PISMO BEACH CITY COUNCIL STAF REPOR
Agenda Item #12.A
Meetin Date: June 16, 2026
TITLE:
Highway 1/Dolliver Street/Price Street Relinquishment Update and Direction
RECOMMENDATION:
Receive an update on the relinquishment process and provide direction to staff to continue moving forward with the relinquishment of Highway 1/Dolliver Street/Price Street in Pismo Beach.
DISCUSSION:
Highway 1, which includes the entirety of Dolliver Street and the portion of Price Street from Dolliver Street to Mattie Road, 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). The lack of City control of this thoroughfare has presented challenges over the years, including:
• Not being able to control or alter traffic patterns
• Not being able to alter parking spaces, or implement paid parking • Not being able to install and/or adjust signalization and/or install stop signs • Not being able to install crosswalks
• Needing to obtain an encroachment permit for special events, such as band review, the classic car show, and Clam Festival
• Needing to obtain an encroachment permit for work, such as the sidewalk paver project, paving of cross streets or to repair sewer and water mains.
Relinquishment Process
In order for a state roadway to be relinquished, several things need to happen. The typical process includes the following steps:
• Initiation
o Letter of intent from agency
o Resolution of interest from Caltrans
• Relinquishment Assessment Report (RAR)
• Enabling legislation must be signed by the Governor
• Draft relinquishment agreement
• Environmental review
• Project Approval Report (PAR)
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• Execute final relinquishment agreement
• California Transportation Commission (CTC) vote.
On December 8, 2017, the City Manager sent the City’s letter of intent to Caltrans and on April 26, 2018, the Caltrans District Director sent the resolution of interest to the City. The RAR was prepared by Caltrans and signed on January 12, 2021. On February 19, 2019, the City Council adopted Resolution R-2019-012 supporting legislative efforts to acquire State Route 1 under the State Relinquishment Process. On September 5, 2019, SB 504, authored by Senator Monning, was adopted by the California Senate and later signed into law by Governor Newsom on October 3, 2019. On August 3, 2021, the City Council adopted Resolution R-2021-067 authorizing the City Manager to negotiate and execute an agreement with Caltrans for the relinquishment of Highway 1/Dolliver Steet/Price Street in Pismo Beach. The environmental review has been completed and the PAR was signed on October 13, 2025. Executing the relinquishment agreement is the final step before it can be presented to the CTC for approval.
Current Efforts
Staff is working with Caltrans to finalize the relinquishment agreement and anticipates it will be presented to the CTC in August, but the process could extend to October. To meet this deadline and due to the active construction at the Mobility Hub lot located on Price Street at Mattie Road, relinquishment of the park-and-ride will be included in the upcoming agreement, but the Mobility Hub relinquishment will not be completed until the current construction project is completed.
Maintenance Considerations
Should the City Council move forward with obtaining Highway 1, the City will be responsible for the maintenance and care of the roadway, adding approximately 2.15 centerline miles of roadway surface to the City’s inventory, from post mile 14.56 (Butterfly Grove) to post mile 16.71 (Mattie Road). In addition to assuming maintenance costs for the roadway, the City would also assume the liability associated with operating the roadway, including potential claims from “trips and falls,” traffic accidents, and other unforeseen claims by the public for injury or damage sustained within the limits of the roadway. Staff has consulted with CJPIA, the City’s self-insurance program provider, to evaluate the risk associated with the relinquishment. While there is a certain level of risk and liability assumed, it can be offset by completing sidewalk grinding, similar to work performed throughout the downtown, as well as other prevention measures.
The City and Caltrans currently participate in maintenance agreements, with the City taking responsibility for maintenance of the sidewalks, landscaping and street trees along Highway 1. The City also contracts litter removal services and street sweeping services for the roadway as part of that maintenance. In addition to these existing maintenance costs, there are other infrastructure that will become the City’s responsibility including traffic signals, storm drains, striping, signage and the Pismo Creek bridge. The majority of the existing streetlights are currently owned and maintained by PG&E and the electrical use is billed to the City.
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Additional costs will also be associated with encroachment permit issuance, parking enforcement, code enforcement, and vegetation maintenance near the Butterfly Grove and State Park Campground.
Conclusion and Recommendation
Staff recommends the Council receive this update on the relinquishment process and provide direction to continue moving forward with the relinquishment of Highway 1/Dolliver Street/Price Street in Pismo Beach.
FISCAL IMPACT:
The fiscal impact of the City obtaining and maintaining Highway 1/Dolliver Street/Price Street will include ongoing maintenance costs as well as periodic major capital rehabilitation costs to reflect a bridge, signals, tourism-related impacts, parking activity, and high traffic volumes. Since this road was recently repaved by Caltrans, the estimated annual cost for maintenance could range from $100,000 to $200,000. This includes routine pavement maintenance, traffic signals; signage; striping; storm drain maintenance; bridge maintenance for the Pismo Creek bridge.
In addition to taking over maintenance costs for the roadway, the City would also take on the liability associated with operating the roadway, including potential claims from “trips and falls,” traffic accidents, and other unforeseen claims by the public for injury or damage sustained within the limits of the roadway.
The relinquishment agreement memorializes the City’s acceptance of full ownership, control, responsibility, maintenance obligations, and liability for the relinquished facilities in perpetuity. In exchange, the City will receive a payment of $1,710,000, or another amount as may be allocated by the CTC, at the time the agreement is approved.
ATTACHMENTS:
None
Prepared by:
Erin Olsen, Senior Management Analyst
Submitted by: Rosemarie R. Gaglione, P.E., Director of Public Works City Manager Approval:
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