 Original Estimate – $29,000
 Updated Cost – $32,667
 Original Timeline – Mid-February 2022
 Updated Timeline – February 28, 2022

Price Historical Park Event Green
Consultant has summitted preliminary landscape improvement plans for a grassy event area between the Price House and the Meherin House. Available budget is $61,114 plus balance of previous Meherin House budget ($42,185). Total available budget $103,299.

12.A-5Council Agenda 3-1-2022

Pismo Beach Storm Drain Project – This project consists of storm drain projects at three separate locations including Encanto Avenue, Reef Court, and Windward Avenue. A contract was awarded to AAAA Engineering Contracting Inc. at the July 20, 2021 City Council meeting. Construction began on September 7, 2021 and to date the Reef Court and Windward Avenue portions of the project have been completed. During construction of the Encanto Avenue portion of the project, it was discovered that the Encanto Outfall was in need of replacement. The materials for the outfall were on backorder and delayed the project. Staff anticipates this portion of the project to be completed by the end of February.
 Original Estimate – $950,000
 Updated Cost – $950,000
 Original Timeline – 65 working days
 Updated Timeline – 106 working days

Previous Council Goal – Bluff Protection

Ocean Boulevard Coastal Access Improvement Project – The Ocean Boulevard Coastal Access Improvement Project includes the following:
 Ocean Boulevard bluff stabilization (federally funded)  Ocean Boulevard Pedestrian Walkway between Vista del Mar and Capistrano Avenue (City-funded)
 Morro Stairs Replacement (City funded)
 Morro Storm Drain Outfall Replacement (City funded)

The bluff stabilization portion of the project is funded through Federal Emergency Relief funding through the Federal Highway Administration (FHWA) and Caltrans Local Assistance (Caltrans LA), 88.53% of which is reimbursed by FHWA/Caltrans LA and

11.47% would be supported by a City match. The Morro stairs and storm drain outfall replacement portions of the project are City-funded with assistance from a partial insurance claim with the City’s insurance provider, the California JPIA.

This project was set to bid in February, however due to additional bluff failure that occurred just prior to bidding the project adjacent to the project site, the project was delayed so that a repair of this section of bluff could be included in the project. By delaying the project and including this section of repair in the project, 88.53% of this repair will be reimbursed by FHWA/Caltrans LA. Council provided staff with authorization to bid at the October 5, 2021, City Council meeting, and bids are due on November 18, 2021.

The project was rebid in October 2021 and a contract was awarded to Granite Construction in the amount of $5,172,223 on December 21, 2021. During the submittal review/supply percurrent period of the project, it was found that epoxy-coated rebar has a current lead time of approximately two months due to global supply chain issues.

Because the epoxy-coated rebar is a critical component of the bluff protection and beach access structure construction will not begin until April 2022. In the meantime, Granite is procuring other materials for the project and working with city staff to have the appropriate submittals reviewed and approved so construction can begin once the materials arrive.

12.A-6Council Agenda 3-1-2022

Original Estimate – $6.9 M
Updated Cost – $7.1 M
Original Estimated Completion Date – April 2023
Updated Estimated Completion Date – June 2023
Design
Council Goal – Water Supply, Conservation and Central Coast Blue Central Coast Blue
Central Coast Blue was recently awarded the League of California Cities Helen Putnam Award for Intergovernmental Collaboration. This is the City’s first Helen Putnam award.

Financing
The City was awarded a Prop 1 Groundwater Grant Program (GWGP) planning grant for the funding amount of $2,000,000 and all funds expended after November 4, 2014, count toward the cost share for this grant, therefore no additional funds are required to meet the match requirements. The grant agreement was executed in April 2019 and grant activities were completed in January 2022. These activities included construction of a test injection well, construction of a monitoring well, aerial geophysics investigations, completion of a leaching study, developing an updated groundwater monitoring plan, and completion of an anti-degradation analysis, all of which will assist in advancing the Central Coast Blue project. On September 7, 2021, the City submitted its concept proposal for Round 3 Prop 1 GWGP Implementation Grant funding. The concept proposal included a request for $28 million, or approximately 50% of implementation costs, in grant funding for the project. The State Water Resources Control Board (SWRCB) Department of Financial Assistance anticipates completing its review of the Round 3 Concept Proposals by March 2022, and will then solicit full proposals from the selected projects.
The City applied for a Title XVI planning grant from the United States Bureau of Reclamation and was notified in February 2019 of an award of $796,094. This grant will fund program management, final design, and value engineering. The City then applied for a Title XVI implementation grant and was notified in August 2021 of an award of $1,700,000 for use in funding final design. The plans to submit another Title XVI implementation grant request on March 15, 2022 for the remainder of funding available to the project from this program. The project is eligible to receive up to 25% of total project costs or approximately an additional $12 million.
San Luis Obispo County plans to submit a State Integrated Regional Water Management Grant Program, Prop 1 Round 2 Implementation Grant request in summer of 2022 that includes multiple projects from around the County. The City

12.A-7Council Agenda 3-1-2022

intends to submit a request for $1 to $2 million in funding for Central Coast Blue and will be engaging with the County in March 2022.
The City submitted applications to the SWRCB for Clean Water State Revolving Fund (CWSRF) financing for construction of the project before the end of the year.

The City submitted two applications, one on behalf of the City, and one on behalf of the proposed Central Coast Blue Joint Powers Authority to keep the City’s loan options open during discussions with project partners City of Grover Beach and City of Arroyo Grande. Both Grover Beach and Arroyo Grande also submitted CWSRF applications for the project. If successful, the CWSRF will provide low interest financing for the construction of the project.

Project Siting
A 1.75-acre parcel was purchased by the City as a location for the advanced treatment facility. Private leases are being terminated on the site to begin site cleanup and preparation.

Technical
The City completed 50% design plans in December 2021. Also, the City has engaged relevant permitting agencies in 2021 to set up permit applications to be submitted in 2022.

Governance
A cost-sharing agreement has been developed and includes the following key terms:
The City of Pismo Beach remains lead agency and acts as project developer through final completion of Phase 1 of the Project.
Costs will be shared by the three cities in proportion to their share of the benefits (water) allocated to the jurisdiction. Grover Beach and Arroyo Grande will reimburse Pismo Beach for their respective shares of the costs of the Project, including all pre-construction and construction costs. Ongoing pre-construction costs will be split between Arroyo Grande and Grover Beach until each party reaches its total contribution amount for its share of pre-construction costs. The allocation of costs/shares are as follows:
o Pismo Beach: 39%
o Grover Beach: 36%
o Arroyo Grande: 25%
The cities will form a Joint Powers Authority (JPA) that will own and operate the Project, as well as obtain financing for construction of the Project.* o The JPA Board of Directors will consist of one representative of each city with each member retaining an equal vote on the Board.
o The JPA will own all Project assets and will employ or contract for the Project’s operations and administrative staff.
o *The revised framework indicated that the JPA would become effective upon completion of construction and commissioning of the Project.

However, the Agreement calls for the JPA to be formed earlier in order to

12.A-8Council Agenda 3-1-2022

ensure that the JPA is able to obtain financing for the Project. The Agreement also acknowledges the intent for the JPA to apply for and obtain financing from the State Water Resources Control Board Clean Water State Revolving Fund (SRF) and, if financing is not available to the JPA through the SRF, that the parties may independently seek financing from the SRF.  Joint meetings of the three City Councils will be held at least once annually until the Project is constructed to provide a venue for discussion and transparency for the public on the project progress, to receive Project updates, and discuss policy issues as needed (e.g., unexpected timeline extensions, approvals of expenditures beyond the Project budget, etc.).
 A Technical Advisory Committee made up of staff from the three cities may be formed and meet monthly to evaluate pre-construction and construction costs, provide input into formation and operations of the JPA, and present reports at the joint City Council meetings.
 Each City Council will review and approve the scope, budget, contingency, and procurement for the remainder of pre-construction and construction phases of the Project. Costs in excess of the agreed-upon budget, plus a 20% contingency, will require approval of all three City Councils. If all three City Councils do not approve any such change order, the parties will meet and confer to arrive at an agreement on the requested change. If this process is unsuccessful, costs will be reduced to below the 20% contingency.
 The Agreement does not impose groundwater pumping limitations on participating parties and recognizes the participants’ contribution of new developed water for their exclusive use. The Agreement also acknowledges that Project water will not be transported out of the Northern Cities Management Area (NCMA) without the prior written approval of the parties.
 An opt-out clause is included to allow exit of a party prior to award of a construction contract as long as the identified share of costs incurred to date are paid by that party.

This cost share agreement was approved by the Arroyo Grande City Council on January 25, 2022 and by the Grover Beach City Council on February 15, 2022. The cost share agreement is on the Pismo Beach City Council agenda this evening.

Previous Council Goal – Old City Hall Public Safety Center

Public Safety Center – Staff and the consultant team are continuing to develop the parameters of the design-build documents for project delivery and reviewing cost impacts and alternate building and site configuration layouts. The team has received requests for qualifications from the future design-build teams to pre-qualify their services to design and construct the new fire station and renovations and additions to the existing police facility, and related site work at 1000 Bello Street.
 Original Estimate – $20 M
 Updated Cost – $22 M to $30 M, depending on project scope

12.A-9Council Agenda 3-1-2022

Chapman Estate Improvements
Windows
Original Estimate – $200 K
Updated Cost – $440 K
Original Estimated Completion Date – November 2021
Updated Estimated Completion Date – July 2022
ADA Restroom
Original Estimate – $200 K
Updated Cost – $475 K
Original Estimated Completion Date – February 2022
Updated Estimated Completion Date – August 2022
Roof
Original Estimate – $500 K
Updated Cost – $580 K
Original Estimated Completion Date – March 2022
Updated Estimated Completion Date – March 2022
Projects include the reroof of the estate, window replacement and construction of an ADA- compliant bathroom, replace parquet floor, paint the interior and repair the plaster ceiling of the estate.

The reroof is currently in progress with anticipated completion in March 2022. Staff is currently working with two separate architectural consultants on plans and specifications for the ADA bathroom and window replacement with an estimated advertisement for construction bids in May 2022.

Council Goal - Community Character and Quality of Life for Residents James Way Beautification Project
In addition to the installation of additional trash cans, benches and new mutt mitts, on February 15, 2022, the City Council directed staff to move forward with a streetscape project that would significantly enhance the corridor with the installation of planters and trees on the ocean side of James Way. The project includes the removal of the concrete between the sidewalk and fence line and replacing it with drought-tolerant landscaping.

Staff is currently developing a request for preproposal to procure a consultant team to design the project and prepare construction documents. The current timeline for the project anticipates construction to begin in October of 2022. Original Estimate – $300 K
Current Project Estimate – $1.5 M

12.A-10Council Agenda 3-1-2022

Toucan Terrace Sewer Trestle Rehabilitation
Awarded a Professional Services contract to a Consultant to prepare plans and specs for recoating the Trestle support bridge.
Original Estimate – $300K
Updated Cost – Pending Inspection and Assessment
Original Estimated Completion Date – N/A
Updated Estimated Completion Date – N/A
Chumash Park and Palisades Park
Request for proposals were received for playground equipment manufacturers. PRBC has reviewed proposals and short-listed vendors who are currently providing updated options and renderings. Request for proposals were received for professional engineering site design layout and ADA improvements. Initial budgeting cost estimates for both park improvements were $450K. Current estimates for park improvements are $1.1 million.

The increased costs are a result of cost increases for installation services, softfall installation and the amount of access improvements that must be constructed in both parks. Staff estimates a budget shortfall of $650K. Current estimated playground equipment vendors manufacture lead-time from the date of authorized purchase is 4-6 months.
Original Estimate – $450 K
Updated Cost – $1.1 M
Original Estimated Completion Date – Summer 2022
Updated Estimated Completion Date – Winter 2022 due to lead time for play equipment
Pier Avenue Stairs Closure
Consultant has been selected to evaluate the stairs and propose repairs and alternatives.

A cost estimate as well as projected timeline will be developed as part of the evaluation.

Dolphin Bay Public Strom Drain Repair
Awarded a Professional Services contract to a consultant to prepare plans and specs to replace existing public storm drain adjacent to The Dolphin Bay Resort. Survey and site assent of pipe and bluff top currently being performed. Geotechnical report has been prepared. Initial cost estimate $250K. Estimated start of Construction Fall 2022.

Completion 2023.
Original Estimate – $250 K
Updated Cost – $300 K
Original Estimated Completion Date – Beginning of 2022 Updated Estimated Completion Date – Fall 2022

12.A-11Council Agenda 3-1-2022

FY 2023 Projects
The projects in this section have not yet been developed to a point to provide an anticipated completion date. Staff will continue to develop these projects.

Dog Park at Spyglass
This project will install a dog park at a portion of Spy Glass Park including chain link fencing to keep the dogs contained in the “dog park,” benches, trash cans, and Mutt Mitt stations.
Original Estimate – $75 K
Updated Cost – $80 K
Hinds/Oceanview Pedestrian Path
This project will construct a sidewalk between Price Canyon Road/Hinds Street to Ocean View adjacent to the US 101.
Original Estimate – $180 K
Updated Cost – $195 K
Shell Beach Parking Lot
This project includes adding a parking lot on Shell Beach Road to the north of the Shell Beach Road tennis courts and pickleball courts. The parking lot must not be larger than 5,000 square feet.
Original Estimate – $175 K
Updated Cost - $250 K
New Production Well
This project will construct a new production well which will add redundance to the system and eventually replace Well 5, which has been rebuilt twice in the last twenty years and is not expected to be rebuilt again in the future.
Original Estimate – $500 K
Updated Cost – $528 K
FISCAL IMPACT:

There is no direct fiscal impact associated with this report. However, based on projected cost increases with these larger capital projects competing for limited resources, staff would like to provide the City Council with an update on the General Fund-supported projects to make sure that Council is aware of its resources as the Council moves forward with approving future funding.

In general, capital projects are funded using one-time funds from accumulated fund balance and can be supported using various special revenue funds, grant funds, capital project funds, enterprise funds, internal service funds, half-cent sales tax fund, and the General Fund. The funding source that is used depends on the type of project and differs based on available resources.

12.A-12Council Agenda 3-1-2022

Currently, the FY 2022 General Fund is supporting $10.6 million of varying levels for 36 different projects. Of those 36 projects, this General Fund support represents about 33% of the total project, where 67% of these projects are supported by other funding sources.

After further review of these 36 projects, staff have identified 6 of these projects that are anticipated to need significantly more funding based on updated cost projections. These projected costs are still estimates at this time as the projects have not been bid. So, it is possible that these costs could be higher or lower.

The projected ending General Fund unassigned fund balance for FY 2022 is $9.5 million.

Staff projects that the 6 projects will require a potential additional $9.5 million from the General Fund unassigned fund balance, completely using up all the remaining projected available General Fund unassigned fund balance. The following table lists the 6 projects that staff is projecting that require a total of $9.5 million from the General Fund unassigned fund balance.

Risks of Using all General Fund Unassigned Fund Balance There are financial risks associated with appropriating all of the City’s General Fund unassigned fund balance in one year. One major concern is the uncertain economic situation with rising inflation, supply chain issues, and global unrest. With these factors, the City has relied on its Budget Stabilization set-aside of $2.0 million that could be used in the event of an economic downturn or rising inflation impacts the City’s other operating costs during this period. Another concern is that it is common that these large capital projects run into unforeseen issues that require change orders or amendments, increasing the cost of the project. It will be imperative to approve these projects with sufficient contingency balances. Furthermore, spending all the City’s General Fund unassigned fund balance may impact cash flow as staff recommends that Council leave approximately $2.5 million to help with this purpose. However, it is likely that these large projects will be spent over time and cross fiscal years which could mitigate this concern.

Finally, as the Council contemplates moving forward with the Public Safety Facility, the City will need to seek a credit rating and the more cash available may help the City obtain a lower borrowing rate.

Once these projects are actually bid, staff will work to find all the funding sources available to support these projects to help offset the impact to the General Fund. In conclusion, while there are risks associated with using all of the General Fund unassigned fund balance, the City is poised to support these major investments with proper planning.

However, any project cost increases and likely inflationary increases on regular operating costs will put a strain on any future projects and possibly impact the City’s credit rating.

In other words, the City can move forward with these projects, but this is the total limit.

The City will require another strong revenue year or two to build up fund balances.

12.A-13Council Agenda 3-1-2022

Table 1. Potential Additional General Fund Support Need for Upcoming Capital Projects ALTERNATIVES:

1. Provide additional direction to staff.

ATTACHMENTS:

None
Prepared by: Meeting Date: March 1, 2022
Benjamin A. Fine, P.E., Director of Public Works/City Engineer City Manager Approval:

Project Title
FY 2022 GF
Support
Remaining Budget
FY 2022 All
Funds Budget
Actuals +
Encumbered
FY 2022
Remaining
Budget
Updated All
Funds Projected
Cost
Other Funding
Sources
Potential
Additional GF
Need Notes
Public Safety
Facility ‐
PAYG/Cash
portion only
2,799,869      3,000,000     2,222,565    777,435    4,000,000   1,000,000     Additonal pre‐construction costs (staff movement, building upgrades)
FY 2022 Paving
Project
2,000,000      6,311,920     708,125        5,603,795     13,708,125        850,000    6,546,205     Assumes a $13M project, also assumes $400K additional Half ‐cent sales tax funds  (*New*)
and $300K Spyglass sidewalk US‐101 from
LBID Fund + $150K from Circulation Fee Fund
3101 (*New*)
James Way
Beautification
300,000          300,000        35,330          264,670    1,466,608   1,166,608     Additonal potential cost per City Council Direction on 2/15/22
Chumash Park
improvements
350,000          350,000        339       349,661    629,000      279,339        Softfall surfacing material and install, engineering and topo, construction and CM
Palisades Park 100,000        339 99,661      453,000      100,000    353,339        Softfall surfacing material and install, engineering and topo, construction and CM.
$100K Park Development Funds
Radio Secure
Communications
project
‐        ‐    625,000      470,000    155,000.00   75% Grant funded, need 25% for Dispatching needs
Total 5,449,869$            10,061,920$  2,966,698$  7,095,222$  20,881,733$      1,420,000$      9,500,491$ 26%
Projected General Fund ending unassigned fund balance as of 6/30/22 9,459,599$ Remaining Balance after Potential Additional Need  $             (40,892)

12.A-14Council Agenda 3-1-2022

PISMO BEACH COUNCIL AGENDA REPORT
Agenda Item #12.B
SUBJECT/TITLE:

BELLO STREET SPORTS COURTS LOCATION ANALYSIS
RECOMMENDATION:

Provide staff with direction on how to proceed with the Bello Street Sports Courts Relocation.

BACKGROUND:

The City has been working on a new Public Safety Facility which is proposed to be constructed on the corner of Bello Street and Wadsworth Avenue, displacing the two existing tennis courts and basketball court (sports courts) at that location. Figure 1, below, shows the corner of Bello Street and Wadsworth Avenue and the location of the existing (E) sports courts, Old City Hall, Fire Sleeping Quarters, Police Department and Fire Department or Fire Apparatus Bays.

Figure 1. Facilities at Corner of Bello Steet and Wadsworth Avenue Consistent with prior Council direction to relocate the sports courts somewhere else in the proximity of the Bello Street neighborhood, staff has been working with staff at the Lucia Mar Unified School District (LMUSD) since August 2019 on an agreement that would allow the City to relocate the existing sports courts to a location adjacent to the track on the lower field at Judkins Middle School. This site is in the same neighborhood as the existing site and less than a quarter of a mile away. (E) Sports Courts Old City Hall
Police Department
Fire
Department
Fire Sleeping Quarters

12.B-1Council Agenda 3-1-2022

Figure 2, on the next page, shows the proposed (P) location of the sports courts, and the relative proximity of the new location to the old location.

Figure 2. Judkins Middle School Location Map

In November of 2021, City staff and LMUSD staff came to an agreement on a location for the courts and conditions LMUSD would like to see met to allow the relocation of the sports courts on LMUSD-owned land. These conditions include the installation of a fence that would completely separate the publicly accessible sports courts from the school grounds for student safety, construction of a sidewalk from the Bello Veterans’ Hall to the track area, and providing the school with 30 days per year where the school would have exclusive rights to the sports courts during school hours.

Staff has also met with the Division of State Architecture (DSA), which has permitting jurisdiction over development of school property, to see what other requirements might be required for the development of the sports courts on LMUSD property. The Americans with Disabilities Act (ADA) requires that when publicly accessible sites are developed, re- developed, or modified that certain ADA improvements must also be made to the site.

The DSA’s initial directive is that an additional 20% of the total project cost would have to be spent on ADA upgrades to the site to meet the ADA guidelines. This would result in additional costs of the project into the six figures.

Because the project is still in the early stages of development and an agreement has not been solidified, staff has prepared a very high-level estimate of the improvements which are shown in the Fiscal Impact section of this report.

(E) Sports Courts
(P) Sports Court
Location

12.B-2Council Agenda 3-1-2022

The next step in solidifying the agreement would be to take it to the LMUSD School Board and City Council for consideration.

Figure 3 shows the exact location of the proposed sports courts in relation to the school’s track and the proposed sidewalk and fencing required by LMUSD, as well as the existing parking lot that has 33 existing parking spaces, which would be shared with other uses of the facility, such as the school’s track and field.

Figure 3. Proposed Improvements on LMUSD Property
While there are many factors that make the proposed site a good choice for relocating the sports courts, there are a few key drawbacks. First, the site is a known site of significant cultural interest. To build the courts in this location would most likely require modified building techniques, most notably that over-excavation and compaction of the native soil would most likely not be allowed. If this were to be true, soil would have to be imported and compacted on top of the native soil. This technique was used in the construction of Dinosaur Caves Park. This would increase costs. Second, the courts will not be as accessible to the public as if they were on City property, with an agreement for use needing to be approved by the school district that would set aside certain days of use by the school. Third, as previously mentioned, additional costs for ADA mitigations are required by the state. Finally, the courts would not as visible or as easily accessible to the public as the existing courts.

Based on some of these concerns, at the Goal Setting meeting on January 28, 2022, the City Council directed staff to investigate whether or not the City-owned lot on Ventana Drive would be a suitable alternative for the sports court’s relocation.

12.B-3Council Agenda 3-1-2022

Staff looked at the Ventana Drive site, which is approximately 2 miles from the existing sports courts by car. Figure 4, below, shows the relationship between the existing sports courts (shown with an x) and the Ventana site (shown with a star).

Figure 4. Map Showing Relationship between the Existing Sports Courts and the Ventana Drive Site
Figure 5 below shows the Ventana Drive site, which is located across the street from Chumash Park. If the sports courts were relocated to this site, staff has concerns with the possibility of users of the sports courts trying to cross Ventana Drive, which has a steep grade and often sees vehicles driving at a higher rate of speed, to the park and users for the park trying to cross Ventana Drive to the sports courts. Staff recommends that, should the Council direct staff to relocate the sports courts to this location, the following public improvements be made:
Install “No Crossing” signs on barricades at the driveway to Chumash Park and the sports courts site
Install “Pedestrian Crossing” wayfinding signs on the barricades Remove the existing curb ramps on Ventana Drive, shown in Figure 5 Install new curb ramps at the controlled intersection of Ventana Drive and James Way, shown in Figure 5
Install approximately 80 feet of new sidewalk across the landscape island, shown in Figure 5
Ventana Drive is included in the 2022 Paving Project that is currently out to bid, with bids due on March 31, 2022. If the Council wishes to move forward with the Ventana Drive site, staff recommends that a bid addendum be issued now, to include the above public improvements with the paving project.

A proof-of-concept layout of the proposed sports courts is shown in Figure 6, below. This exhibit shows that the two tennis courts, basketball court, and approximately 21 parking spaces can fit on the site. Staff would need to do a more detailed analysis to determine exactly what improvements could be constructed at this site and if any retaining walls would be required. The Council may choose to delegate the actual design and court selection to the Parks, Recreation and Beautification Commission.

12.B-4Council Agenda 3-1-2022

Figure 5. Ventana Drive Site and Recommended Public Improvements Chumash Park
Ventana Site

12.B-5Council Agenda 3-1-2022

Figure 6. Proof of Concept Layout of Proposed Sports Courts While staff has only done a preliminary investigation to both sites, the Ventana Drive site appears to be an easier site to develop since it is not a known site of significant cultural interest, would require fewer public improvements, and would not require spending an additional 20% of the project budget in site upgrades. The site is also more visible and accessible.

Recommendation
Staff recommends that the City Council discuss options for the relocation of the existing sports courts located on the corner of Wadsworth Avenue and Bello Street and provide staff with direction on how to proceed.

FISCAL IMPACT:

While there is no immediate fiscal impact from Council discussing options and providing staff with direction on how to proceed, each potential location for the new sports courts has different costs associated with construction. The estimates shown below are very high-level estimates that will require more time and effort to refine, including a topographic survey, which could cost $5,000—$7,000. Because a definitive site has not been selected by the City Council, staff did not invest the extra resources to refine either cost estimate.

Once a topographic survey is performed, staff will have an idea of the size of retaining walls that will be required. Staff estimates that the Bello site will likely need retaining walls

12.B-6Council Agenda 3-1-2022

in some capacity for the sidewalk which could cost between $35,000 and $45,000. This cost is not included in the estimate below.

Bello Street Site
Construction of sports courts $963,000
Special site considerations $90,000
Sidewalk (including utility pole relocation) $65,000
Fencing 980 lineal feet $45,000
Subtotal $1,163,000
Design (10%) $116,300
Project administration (20%) $232,600
ADA Improvements (20%) $232,600
Contingency (10%) $116,300
Total $1,860,800
Ventana Drive Site
Construction of sports courts $963,000
Sidewalk and ramps $15,000
Fencing 640 lineal feet $30,000
Subtotal $1,008,000
Design (10%) $100,800
Project administration (20%) $201,600
Contingency (10%) $100,800
Total $1,411,200
ALTERNATIVES:

1. Provide staff direction on a different project.

ATTACHMENTS:

None
Submitted by: Meeting Date: March 1, 2022
Benjamin A. Fine, P.E., Director of Public Works/City Engineer City Manager Approval:

12.B-7Council Agenda 3-1-2022

PISMO BEACH COUNCIL AGENDA REPORT
Agenda Item #12.C

SUBJECT/TITLE:

CENTRAL COAST BLUE COST-SHARING AGREEMENT AND CLEAN WATER

STATE REVOLVING FUND LOAN AUTHORIZING RESOLUTION

RECOMMENDATION:

1. Adopt a Resolution authorizing the City Manager to enter into a cost-sharing agreement with the Cities of Arroyo Grande and Grover Beach for the Central Coast Blue project;

2. Adopt a Resolution authorizing the City Manager to file a financial assistance application with the Clean Water State Revolving Fund for the Central Coast Blue project.

BACKGROUND:

The City of Pismo Beach is the lead agency for Central Coast Blue, a regional recycled water project. The Project has been a multi-agency effort between three of the four Northern Cities Management Area agencies (the Cities of Arroyo Grande, Grover Beach, and Pismo Beach) and the South San Luis Obispo County Sanitation District to construct a regional recycled water project that will enhance supply reliability by injecting advanced purified water into the Santa Maria Groundwater Basin (SMGB). The Project will reduce vulnerability to drought and seawater intrusion by creating a seawater intrusion barrier and supplementing the naturally occurring groundwater.

Phase I of Central Coast Blue will purify the effluent from the City of Pismo Beach’s wastewater treatment plant (WWTP) and inject it into the groundwater basin. If needed and deemed feasible, an additional phase, Phase II, would allow Central Coast Blue to purify the effluent from the South San Luis Obispo County Sanitation District’s WWTP and inject it into the groundwater basin, creating additional supply.

This innovative multi-agency project was awarded a Helen Putnam Award by Cal Cities in 2021 for regional collaboration. In addition, the project has received five grant awards to date totaling $4.5M and is well-positioned to receive additional grant funding for up to 75% of the project costs. The project has also received awards for exceptional education and outreach efforts in 2019 at the WateReuse California Annual Conference, and again in 2019 at the 2019 National WateReuse Symposium.

The partner agencies, which consist of the cities of Arroyo Grande, Grover Beach, and Pismo Beach, have formed a cost- and benefit-sharing subcommittee which has met ten times to help draft a framework outlining how costs and benefits for the project will be distributed. These items, along with others, have been placed in a framework Memorandum of Agreement (MOA). The Oceano Community Services District (OCSD) was initially involved in the development of Central Coast Blue, however OCSD has indicated that it does not need the water produced from the project, that it believes it will not benefit from the project, and that it cannot afford to support the project financially.

12.C-1Council Agenda 3-1-2022

In addition to outlining costs and benefits, the MOA indicates how non-participating agencies will manage their groundwater resources without impacting the benefits from Central Coast Blue and provides a way for non-participating agencies to join Central Coast Blue at a later date.

A draft MOA was presented to all of the partner agencies in late 2019 and early 2020, with Arroyo Grande first hearing the item on January 28, 2020, Grover Beach first hearing the item on January 21, 2020, and the Pismo Beach City Council initially hearing the item on December 3, 2019. Feedback was received from each of the agencies and the MOA was revised accordingly for further discussion by the City Councils. A joint meeting of all three City Councils was planned for March 2020, however this was halted due to COVID- 19 shutdown. The postponement of this meeting caused delay to the project by not allowing the City Councils to work collaboratively through the JPA at that time.

Since 2020, the three partner cities’ City Managers have continued to negotiate the points of the MOA and have continued to get input from their respective City Councils. A new framework for the project was presented in August 2021, and on November 16, 2021, the Pismo Beach City Council directed staff to increase the City’s participation in the project from 20% to 39%, making the project fully subscribed.

The City of Arroyo Grande drafted, and the staff from the Cities of Grover Beach and Pismo Beach made recommended changes to, a revised cost-sharing agreement that includes the most recent allocation of 39% for Pismo Beach, 36% for Grover Beach, and 25% for Arroyo Grande, and that made additional changes agreed to by the parties regarding the cost-sharing mechanisms for the project. On January 25, 2022, the Arroyo Grande City Council unanimously approved the Cost Sharing Agreement (Agreement) and the Grover Beach City Council unanimously approved the Agreement on February 15, 2022.

Central Coast Blue will help address the threat of seawater intrusion by injecting recycled water into the basin at key locations near the seawater interface. Phase 1 of the Project proposes to treat wastewater from the City of Pismo Beach to an advanced purification level to create between 900–1,000 acre-feet additional water per year. This new developed water will help to ensure that a sufficient barrier exists within the basin to keep sea water from flooding into the aquifer and contaminating the wells used by the NCMA parties. As a result, the Project will help to make the City’s water supply portfolio more drought-resistant and sustainable into the future. Approval of the Agreement and completion of the Project will secure an estimated 351–390 acre-feet per year of reliable groundwater for the City.

Proposed Agreement
Consistent with the revised framework, the proposed Cost Sharing Agreement includes the following key terms:
 The City of Pismo Beach remains lead agency and acts as project developer through final completion of Phase 1 of the Project.

12.C-2Council Agenda 3-1-2022

 Costs will be shared by the three cities in proportion to their share of the benefits (water) allocated to the jurisdiction. Grover Beach and Arroyo Grande will reimburse Pismo Beach for their respective shares of the costs of the Project, including all pre-construction and construction costs. Ongoing pre-construction costs will be split between Arroyo Grande and Grover Beach until each party reaches its total contribution amount for its share of pre-construction costs.  The allocation of costs/shares are as follows:
o Pismo Beach: 39%
o Grover Beach: 36%
o Arroyo Grande: 25%
 The cities will form a Joint Powers Authority (JPA) that will own and operate the Project, as well as obtain financing for construction of the Project.* o The JPA Board of Directors will consist of one representative of each city with each member retaining an equal vote on the Board.
o The JPA will own all Project assets and will employ or contract for the Project’s operations and administrative staff.
o *The revised framework indicated that the JPA would become effective upon completion of construction and commissioning of the Project.

However, the Agreement calls for the JPA to be formed earlier in order to ensure that the JPA is able to obtain financing for the Project. The Agreement also acknowledges the intent for the JPA to apply for and obtain financing from the State Water Resources Control Board Clean Water State Revolving Fund (SRF) and, if financing is not available to the JPA through the SRF, that the parties may independently seek financing from the SRF.  Joint meetings of the three City Councils will be held at least once annually until the Project is constructed to provide a venue for discussion and transparency for the public on the project progress, to receive Project updates, and discuss policy issues as needed (e.g., unexpected timeline extensions, approvals of expenditures beyond the Project budget, etc.).
 A Technical Advisory Committee made up of staff from the three cities may be formed and meet monthly to evaluate pre-construction and construction costs, provide input into formation and operations of the JPA, and present reports at the joint City Council meetings. The group will be formed and has its first meeting scheduled in March.
 Each City Council will review and approve the scope, budget, contingency, and procurement for the remainder of pre-construction and construction phases of the Project. Costs in excess of the agreed-upon budget, plus a 20% contingency, will require approval of all three City Councils. If all three City Councils do not approve any such change order, the parties will meet and confer to arrive at an agreement on the requested change. If this process is unsuccessful, costs will be reduced to below the 20% contingency.
 The Agreement does not impose groundwater pumping limitations on participating parties and recognizes the participants’ contribution of new developed water for their exclusive use. The Agreement also acknowledges that Project water will not

12.C-3Council Agenda 3-1-2022

be transported out of the Northern Cities Management Area (NCMA) without the prior written approval of the parties.
 An opt-out clause is included to allow exit of a party prior to award of a construction contract as long as the identified share of costs incurred to date are paid by that party.

In addition to clarifications regarding formation of the JPA and the intent for the JPA to obtain financing for construction, the Agreement states that a financing plan may be prepared by the parties to describe the intended mechanisms for funding the Project. It is anticipated that such a plan would be flexible and general in nature to account for the various opportunities for grants and other financing arrangements that may be awarded to the Project over time.

Finally, the Agreement also states the intent for the JPA to obtain title to the Project site from Pismo Beach. The prior proposed Operating Agreement included provisions allowing the City of Grover Beach to take title to the site in order to reduce potential property tax liability due to the site’s location within Grover Beach’s jurisdiction. The Arroyo Grande City Attorney’s research has concluded that, if the JPA owns the Project site, it will receive the same property tax benefits as the City of Grover Beach would have, thereby eliminating the potential desire by the parties for Grover Beach to hold title to the property.

Cost-Sharing Agreement; Financials
The City of Arroyo Grande drafted, and the staff from the Cities of Grover Beach and Pismo Beach made recommended changes to, a cost-sharing agreement that includes the most recent allocation of 39% for Pismo Beach, 36% for Grover Beach, and 25% for Arroyo Grande. Based on an estimated $43.5 million for the construction phase of the project, the cities are pursuing various funding options, including Proposition 1 grants and federal Title XVI grants. So far, the City of Pismo Beach has been successful at receiving these planning grants and is in the process of seeking construction grant funding. These grants may not cover the full amount of the estimated construction cost. As such, the cities are also pursuing low interest financing through the State Water Resources Control Board Clean Water State Revolving Fund (SRF). The cities would pay back the SFR loan, if awarded, by net water revenues for Arroyo Grande and Grover Beach, and net water and wastewater revenues for Pismo Beach. Staff has worked with State Water Resource Control Board (Water Board) staff on how best to submit an application for a SRF low interest loan.

Timing of State Revolving Fund Loan
Based on past experience and discussions with the Water Board staff, it will take over a year to secure financing if the project is approved for financing. The Water Board reviews State Revolving Fund (SRF) applications received by December 31st each year to be considered for funding in the next fiscal year. Since the project construction could potentially start towards the end of 2022 or beginning of 2023, it was important to get the SRF application in 2021 rather than waiting until 2022, since the project would be considered for funding in FY 2024 if delayed. It is also possible that, even with an incomplete application, the project could be awarded sufficient points to be awarded the

12.C-4Council Agenda 3-1-2022

financial assistance. In order to keep the project moving forward and avoid a year of delays waiting for the funding to begin construction, the three cities have submitted SRF applications as of December 31, 2021. In addition, the cities submitted a SRF application as a potential future Joint Powers Authority (JPA) that is currently envisioned as owning and operating the Central Coast Blue facility and shared by the current allocation among the cities. The Water Board stated that although it will work closely with the three cities, if and when they award the SRF loan, it assumes that the applicant will own and operate the facility. Once the cost-sharing agreement is approved by all three cities, the three cities will begin working on forming the Central Coast Blue JPA.

Authorizing Resolution
As part of the SRF application, the Water Board requires that the governing board of each entity submitting the SRF application, and in this case, the City Council of each City and the governing board of the future JPA submit an Authorizing Resolution. The Authorizing Resolution states that the Authorized Representative or designee is authorized to sign, file, carry out, and implement the SFR application and resulting financing agreement.

The City received feedback from the Water Board on the draft resolution, which is included for Council’s review and approval (Attachment 2).

Environmental Review
Pismo Beach is the Lead Agency under the California Environmental Quality Act (CEQA) for Central Coast Blue. As such, on February 16, 2021, the City Council certified an Environmental Impact Report (EIR), adopted findings, and adopted a Statement of Overriding Considerations. No additional CEQA findings or amendments to the EIR are necessary at this time. Should components of the project change in the future, additional environmental review will be conducted at that time.

Conclusion and Recommendation
Staff recommends that Council adopt a Resolution (Attachment 1) authorizing the City Manager to enter into a cost sharing agreement (Attachment 1.A) with the Cities of Arroyo Grande and Grover Beach for the Central Coast Blue project.

Due to the desire to obtain the lowest interest loan possible, staff also recommends that Council adopt a Resolution (Attachment 2) authorizing the City Manager to file a financial assistance application with the Clean Water State Revolving Fund for the Central Coast Blue project.

FISCAL IMPACT:

The fiscal impact of approving the cost-sharing agreement to the City of Pismo Beach is committing to 39% of the pre-construction and construction costs of the Central Coast Blue project. Currently, the estimated pre-construction costs are projected to be $13,507,007. Of this amount $4,496,094 is projected to be supported by grants, leaving $9,010,913 pre-construction costs. Construction costs are currently estimated at $43,407,577. Total pre-construction (assuming projected grant funding) and construction

12.C-5Council Agenda 3-1-2022

costs (assuming no grant funding) are $52,418,490. Of this, amount, Pismo Beach’s share is 39% or $20,443,211. The following table lists these costs:

Table 1. Pismo Beach’s Share of Project Costs

The pre-construction costs are anticipated to be supported with cash and the construction costs are anticipated to be supported with low interest SRF funding. Annual projected debt service and projected operating and maintenance costs for the Central Coast Blue facility are projected to be $3,779,123 per year for 30 years. Of this amount, Pismo Beach’s share is 39%, or $1,473,858 per year for 30 years. In the likely event that the project is awarded grants for a portion of the construction of the project, this annual debt service payment would be less.

To date, based on City staff’s reconciliation of expenditures for the project since FY 2017, the City has spent $4,888,814 on the project and $1,794,331 for the purchase of land.

The City has also received $630,930 in revenues for the project and has been awarded $2,796,094 in Proposition 1 and Title XVI grant funding. Total net expenditures on the project (project costs less revenues and grants) is $3,256,121. Of this amount, after taking into account amounts paid by the cities of Grover Beach and Arroyo Grande toward the project, the cities of Grover Beach and Arroyo Grande owe the City of Pismo Beach $892,612 and $549,055, respectively. Excluding the land purchase, the total net expenditures for the project are $1,461,790. Of this amount, the cities of Grover Beach and Arroyo Grande owe the City of Pismo Beach $246,653 and $100,473, respectively.

The following tables provide a recap of these amounts.

$13,507,007 Pre-construction costs
43,407,577 Construction costs
$52,418,490 Total
$20,443,211 39% Pismo Beach
$3,779,123 Annual Debt Service & O&M
1,473,858 39% Pismo Beach

12.C-6Council Agenda 3-1-2022

Table 2. Net Project Expenditures
Table 3. Expenditures and Amounts Owed by Partner Agencies ALTERNATIVES:

1. Request additional information from staff.

ATTACHMENTS:

1. Resolution for Cost-Sharing Agreement

1.A Exhibit 1.A Cost-Sharing Agreement

2. Loan Authorizing Resolution
Submitted by: Meeting Date: February 15, 2022
Benjamin A. Fine, P.E., Director of Public Works/City Engineer Nadia Feeser, Administrative Services Director
City Manager Approval:

Total Pismo Beach Expenditures 6,237,683$
Total Arroyo Grande Exenditures 215,423
Total Grover Beach Expenditures 230,039
Land Purchase 1,794,331
Expenditures less Land 4,888,814$
Prop 1 Grant Funding 2,000,000$
Title XVI Grant Funds 796,094
2,796,094$
Expenditures less land and grants 2,092,720$
Revenues received to date 630,930
Net Expenditures 1,461,790$
Allocation of Expenditures less grants 3,256,121$ Paid to date Remaining Due Pismo Beach 39% 1,269,887$ 2,711,555$ (1,441,668)$ Grover Beach 36% 1,172,204 279,591 892,612
Arroyo Grande 25% 814,030 264,975 549,055
100% 3,256,121$ 3,256,121$ -$
Allocation of Expenditures less land and grants 1,461,790$ Paid to date Remaining Due Pismo Beach 39% 570,098$ 917,224$ (347,126)$
Grover Beach 36% 526,244 279,591 246,653
Arroyo Grande 25% 365,447 264,975 100,473
100% 1,461,790$ 1,461,790$ 0$

12.C-7Council Agenda 3-1-2022

RESOLUTION NO. R-2022-XXX

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PISMO BEACH,

CALIFORNIA AUTHORIZING THE CITY MANAGER TO ENTER INTO A COST

SHARING AGREEMENT WITH THE CITIES OF ARROYO GRANDE AND GROVER

BEACH FOR THE CENTRAL COAST BLUE PROJECT
WHEREAS, the City of Pismo Beach is the lead agency for Central Coast Blue, a regional recycled water project that will enhance supply reliability by injecting advanced purified water into the Santa Maria Groundwater Basin; and
WHEREAS, the partner agencies, which consist of the cities of Arroyo Grande, Grover Beach, and Pismo Beach, have formed a cost- and benefit-sharing subcommittee which has helped draft a framework outlining how costs and benefits for the project will be distributed; and
WHEREAS, the City of Arroyo Grande drafted, and the staff from the Cities of Grover Beach and Pismo Beach made recommended changes to, a cost-sharing agreement that includes the most recent allocation of 39% for Pismo Beach, 36% for Grover Beach, and 25% for Arroyo Grande; and
WHEREAS, costs will be shared by the three cities in proportion to their share of the benefits (water) allocated to the jurisdiction; and
WHEREAS, the Arroyo Grande City Council unanimously approved the Cost Sharing Agreement on January 25, 2022, and the Grover Beach City Council unanimously approved the Cost Sharing Agreement on February 15, 2022.

NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Pismo Beach hereby authorizes the City Manager to enter into a cost-sharing agreement with the Cities of Arroyo Grande and Grover Beach for the Central Coast Blue project (Exhibit A).

UPON MOTION OF Council Member , seconded by Council Member , the foregoing resolution was adopted by the City Council of the City of Pismo Beach this 15th day of February 2022, by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:

RECUSED:

Approved: Attest:
________________________ ________________________
Ed Waage, Mayor Erica Inderlied, City Clerk
Attachment 1

12.C-8Council Agenda 3-1-2022

{CW108993.18} COST SHARING AGREEMENT
City of Arroyo Grande, City of Pismo Beach, and City of Grover Beach

COST SHARING AGREEMENT

FOR PARTIES PARTICIPATION IN THE

CENTRAL COAST BLUE PROJECT

THIS COST SHARING AGREEMENT (hereinafter “Agreement”), is effective as of __________, 2022 (the “Effective Date”) by and between the City of Arroyo Grande, a California municipal corporation (“Arroyo Grande”), City of Grover Beach, a California municipal corporation (“Grover Beach”) and City of Pismo Beach, a California municipal corporation (“Pismo Beach”). The cities may be individually referred to herein as a “Party” or collectively as the “Parties.”
RECITALS:

WHEREAS, in 1983, the Parties hereto entered into a voluntary groundwater management plan to manage the safe yield of the Arroyo Grande Groundwater Basin, which agreement was updated by the Parties through approval of the 2002 Agreement Regarding Management of the Arroyo Grande Groundwater Basin (the “Management Agreement”); and WHEREAS, on April 30, 2002, the Parties hereto, among others, entered into a settlement agreement (the “Settlement Agreement”) related to a 1997 groundwater adjudication litigation filed by the Santa Maria Valley Water Conservation District, which reaffirmed the Management Agreement, established separate water management areas (the “Original Management Areas”) to be independently managed by the Parties and others, and requiring the Parties and others to develop an equitable cost sharing agreement for any newly constructed water resource and water production facilities within the Original Management Areas; and WHEREAS, on June 30, 2005, the Parties hereto entered into a stipulation imposing a physical solution for ensuring the Arroyo Grande Groundwater Basin’s long-term stability (the “Stipulation”). The Stipulation adopted a local management approach, establishing three management areas (the “Current Management Areas”) and requiring a monitoring program to be established in each of the Current Management Areas; and WHEREAS, on January 25, 2008, the Santa Clara Superior Court entered Judgment in the Santa Maria Groundwater Adjudication litigation approving the Stipulation, without qualification (the “Adjudication Decree”); and
WHEREAS, the Parties intend to participate in the Central Coast Blue Project to construct a regional recycled water project that will enhance supply reliability by injecting advanced purified water into the Northern Cities Management Area of the Santa Maria Groundwater Basin (“Project”). The Project will reduce vulnerability to drought and seawater intrusion by creating a seawater intrusion barrier and supplementing the naturally occurring groundwater; and WHEREAS, the Project must comply with the California Environmental Quality Act (“CEQA”), and the lead agency pursuant to CEQA is Pismo Beach. Both Arroyo Grande and Grover Beach are considered responsible agencies for the Project and are required to make findings Attachment 1.A

12.C-9Council Agenda 3-1-2022

{CW108993.18} COST SHARING AGREEMENT
City of Arroyo Grande, City of Pismo Beach, and City of Grover Beach

for each significant effect of the Project and adopt a mitigation monitoring and reporting program; and
WHEREAS, Phase 1 of the Project includes construction of an Advanced Treatment Facility (“ATF”), treatment of all secondary treated flows from Pismo Beach’s Wastewater Treatment Plant (“WWTP”), construction of five injection wells and associated transmission lines, and injection of flows from the WWTP (“Phase 1”). Phase 1 proposes to treat wastewater from Pismo Beach to an advanced purification level to create between nine hundred (900) and one thousand (1,000) acre-feet of additional water per year; and WHEREAS, Phase 2 will include upgrades to the ATF to increase capacity, construction of two additional injection wells and associated transmission lines, and injection of flows from the South San Luis Obispo County Sanitation District Wastewater Treatment Plant (“Phase 2”); and WHEREAS, the Parties desire to enter into this Agreement to set forth the mechanism for establishing the fair share allotment of the Phase 1 costs in proportion to each Party’s share of the benefits of the Project.

NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth herein and other good and valuable consideration, the receipt and sufficiency of which are hereby expressly acknowledged, the Parties hereby agrees as follows:

ARTICLE I
General Provisions

1. Recitals. The Recitals set forth above are expressly incorporated as terms of this Agreement. In the event of a conflict between the Recitals above and Articles I through V of this Agreement, Articles I through V shall prevail.

2. Term. This Agreement shall be effective from the last date of execution by all Parties until the date of issuance of a Notice of Completion of Phase 1 to all other Parties by Pismo Beach (the “Term”).

3. Management Agreement. In the event of a conflict between this Agreement and the Management Agreement, the Management Agreement shall prevail.

4. Adjudication Decree. In the event of a conflict between this Agreement and the Adjudication Decree, the Adjudication Decree shall prevail.

5. Developed Water. The Parties hereto acknowledge and agree that the recycled water injected into the ground pursuant to this Agreement, as well as all new developed water subsequently extracted, is New Developed Water as defined in the Adjudication Decree.

6. Municipal Pumping Entitlement. Each Party’s annual allocation of groundwater, as provided in the Management Agreement including agricultural conversion credits, shall remain as follows:

Attachment 1.A

12.C-10Council Agenda 3-1-2022

{CW108993.18} COST SHARING AGREEMENT
City of Arroyo Grande, City of Pismo Beach, and City of Grover Beach

Arroyo Grande: 1,323 acre-feet per year.

Grover Beach: 1,407 acre-feet per year.

Pismo Beach: 700 acre-feet per year.

This Agreement in no way limits any Party’s right to pump their respective annual allocation of groundwater under the Adjudication Decree and in no way limits any Party’s right to transfer, sell, or lease their allocation of water consistent with the Adjudication Decree. Further, this Agreement in no way limits any Party’s right to pump their respective share of the recycled water injected into the ground pursuant to this Agreement, as well as all other dependent agreements described herein, for subsequent extraction.

ARTICLE II
Definitions

1. Construction Cost. Means the cost incurred as of the effective date of the first construction contract for Phase 1 of the Project through the determination by the Parties that construction of Phase 1 is complete, including the cost of the purchase of the Facility site for the Project. Construction Cost does not include legal expenses attributable to each Party’s City Attorney, retained counsel or their associates.

2. Enterprise. Means, for purposes of application to the Cities of Arroyo Grande and Grover Beach, the Party’s water system, including all facilities, works, properties and structures of the Party for the treatment, transmission and distribution of potable and non-potable water, including all contractual rights to water supplies, transmission capacity supply, easements, rights- of-way and other works, property or structures necessary or convenient for such facilities, together with all additions, betterments, extensions and improvements to such facilities or any part thereof hereafter acquired or constructed. For purposes of City of Pismo Beach, the above definition shall include both the Party’s water and wastewater system.

3. Facility or Facilities. Means the advanced water treatment facility that will receive and further treat wastewater influent from Pismo Beach’s WWTP, in Phase 1, which as of the date of this Agreement is proposed to be constructed on Assessor’s Parcel Number 060-543-016 in the City of Grover Beach, including the Facility’s equalization basin, injection wells, storage tanks, pump station and associated piping and equipment from the Pismo Beach WWTP.

4. Gross Revenues. Means all gross income and revenue received or receivable by the Party from the ownership and operation of its Enterprise, calculated in accordance with Generally Accepted Accounting Principles, including all rates, fees and charges (including fees for connecting to the Enterprise and any water stand-by or water availability charges or assessments) received by the Party for water service made available or provided by the Enterprise and all other income and revenue howsoever derived by the Party from the Enterprise or arising from the Enterprise; provided, however, that (i) any specific charges levied for the express purpose of reimbursing others for all or a portion of the cost of the acquisition or construction of specific facilities, or (ii) customers’ deposits or any other deposits subject to refund until such deposits have become the property of the Party, are not Gross Revenues and are not subject to the lien of Attachment 1.A

12.C-11Council Agenda 3-1-2022

{CW108993.18} COST SHARING AGREEMENT
City of Arroyo Grande, City of Pismo Beach, and City of Grover Beach

the Agreement. For purposes of Pismo Beach, this definition will include all income and revenue received as defined by this provision for both the water and wastewater system.

5. Lead Agency. Means the public agency that has the principal responsibility for carrying out or approving a project. The lead agency for this Project is Pismo Beach.

6. Net Revenues. “Net Revenues” means, for any period, all of the Gross Revenues during such period less all of the Maintenance and Operation Costs during such period. For purposes of this provision, Maintenance and Operation Expense means all reasonable expenses incurred by the Party in causing the Enterprise to be operated and maintained in good repair, working order and condition, including payments made to any other municipal corporation or private entity for water service (or other utility service if the Party combines such service in the Enterprise and enters into a contract for such services), but not including any depreciation or taxes levied or imposed by the Party or payments to the Party in lieu of taxes, or capital additions to or capital replacements of any portion of the Enterprise. Net Revenues for the City of Pismo shall mean the above definition as it applies to both the water and wastewater systems.

7. Pre-Construction Cost. Includes the cost of planning, designing and procuring of contracts for professional services required to obtain and perfect any necessary permits, leases, licenses, or other requirements for Phase 1 of the Project, beginning with the 2017 Regional Groundwater Sustainability Program Contract through, but not including award of the first construction contract for Phase 1 of the Project. Pre-Construction Cost does not include legal expenses attributable to each Party’s City Attorney, retained counsel or their associates.

ARTICLE III
Project Delivery and Governance Framework

1. Lead Agency Duties. Pismo Beach will remain Lead Agency and act as project developer through final completion of Phase 1 of the Project. As the Lead Agency, Pismo Beach will act as the construction manager for Phase 1 and will provide administration of Phase 1 on all Parties' behalf. Pismo Beach is hereby authorized and empowered to represent the Parties in construction supervisory and coordination activities, including the authority to issue field work directives and/or change orders on behalf of the Parties, pursuant to the terms of this Agreement.

As Lead Agency, Pismo Beach will contract for professional services and is responsible for obtaining and perfecting any necessary permits, leases, licenses or other approvals for Phase 1 of the Project, consistent with its own contracting policies. The Parties shall pay their pro rata shares of Pre-Construction costs for any professional service expenses incurred by Pismo Beach in connection with obtaining such Phase 1 approvals, in accordance with Article IV below. a. Contract Awards. Pismo Beach shall adhere to all federal, State, and local laws in awarding contracts for Phase 1 and, to the extent any federal grant funds are used to finance contracts for Phase 1, specifically in compliance with Title 2 of the Federal Code of Regulations, part 200 et seq.
b. Local Hire. Subject to Section 1.a., above, every contractor submitting a bid to Pismo Beach for a public works contract for Phase 1 of the Project shall agree to make a good faith effort to hire individuals who are local residents. A “good faith effort” means a contractor Attachment 1.A

12.C-12Council Agenda 3-1-2022

{CW108993.18} COST SHARING AGREEMENT
City of Arroyo Grande, City of Pismo Beach, and City of Grover Beach

will take the following or similar actions to recruit and maintain residents of San Luis Obispo County and Santa Barbara County as part of the construction workforce:
i. Contact local recruitment sources to identify individuals who are local residents;
ii. Advertise for individuals who are local residents in trade papers and newspapers of general circulation within San Luis Obispo and Santa Barbara Counties; and
iii. With respect to any portion of a public works contract to be performed by a subcontractor, identify subcontractors whose workforce includes individuals who are local residents.
c. Grant Funding and Financing. As Lead Agency, Pismo Beach will apply for available grant funding for Pre-Construction and Construction Costs of Phase 1 of the Project, including but not limited to Proposition 1 Groundwater Grant Program Grant Funding from the State Water Resources Control Board and Title XVI WaterSMART Water Reclamation and Reuse Grant Funding from the United States Bureau of Reclamation. The Parties may jointly develop a financing plan describing the anticipated mechanisms for obtaining the necessary funding to construct Phase 1 of the Project.

2. Phase 1 Accounting. Pismo Beach will maintain Phase 1 accounting and will invoice the other Parties consistent with the Water Purveyor Contributions identified in Article IV of this Agreement. Pismo Beach shall, on a monthly basis, invoice each Party for its pro rata percentage of the Pre-Construction Costs and Construction Costs incurred by Pismo Beach during such preceding, if not reimbursed by other funding sources, as established in the annual operating budget, and further detailed in Article IV of this Agreement. All Parties agree to pay Pismo Beach’s invoices within thirty (30) days of the date of the invoice subject to and consistent with Article IV, Section 4 of this Agreement.

3. Joint Powers Authority. Contemporaneously with preparation of this Agreement, the Parties are negotiating a Joint Powers Agreement to establish a Joint Powers Authority (“JPA”), pursuant to Government Code section 6500 et seq., that will own and operate the Project and have the power to issue debt and enter into loans or financing agreements to finance the Construction Costs for Phase 1. The Joint Powers Agreement will contain provisions addressing, without limitation, acquisition of the Facility site from Pismo Beach, ownership of the Facility, and financing of Construction Costs, including repayment obligations of the Parties consistent with the Water Purveyor Contribution percentages identified in Article IV, Section 2.a of this Agreement. It is the intent of the Parties that the JPA shall apply for and obtain financing through the State Water Resources Control Board’s Clean Water State Revolving Fund for Construction Costs or other financing mechanisms not otherwise covered by grant funding awarded to the Project and for the JPA to comply with all requirements to obtain such financing. The potential loans could be separate installment sale agreements based on the respective share of each Party, and repayment would be paid either directly to the JPA by each Party consistent with the Water Purveyor Contribution percentages identified in Article IV, Section 2.a of this Agreement or directly to the State Water Resources Control Board or bond trustee, depending on the funding Attachment 1.A

12.C-13Council Agenda 3-1-2022

{CW108993.18} COST SHARING AGREEMENT
City of Arroyo Grande, City of Pismo Beach, and City of Grover Beach

mechanism. In the event that the JPA is not able to finance the Construction Costs, the Parties will seek financing consistent with the financing plan described in Article III, Section 1.c above, which may include applications by each Party to the State Water Resources Control Board’s Clean Water State Revolving Fund for its respective share of Construction Costs. Any financing mechanism for construction of Phase 1 of the Project, ownership, and operation of the Facility will be addressed in the Joint Powers Agreement. The Joint Powers Agreement will also contain provisions regarding governance of the JPA that will include, at a minimum, the following requirements: the JPA will be governed by a three-member Board of Directors consisting of one elected official from each Party; each JPA Director will retain equal voting rights on the JPA Board of Directors; and the JPA Board of Directors will meet bi-monthly or quarterly.

4. Parties Review of Construction Scope, Schedule and Budget. Prior to initiating construction, the City Council for each Party shall have a reasonable opportunity to review and approve the scope, schedule, and budget of Phase 1 of the Project. The approved budget for Phase 1 shall include a twenty percent (20%) contingency to allow for appropriate flexibility for contract management by the Lead Agency. Change orders and amendments that exceed twenty percent (20%) of the most recently-approved contract value shall require approval by the City Council for each Party. If a Party does not grant such approval, the Parties will immediately confer in an attempt to reconcile the disagreement. Should the Parties be unable to reach agreement, measures shall be taken to reduce the additional costs below 20% of the current contract value and in no such event shall the Parties be liable for Construction Costs in excess of this amount absent a written amendment to this Agreement.

5. Technical Advisory Committee. The City Managers of the Parties may create a temporary Technical Advisory Committee (“TAC”) to assist the Parties in reviewing the technical aspects of Phase 1 and the Phase 1 budget. The TAC will consist of nine (9) members with three members appointed by each Party’s City Manager. If created, the TAC will be established within one (1) month of the Effective Date and will meet monthly until completion of Phase I of the Project. The TAC will provide technical input on the following: (1) review and suggest any modifications to the pre-construction and construction plans and agreements for Phase 1; (2) assist the Parties in deliberating on technical matters that could be of issue in the development of Phase 1, and make recommendations to be presented to the City Councils of the Parties on all major technical aspects of Phase 1 of the Project; and (3) develop, for consideration by the Parties’ City Councils, joint operational protocols for the JPA to ensure the continued operation of the facilities and viability of the Project in the future. The TAC will be disbanded upon completion of Phase I of the Project.

6. Joint Agency Meetings. During design and construction of Phase 1, the City Councils for each Party will meet jointly at least once but no more than twice per year to provide a venue for discussion and transparency for the public on the progress of Phase 1, to receive Phase 1 updates, and discuss policy issues as needed. The TAC will present a summary of their work and analysis of Phase 1 at all the joint meetings. 
Attachment 1.A

12.C-14Council Agenda 3-1-2022

{CW108993.18} COST SHARING AGREEMENT
City of Arroyo Grande, City of Pismo Beach, and City of Grover Beach

ARTICLE IV
Pre-Construction and Construction Costs

1. Facility Purchase. Pismo Beach has previously purchased the site for the Facility at a total cost of $1,815,373 (the “Purchase Price”). The Purchase Price shall be included as a Construction Cost of Phase 1 of the Project. The Parties acknowledge that pursuant to Article XIII, Section 11, subdivision (a), of the California Constitution, the Facility site may be considered taxable real property. As such, the Parties shall cooperate to minimize the property tax implications of Pismo Beach’s current ownership of the Facility site by either allocating such property tax costs among the Parties according to the Water Purveyor Contribution percentages, as defined in Article IV below, by transferring title of the Facility site to the JPA, or by such other action upon which the Parties may agree.

2. Water Purveyor Contributions. The Parties shall pay their pro rata share of all Pre- Construction and Construction Costs incurred by Pismo Beach in connection with Phase 1 of the Project.
a. The Parties agree to the following cost allocation of the total Pre- Construction and Construction costs for Phase 1 for each Party:
i. Arroyo Grande shall contribute 25%.
ii. Grover Beach shall contribute 36%.
iii. Pismo Beach shall contribute 39%.
b. Pursuant to Section VII.3(c) of the Stipulation, as adopted by the Adjudication Decree, the Parties may engage in contractual transfers, leases, licenses, or sales of any of their water rights, including voluntary fallowing programs, for drought protection, conservation, or other management purposes; however, no groundwater produced within the Current Management Areas, including water produced by Phase 1 of the Project, may be transported outside of the Current Management Areas without the written agreement of each Party.

3. Pre-Construction Cost Review and Adjustment. Following approval of this Agreement, the City Council for each Party shall have a reasonable opportunity to review and approve the scope, schedule, and budget of the remaining Pre-Construction Costs for Phase 1 of the Project, which will include a twenty percent (20%) contingency to allow for appropriate flexibility for contract management by the Lead Agency. Change orders and amendments that exceed twenty percent (20%) of the current Pre-Construction Cost contract value shall require approval by the City Council for each Party. If a Party does not grant such approval, the Parties will immediately confer in an attempt to reconcile the disagreement. Should the Parties be unable to reach agreement, measures shall be taken to reduce the additional costs below 20% of the current contract value and in no such event shall the Parties be liable for Pre-Construction Costs in excess of these amounts absent a written amendment to this Agreement. Cost share percentages for Preဨ Construction Costs may be temporarily adjusted to help reconcile remaining PreဨConstruction Cost contributions for each of the Parties, if funding is available, until the cumulative contributions by each Party approximately match the Water Purveyor Contribution percentages set forth in Section Attachment 1.A

12.C-15Council Agenda 3-1-2022

{CW108993.18} COST SHARING AGREEMENT
City of Arroyo Grande, City of Pismo Beach, and City of Grover Beach